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Maryland’s 1st Mega Design-Build Project:
         Procurement Process

  Lisa Choplin, Chief, Innovative Contracting Design
       Maryland State Highway Administration

                    March 20, 2008
    Topics for Discussion

• The ICC in a Snapshot
• Procurement Approach

The ICC in a Snapshot

                    What is the ICC?
• An east-west 18 mile multi-modal highway:
    Connects I-270 / I-370 and the I-95 / US 1 corridors
    Multi-modal (auto, bus, carpool)
    6 lanes (3 per direction)                                 Baltimore

    9 interchanges
    Highway speed electronic tolling
    to help manage traffic flow
    Environmentally sensitive and
    extensive enhancements
                                                             Washington, D.C.


            *Note: median width varies from 26’ to 50’
    Project Milestones
Initiation of Study Efforts

  Publication of Draft Environmental
  Impact Statement (EIS)

   Contract A Informational Meeting - 12.8.2005

    Final Environmental Impact
    Statement (FEIS) signed 1.3.2006

       Record of Decision (ROD) signed 5.29.2006

         Contract C Informational Meeting - 6.29.2006

          Contract B Informational Meeting – 5.17.2007

             Contract A: Limited NTP – 6.8.2007 & 10.16.2007;
                         Full NTP – 11.13.2007
               Contract C - Awarded 11.20.2007; Limited NTP – 1.14.2008
           Project Oversight

      SHA                         MdTA

(One of 5 MDOT modal           (An Authority whose
administrations: MAA,          chairman is also the
MVA, MTA, MPA)                 MDOT Secretary)

Design-Build Contracts A-E

 Construction Contract Packaging
⇒ 5 Design-Build Contracts for ICC Mainline /
  Interchanges totaling approximately $1.5 billion.
⇒ Approximately 50 Design-Bid-Build or Design-Build
  Contracts for Environmental Mitigation,
  Environmental Stewardship, and Community /
  Cultural Stewardship totaling approx. $97 million.

  Five Mainline Contracts Overview
• Contract A $478.7M*
          • Granite / Corman / Wagman
            (Parsons Transportation Group / Jacobs)
          • 15% Overall DBE Goal, 20% Professional Services

• Contract C $513.9M*
          • Shirley / Clark / Atkinson / Facchina / Trumbull
            (Dewberry, JMT, Whitney Bailey)
          • 20% Overall DBE Goal, 20% Professional Services

• Contract B $410M to $460M*
          • RFP Released to RCLs mid-December
          • 20% Overall DBE Goal, 20% Professional Services

• Contract D $60M to $75M*
          • DBE Goal TBD

• Contract E $50M to $65M*
          • DBE Goal TBD                          * Year of Expenditure $

 Current Schedule ICC Contracts A Thru E
                         Limited NTPs 6.8.2007 & 10.16.2007                                  6 months
                                                                                             testing of

   Contract A                                                     Full NTP 11.13.2007      toll systems

I-270 / I-370 to MD 97              Procurement                    Design-Build                           Revenue Service
                                                                                                                      6 months
                                                                                                                      testing of
                                Limited NTP 1.14.2008                                                               toll systems
   Contract C                                                                                                                      Revenue
    US 29 to I-95                            Procurement                      Design-Build *                                       Service
                                                                                                                    6 months
                                                                                                                    testing of
                                         Procurement             NTP                                              toll systems
   Contract B                                                                                                                      Revenue
  MD 97 to US 29                                                                Design-Build *                                     Service
  $410M to $460M
                                                                                                            6 months
                                                                                                            testing of

   Contract E                                            Procurement          NTP                         toll systems

                                                                                     Design-Build *                      Revenue
    I-95 to US 1                                                                                                         Service
   $50M to $65M

                                                               Procurement          NTP
   Contract D
C-D Roads Along I-95                                                                               Design-Build *
   $60M to $75M

                    2005         2006        2007         2008         2009         2010              2011                 2012

