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Domain 5 - Procurement Flashcards

1
Q

Describe the solicitation documents used for bidding.
(Bid or Negotiated)

A

Solicitation is the process of notifying prospective or qualified bidders on the wish to receive bids or proposals for a specific product or project. Documents used:
*Invitation-to-Bid (ITB) / Advertisement for Bids
*Request for Qualifications (RFQ)
*Request for Proposal (RFP)

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2
Q

Intended to attract selected qualified bidders and to help prospective bidders decide whether to obtain the procurement
documents.

A

Invitation-to-Bid (ITB)

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3
Q

asks bidders to provide information regarding their capability to do the work. It may be submitted with a bid.

A

Request for Qualifications (RFQ)

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4
Q

a public notice to all qualified bidders—not only a select few.

A

Advertisement for Bids

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5
Q

Owner desiring to work with a specific qualified bidder.

A

Request for Proposal

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6
Q

Describes the information a bidder/proposer needs to properly
prepare and submit a bid as well as the conditions affecting the award of the contract.
Supplementary instructions are project- or owner-specific modifications to the instructions to bidders and are not always necessary.

A

Instructions to bidders

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7
Q

Not considered a part of the instructions to bidders.
Bound into the project manual.

A

Bid Form

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8
Q

What basic items are found in the Instructions to Bidders?

A

1.) Documents
2.) Time limitations for the Examination of documents, Site visit, and local conditions
3.) Interpretation during bidding
4.) Substitution of Products
5.) Type of Bid
6.) Preparation of Bid
7.) Bid security information
8.) Performance Bonds and Payment Bonds
9.) Subcontractor listing
10.) Identification and Submittal of bid
11.) Modification or withdrawal of bid
12.) Disqualification of bidder
13.) Applicable Laws
14.) Prebid Meeting
15.) Liquidated damages
16.) Opening of Bids
17.) Evaluation and consideration of Bids
18.) Execution of Agreement

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9
Q

List standardized forms used for Instruction to Bidders

A

1.) AIA Document A701, Instructions to Bidders
2.) AIA Document A 751, Invitation and Instructions to Vendors for Quotation for Furniture, Furnishings, and Equipment.
3.) ConsensusDocs 270, Instructions to Bidders on Private work
4.) ConsensusDocs 271, Instructions to Bidders on Public work
5.) EJCDC C-200, Guide to the preparation of Instructions to Bidders.
6.) EJCDC P-200, Suggested Instructions to Bidders, Procurement Contracts.

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10
Q

Supplementary Instructions

A

Project or Owner specific modifications to the Instructions to Bidders

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11
Q

What basic items are found in the Bid Form?

A

1.) Project Identification
2.) Name and address of the party to whom the bid is directed
3.) Entity Submitting Bid
4.) Acknowledgements ( “The bidder agrees to..”)
5.) Amount of time bid to be held open
6.) Identification of Addenda
7.) Prices
8.) Combined bids
9.) Alternates
10.) Allowances
11.) Unit Prices
12.) Completion time
13.) Liquidated damages
14.) Supplements (additional forms)
15.) Closing

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12
Q

Identify the types of Bid or Proposal Form (Negotiated) supplements.

A

1.) Bid Security Form ( binds the winning bidder to the contract)
2.) Allowance Form/ Unit Prices Form/ Alternates Form
3.) Substitution Request Form (during procurement)
4.) Estimated Quantities Form
5.) Proposed Products Form
6.) Proposed Subcontractors Form
7.) Minority Business Enterprise Statement of Intent Form
8.) Wage Rate Form
9.) Proposed Schedule of Values Form
10.) Proposed Construction Schedule Form
11.) Proposed Work Plan Schedule Form
12.) Bid Submittal Checklist

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13
Q

Statements of qualifications (bidders) provided to the owner with more information in which to make a decision other than just price.

