16 Things Every Contractor Should Know When Bidding a Job Order Contract is just an introduction to anyone interested in JOC. Learn more…
1. Typically, what kind of information is given to the general contractor to put together a price and approximately how often does each occur? For example, are drawings given to the general contractor 50% of the time? Is the other 50% of the time just walking the job and talking about scope?
Information varies by Owner. At a minimum, the Owner should provide a statement of work with sufficient detail to enable the contractor to create a detailed line item construction cost estimate. Information should include a description of current conditions including access, materials, dimensions, and a drawing/PDF, as well as a description and drawing/PDF of requirements.
2. Approximately what percentage of the time are specifications provided?
Specifications should be provided for all work order requests. For Owners following “best management practices” specialized JOC specifications are NOT used. The Owner simply references their existing Technical Specifications. The reason for this is obvious. The Owner should expect the same quality and type of work across their portfolio. Be Specifications should be per the Job Order Contract and associated with the UPB. AIA MasteSpec or BSD Speclink specifications or the owner equivalent are generally used for commercial construction. All local, state, and national codes apply to work done under an executed contract.
Individual owner specifications may also be provided. Specifications should be present to indicate minimal standards as the usage, materials, and content needs of the owner.
3. Who is responsible for making the quantity takeoff(QTO)? Is it the general contractor? Is it an electrical (other trade) contractor that performs the work?
The awarded JOC contractor is responsible for QTO. If subcontractors are allowed and used per the JOC, it is still the ultimate responsibility of the awarded JOC contractor.
4. Who is responsible for checking the unit price line items in a contractor proposal?
The awarded JOC contractor is responsible for all unit line items as well as any nonprepriced line items. The Owner SHOULD, per fiscal responsibility, check each and every line item. If a JOC Cooperative is used and/or a JOC Consultant, they may conduct audits of specific project estimates at their discretion and per the JOC Program requirements.
16 Things Every Contractor Should Know When Bidding a Job Order Contract is just an introduction to anyone interested in JOC. Learn more…
5. Who is responsible for checking the quantities we enter into the JOC to create a proposal?
The awarded JOC contractor is responsible for all quantities entered in the JOC software. (Also see Question #4 and Response)
6. Typically, how many general contractors are invited to bid on a JOC project?
The number of awarded JOC contractors invited to bind on any individual project varies. It typically ranges from one (1) to three (3) awarded JOC contractors. The Owner and/or Cooperative generally has the right to approve and/or award contracts. The decision to award one, several, or no contracts rests solely with the Owner and/or JOC Cooperative. Under NO CIRCUMSTANCES should a JOC Consultant be involved in make an award decision if the JOC Consultant is being compensated via a % of JOC construction volume.
7. The information we have seen from previous JOC proposals indicate Coefficient factors run from .80 to 1.20 for Standard Working hours and .68 to 1.30 for Non-Standard Working hours. Is this the range that you typically see?
Yes. For properly designed and managed JOC programs, coefficients average from 0.80 t0 1.20. If coeffficients are under 0.80 it can be difficult for awarded JOC contractors to make a reasonable profit and can place undue pressure on the contractor. Coefficients over 1.20 are typically the result of site access/security issues or other unusual circumstances.
8. Who determines which general contractor will be asked to price a specific project for a member in a JOC Cooperative situation? Is it the member? Is it somebody the JOC Cooperative?
It is generally the member party (school district, government body, etc.) that determines which contractor will be asked to price a specific project. In fact, if could be considered a conflict of interest for a JOC Cooperative to make a determination in this regard on a specific project. Purchase orders are issued by participating governmental agencies (schools, school districts, government entities, etc.) indicating “Per JOC Cooperative Contract”, on the appropriate document.
The decision as to the number of contractors and their regions awarded contracts, however, is solely made by the JOC Cooperative and/or Owner. Note: Most JOC Cooperatives are managed by private entities. The only JOC Cooperative run and managed by a Government Entity on a nationwide basis is ESC19/Allied States Cooperative.
9. When are proposals due form a Contractor to an Owner?
All timing requirements are specified in the JOC award documents, when should include a JOC Operations/Execution Manual.
