Administrative ProvisionsTransportation Design-build Program

Section § 6820

Explanation

This section outlines key definitions used in the chapter. "Best value" refers to evaluating offers based on several factors, not just price. The "design-build" process involves one entity handling both the design and construction of a project. "Design-build entity" and "team" indicate the group capable of providing necessary services for such projects. The "Department" is the state's Department of Transportation. "Expressway" is as defined in another code, and interfacing with the highway involves work related to state highway property. Regional transportation agencies can be several types of local or state entities responsible for managing transportation projects. "Transportation entity" encompasses both the Department of Transportation and regional agencies.

For purposes of this chapter, the following definitions apply:
(a)CA Public Contract Code § 6820(a) “Best value” means a value determined by objective criteria, including, but not limited to, price, features, functions, life-cycle costs, and other criteria deemed appropriate by the transportation entity.
(b)CA Public Contract Code § 6820(b) “Commission” means the California Transportation Commission.
(c)CA Public Contract Code § 6820(c) “Design-build” means a procurement process in which both the design and construction of a project are procured from a single entity.
(d)CA Public Contract Code § 6820(d) “Design-build entity” means a partnership, corporation, or other legal entity that is able to provide appropriately licensed contracting, architectural, and engineering services as needed pursuant to a design-build contract.
(e)CA Public Contract Code § 6820(e) “Design-build team” means the design-build entity itself and the individuals and other entities identified by the design-build entity as members of its team.
(f)CA Public Contract Code § 6820(f) “Department” means the Department of Transportation as established under Part 5 (commencing with Section 14000) of Division 3 of Title 2 of the Government Code.
(g)CA Public Contract Code § 6820(g) “Expressway” means expressway as defined in Section 257 of the Streets and Highways Code.
(h)CA Public Contract Code § 6820(h) “Interfacing with the state highway system” means work performed within the state highway right-of-way, including airspace over or under that property, or work performed upon property acquired by the department for construction of a state highway, including airspace over or under that property.
(i)CA Public Contract Code § 6820(i) “Regional transportation agency” means any of the following:
(1)CA Public Contract Code § 6820(i)(1) A transportation planning agency described in Section 29532 or 29532.1 of the Government Code.
(2)CA Public Contract Code § 6820(i)(2) A county transportation commission established under Section 130050, 130050.1, or 130050.2 of the Public Utilities Code.
(3)CA Public Contract Code § 6820(i)(3) Any other local or regional transportation entity that is designated by statute as a regional transportation agency.
(4)CA Public Contract Code § 6820(i)(4) A joint exercise of powers authority established pursuant to Chapter 5 (commencing with Section 6500) of Division 7 of Title 1 of the Government Code, with the consent of a transportation planning agency or a county transportation commission for the jurisdiction in which the transportation project will be developed.
(5)CA Public Contract Code § 6820(i)(5) A local transportation authority designated pursuant to Division 12.5 (commencing with Section 131000) or Division 19 (commencing with Section 180000) of the Public Utilities Code.
(6)CA Public Contract Code § 6820(i)(6) The Santa Clara Valley Transportation Authority established pursuant to Part 12 (commencing with Section 100000) of Division 10 of the Public Utilities Code.
(j)CA Public Contract Code § 6820(j) “Transportation entity” means the department or a regional transportation agency.
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Section § 6821

Explanation

This law allows the department to use the design-build method for up to 10 highway projects, with more allowed in the following two fiscal years. This method can be based on either the best value or the lowest responsible bid. Regional transportation agencies can also use this method for projects on or near highways but must make agreements with the department for roles, responsibilities, and issue resolution. For expressways not on the state highway system, the design-build method can be used if voters approved the projects by 2014. However, cities and counties cannot use design-build procurement under this law.

Construction inspection must follow another section of the code and is not included in this authority. Reports on project progress and compliance are required annually starting two years after a contract award and stop four years after the first report. These reports must follow specific Government Code requirements.