A

Single Purpose form/ Certificates or Representation

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14
Q

List types of Single Purpose forms:
The owner may require more information from bidders than can be provided in most bids. If bidders are not prequalified prior to solicitation, representations and certifications are effective means of obtaining information to be evaluated. There may be a procurement requirement for the execution of single purpose forms (usually provided by the owner) as a means of verifying that a bidder has a particular qualification that is important to the project.

A

1.) AIA Document A305, Contractor’s Qualification Statement
2.) Non-collusion Affidavit
3.) Statement of Disposal Facility
4.) Worker’s Compensation Certification Schedule
5.) Non-segregated Facilities Affidavit
6.) Equal Employment Opportunity Affidavit
7.) Minority Business Enterprise Affidavit
8.) Corporate resolutions
9.) Governmental certification

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15
Q

Name the 4 options available to the owner when selecting a contractor? (subcontractor, suppliers, equipment rental firms, and service firms)

A

a.) Low Bid
b.) Best Value: Total Cost
c.) Best Value: Fees
d.) Qualifications-based selection

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16
Q

What three questions should be asked that lead to a procurement option?

A

1.) Is PRICE part of the final selection criteria? Yes or NO?
If NO, then use procurement type: Qualifications Based Selection
If YES, then (2.) Is the price the Construction Cost?
If NO, then use Procurement type: Best Value Fee
If YES, then (3.) Is the price the final and sole selection criteria?
If No, Then use procurement type: Best Value:Total Cost
If Yes, then use procurement type: Low Bid.

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17
Q

Low Bid option ( Competitive Sealed Bid/ Sealed Bid)

A

*Contractor with lowest bid is selected by the Owner
*Represents the total construction cost
* sole criteria for the selection of the Contractor

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18
Q

Best Value: Total Cost option (Competitive sealed proposal, best value source selection, or competitive proposal selection)

A
  • The Total Construction cost is NOT the Sole Criterion for the decision by the owner.
  • Select by Total cost and other factors intended to maximize the benefits and optimize the solutions to the Owner’s needs. These factors may be: Personnel qualifications; Technical capabilities; past performances; Proposed subcontractors and suppliers, Creative and beneficial proposals to reduce cost or time; History of Lawsuits and claims.
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19
Q

Best Value: Fees option (Best Value source selection(fees), or Competitive sealed proposal (fees)

A
  • Fees and not Total Construction cost is an important factor.
  • Other factors in the evaluation of the proposal include: Design contingency; Construction Contingency, Project Budget estimate; Preconstruction service fees; Construction services fees; Post- construction service fees; General conditions estimates.
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20
Q

Qualification Based Selection option

A
  • Qualifications sole criteria for selection by owner
    *Price and Fees are NOT a criterion for evaluation
    *Selection focuses on the quality and value associated with helping the owner achieve budgetary and functionality goals.
  • experience; financial stability, project excellence, reputation, staff and resources, bonding capacity.
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21
Q

Qualification Based Selection option (negotiated , competitive negotiation, or single source selection)

A
  • Qualifications sole criteria for selection by owner
    *Price and Fees are NOT a criterion for evaluation
    *Selection focuses on the quality and value associated with helping the owner achieve budgetary and functionality goals.
  • experience; financial stability, project excellence, reputation, staff and resources, bonding capacity.
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22
Q

Qualification Based Selection option (negotiated, competitive negotiation, or single source selection)

A
  • Qualifications sole criteria for selection by owner
    *Price and Fees are NOT a criterion for evaluation
    *Selection focuses on the quality and value associated with helping the owner achieve budgetary and functionality goals.
  • experience; financial stability, project excellence, reputation, staff and resources, bonding capacity.
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23
Q

Competitive Bidding process

A

Bidders are solicited by an owner to prepare pricing based on procurement documents and to submit their pricing as bids. The submission of the bid or proposal is one of the most important steps in the competitive bidding process and should be allowed a reasonable amount of time to perform bidding activities.

