June 28, 2017

Subject:	FAP No.:	AA2005180
Contract No.:	AA2005180
Description: 	

Mr. Eric Amoako, Division Chief
Contract Awards Division
7450 Traffic Drive
Hanover, MD 21076				

Dear Mr. Amoako,

This letter serves to provide analysis of the bids and recommendation for acceptance / rejection of the responsive low bidder for the subject contract. (See OOC Construction Memorandum – attachment H.2) 

SUMMARY

We are recommending the award of this contract to the responsive low bidder, XXXXXXX.  The low bid of $XXXXXX.XX for the XXXXXXXXXX project was submitted on XXX, XX, 20XX.  Based on our review, we believe that the letting was competitive and that the low bidder’s total price accurately reflects the cost of performing the work.

ANALYSIS

The subject contract advertised on XXX, XX, 20XX, and received XX bids on XXX, XX, 20XX.  The bids ranged from $XXXX.XX to $XXXX.XX.  A summary of the three low bidders is as follows:

	Estimate / Bid	% Above or Below Engineer’s Estimate	
Engineer’s Estimate			
Low Bidder			
2nd Low Bidder			
3rd Low Bidder			

The bid items of significant cost difference from the Engineer’s Estimate include the following:

Show analysis of data in written and/or tabular format to include Identification of ALL bid items of significant cost difference from Engineer’s Estimate.  Include the description of Items, quantity, and monetary difference between bid and Engineer’s Estimate.  Explain analysis of price differences (low bid vs. Engineer’s Estimate) of these items in written format to include reasoning for differences.  Reference price index or how Engineer’s Estimate was developed.  Also talk to low bidder and potentially others to obtain and document this reasoning.  Example:

Item 4001- Steel Sheet Piling, Category Code 423180, 6,016 Square Feet (SF)
The Engineer’s Estimated unit price was $50/SF and the Contractor’s unit price for this item was $35/SF producing extended prices of $300,800.00 and $210,560.00, respectively.  When developing the Engineer’s Estimate, an escalation in unit price was recommended by designer to account for the perceived difficulty of the steep slope conditions and working over water at the MD 888 site.  Without this escalation the Engineer’s Estimated unit price was $30/SF, as determined by using the 2017 RS Means Heavy Construction Cost Book.  There was no bid history available for this item in the July 2017 MDOT SHA Price Index. 

During a conference call with the Contractor’s estimator, it became apparent that the Contractor anticipated requesting a full roadway closure to complete the work, eliminating the complexities assumed for this item.  A conversation with Mr. xxxxxxx, the ADE of Construction in District x indicated that such a request would be considered approvable.  The operation then becomes a relatively standard crane pile driving operation.  The escalation applied to the Engineer’s Estimate, based upon the assumption of completing the work under traffic, would no longer be required.  The DAB’s unit price for this item fell within $20.70/SF - $42/SF range bid by the other contractors.  The non-escalated Engineer’s Estimated unit price ($30.00/SF) falls within that range as well.  It is apparent that the bid by the Contractor is a fair value for the work and is competitive. We recommend accepting the Contractor’s bid of $210,560.00 for Steel Sheet Piling.

Identify and explain any other abnormalities that could include things such as discrepancies/significant differences in other bids received and the reasoning, and Penny Bids.  Example:

There were four “Penny-Bids” on this project. The two Category 1 ‘Penny-Bid’ items were Item 1009, Temporary Type E Traffic Barrier End Treatment for 60 mph any width, and Item 1010, Precast Temporary 32 Inch F Shape Concrete Traffic Barrier.  The differences between the Engineer’s Estimate and the corresponding bid prices were $4,999.99 and $1,799.64, respectively, for these items.  Per the conference call on January 8, 2018 the estimator from the Contractor stated that they bid the Temporary Type E Traffic Barrier End Treatment for 60 mph any width, and Precast Temporary 32 Inch F Shape Concrete Traffic Barrier for a penny per unit because they did not plan to use these items, nor the proposed access road on the MD 346 site, thus confirming a potential MOT change request.  With a full detour, the MOT traffic items that were bid as a penny would not be used.  This would result in a difference between the first and second bidder of $14,801.98.  Despite the indications of a mathematically unbalanced bid, neither of these potential MOT plan changes would cause a reordering of the bid results, as the total neat cost difference between the first and second bidder is substantial, i.e., $46,058.55.  The bid therefore does not appear to be materially unbalanced.

RECOMMENDATION

Provide overall recommendation in written and or tabular format.  Include confirmation summary from the contractor of their pricing.  

The bid for $XXXXX.XX was examined for non-competitive bidding practices.  Overall, our review did not identify any items that were materially unbalanced in a way that would impact the award decision or impact the ability of the marketplace to provide the lowest ultimate cost to the State for the given scope of work.

Based on our analysis, we recommend the award of this contract to XXXXX. We do not believe there would be an advantage to re-advertise this project, nor to incur the resultant delay and additional preliminary engineering cost.  In our meeting with XXXXX, they stated they are completely familiar with the contract scope and specifications. This includes but is not limited to the accurate understanding of the required square footage to completely (blast) clean the structural steel and paint the bridge with the specified coating system, the containment system and environmental/worker protection requirements, bridge access and maintenance of traffic requirements, and contract term/time-of-year restrictions.  In additional they have had a successful history in completing transportation projects. 

Use the following paragraph too, if applicable.  (Not all contracts require bonds.)  

The Prime Contractor is required to provide Performance Bonds prior to award of this contract. Bonding companies perform an evaluation of the contractor’s capacity and capability to complete a project as a part of their bonding decisions, therefore no separate evaluation of the capabilities of the Prime Contractor or the identified sub-contractors will be conducted by the County as part of the overall contractor responsibility determination. The contractor’s ability to obtain bonding is deemed to be a reasonable assessment of their responsibility to bid a project.

Attached for your information is a copy of the bid analysis report and the tabulation of bids.   

If you have any questions concerning this project, please contact our Project Manager - ### (telephone [###] ###-####) for further discussion.

Attachments:  Bid Analysis Report and Tabulation of Bids

Sincerely, 

County Representative

RECOMMEND CONCURRENCE:

VICTOR GRAFTON,									Date
Acting Director, Office of Construction	

CONCUR:

TIM SMITH, P.E. 									Date
Chief Engineer/Deputy Administrator for Operations