(a)CA Public Contract Code § 6821(a) The department may utilize the design-build method of procurement for up to 10 projects, and an additional 6 projects per fiscal year in the 2022–23 and 2023–24 fiscal years, on the state highway system, based on either best value or lowest responsible bid.
(b)CA Public Contract Code § 6821(b) A regional transportation agency may utilize the design-build method of procurement to design and construct projects on or adjacent to the state highway system, including related nonhighway portions of the project, based on either best value or lowest responsible bid. A regional transportation agency and the department shall enter into a cooperative agreement reflecting the roles and responsibilities assigned by law for a project on or interfacing with the state highway system authorized under this subdivision. The cooperative agreement shall also include the requirement to develop a mutually agreed upon issue resolution process with a primary objective to ensure the project stays on schedule and issues between the parties are resolved in a timely manner.
(c)Copy CA Public Contract Code § 6821(c)
(1)Copy CA Public Contract Code § 6821(c)(1) A regional transportation agency may utilize the design-build method of procurement, based on either best value or lowest responsible bid, to design and construct projects on expressways that are not on the state highway system if the projects are developed in accordance with an expenditure plan approved by voters as of January 1, 2014.
(2)CA Public Contract Code § 6821(c)(2) The entity responsible for the maintenance of the local streets and roads within the jurisdiction of the expressway shall be responsible for the maintenance of the expressway.
(d)CA Public Contract Code § 6821(d) A city, county, or city and county shall not utilize the design-build method of procurement under this chapter. A regional transportation agency shall not utilize the design-build method of procurement on behalf of a city, county, or city and county.
(e)CA Public Contract Code § 6821(e) The design-build authorization in subdivisions (a) and (b) shall not include the authority to perform construction inspection services for projects on or interfacing with the state highway system, which shall be performed by the department consistent with Section 91.2 of the Streets and Highway Code.
(f)Copy CA Public Contract Code § 6821(f)
(1)Copy CA Public Contract Code § 6821(f)(1) Not later than the first day of July that occurs two years after a design-build contract is awarded, and each July 1 thereafter until a project is completed, the department or the regional transportation agency shall submit a report on the progress of the project and compliance with this section to the legislative policy committees having jurisdiction over transportation matters.
(2)CA Public Contract Code § 6821(f)(2) The requirement of submitting a report imposed under paragraph (1) is inoperative on the first day of July four years after the first report was submitted, pursuant to Section 10231.5 of the Government Code.
(3)CA Public Contract Code § 6821(f)(3) A report to be submitted pursuant to paragraph (1) shall be submitted in compliance with Section 9795 of the Government Code.
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Section § 6822

Explanation

This law requires the commission to use specific guidelines to create a conflict-of-interest policy. This policy dictates that anyone who helps a transportation entity plan a design-build project cannot also bid on that project as a contractor or join a team bidding on it. This is to ensure fairness in design-build contracts.

The commission shall use the guidelines developed pursuant to subdivision (e) of Section 6803, as it read on December 31, 2013, to provide a standard organizational conflict-of-interest policy, consistent with applicable law, regarding the ability of a person or entity, that performs services for the transportation entity relating to the solicitation of a design-build project, to submit a proposal as a design-build entity, or to join a design-build team. This conflict-of-interest policy shall apply to the transportation entity entering into design-build contracts authorized under this chapter.
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Section § 6823

Explanation

This law talks about how certain public works projects in California should handle labor compliance. If a transportation project using the design-build method was awarded before January 1, 2012, they must either set up their own labor compliance program or work with a third party to do so, following rules from another law (Section 1771.5 of the Labor Code). However, if there's already a collective bargaining agreement covering all contractors, this requirement doesn't apply. For projects started on or after January 1, 2012, they need to follow different labor compliance rules laid out in Section 1771.4 of the Labor Code.