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24
Q

Identify the activities associated with the competitive bidding process

A
  • Bid Solicitation
  • Distribution of Procurement Documents
  • Prebid Meeting
  • Examination of Site Conditions
  • Requests for Information and Responses
  • Substitution Requests
  • Addenda
  • Preparation of Bids
  • Submitting Bids
  • Bid Opening
  • Evaluating Bids
  • Award of Contract
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25
Q

Bid Solicitation

A

To inform the bidders (prospective contractors) about the project.

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26
Q

Prebid Meeting

A

Allows the owner, architect/engineer, and architect/engineer’s consultants to orient the bidders to conditions affecting the project. The date, time, and location of the prebid meeting is documented in the bid solicitation. The owner may or may not make attendance a mandatory condition of the bidding process. Typically, the architect/engineer prepares an agenda for this meeting.

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27
Q

Examination of Site Conditions

A

There is typically a requirement in the instructions to bidders for the bidders to visit the site and examine the conditions affecting construction. Examining the site helps educate the bidders so that the company can make an intelligent bid.

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28
Q

Substitution Requests

A

If substitutions are permitted during the bidding period, bidders and sub-bidders may propose substitutions for materials, products, components, equipment, and systems during the bidding period in accordance with the instructions to bidders. If a substitution is judged to be acceptable, the architect/engineer will issue an addendum advising bidders to incorporate the substitution into the procurement documents so that it can be bid as an acceptable equivalent to comparable specified products

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29
Q

Preparation of Bids

A

Immediately preceding competitive bidding deadlines, numerous sub-bids, both solicited and unsolicited, are transmitted to the bidders. The bidders quickly evaluate each sub-bid for its completeness and consider the qualifications of subcontractors and suppliers. Once all of the sub-bids and supplier bids have been received and included with other pricing they are tabulated and filled in on the bid form.
The preparation of bids is a three-tiered process:
*Tier 1: An owner solicits bids or proposals from prospective contractors.
*Tier 2: The prospective contractor solicits bids for portions of the project from subcontractors and suppliers.
*Tier 3: The subcontractors and suppliers in turn solicit bids from sub-subcontractors and sub-suppliers.

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30
Q

Submitting Bids

A

The time and place for the submission of bids is a fixed time of day, on a particular date, and at a specific location. The bid is then sealed and deposited at the required location on the bid due date and immediately before the time for receipt.

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31
Q

Evaluating Bids

A

Immediately preceding competitive bidding deadlines, numerous sub-bids, both solicited and unsolicited, are transmitted to the bidders. The bidders quickly evaluate each sub-bid for its completeness and consider the qualifications of subcontractors and suppliers. Once all of the sub-bids and supplier bids have been received and included with other pricing they are tabulated and filled in on the bid form.
The preparation of bids is a three-tiered process:
*Timelines (submitted on or before deadline)
*Completeness
*Variance from the construction budget
*Competitive bidding irregularities

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32
Q

Describe the characteristics of the public bidding process

A

*Laws have placed significant restrictions on how projects that use public funds may be competitively bid.
*It requires contracting the project in an open environment for the lowest available price with the most qualified contractor.
*Requirements are more formal and subject to more public scrutiny than privately funded projects.
*The restrictions cannot be waived or modified for a bidder’s convenience.
*Changes in the restrictions must be made through formal legislative-administrative procedures.

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33
Q

Identify additional considerations that public projects include
in the bidding process

A
  • Wage requirements (Davis-Bacon Act, rates of wages for laborers and Mechanics)
  • Percentage of the bidder’s own labor forces provided
  • Minority business enterprise/disadvantaged business enterprise
  • Environmental requirements (or restrictions, wetlands, etc.)
  • Liquidated damages (failure to complete project on time)
  • Incentives (early completion reward)
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34
Q

Identify supplemental procurement documents that
may be required for public projects

A

*Statement of Qualification
*Tax Liability
*Proof of Insurance
*Bid Security
*Non-collusion affidavit
*Minority and disadvantage business participation
*Acknowledgments

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35
Q

Describe bid solicitation requirements for public projects.

