DAR File No. 29184

Transportation, Operations, Construction

R916-2-3

Prequalification Policy

NOTICE OF PROPOSED RULE

DAR File No.: 29184
Filed: 11/01/2006, 12:11
Received by: NL

RULE ANALYSIS

Purpose of the rule or reason for the change:

This amendment is designed to eliminate the need for prequalification for projects for less than $1,500,000.

Summary of the rule or change:

The amendment eliminates the prequalification step for companies interested in bidding on projects worth less than $1,500,000 from $500,000.

State statutory or constitutional authorization for this rule:

Section 72-1-201

Anticipated cost or savings to:

the state budget:

This should save money in the state budget because it will eliminate the work associated with processing and reviewing prequalification documents. It is impossible to know how much that might be.

local governments:

This rule does not apply to local governments because it only deals with the state process.

other persons:

This should save money for private parties because the number of prequalifications that they have to go through will be reduced or eliminated for some smaller firms.

Compliance costs for affected persons:

There will be no costs for affected persons because they won't have to pay anything. In fact, they will save money because they will no longer have to go through a prequalification process.

Comments by the department head on the fiscal impact the rule may have on businesses:

There should be nothing but a positive fiscal impact on business. John R. Njord, Executive Director

The full text of this rule may be inspected, during regular business hours, at the Division of Administrative Rules, or at:

Transportation
Operations, Construction
CALVIN L RAMPTON COMPLEX
4501 S 2700 W
SALT LAKE CITY UT 84119-5998

Direct questions regarding this rule to:

James Beadles at the above address, by phone at 801-965-4168, by FAX at 801-965-4796, or by Internet E-mail at jbeadles@utah.gov

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

12/15/2006

This rule may become effective on:

12/22/2006

Authorized by:

John R. Njord, Executive Director

R916. Transportation, Operations, Construction.

R916-2. Prequalification of Contractors.

R916-2-3. Prequalification Policy.

(1) Contractors desiring to submit bid proposals for construction contracts shall be prequalified by the department to ensure they have the resources and capability to successfully complete awarded contracts. Prequalification of contractors is not required for contracts that have an advertised estimate under $1,500,000[500,000].

(2) Qualification ratings establish the type of construction work contractors may be permitted to perform and the maximum dollar value of contracts they are allowed to undertake at any one time.

(3) Contractors who attain a total prequalification of $50,000,000 shall be classified as unlimited. Each contractor's prequalification shall be reviewed at least annually; more often if circumstances so warrant.

(4) Qualification ratings shall be based on evaluation of the contractor's:

(a) experience;

(b) past performance; and

(c) analysis of certified audited financial statements, including balance sheet, income statements, and changes in financial condition.

(i) Unaudited financial statements accompanied by the company federal income tax return for the same time period may be accepted in lieu of the required certified audited financial statements, however, this shall result in a lower prequalification rating.

(5) Each bid proposal submitted shall include a complete "Status of Work Under Contract" form. The form shall include all work presently the responsibility of said contractor, both in and out of the state of Utah.

(a) Contractors with a prequalification amount classified as unlimited are exempt from this requirement.

(6) This policy shall be administered to ensure adequate competition in bidding for construction contracts.

 

KEY: bids, contracts, prequalification

Date of Enactment or Last Substantive Amendment: [1994]2006

Notice of Continuation: January 18, 2002

Authorizing, and Implemented or Interpreted Law: 72-1-102; 72-1-201; 63-56-13(3)