(a)CA Public Contract Code § 6823(a) For contracts for public works projects awarded prior January 1, 2012, a transportation entity authorized to use the design-build method of procurement shall establish and enforce a labor compliance program containing the requirements outlined in Section 1771.5 of the Labor Code or shall contract with a third party to operate a labor compliance program containing the requirements outlined in Section 1771.5 of the Labor Code. This requirement shall not apply to projects where the transportation entity or design-build entity has entered into any collective bargaining agreement that binds all of the contractors performing work on the projects.
(b)CA Public Contract Code § 6823(b) For contracts for public works projects awarded on or after January 1, 2012, the project shall be subject to the requirements of Section 1771.4 of the Labor Code.
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Section § 6824

Explanation

This law outlines the steps a transportation entity in California should follow when undertaking a design-build project. It starts with the preparation of detailed documents describing the project's scope, estimated cost, and specifications, which must be done by a licensed design professional.

The next step is issuing a Request for Proposals (RFP) based on these initial documents. The RFP must define the project's needs, evaluation methodology, and significant factors like cost and design requirements. The law also allows for discussions and negotiations with potential bidders in some cases.

The transportation entity must also issue a Request for Qualifications (RFQ). This helps prequalify the design-build entities, assessing their experience, technical skills, financial stability, and any past legal issues.

Finally, the law describes how contracts can be awarded either through the lowest responsible bidder or based on the best value, which includes criteria like price, technical design, and life-cycle costs. After selection, the entity announces the contract award publicly and ensures a thorough record is kept for audits.