A

*Laws require that information about public projects be made available to the public through published advertisement.
*Bid solicitations are normally published in project reporting websites or by notices posted in public locations such as government websites.
*State and federal projects are advertised in state and federal registries, which are available to the public.

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36
Q

The Minority Business Enterprise Affidavit is an example of which of the following? Check all that apply.
a.) Representation and certification
b.) Statement of qualifications
c.) Supplemental procurement document
d.) None of the above

A

a.) Representation and certification
c.) Supplemental procurement document

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37
Q

True or False? Any substitutions by bidders
should be submitted during the bidding
process using a Substitution Request Form
and in accordance with the instructions
to bidders.

A

True

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38
Q

Which of the following is the best solicitation document to use for a public project?
a.) Invitation for Bids
b.) Advertisement for Bids
c.) Request for Proposals
d.) Request for Qualifications

A

b.) Advertisement for Bids

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39
Q

What is the purpose of addenda?

A

The purpose of addenda is to modify the procurements documents by issuing revisions to the documents, list new requirements, to correct error and omissions, add clarifications and provide answers requested by bidders.

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40
Q

When are addenda used?

A

After the bidding period starts, and before the bids are submitted to the owner.

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41
Q

Describe the role of subcontractors in the bidding process

A

*Subcontractors are the principal providers of labor and materials on a project.
*As specialists, subcontractors can provide other project participants with important information such as technical data, financial cost estimating, installation requirements, manufacturing/delivery scheduling, facility maintenance programs
*The subcontractors in turn may solicit bids from sub-subcontractors.
* A valuable resource for the design and construction teams.

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42
Q

The unethical practice of a bidder revealing the price of one subcontractor to obtain a lower price from another subcontractor during the procurement process. It can also consist of a bidder asking the subcontractor to reevaluate their prices and find ways to lower them after a price has been submitted.

A

Bid shopping

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43
Q

Describe the effect Bid Shopping has on the bidding process

A

Bid shopping can have the following effects on the bidding process:
* It has the potential for adversely altering project performance or imposing unanticipated risks on other project participants, because it encourages cost-cutting measures that might
compromise project quality and requirements, and the owner does not always receive the financial benefit of the cost savings.
* It can lead to unauthorized substitutions and generally degrades the competitive bidding environment.

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44
Q

List ways to control Bid Shopping.

A

*Bid Depositories: subcontractors submits directly to Owner.
*List of Subcontractors: contractors submits list to Owner.
* Architect/Engineer measures: QC/QA, Control Substitutions, Clear construction documents, Prompt review of submittals, Retainage,

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45
Q

Describe the solicitation documents used for Negotiated contracts

A

Solicitation is the process of notifying prospective or qualified bidders on the wish list to receive bids or proposals for a specific product or project. Documents used:
*Invitation-to-Bid (ITB) / Advertisement for Bids
*Request for Qualifications (RFQ)
*Request for Proposal (RFP)

46
Q

Describe the purpose of the Instructions to Proposers.

A

The Instructions to Proposers describe the information a proposer needs to properly prepare and submit a proposal as well as the conditions affecting the award of the contract. Professional associations have no standardized forms for the proposal and negotiation process. The arrangement of typical instructions to bidders can be used to develop these instructions to proposers. Because the process is less formal, many of the guidelines for preparing bids might not be applicable. In the proposal process, other elements such as team participant qualifications and completion schedules could be primary considerations of the proposal.

47
Q

Describe the two methods of private bidding and proposing

A
  • Open bidding/proposing
  • Closed bidding/proposing select list
48
Q

Open Bidding/Proposing

A
  • Experienced and Qualified bidders only submit
  • Lowest responsive and responsible bid
  • Responsive and responsible proposal (not the lowest) the owner deems to be the most suitable for the owner’s need.
49
Q

Closed bidding/proposing select list

A

*Only those prospective contractors that have been prequalified, preselected, or invited by the owner may submit bids or proposal.
*Most responsive and responsible bid, but not necessarily the lowest bid.
*Responsive and responsible proposal (not the lowest) the owner deems to be the most suitable for the owner’s need.