10. Do General Contractor’s typically find a team of subcontractors skilled in using a UPB?
The awarded JOC contractor must have a full understanding of costs for all project requirements. A fundamental aspect of JOC is that the contractor have requisite knowledge to price all tasks required by a JOC owner. The Unit Price Book (UPB), and associated coefficient(s) and the associated quantities are the source of proposal / task order construction cost estimates. If the awarded JOC contractor is skilled/knowledgeable relative to the UPB and the UPB is appropriate for the JOC Program, use of the UPB should be sufficient. Of course, subcontractors must be allowed per the JOC, and the subcontractor must be equally skilled/knowledgeable relative the associated UPB.
11. How do general contractors handle the situation where the pricing from one trade, like drywall, runs about 92% of the prices and the prices from another trade, like electrical, run 105% of the prices? It seems very unlikely that any two trades will have the same coefficient factor which they charge us. So our overall coefficient factor will depend upon the proportion of each trades work in the project. For example, if Project A is 90% drywall and 10% electrical, the general contractor’s overall cost will be different than Project B which has 10% drywall and 90% electrical.
PROJECT A JOC $ Cost to GC
Drywall $90,000 x 92% = $82,800
Electrical $10,000 x 105% = $10,500
TOTAL $93,300
PROJECT B
Drywall $10,000 x 92% = $ 9,200
Electrical $90,000 x 105% = $94,500
TOTAL $103,700
Individual JOC task orders/project must be bid by the eligible JOC contractors(s) using the UPB and allowable coefficient(s) only, regardless of the associated distribution of “trades” associated with the particular task order/project. JOC is based upon the premise that the UPB is generally applicable to all trades. Furthermore, the JOC contractor may make a varying profit for various individual projects, however, each a reasonable profit overall.
12. We have encountered several contradictions between a JOC RFQ, the Questions and Answers, and Addenda. Here are a few.
– General Conditions – is our coefficient factor supposed to include costs such as project superintendent, jobsite trailer, port-a-cans, etc. or do we add line items from the UPB for these costs?
The coefficient should contain all requisite project administrative and/or set-up costs, including overhead and profit. General conditions are generally not allowed. Please note that in the case of a JOC Cooperative administrative fee is generally also required.
– Engineering fees appear to be included in our coefficient factor but the RFQ clearly states that this RFQ is not for engineering or architectural scope
Per most, if not all, legislation/regulations, engineering fees are not allowed in a Job Order Contract. JOC is designed for routine renovation, repair, and maintenance that doesn’t include any significant engineering component.
– P&P Bond costs appear to be included in our coefficient factor but Q&A stated that these are a pass through cost.
Performance and payment bonds are governed by any and all applicable state and local laws or policies. P&P bonds are may be linked to the contract between the member agency and the prime contractor, if a cooperative situation, and for example stipulated to be 100% of specified contract price. The actual cost of the bond is a pass through, however, any tax consequences should be consider with respect to impact upon profit.
13. Should we qualify our JOC proposal, or will that likely disqualify us?
JOC experience is considered very highly by Owners and JOC Cooperatives if not virtually a mandatory requiremenOur recommendation is to answer any questions on experience in terms of the fundamental characteristics of JOC – early and ongoing information sharing with clients and subcontractors, collaboration, financial transparency, on-demand service, responsiveness to emergency service requests, customer/problems resolution process, financial status/condition, safety record, reputation/testimonials/references, past experience with similar owners, employee experience, market outreach capabilities (marketing, education/training) etc. Furthermore, we have found that most effective way to enter the JOC market is to participant on JOC programs as subcontractor.
14. Regarding “Economies of Scale”, how is this handled in a JOC?
The only economies of scale contained in a UPB are quantity based line items. Historically, these are not generally found within and commercial “national average” cost databases, however, have are included within JOC UPBs. Also, the ability to perform multiple jobs for the same owner, in the same location provides significant economies.
15. It is normal to include a “Buy American Act” into our coefficient factor.
Vendors may be exclusively responsible for compliance of the Buy American requirement for the certain states and for virtually all Federal Agencies. all other applicable states. Separate coefficients for these “applicable locations” are generally not specifically allowed, nor are nonprepriced line items.
16. Do general contractors typically get subcontractors approved during the JOC pricing effort we are currently bidding?
Yes. In fact it is considered “best practice”, if not mandatory to have subcontractors approved prior to award, and or shortly after award, and certainly prior to any use of subcontractor.
16 Things Every Contractor Should Know When Bidding a Job Order Contract is just an introduction to anyone interested in JOC. Learn more…