The procurement process for the design-build project shall progress as follows:
(a)CA Public Contract Code § 6824(a) A transportation entity shall prepare a set of documents setting forth the scope and estimated price of a project. The documents may include, but need not be limited to, the size, type, and desired design character of the project, performance specifications covering the quality of materials, equipment, workmanship, preliminary plans, and any other information deemed necessary to describe adequately the transportation entity’s needs. The performance specifications and any plans shall be prepared by a design professional who is duly licensed and registered in California.
(b)CA Public Contract Code § 6824(b) Based on the documents prepared as described in subdivision (a), the transportation entity shall prepare a request for proposals that invites interested parties to submit competitive sealed proposals in the manner prescribed by the transportation entity. The request for proposals shall include, but need not be limited to, the following elements:
(1)CA Public Contract Code § 6824(b)(1) Identification of the basic scope and needs of the project or contract, the estimated cost of the project, the methodology that will be used by the transportation entity to evaluate proposals, whether the contract will be awarded on the basis of the lowest responsible bid or on best value, and any other information deemed necessary by the transportation entity to inform interested parties of the contracting opportunity.
(2)CA Public Contract Code § 6824(b)(2) Significant factors that the transportation entity reasonably expects to consider in evaluating proposals, including, but not limited to, cost or price and all nonprice-related factors.
(3)CA Public Contract Code § 6824(b)(3) The relative importance or the weight assigned to each of the factors identified in the request for proposals.
(4)CA Public Contract Code § 6824(b)(4) For transportation entities authorized to utilize best value as a selection method, the transportation entity reserves the right to request proposal revisions and hold discussions and negotiations with responsive bidders and shall so specify in the request for proposals and shall publish separately or incorporate into the request for proposals applicable rules and procedures to be observed by the transportation entity to ensure that any discussions or negotiations are conducted in good faith.
(c)CA Public Contract Code § 6824(c) Based on the documents prepared under subdivision (a), the transportation entity shall prepare and issue a request for qualifications in order to prequalify or short-list the design-build entities whose proposals shall be evaluated for final selection. The request for qualifications shall include, but need not be limited to, the following elements:
(1)CA Public Contract Code § 6824(c)(1) Identification of the basic scope and needs of the project or contract, the expected cost range, the methodology that will be used by the transportation entity to evaluate proposals, the procedure for final selection of the design-build entity, and any other information deemed necessary by the transportation entity to inform interested parties of the contracting opportunity.
(2)Copy CA Public Contract Code § 6824(c)(2)
(A)Copy CA Public Contract Code § 6824(c)(2)(A) Significant factors that the transportation entity reasonably expects to consider in evaluating qualifications, including technical design and construction expertise, skilled labor force availability, and all other nonprice-related factors.
(B)CA Public Contract Code § 6824(c)(2)(A)(B) For purposes of subparagraph (A), skilled labor force availability shall be determined by the existence of an agreement with a registered apprenticeship program, approved by the California Apprenticeship Council, that has graduated at least one apprentice in each of the preceding five years. This graduation requirement shall not apply to programs providing apprenticeship training for any craft that was first deemed by the Department of Labor and the Department of Industrial Relations to be an apprenticeable craft within the five years prior to the effective date of this article.
(3)CA Public Contract Code § 6824(c)(3) A standard form request for statements of qualifications prepared by the transportation entity. In preparing the standard form, the transportation entity may consult with the construction industry, the building trades and surety industry, and other public agencies interested in using the authorization provided by this chapter. The standard form shall require information including, but not limited to, all of the following:
(A)CA Public Contract Code § 6824(c)(3)(A) If the design-build entity is a partnership, limited partnership, joint venture, or other association, a listing of all of the partners, general partners, or association members known at the time of statement of qualification submission who will participate in the design-build contract.
(B)CA Public Contract Code § 6824(c)(3)(B) Evidence that the members of the design-build entity have completed, or demonstrated the experience, competency, capability, and capacity to complete projects of similar size, scope, or complexity, and that proposed key personnel have sufficient experience and training to competently manage and complete the design and construction of the project, and a financial statement that assures the transportation entity that the design-build entity has the capacity to complete the project.
(C)CA Public Contract Code § 6824(c)(3)(C) The licenses, registration, and credentials required to design and construct the project, including, but not limited to, information on the revocation or suspension of any license, credential, or registration.
(D)CA Public Contract Code § 6824(c)(3)(D) Evidence that establishes that the design-build entity has the capacity to obtain all required payment and performance bonding, liability insurance, and errors and omissions insurance.
