Transcript No Slide Title

LOS ANGELES UNIFIED SCHOOL
DISTRICT
FACILITIES SERVICES DIVISION
FACILITIES CONSTRUCTION
CONTRACTS
THE DISTRICT’S
PREQUALIFICATION
PROGRAM
PRESENTED BY:
CIMONE WATSON – TONY GOMEZ
PREQUALIFICATION UNIT
Prequalification Program
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It is the intent of the District to do business with quality
contractors by identifying such contractors through a
uniform system of rating bidders to obtain the best
quality construction for the lowest price practicable
under the circumstances.
The District’s prequalification programs are adopted
pursuant to Public Contract Code 20111.5, 20111.6
and 20919.4.
Requires all contractors interested in bidding either
formal or informal, competitively bid public works
projects to prequalify before submitting a bid to the
District
Provides standard on-going prequalification enrollment
for prospective bidders
Prequalification Types
Safety (Informal) Prequalification
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o
Subcontractor Prequalification (MEP)
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o
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Required to bid informal contracts, JOC job orders, and other
projects for which safety prequalification is required.
Required for Mechanical, Electrical, and Plumbing
subcontractors on formal contracts
Formal Prequalification
Prospective Bidders Interested in Bidding
on INFORMAL District Projects:

Informal District contracts, $84,100 or less, are bid through the Local
District Maintenance & Operations Offices. Information on Informal
contracts may be found on the LAUSD M & O Web Site @
http://mo.laschools.org/fis/existing-facilities/m-and-o/bidwalks/
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Contacts and telephone numbers to the Local M & O offices are located in
the Construction Bidder’s Handbook, available on the web site at
http://www.laschools.org/new-site/bidding-opportunities/
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Prospective bidders interested in bidding on Informal District contracts only
need to be Safety prequalified.
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The Contractor Safety Prequalification Questionnaire may be obtained by
visiting the Prequalification website @ http://www.laschools.org/newsite/prequalification/forms.
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Submit Informal Questionnaires directly to Prequalification by fax to 562654-9499 or email to [email protected].
Construction Contractor
Safety Prequalification
Contractor
Applicant
Overview
For the LAUSD School Repair and Construction Program

Safety Prequalification Questionnaire:
Four primary sections

Sources needed to complete the
Questionnaire:
◦ (a) Your Insurance Carrier or Broker
◦ (b) Company files
IMPORTANT NOTES:
Safety Prequalification only applies to
firms performing construction work for
the School Repair and Construction
Program.
 It does not apply to suppliers, vendors
and service contracts.

IMPORTANT NOTES:
Prequalification is valid for one (1)
year.
 Each firm must reapply prior to
expiration.
 Renewals: Your firm’s safety and loss
history will be considered during the
renewal process.
 The Safety Prequalification
Questionnaire is included in the Prime
and Subcontractor Prequalification.
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BASIC REQUIREMENTS:
Current and valid California Contractor’s
License in good standing with the California
State License Board (CSLB)
 Applicant name must match the same name
on the CSLB license
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BASIC REQUIREMENTS:
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Workers’ Compensation (WC) insurance policy
◦ required of all companies, including companies with
no employees (‘owner-operator’)
◦ NO EXCEPTIONS
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WC policy must identify the name of the
Applicant
◦ You will be required to provide proof of coverage in
the form of a Certificate of Insurance if it does not
appear on the CSLB
Useful Tips:
Fill in every blank. Write “N/A” if not applicable.
 Make sure your answers are legible. (If it can’t
be read, it can’t be processed!)
 Evaluation of your Questionnaire will not be
completed until all information is complete and
all fields are properly filled out.
 Do NOT send us anything we don’t ask for in
the questionnaire.
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Applicant
Information
Section A: Insurance Information
What is the Experience
Modification Rate (EMR)?
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A multiplier based on your firm’s Workers’
Compensation loss claim history that
causes your insurance premiums to go up,
or down.
It impacts the cost of your firm doing
business.
Base Rate (Premium Rate) x EMR = Your
insurance cost (Modified Rate)
Where does EMR come from?

The EMR is not calculated by your
insurance broker or carrier.
• California (intrastate) EMRs are calculated
by the WCIRB (Workers Compensation
Insurance Rating Bureau).
• Interstate EMRs are calculated by NCCI
(National Council on Compensation
Insurance).
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In simple terms, the EMR is a ratio of
actual claims dollars incurred by your
firm compared to the industry average
value for firms that do the same kind of
work you do.
◦ Good history causes it to go down.
◦ Adverse history causes it to rise.
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It is desirable to have an EMR < 1.0.
◦ 1.0 is considered to be “average”.
If you DON’T have an EMR:
You must provide copies of your firm’s
Workers’ Compensation Loss Runs for each
of the last three years, along with your
questionnaire.
 Contact your Insurance Carrier or Broker to
obtain your Loss Runs.
 If you are a brand new company you will have
neither an EMR nor loss runs. Please note
this in writing on the questionnaire.
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What the EMR means to you:

Let’s say you, Fred, are bidding against Joe
and Bob.
◦ Your EMR is 1.0,
◦ Joe’s is 0.5, and
◦ Bob’s is 2.0.

