WORKSHOP IN EFFECTIVE CONTRACT MANAGEMENT CalACT Spring Conference April 21, 2010

Roy Glauthier Transportation Planning and Policy

v/fax: 949.650.5956 Email: rglauthier@aol.com
Workshop in Effective Contract Management CalACT 2010 Spring Conference

WORKSHOP IN EFFECTIVE CONTRACT MANAGEMENT

Workshop Goal: To share tips, techniques and approaches that can improve the effectiveness and experience of contracting for public transit management and operations.

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Workshop Outline

Sources of Procurement Guidance Terminology Contracting Market Should You Go To Bid? Procurement Timeline

Procurement Process

RFP Development Contract Elements SOW Elements Interviews & BAFO

Transitioning Monitoring Contractor Performance Managing Your Contractor

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Primary Sources for Procurement Guidance:

Federal Transit Administration Best Practices Procurement Manual [do not print. 694pp] FTA Triennial Review Workbook
_6037.html

Available at: http://www.fta.dot.gov/funding/thirdpartyprocurement/grants_financing

http://www.fta.dot.gov/funding/oversight/grants_financing_10924.html

Your agencys procurement policies.

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Critical Terminology

Bid versus Competitive Procurement

-- Bid requires very clear specifications -- Competitive Procurement is intended to permit competition on quality and other factors, as well as on price

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Critical Terminology
Types of Procurements*: Professional Services Agreement Sole Source Negotiated Procurement Competitive Procurement
*Depending on agency procurement policies
Workshop in Effective Contract Management CalACT 2010 Spring Conference

Overview of the Contracting Market

Major National Firms Regional Firms Local Transportation Firms

Focus on performance-based specifications Clearly indicate criteria for selection Seek broadest possible participation in process
Workshop in Effective Contract Management CalACT 2010 Spring Conference

Step 1: Should you go to out to bid or not?

What does your existing contract say about contract term and options? What objectives will be achieved by a competitive procurement? Could these be achieved through negotiations with existing contractor?

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Step 2: Determining Your Procurement Timeline

Request for Proposals Issued October 1, 2010 Voluntary Pre-proposal Conference October 13, 2010 Deadline for Submission of Questions October 15, 2010 Addenda and Answers Distributed October 22, 2010 PROPOSALS DUE 5:00 pm PDT October 29, 2010 Evaluation and Interviews November 1-24, 2010 Contract Award December 1, 2010 START OF SERVICE January 1, 2011

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Step 2: Determining Your Procurement Timeline

Critical Considerations in Setting Timeline: Acquisition and Preparation of

Vehicles Facilities Computers and software, other equipment Review and approval of RFP document by management, legal counsel, risk management, etc. Council/governing body approval of RFP, selection, award Holiday periods Governing Board meeting schedule Coordinating contract timing to fiscal year

Internal City/Agency Reviews and Approvals

Practical Considerations

Others?
Workshop in Effective Contract Management CalACT 2010 Spring Conference

Step 3: Understanding the Complete Procurement Process

Guidelines: Transparency Define your process, then follow it Fairness, level playing field Establish Sole Point of Contact Win/Win/Win -- Agency, Contractor, Public

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Elements in the Procurement Process

RFP development RFP release/publication Preproposal conference & question period Addenda/clarifications Proposal submission Evaluation Interviews BAFO/negotiations

Selection/staff report Award Contract finalization Transition Start-up Month One Monitoring & management Repeat ?

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Developing Your Request for Proposals

Start with a good sample RFP or several Why reinvent the wheel? Sample: City of Rosemead, Rosemead Transit
[procurement conducted Dec 07 Feb 08]

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Major Parts of RFP Document

Solicitation Terms of procurement, evaluation criteria and protest process, checklist of proposal contents Sample contract Scope of Work Attachments -- Anticipate bidders requests:
Copies of monthly reports, present wage scales and benefits, fleet schedule and mileages, detail on provided equipment, facilities and furnishings
Workshop in Effective Contract Management CalACT 2010 Spring Conference

Contract vs. Scope of Work ??