50
Q

Describe the steps of the Negotiating Procedure.

A

1.) Request for Proposal
2.) Discovery
3.) Pricing Procedures
4.) Offer
5.) Counteroffer
6.) Resolution
7.) Award of Contract
8.) execution

51
Q

The Owner invites a prospective contractor to enter into negotiation process

A

Request for Proposal

52
Q

The exchange of documents that will become the basis of the negotiation, including drawings, specifications, procurement and contracting documents and other negotiation documents.

A

Discovery

53
Q

A construction price is prepared by the prospective contractor

A

Pricing Procedures

54
Q

The prospective contractor proposes the construction price to the owner, and in some cases a length of time to perform the work described in the construction documents.

A

Offer

55
Q

Unlike formal competitive bidding/proposing procedures, the owner may propose counteroffers to the prospective contractor’s offer. The Prospective contractor may perform value analysis and repricing procedures to determine the acceptability of the owners counteroffer.

A

Counteroffer

56
Q

Acceptance or rejection of the offer and counteroffer. Finalize the final terms of the contract

A

Resolution

57
Q

The formal acceptance of the terms of negotiation by the participants

A

Award of contract

58
Q

The work executed according to the terms of the contract

A

Execution.

59
Q

True or False?
An allowance can be included on the bid/proposal form or on
a separate allowance form attached to the bid form.

A

True

60
Q

True or False?
If the procurement documents include an allowance, a
bidder/proposer is not required to include the allowance in their bid/proposal.

A

False

61
Q

True or False?
The instructions to bidders/proposers should describe the order in which alternates will be accepted.

A

True

62
Q

True or False?
A unit price should be provided on the bid form or a separate form for each cash allowance with a blank for the total cost based on the specified quantity.

A

True

63
Q

Scenario 1
A restaurant project received the following bids with qualification statements:
* Bidder #1: $2,500,000
* Bidder #2: $2,350,000
* Bidder #3: $2,550,000
* Bidder #4: $2,475,000

There are four options for selecting a contractor. Depending on the project delivery method used, a project may use one or any combination of the four options to retain the various
subcontractors, suppliers, equipment rental firms, and service firms for specific portions of the work.
For each scenario, indicate which of the four options was used.
Which option is this?
a.) Low Bid
b.) Best Value: Total Cost
c.) Best Value: Fees
d.) Qualifications-Base Selection

A

b.) Best Value: Total Cost

64
Q

Scenario 2
The owner requested RFQs from a selected group of contractors. Each RFQ was evaluated based on a point system using the following criteria:

Bonding capacity: 10 points
Contractor team experience: 50 points
Timely completion of past projects: 25 points
Financial strength and stability: 10 points
List of selected major subcontractors: 5 points
TOTAL 100 points
The selected contractors received the following scores:
* Contractor #1: 94 points
* Contractor #2: 88 points
* Contractor #3: 91 points
* Contractor #4: 83 points
The owner selected Contractor #1 to begin negotiating for the construction contract.

Which option is this?
a.) Low Bid
b.) Best Value: Total Cost
c.) Best Value: Fees
d.) Qualifications-Base Selection

A

d.) Qualifications-Base Selection

65
Q

Scenario 3
A project received the following bids:
The owner selected Bidder #3 because they provided reasonable fees and a sufficient contingency.
Bidder#1:
* Preconstruction Services Fee: $30,000
* Construction Services Fee: $400,000
* Construction Contingency: $125,000
Bidder #2:
* Preconstruction Services Fee: $22,000
* Construction Services Fee: $350,000
* Construction Contingency: $120,000
Bidder #3:
* Preconstruction Services Fee: $24,000
* Construction Services Fee: $380,000
* Construction Contingency: $115,000
Bidder#4:
* Preconstruction Services Fee: $26,000
* Construction Services Fee: $410,000
* Construction Contingency: $110,000