Let us also assume that your bids are
identical with respect to time, material and
labor hours, and include $10,000 as the
manual (base) rate for Workers’ Comp.
◦ Your insurance would cost you $10,000.
◦ Joe would pay $5,000 for the same
insurance.
◦ Bob would pay $20,000 for the same
insurance.
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Who gets the job?
◦ JOE!
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Who says safety doesn’t pay?
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You can learn what your EMR is (if you have
one) by contacting your Workers’
Compensation Insurance carrier.
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We will verify your answers.
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Applicant may be disqualified if either its (a)
current EMR, or (b) average EMR for the most
recent three-year period, is above 1.00, in
which case, the District will determine, based
on information submitted, whether Applicant
has satisfied the requirements of Section A.
Section B: Incidence Rates
Enter only one (1) NAICS code
If you don’t know your firm’s NAICS Code, visit the
Facilities Vendor Registration web site at:
http://mo.laschools.org/lausd-vendor/register-ae
Click on “View NAICS” to see a list of codes, or
Type specialty trade in Primary box to get applicable code.
Incidence Rates...
…are based on employee injuries and
illnesses and total company man-hours per
CALENDAR YEAR, not insurance policy
year.
 They:
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◦ are not based on OSHA inspections or
citations/violations.
◦ can be computed for every contractor EVEN
IF THERE ARE NO OSHA
‘RECORDABLE’ CASES.
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A work-related injury or illness must be
recorded if it resulted in:
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Death or dismemberment
Loss of consciousness
Days away from work
Restricted work activity or job transfer
Medical treatment beyond first aid
Specific information on how to evaluate
whether an incident is to be considered
OSHA recordable can be found at
www.osha.gov/recordkeeping
Information Used for Calculating
Incidence Rates
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Refer to your OSHA 300 Logs and/or your Loss
Runs and injury/illness records to determine the
number of injury cases you have incurred.
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Company hours is the total sum of all work hours
by all employees (including those of a sole
proprietor/owner) for the calendar year.
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Complete all information in this section of the
questionnaire! Fill in every blank EVEN IF THE
ANSWER IS “0.”
Calculating Your
Incidence Rates

The formula used to calculate the incidence
rates was established by the U.S.
Department of Labor - Bureau of Labor
Statistics.
◦ It’s been around for decades –
it’s THE standard formula for everyone.
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Your rates are compared against the national
average rates for your NAICS code. See Table 1 at
http://www.bls.gov/iif/oshwc/osh/os/ostb3191.pdf
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When an employer calculates the company’s
rates, the answer is a rate of incidents (injuries)
per 200,000 hours (100 people working 8 hours a
day, 50 weeks a year) - regardless of how many
hours the contractor worked!
Sample rate calculations:

In 2006, a company has 1 OSHA recordable
injury which did not involve lost workdays.
The company worked 30,000 hours that
year.
◦ The Total Case Incidence Rate is:
(1 x 200,000) / 30,000 = 6.7
◦ The Lost Workday Case Incidence Rate is:
(0 x 200,000) / 30,000 = 0
◦ The No Lost Workday Case Incidence Rate is:
(1 x 200,000) / 30,000 = 6.7
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A company has 4 OSHA recordable injuries
in a 2008. Three cases were lost-workday
injuries. One case did not involve lost
workdays. The company worked 30,000
hours that year.
◦ The Total Case Incidence Rate is:
(4 x 200,000) / 30,000 = 26.7
◦ The Lost Workday Case Incidence Rate is:
(3 x 200,000) / 30,000 = 20
◦ The No Lost Workday Case Incidence Rate is:
(1 x 200,000) / 30,000 = 6.7
 If
you are a new firm, please add a note
on your forms that informs us of this.
 A new firm will be expected to have
very few, or possibly no, company
hours.
 We will verify this by checking the
effective date of your Contractor’s
License.
Section C: OSHA Citation History
 This
section looks at your firm’s OSHA
citation history.
 It considers 4 types of citations:
◦ serious
◦ willful
◦ failure to abate
◦ repeat.
 You
must report all such citations
that your firm has received.
 If you are contesting or appealing
an applicable citation and it has
not reached final resolution, you
must still report the citation!
 The
classification of the citation itself is
important, but we also look at:
◦ what happened
◦ what corrective action was taken
◦ your firm’s safety program to see
that it meets minimum
Cal/OSHA and Labor Code
requirements
 Citations
are public information.
 Citation information for all employers
is available using the “Establishment
Search” at www.osha.gov
 Your answers will be verified.
◦ We will check back 60 months as
stated in the Questionnaire!
Section D: Safety Policy &
Procedure Questions
 Read
each question carefully.
 The questions are based on
Cal/OSHA and California Labor
Code requirements.
 Understand what it is asking.
◦ The source regulation is listed
with every question (Labor Code
or Cal/OSHA).
 You
may be required to provide
documentation for any or all of
your answers - be prepared!
 A “yes” answer implies that you
have documentation available for
review for that item if you are
asked to provide it!
Certification:
Still have questions?
Here are some sources for additional
information:
Your firm’s Insurance Broker or Insurance
Carrier Loss Control (Safety) Department,
 Cal/OSHA Consultation,
 Trade Associations your firm belongs to,
 Internet construction safety sources

Formal & Subcontractor
Prequalification
Contractor
Applicant
Overview
Prequalification Types

Safety (Informal) Prequalification
◦ Required to bid informal contracts, JOC job
orders, and other projects for which safety
prequalification is required.