Contract Legal structure of relationship between the contracting agency and the contractor firm

Scope of Work Description of the services, equipment, and/or facilities to be provided under the contract

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Contract Document

Term of contract and any option periods

Clearly state base term of contract Specify any option periods and how these may be exercised [at sole option of the City or upon mutual agreement] Specify option term price [specific price or CPI limit]

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Contract Document

Term of contract and any option periods Termination for cause and for convenience

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Contract Document

Term of contract and any option periods Termination for cause and for convenience How compensation will be paid

Form of compensation Documentation needed for payment Timing of payments Payment for additional and out-of-contract services

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Form of Compensation

Fixed Rate [per Rev Vehicle Hour, RVM, passenger] Fixed and Variable usually fixed payment per month for fixed cost reimbursement plus specified amount per hour or mile operated during billing period Pass-through or Cost reimbursement useful for cost items out of contractors control [e.g. fuel, facility rent, public phones]

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Contract Document

Term of contract and any option periods Termination for cause and for convenience How compensation will be paid Insurance Requirements Emergency response:

Expected actions Terms of compensation

Workshop in Effective Contract Management CalACT 2010 Spring Conference

And, in case your project uses Federal funds..

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Applicable Federal Clauses See FTA Triennial Review Workbook

[http://www.fta.dot.gov/documents/06_Procurement_TriennialReview_FY2010_WKBK.pdf

Exhibit 6.1 A. Required Third-Party Contract Clauses B. Required Certifications, Reports and Forms C. Other Required Items

Exhibit 6.2 Applicability of Third-Party Contract Clauses [breaks down applicability by type of procurement & dollar value]

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Scope of Work

Definitions

Any terms used in compensation [e.g. vehicle revenue hours and miles] Acronyms [NTD, FTA, GPPV] Service terms: door-to-door, curb-to-curb, ontime, dwell time, missed trip, no-show

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Scope of Work

Definitions Description of services to be operated [hours, days, routes, service levels, policies]

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Scope of Work

Definitions Description of services to be operated Performance standards, penalties/incentives, how defined and measured Detailed Responsibilities of Agency and Contractor Staffing: key positions, qualifications, retention/replacement and approval
Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Scope of Work -Continued

Specifications for vehicles and equipment to be provided by contractor or supplied by agency

Make, model year, fuel, mileages Replacement schedule or requirements Present condition/ major rebuild history Integrated equipment: radios, MDTs, AVL, annunciators, fareboxes,
Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Scope of Work -Continued

Specifications for vehicles and equipment to be provided by contractor or supplied by agency If DAR, operating details

Scheduling software or procedures to be used Present call volumes by hour and day Request policies [DR, advance or subscriptions]

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Key Elements in Scope of Work -Continued

Specifications for vehicles and equipment to be provided by contractor or supplied by agency If DAR, operating details Fuel cost arrangements

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Elements in the Procurement Process

RFP development

RFP release/publication Preproposal conference & question period Addenda/clarifications Proposal submission Evaluation Interviews BAFO/negotiations

Selection/staff report Award Contract finalization Transition Start-up Month One Monitoring & management Repeat ?

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Interviews

Optional at agencys discretion Specify total time and breakdown [e.g. No more than 60 minutes, presentation not to exceed 15 minutes] Require project manager to participate and limit number on proposer teams If PP allowed, equipment failure does not extend time allowed for presentation.

Workshop in Effective Contract Management CalACT 2010 Spring Conference

BAFO: Best And Final Offers

Optional Valuable if: Selection is close Questions about what is being provided Specifications need to be clarified May be requested of all proposers or only those in competitive range

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Transition

Include transition requirements in Scope of Work Initiate transition meetings immediately of award of contract Require participation of on-site managers and responsible superior manager Document agreements reached in meetings If vehicle maintenance/condition involved, consider independent maintenance expert Critical issues: vehicle maintenance and physical condition, transfer of phone lines, access to current employees for information/interviews/training, other?
Workshop in Effective Contract Management CalACT 2010 Spring Conference

Monitoring Contractor Performance

Review, question and refine monthly reporting; Establish regular monthly review meeting with standing agenda; Document meeting discussion, follow-up & action items; If performance standards, penalties or incentives included in contract, monitor and follow through; and Conduct annual review of contractor performance.
Workshop in Effective Contract Management CalACT 2010 Spring Conference

Managing Your Contractor

Work to develop a partnership both parties must succeed; Manage, dont micro-manage; Dont get between company and its employees; Strive for consistency and clear direction; and Be familiar with actual operations, employees, services.

Workshop in Effective Contract Management CalACT 2010 Spring Conference

Expert Contracting Panel

George Sparks, Pomona Valley Transportation Authority Mark Wall, Mark Wall Consulting Sandi Schmidt, Transportation Concepts Ron Bushman, Veolia Transportation

Workshop in Effective Contract Management CalACT 2010 Spring Conference