Which option is this?
a.) Low Bid
b.) Best Value: Total Cost
c.) Best Value: Fees
d.) Qualifications-Base Selection

A

c.) Best Value: Fees

66
Q

Scenario 4
For an advertisement for bid, an owner received the following bids:
* Bidder #1: $2,500,000
* Bidder #2: $2,350,000
* Bidder #3: $2,550,000
* Bidder #4: $2,475,000
The owner selects Bidder #2 based on the bid received.

Which option is this?
a.) Low Bid
b.) Best Value: Total Cost
c.) Best Value: Fees
d.) Qualifications-Base Selection

A

a.) Low Bid

67
Q

A contractor’s reimbursement method for the funds expended to construct the project and complete the work described in the contract documents. A successful bidders’s proposed price.

A

Basis of Payment

68
Q

All cost information forming the basis of payment of the
agreement is shared between the owner and the contractor. This includes the bid estimates, bids from subcontractors and suppliers, invoices, and any other cost related information.

A

Open book contracting

69
Q

None of the cost information is shared between the owner and the contractor.

A

Closed book contracting

70
Q

Method of Payment:
Used for IPD projects, the owner agrees to pay the
contractor 100 percent of the direct cost of the work and
the project-specific overhead.
Contract type: Open or Closed?

A

Target Price
Open book

71
Q

Method of Payment:
Reimbursement for the actual cost of direct expenses, plus
an additional fee for overhead and profit which is usually a
percentage of the direct expenses, but may also be a fixed
fee amount.
Contract type: Open or Closed?

A

Cost Plus with a GMP
Open Book

72
Q

Method Of Payment:
A cost-based contract in which the owner places a limit on
the amount they will have to pay the contractor, regardless
of the actual cost for the project.

Contract type: Open or Closed?

A

Guarantee Maximum Price
Open Book

73
Q

Method Of Payment:
A cost per unit of work is established during the
procurement process for each identified type of work. The
contract would then contain these established unit prices
as the basis of payment. As the work is performed, the
completed work is documented and verified. The contractor
is compensated only for actual quantities of completed work.

Contract type: Open or Closed?

A

Unit Price
Closed Book

74
Q

Method of Payment:
A single fixed amount for a described extent of work, based
on complete or partially complete construction documents.

Contract type: Open or Closed?

A

Stipulated Sum
Closed Book

75
Q

Method of Payment:
Reimbursement for the actual cost of direct expenses,
plus an additional fee for overhead and profit—typically
calculated as a percentage of the direct expenses, but it also
may be a fixed fee amount. However, there is no specified
ceiling amount; the owner is at risk because there is not an
upper limit to the owner’s cost exposure.

Contract type: Open or Closed?

A

Cost Plus without a GMP
Open Book

76
Q

May be included in a contract to ensure completion in a timely manner. Referred to as contract clauses and are important to emphasize that “time is of the essence” and to avoid compounding financial damage by the owner.

A

Incentives

77
Q

Describe the four incentives used to ensure completion in a timely manner.

A

1.) Bonus/Early Completion Incentive
2.) Penalties
3.) Liquidated Damages
4.) Shared Savings

78
Q

A monetary amount added to a contract for early
completion. The amount would likely be less than the
monetary loss the owner would incur if the project was
not completed on time.

A

Bonus/Early Completion Incentive

79
Q

A daily monetary amount the contractor must pay the
owner for not completing the work in the allotted time
or by the agreed-upon date.

A

Penalties

80
Q

A monetary amount based on an agreed-upon portion
of the difference between the original cost (stated or
agreed) and the actual amount spent for the work. The
savings are shared on a percentage basis between the
parties to the agreement

A

Shared Savings

81
Q

A mutually agreed upon monetary amount defining the
injury suffered by the owner for inexcusable delay of the
project’s completion.