                         * Duration to be determined during negotiations with successful D-B Team
   Specifications for Design-Build
• Prescriptive vs. Performance
    Prescriptive (traditional)
     ►   “How to” do it
     ►   Define “required results”

• Use of Standards vs. References

Performance-Based Specifications …
            In General
• Outlines Owner Expected Performance of a
  Specific Work Item Over a Period of Time
• Provide Design-Builder the flexibility to
  design and construct the project meeting all
  project goals

Lighting … Performance Specification
   •   General Criteria
          Design & Construct a Durable Lighting System
          Provide Appropriate Illumination
          Avoid Light Pollution Outside Corridor
          Avoids Disability and Discomfort Glare to Users
          Provide for Ease of Maintenance
   •   Specific Criteria
          AASHTO Guides; National Electric Code
          Incorporate ATMS & Aesthetic Requirements
          Minimize Lane Closures During Maintenance
          Uniformity Ratio of 3:1
          Average Lux of 6.5 to 8.6 (maximum 1.85)
          Lamp Types as Outlined in FEIS
          Use Sylvania, Phillips or GE Lamps!!

Performance Specifications … examples
      Maryland State Highway Administration

                                              Maryland State Highway Administration

     Standards and References
• Standards and References are cited within the
  Performance Specifications. The following
  distinction between “Standards” and
  “References” applies:
    Standards constitute a further elaboration of the
    requirement. References constitute advisory or
    information material, provided for the Design-Builder’s
    benefit, that need not be followed but in some cases
    provides solutions already in use by the Administration.
    In some cases, specific parts of references are cited in
    Performance Specifications as Standards.

Standard versus Reference Example

Standard versus Reference Example

Standard versus Reference Example

Performance Box

            = Constraints

Procurement Approach

    The Design-Build Decision
    Reasons for Design-Build
• Early Completion / Less Public Impact
• Lower Cost & Certainty of Final Cost
• Maintain or Increase Quality
• Ability for Innovation
• Available Owner Staffing
• Less Management Effort
• Less Conflict
• Shift of Risk to Party Best Able to Manage

           Procurement Process
             Two Step Process
Step One
• Informational Meeting
• Request for Qualifications (RFQ)
• Submittal of Statement of Qualifications (SOQ)
• Reduced Candidate List (RCL) Notified

Steps in the Procurement Process – Step One
        • Goals of Informational Meeting
            Program Overview
              ►   Status of the Program
              ►   Key Challenges
            Project Details
              ►   Goals and Objectives
              ►   Describe Project Limits/Characteristics
              ►   Areas of Special Interest
                    – Environment
                    – Communities
            Design-Build Process
              ►   RFQ requirements
              ►   Goals
              ►   Industry Comments
              ►   Schedule
            MBE / DBE and Outreach
              ►   Opportunities

Steps in the Procurement Process – Step One
     • RFQ Evaluation Factors:
         (Pass/Fail) Legal
         (Pass/Fail) Financial
         (Pass/Fail) Responsiveness to RFQ
         Organization and Key Managers
         Experience of the Firms
         Past Performance
                                      Covers: Management,
         Project Understanding        Construction, Design,
                                      Quality, & Environmental

Steps in the Procurement Process – Step One
   • Request for Qualifications – Results
       Determine Reduced Candidate List (RCL)
        ►   Evaluated using Adjectival Rating process

        ►   Select best qualified teams

       Ratings do not carry forward

                     Adjectival Ratings
EXCEPTIONAL ~ The Proposer has provided information relative to its qualifications which
is considered to significantly exceed stated objectives/requirements in a beneficial way and
indicates a consistently outstanding level of quality. There are essentially no weaknesses.

GOOD ~ The Proposer has presented information relative to its qualifications which is
considered to exceed stated objectives/requirements and offers a generally better than
acceptable level of quality. Weaknesses, if any, are very minor.