(E)CA Public Contract Code § 6824(c)(3)(E) Information concerning workers’ compensation experience history and a worker safety program.
(F)CA Public Contract Code § 6824(c)(3)(F) A full disclosure regarding all of the following that are applicable:
(i)CA Public Contract Code § 6824(c)(3)(F)(i) Any serious or willful violation of Part 1 (commencing with Section 6300) of Division 5 of the Labor Code or the federal Occupational Safety and Health Act of 1970 (Public Law 91-596), settled against any member of the design-build entity.
(ii)CA Public Contract Code § 6824(c)(3)(F)(ii) Any debarment, disqualification, or removal from a federal, state, or local government public works project.
(iii)CA Public Contract Code § 6824(c)(3)(F)(iii) Any instance where the design-build entity, or its owners, officers, or managing employees submitted a bid on a public works project and were found to be nonresponsive or were found by an awarding body not to be a responsible bidder.
(iv)CA Public Contract Code § 6824(c)(3)(F)(iv) Any instance where the design-build entity, or its owners, officers, or managing employees defaulted on a construction contract.
(v)CA Public Contract Code § 6824(c)(3)(F)(v) Any violations of the Contractors’ State License Law, as described in Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code, including alleged violations of federal or state law regarding the payment of wages, benefits, apprenticeship requirements, or personal income tax withholding, or Federal Insurance Contribution Act (FICA) withholding requirements settled against any member of the design-build entity.
(vi)CA Public Contract Code § 6824(c)(3)(F)(vi) Any bankruptcy or receivership of any member of the design-build entity, including, but not limited to, information concerning any work completed by a surety.
(vii)CA Public Contract Code § 6824(c)(3)(F)(vii) Any settled adverse claims, disputes, or lawsuits between the owner of a public works project and any member of the design-build entity during the five years preceding submission of a bid under this article, in which the claim, settlement, or judgment exceeds fifty thousand dollars ($50,000). Information shall also be provided concerning any work completed by a surety during this five-year period.
(G)CA Public Contract Code § 6824(c)(3)(G) If the proposed design-build entity is a partnership, limited partnership, joint-venture, or other association, a copy of the organizational documents or agreement committing to form the organization, and a statement that all general partners, joint venture members, or other association members agree to be fully liable for the performance under the design-build contract.
(H)CA Public Contract Code § 6824(c)(3)(H) An acceptable safety record. A bidder’s safety record shall be deemed acceptable if its experience modification rate for the most recent three-year period is an average of 1.00 or less, and its average total recordable injury/illness rate and average lost work rate for the most recent three-year period does not exceed the applicable statistical standards for its business category or if the bidder is a party to an alternative dispute resolution system as provided for in Section 3201.5 of the Labor Code.
(4)CA Public Contract Code § 6824(c)(4) The information required under this subdivision shall be verified under oath by the design-build entity and its members in the manner in which civil pleadings in civil actions are verified. Information required under this subdivision that is not a public record under the California Public Records Act, as described in Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code, shall not be open to public inspection.
(d)CA Public Contract Code § 6824(d) For those projects utilizing low bid as the final selection method, the competitive bidding process shall result in lump-sum bids by the prequalified or short-listed design-build entities. Awards shall be made to the lowest responsible bidder.
(e)CA Public Contract Code § 6824(e) For those projects utilizing best value as a selection method, the design-build competition shall progress as follows:
(1)CA Public Contract Code § 6824(e)(1) Competitive proposals shall be evaluated by using only the criteria and selection procedures specifically identified in the request for proposals. However, the following minimum factors shall be weighted as deemed appropriate by the contracting transportation entity:
(A)CA Public Contract Code § 6824(e)(1)(A) Price.
(B)CA Public Contract Code § 6824(e)(1)(B) Technical design and construction expertise.
(C)CA Public Contract Code § 6824(e)(1)(C) Life-cycle costs over 15 years or more.
(2)CA Public Contract Code § 6824(e)(2) Pursuant to subdivision (b), the transportation entity may hold discussions or negotiations with responsive bidders using the process articulated in the transportation entity’s request for proposals.
(3)CA Public Contract Code § 6824(e)(3) When the evaluation is complete, the top three responsive bidders shall be ranked sequentially based on a determination of value provided.
(4)CA Public Contract Code § 6824(e)(4) The award of the contract shall be made to the responsible bidder whose proposal is determined by the transportation entity to have offered the best value to the public.
(5)CA Public Contract Code § 6824(e)(5) Notwithstanding any other provision of this code, upon issuance of a contract award, the transportation entity shall publicly announce its award, identifying the contractor to whom the award is made, along with a written decision supporting its contract award and stating the basis of the award. The notice of award shall also include the transportation entity’s second- and third-ranked design-build entities.
(6)CA Public Contract Code § 6824(e)(6) The written decision supporting the transportation entity’s contract award, described in paragraph (5), and the contract file shall provide sufficient information to satisfy an external audit.
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Section § 6825

