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HomeMy WebLinkAbout2005 08 08 Informational Item 304- Capital Proj Coordinator Response to Questions for Bid Bonds etc. COMMISSION AGENDA ITEM 304 CONSENT INFORMATIONAL X PUBLIC HEARING REGULAR August 8, 2005 Meeting MGR /~EPT /~ Authorization REQUEST: The Capital Project Coordinator responding to the City Commission's questions regarding requirements for Bid Bonds, Payment and Performance Bonds and other Contract Requirements as required by City Policy/Code/Ordinance and State Statutes. PURPOSE: The purpose of this Agenda Item is to respond to questions asked by the City Commission regarding bid requirements and why there are occasions where no bids or only one bid is received CONSIDERA nONS: The Commission asked staff on July 11 th whether City bid requirements were limiting the quantity of bidders for city projects. This question arose because the City sometimes receives no bids or only one bid for contracts advertised by the City of Winter Springs as was the instance with the advertisement of the Parks and Recreation Departments Invitation to Bid for the construction of backstops in the Central Winds Park expansion. Mr. Pula responded that for smaller jobs many contractors do not have the means to secure the required bonds or meet the other requirements of city contracts. To further expand on this, many small contractors have a difficult time getting a payment and performance bond in a very restrictive bond market at present time. Other contractors are hesitant to enter into a contract with the City due to the size and detail of the contracts for the smaller contracts. Our contracts for construction are detailed to prevent mis-interpretation that can lead to costly change orders. On previous advice from the City Attorney's office, construction contracts require a payment and performance bond for all works. Informational Agenda Item A August 8, 2005 Page 2 In response to Commissioner Blake's question on the legal requirement for the bond specified as requirements of city construction contracts, Attachment A summarizes Florida State Statutes in regards to contract for public works. Staff would not recommend any changes to the bidding requirements at this time. FUNDING: N/A ATTACHMENTS: 1. Public Contracts, Bids and Bond Summary COMMISSION ACTION: Information Agenda Item August 8, 2005 Attachment A Public Contracts and Bond Summary Rea........... ...CitYQ~~~ $tate .-.. Purchase any commodity City Manager approval. Can be sole/single source Ordinance No. 2005-15 or service less than or advertised $12500 Purchase any commodity Commission approval required Ordinance No. 2005-15 or service more than $12,500 Public Works (Utility) Bond required F.S. Section 180.24 construction less than $25,000 Public Works (Utility) Bond required, advertised at least once each F.S. Section 180.24 construction in excess of week for two consecutive weeks with at least ten $25,000 days between the first advertisement and the date of receMng bids. Advertising requirements under this section are superseded by those under Section 255.0525. Any construction project Advertised at least once 21 days prior to bid F.S Section 255.0525 (2) more than $200,000 but opening and at least 5 days prior to any pre-bid less than $500,00 conference. Any construction project Advertised at least once 30 days prior to bid F.S Section 255.0525 (2) more than $500,00 opening and at least 5 days prior to any pre-bid conference. Contractor Bonds Any formal contract for the construction of a F.S. Section 255.05 public building or public work requires a payment and performance bond. At the discretion of the person or board awarding a contract for less than $200,000 can be exempted from the payment and performance bond. In lieu of the bond reuirement of this section, the contractor may file an alternative form of security in the form of cash, money order, a certified check, a cashiers check, an irrevocable letter of credit. Bid Bonds Whenever any form of bid specifies a bond, such F.S. Section 255.051 requirement can be satisfied by the bidder in the form of cashier's check, treasurers check or bank draft Competitive Bids Must competitively award construction projects F.S. Section 255.2 more than $200,000 ($50,000 for electrical work) from proposals submitted in a sealed bid. This includes construction management services, design/build contracts, continuation contracts based on unit prices or any other contract with a private sector contractor. For bridges, roads, streets, highways and services incidental thereto, at cost of more than $250,000 a municipality may require certified or qualified bidders only. These provisions do not apply when no bids are received, when the fund source will be diminished or lost because of the time required to competitively bid and award the contract, or when a contractor for a competitively bid contract abandons a job prior to completion.