ACCEPTABLE ~ The Proposer has presented information relative to its qualifications, which
is considered to meet the stated objectives/requirements, and has an acceptable level of
quality. Weaknesses are minor and can be corrected.

UNACCEPTABLE ~ The Proposer has presented information relative to its qualifications
that contains significant weaknesses and/or deficiencies and/or unacceptable level of quality.
The SOQ fails to meet the stated objectives and/or requirements and/or lacks essential
information and is conflicting and/or unproductive. Weaknesses/deficiencies are so major
and/or extensive that a major revision to the SOQ would be necessary and/or are not

The evaluators may also use a plus (+) or minus (-) suffix to further differentiate the strengths
or limitations within a technical rating.

Procurement Process Timeline: Contract C
             Information Meeting – 6/9/2006

              Issue RFQ – 8/8/2006

               SOQ Received – 11/9/2006

                RCL Notified – 11/21/2006

           Procurement Process
             Two Step Process
Step Two
• Share Draft RFP with RCL
• Issue Final RFP
• Alternate Technical Concepts Review
• Technical & Price Proposal Evaluations
• Discussions / Best & Final Offer (BAFO)
• Selection & Award
• Contract Execution / NTP

Steps in the Procurement Process – Step Two
  • Alternative Technical Concepts (ATC)
      What is an ATC?
       ►   An approach for the proposer to be innovative--submit
           new innovative concepts for review and approval
      Approved ATC’s may be included in the proposal
      Benefits of ATC’s
       ►   Encourages proposers to promote new ideas, and put
           best staff on the team
       ►   Allows proposers to develop better/improved concepts
           than shown in the RFP
       ►   Approved concepts provide an improved project to the
           public, and may save time and money

Steps in the Procurement Process – Step Two
 • Areas for the RFP Evaluation (example):
     (Pass/Fail) Legal             Management
     (Pass/Fail) Financial
     (Pass/Fail) Responsiveness    Solutions
     (Pass/Fail) DBE Compliance    Project Support
     Environmental                 Price
     Key Personnel and

 Steps in the Procurement Process
• The Evaluation and Selection Process uses:
    Clarifications & Communications
    Adjectival Rating Method
    Recommendations by Evaluation Teams
    Consensus of Committees for:
     ►   Quality Ratings for Each Technical Evaluation Factor
     ►   Overall Technical Quality Rating for Each Proposal

    Discussions / Final Proposal Revision (i.e., BAFO)
    Best Value Selection

Steps in the Procurement Process – Step Two
  • Best and Final Offer (BAFO)--Opportunity for the
    Proposer to improve its Proposal based upon
    “Clarifications, Discussions, and One-on-One Mtgs”
  • BAFO may include
      Technical changes, and
      Review/adjustment to the proposer’s price

  • Objective
       To obtain an improved proposal

  • Trade-Off Analysis
      May occur when competing proposals are close in quality
      and price – Best Value

Procurement Process Timeline: Contract C
             Information Meeting – 6/9/2006

              Issue RFQ – 8/8/2006

               SOQ Received – 11/9/2006

                RCL Notified – 11/21/2006

                  Issue RFP – 3/16/2007

                   Final ATC Due – 7/24/2007

                     Proposal Received – 9/20/2007

                       Presentations – 10/9/2007

                         BAFO Due – 11/6/2007

                          D-B Team Announced – 11/20/2007

                            Execution of Contract – 12/21/2007

                              Limited NTP – 1/14/2008
                                 Full NTP – 4/12/2008
                Evaluation Criteria Comparison
        Contract A                             Contract C                               Contract B
                Legal / financial                         Legal / financial                        Legal / financial
 Pass // fail
 Pass fail                                 Pass // fail
                                           Pass fail                                 Pass / fail
                DBE                                       DBE                                      DBE

   Most                                Most important
                                       Most important     Environmental          Most important
                                                                                 Most important    Environmental
                Environmental           and equal in
                                        and equal in                              and equal in
                                                                                  and equal in
                                         importance       Technical Solutions     importance
                                                                                   importance      Technical Solutions