A

Liquidated Damages

82
Q

A construction contract was executed that establishes the contract sum based on the actual construction cost with the contractor’s markup for overhead and profit. The total construction cost has a ceiling limit of $10,000,000. Also, for every day beyond the contract completion date that the contractor has not finished the project, the contractor must pay $5,000. On the other hand, for every day the contractor completes the project before the contract completion date, the owner will pay the contractor $3,000.

Which of the following basis of payments is this project using?
a.) Stipulated sum
b.) Cost-plus without a guaranteed maximum price
c.) Cost-plus with a guaranteed maximum price
d.) Guaranteed maximum price

A

c.) Cost-plus with a guaranteed maximum price

83
Q

The $5,000 the contractor must pay is called which of the following?
a.) Penalty
b.) Bonus
c.) Liquidated damage
d.) Shared savings

A

a.) Penalty

84
Q

The $3,000 the owner must pay is called which of the following?
a.) Penalty
b.) Bonus
c.) Liquidated damage
d.) Shared savings

A

b.) Bonus

85
Q

True or False?
This contract would be considered closed book.

A

False

86
Q

Nature of the Bid/Proposal

A

If the work is constructed for less than the contract sum, then there is additional profit.
If the work is constructed for more than the contract sum, then there is overage and less profit for the contractor/subcontractor.

87
Q

Construction Cost

A

The calculable cost of the materials and labor required for a single project. May include taxes, fees, insurance/bonds, commissioning, field engineering, mobilization costs, etc. see page 278.

88
Q

Overhead

A

The cost incurred for maintaining a viable business but not directly attributable to an individual project. May include employee salaries, general office expenses/rent or leases, Leased or rented equipment and furniture not used on the project site, office supplies.

89
Q

Contingency

A

An estimated monetary amount included in the bid to account for the risk of performing the work arising from the following:
* Incomplete documents
* Unverified cost factors
* Errors made in pricing
* Costs related to dispute resolution, legal fees, and claims against the contractor
* Costs and penalties related to scheduling delays due to weather and other circumstances beyond the contractor’s control
* Default by a subcontractor or supplier, resulting in delays and monetary losses

90
Q

Profit

A

The reward for the risks they take and is what motivates business to continue and to invest in their own future.
The financial benefit that the contractor, subcontractor, or supplier will realize after all costs and claims for the project are paid.

91
Q

Describe the three methods used to purchase goods not part
of a construction contract

A

1.) Owner Furnished and Contractor Installed (OF/CI) – Owner will purchase the materials and give them to the contractor for installation. The contractor only provides the cost of labor.
2.) Owner Furnished and Owner Installed (OF/OI) – Owner will provide the material and also provide the labor for installation either by the owner’s own personnel or by a separate
contractor.
3.) Goods and services for a completed facility – Those items necessary for the facility to function, such as supplies, furniture, fixtures, and equipment.

92
Q

Contrast between the purchasing of goods for public and private projects.

A

Private buyers may request bids from multiple prospective sellers, whereas Public buyers are required to purchase goods at the most competitive price available.

93
Q

Describe the national account pricing method

A

The contractor or owner has special or “fixed” pricing direct from the manufacturer, distributor, or supplier. The national account guarantees a price regardless of project location and may bypass the supplier in the sale.

94
Q

Describe the cooperative purchasing pricing method

A

An organization of two or more buyers who solicit bids for goods and services from two or more sellers. By collecting buyers to purchase goods of common need, the cooperative enhances the purchasing power of the participants.