Explanation

This section outlines the requirements for a design-build project. It mandates that the design-build entity must provide both payment and performance bonds for the project, as specified by the transportation entity. The amount of the payment bond can't be less than that of the performance bond, and both must be issued by an insurance company authorized in California. Additionally, the contract must include insurance coverage for any design mistakes or errors.

(a)CA Public Contract Code § 6825(a) The design-build entity shall provide payment and performance bonds for the project in the form and in the amount required by the transportation entity, and issued by a California admitted surety. In no case shall the amount of the payment bond be less than the amount of the performance bond.
(b)CA Public Contract Code § 6825(b) The design-build contract shall require errors and omissions insurance coverage for the design elements of the project.
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Section § 6826

Explanation

This law section outlines how transportation entities in California can use design-build contracts for projects. When creating proposals, they need to specify certain subcontractors that must be included, and all construction subcontractors in the proposal are protected by specific legal provisions.

For subcontracting work not initially listed, the design-build entity has to publicly announce the available work, set a specific date and time for awarding it, establish fair qualification criteria, and decide between awarding the contract based on best value or to the lowest bidder.

When choosing the best value, a thorough evaluation is required. Subcontractors chosen this way also receive the same legal protections as initially named subcontractors.

(a)CA Public Contract Code § 6826(a) The transportation entity, in each design-build request for proposals, may identify specific types of subcontractors that must be included in the design-build entity statement of qualifications and proposal. All construction subcontractors that are identified in the proposal shall be afforded all the protections of Chapter 4 (commencing with Section 4100) of Part 1 of Division 2.
(b)CA Public Contract Code § 6826(b) In awarding subcontracts not listed in the request for proposals, the design-build entity shall do all of the following:
(1)CA Public Contract Code § 6826(b)(1) Provide public notice of availability of work to be subcontracted in accordance with the publication requirements applicable to the competitive bidding process of the transportation entity.
(2)CA Public Contract Code § 6826(b)(2) Provide a fixed date and time on which the subcontracted work will be awarded.
(3)CA Public Contract Code § 6826(b)(3) Establish reasonable qualification criteria and standards.
(4)CA Public Contract Code § 6826(b)(4) Provide that the subcontracted construction work shall be awarded either on a best value basis or to the lowest responsible bidder. For construction work awarded on a best value basis, the design-build entity shall evaluate all bids utilizing the factors described in paragraph (1) of subdivision (e) of Section 6824, and shall award the contract to the bidder determined by the design-build entity to have offered the best value.
(c)CA Public Contract Code § 6826(c) Subcontractors awarded subcontracts under this chapter shall be afforded all the protections of Chapter 4 (commencing with Section 4100) of Part 1 of Division 2.
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Section § 6826.5

Explanation

By January 1, 2033, the department must provide a report to the transportation and fiscal committees of the Legislature. This report should cover their experiences using the design-build method for projects, focusing on comparing costs, value, and completion times of these projects.

The department shall submit a report to the transportation and fiscal committees of the Legislature on or before January 1, 2033, on its experience with use of the design-build method of procurement pursuant to this chapter, in terms of the relative costs and value of, and time to complete, projects that used the design-build method of procurement.
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Section § 6827

Explanation

This section states that the contents of this chapter do not change any existing legal rights or remedies. In other words, whatever legal rights or options people have under the law are not affected by what is written in this chapter.

Nothing in this chapter affects, expands, alters, or limits any rights or remedies otherwise available at law.
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Section § 6828

Explanation

This section means that if any part of this chapter is found to be invalid or illegal, the rest of the chapter can still stand and be enforced. The idea is that the invalid part doesn't affect the enforceability of the valid parts.

The provisions of this chapter are severable. If any provision of this chapter or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
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Section § 6829

Explanation

This law explains that the current rules will expire on January 1, 2034. If a specific part of the Streets and Highways Code (Section 91.2) is ruled invalid by a court, these rules will end a year after the announcement of this court decision on the department's website. Importantly, any contracts or agreements made under these rules before they expire will still be valid even after the rules are repealed.

(a)CA Public Contract Code § 6829(a) This chapter shall remain in effect only until January 1, 2034, and as of that date is repealed.
(b)CA Public Contract Code § 6829(b) Notwithstanding subdivision (a), if any provision or application of Section 91.2 of the Streets and Highways Code is held invalid by a court of competent jurisdiction, this chapter shall be repealed one year from the date in which the department posts on its internet website that Section 91.2 of the Streets and Highways Code has been held invalid.
(c)CA Public Contract Code § 6829(c) The repeal of this chapter shall not affect an executed design-build contract or cooperative agreement entered into pursuant to this chapter prior to the date of its repeal, regardless of the stage of the project at the time of repeal.
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