                Key Personnel,
                Experience, and                           Management                               Management
  Lesser                                    Lesser
                                            Lesser                                    Lesser
 and equal
                Financial Capability       and equal      Approach                   and equal     Approach
 and equal                                 and equal                                 and equal
importance      Management Approach       importance
                                          importance                                importance
                                                          Innovation                               Innovation
                Technical Solutions

                                                          Financial Capability                     Financial Capability
  Lesser                                    Lesser
                                            Lesser        and Qualifications          Lesser
                                                                                      Lesser       and Qualifications
importance      Project Support            and equal
                                           and equal      Improvement                and equal
                                                                                     and equal     Improvement
                                          importance                                importance
                                                          Project Support                          Project Support

Evaluation Results for Contracts A & C

Contract A
                            Rating / Price
Intercounty Constructors   Good+ / $463.9M
ICC Constructors           Good– / $509.8M
Facchina-Trumbull          Acceptable+ / $466.1M

Contract C
                            Rating / Price
ICC Constructors           Good+ / $498.8M
Skanska USA                Good– / $604.6M

Responsiveness to Industry Comments
 • Retained our emphasis on Key staff, similar project
   experience, and surety

 • Retained emphasis on Environmental past

 • Submittal requirements are being simplified
      Deferred Project understanding to RFP

      Eliminated two Appendices

      Reduced Number of pages

Responsiveness to Industry Comments
 • DBE Participation has been clarified in the ITP

 • Stipend was increased to 0.2%

 • Cost and Pricing Data initial submittal requirements
   reduced at time of Proposal; Selected team required to
   provide data

 • Insurance requirements have been revised

 • Hazardous Materials Special Provision added; Findings
   resulting from survey will be Contract Modifications

 • Cost Adjustments provided for pavement (asphalt and
   cement), fuel and structural steel

  Responsiveness to Industry Comments

• Right-of-Way
    SHA stands behind all R/W clear dates; scheduled defined in
    the RFP
• Engineering Data
    SHA stands behind all engineering data provided
• Geotechnical Data
    SHA stands behind all Baseline data; scheduled defined in the

  Responsiveness to Industry Comments

• Utilities
     Utility Agreements included in the RFP or addenda; SHA
     stands behind these agreements and dates
• Mobilization
     Allowance increased from 4% to 10%
• Hub Office/Key Staff
     Work in partnership to with selected team to complete a
     successful project

• What is a Stipend?
    Recognition of the proposer’s investment and time

• Why Pay a Stipend?
    Facilitates Quality in the Proposal
    Ownership of Concepts
    Encourages Participation in Next DB Project

• How is the Stipend Calculated?
    Generally 0.2% of the Estimated Contract value
     ►   Contract A - $700,000
     ►   Contract B - $800,000
     ►   Contract C - $700,000

        Keys to Success
The Successful Owner’s Approach
 • Develop a Procurement Strategy “First”
     Project Goals are the “Key”
     Decide on a Design-Build Approach

 • Embrace “Teamwork & Trust”
 • Encourage Creativity
 • Manage Cultural Change
 • Administer Consistent with Strategy

          Keys to Success
     The Contractor’s Perspective
• Well Planned Procurement Strategy and Process
     Communicated Well; Understood; Fair
     Performance Specs; Flexibility
     Opportunity for Innovation & Creativity
     Best Value Selection

• Provide Positive Incentives
• Recognize “Different Way of Doing Business” When
  Administering Contract

                 Questions / Discussion
Melinda Peters, P.E.
Project Director
Office of the Intercounty Connector
Maryland State Highway Administration

David Wallace, P.E.
GEC’s Project Manager
dwallace@iccproject.com                    N


        ICC Project Management Office                IC’s Hub A Office    43
             Beltsville, Maryland                   Rockville, Maryland

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