95
Q

Distinguish between purchasing and construction

A
96
Q

Describe the two procurement options for purchasing

A

1.) Request for Proposal
2.) Purchase Order

97
Q

Invites a prospective seller to submit a proposal to furnish a defined quantity or quantities of specified goods or special services within a specified time

A

Request for Proposal

98
Q

an offer that is accepted when the specified goods are delivered. They authorize a supplier to furnish goods of a specific quantity and quality. Are similar to construction contracts in that they have provisions for defined roles and responsibilities, descriptions of goods and services, payment method and terms, shipping terms and delivery date, and authorizing signatures.

A

Purchase Order

99
Q

Describe the steps associated with a purchasing request for proposal

A
  • Request for proposal issued
  • Visit destination
  • Purchase price
  • Proposal submittal
  • Proposal evaluation
  • Price variability
  • Executing a contract
  • Purchasing agreement modifications
  • Delivery to the point of destination
  • Performance of special services at the point of performance
100
Q

Materials/items may be shipped “FOB” or “freight on board,”
meaning once it is on the carrier, the materials/items belong to
the buyer and the buyer assumes the risks and responsibility.
Distributers may not stock some items. Other factors affecting
schedule include supply and demand, labor disputes/strikes,
weather, geographical influences, coordination with adjacent
materials, and shipping, packaging, and damage claim
requirements.

A

Delivery and Distribution

101
Q

The amount of time required from receipt of a purchase order
by a seller to the time the goods are delivered.

A

Lead Time

102
Q

Some special situations require costs above the cost of the item itself.

A

Special Shipping and
Handling Considerations

103
Q

Requirements that a manufacturer may require for payment
including down payment for manufacturer’s work effort prior to
receiving an order. Additionally, the owner may hold retainage
until final acceptance of goods.

A

Terms of Payment

104
Q

Describe the factors that affect cost and schedule for purchased goods

A

1.) Delivery and Distribution
2.) Lead Time
3.) Special Shipping and Handling Considerations
4.) Terms of Payment

105
Q

Describe the reason for having procurement documents readily available.

A

Each bidder requires graphic and written documents (the procurement documents) upon which to base their price. The procurement document information must be readily available so bidders can complete their pricing in a timely and efficient manner.

106
Q

Describe the purpose of an information control plan

A

Distribution of procurement documents should be carefully managed to ensure that all bidders receive the documents in time to undertake pricing in an efficient and accurate manner. It should include the following:
* Support the owner’s disclosure and privacy policies related to the project.
* Establish which reporting and document distribution services will be used.
* Provide supplemental information in a timely manner.
* Ensure the integrity of information by exchanging it as paper documents or read-only electronic formats.
* Ensure that oral inquiries are documented.

107
Q

Identify the types of documents used as available information for bidders and proposers and are not part of the contract documents.

A

Preliminary schedules
Project budget information
Existing conditions information
Survey information
Environmental Assessment information
Existing material information
Existing Hazardous material information
Geophysical data
Geotechnical Data
Permit application

108
Q

True or False?
The asbestos abatement report and record drawings are available information.

A

True

109
Q

Which of the following could be used for distribution of the procurement documents?
a.) Electronic plan rooms only
b.) Purchasing from document reproduction services
c.) Paper-based plan rooms
d.) Electronic plan rooms, project websites, extranets, and clouds

A

d.) Electronic plan rooms, project websites, extranets, and clouds

110
Q

Which of the following should develop the distribution control plan?
a.) Architect/engineer
b.) Owner
c.) Document reproduction service
e.) Electronic plan room

A

a.) Architect/engineer

111
Q

True or False?
The questions and addenda should be handled in accordance
with the information control plan.

A

True

112
Q

List the methods of making printed or electronic procurement documents available to bidders.

A

1.) Distributing from the owner or architect/engineer
2.) Distributing to subcontractors and suppliers from bidders
3.) Distributing notices about the project through construction reporting services and construction trade associations
4.) Distributing through paper-based plan rooms
5.) Distributing through electronic plan rooms
6.) Using project websites, extranets, and clouds
7.) Purchasing from document reproduction services

CDT- IAJ flashcards (8 decks)

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