Subcontractor Prequalification (MEP)
◦ Required for Mechanical, Electrical, and Plumbing
subcontractors on formal contracts
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Formal Prequalification
Formal & Subcontractor
Prequalification
Questionnaire is designed to thoroughly
evaluate a contractor’s:
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Safety History
Quality and Workmanship
Past Performance
Bonding/Insurance/Licensing
Financial Capabilities
Subcontractor
Prequalification
PCC 20111.6 requirement for Mechanical, Electrical and
Plumbing subcontractors on projects of $1 million or more.
 LAUSD is applying requirement to all formal contracts and
JOC job orders.
 License classes affected:
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C-4 - Boiler, Hot Water
Heating and Steam Fitting
C-7 - Low Voltage Systems
C-10 - Electrical
C-16 - Fire Protection
C-20 - Warm-Air Heating,
Ventilating and AirConditioning
 Does
C-34 - Pipeline
C-36 - Plumbing
C-38 - Refrigeration
C-42 - Sanitation System
C-43 - Sheet Metal
C-46 - Solar
not apply to other license classifications.
Formal Prequalification
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Prequalification program implemented pursuant to PCC
20111.5 and 20919.4.
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Required to bid as a prime contractor on formal
projects, including JOC and 17406
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Assigned a bid rating based on bonding and experience
Formal & Subcontractor
Prequalification
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Complete the most current Prime Contractor
Prequalification Questionnaire or Subcontractor
Prequalification Questionnaire
Have a current and active California Contractors
License
Receive and maintain Safety Approval via the Safety
Prequalification section of the Questionnaire
Meet the Mandatory and General Qualifications
requirements
Provide bonds by a California-admitted surety company
Formal & Subcontractor
Prequalification
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Provide proof of Workers’ Comp and Liability coverage by
an Insurance Company licensed to do business in
California
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Provide references of projects completed within the last
36 months
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Submit a current financial statement (at least balance
sheet and income statement)
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Achieve passing score on PART V. Scorable Questions
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Achieve passing Contractor Performance Score
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Prequalification approval is valid for one (1) year.
THREE LEVELS OF FORMAL
PREQUALIFICATION BASED ON
EXPERIENCE:
Level I
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Entitled to bid on contracts in an amount not to
exceed $350,000.
Non-LAUSD experience: Within the past three (3)
years, at least three (3) public or private works as
either a prime contractor or a subcontractor with
cumulative contract value totaling at least
$500,000.
LAUSD experience: Within the past three (3)
years, at least three (3) LAUSD contracts as either
a prime contractor or a subcontractor, with
cumulative contract value totaling at least
$100,000.
THREE LEVELS OF FORMAL
PREQUALIFICATION BASED ON
EXPERIENCE:
Level II
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Entitled to bid on contracts in an amount not to
exceed $5,000,000.
Non-LAUSD experience: Within the past three (3)
years, at least three (3) public or private works as
either a prime contractor or a subcontractor with
cumulative contract value totaling at least
$2,000,000.
LAUSD experience: Within the past three (3) years,
at least three (3) LAUSD contracts as either a prime
contractor or a subcontractor, with cumulative
contract value totaling at least $500,000.
THREE LEVELS OF FORMAL
PREQUALIFICATION BASED ON
EXPERIENCE:
Level III
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Entitled to bid on contracts in an amount in excess
of $5,000,000.
Non-LAUSD experience: Within the past three (3)
years, at least three (3) public or private works as
either a prime contractor or a subcontractor with
cumulative contract value totaling at least
$10,000,000.
LAUSD experience: Within the past three (3) years,
at least three (3) LAUSD contracts as either a prime
contractor or a subcontractor, with cumulative
contract value totaling at least $7,000,000.
Contractor Performance
Score
Contractor performance history will be measured
according to two separate components, Field and
Compliance.
Field Component (Maximum Score 50, Passing
Score 35)
◦ Average score of Contractor Performance
Evaluations for the last three (3) LAUSD contracts.
◦ Applicant must receive an average score of at least
35 points to prequalify.
Compliance Component (Maximum Score 50,
Passing Score 35):
1.Labor Compliance
2.Project Stabilization Agreement (PSA)
3.Bid Issues/Protests
4.Assessments
5.Failure to comply with LAUSD contract Warranty
requirements
For details, see Field and Compliance Scoring Summary
on the Prequalification web page at
http://www.laschools.org/new-site/prequalification/forms
QUESTIONS???