S.B. 23

1

SCHOOL CONSTRUCTION AMENDMENTS
2 2014 GENERAL SESSION
3 STATE OF UTAH
4 Chief Sponsor: Scott K. Jenkins
5 House Sponsor: Gage Froerer
6
7 LONG TITLE
8 Committee Note:
9 The Government Operations Interim Committee recommended this bill.
10 General Description:
11 This bill amends certain provisions related to the procurement process for public school
12 construction.
13 Highlighted Provisions:
14 This bill:
15 . defines terms;
16 . requires a local education agency to follow the Utah Procurement Code when
17 constructing a public school or public school facility;
18 . requires a local education agency to follow certain retention requirements if the
19 local education agency chooses to withhold a portion of the contract price until the
20 project is completed;
21 . amends certain procurement code definitions related to public schools; and
22 . makes technical changes.
23 Money Appropriated in this Bill:
24 None
25 Other Special Clauses:
26 None
27 Utah Code Sections Affected:

28 AMENDS:
29 53A-20-101 , as last amended by Laws of Utah 2012, Chapters 86 and 347
30 63G-6a-103 , as last amended by Laws of Utah 2013, Chapter 445
31
32 Be it enacted by the Legislature of the state of Utah:
33 Section 1. Section 53A-20-101 is amended to read:
34 53A-20-101. Construction and alteration of public schools and other public
35 school facilities.
36 (1) As used in this section[, the word "sealed" does not preclude acceptance of
37 electronically sealed and submitted bids or proposals in addition to bids or proposals manually
38 sealed and submitted.]:
39 (a) "Construction" has the same meaning as defined in Section 63G-6a-103 .
40 (b) "Local education agency" or "LEA" means a school district, charter school, or the
41 Utah Schools for the Deaf and the Blind.
42 (2) Except as provided in Subsection (4), the design, construction, and maintenance
43 projects for a public school or other public school facility shall follow all procurement, source
44 selection, construction, public notice, and contracting procedures provided in Title 63G,
45 Chapter 6a, Utah Procurement Code.
46 [(2) (a) Prior to the construction of any school or the alteration of any existing school
47 plant, if the total estimated accumulative building project cost exceeds $80,000, a local school
48 board shall advertise for bids on the project at least 10 days before the bid due date.]
49 [(b) The board shall have the advertisement published in a newspaper having general
50 circulation throughout the state and in appropriate construction trade publications that offer
51 free listings.]
52 [(c) A similar advertisement is required in a newspaper published or having general
53 circulation in any city or county that would be affected by the proposed project.]
54 [(d) The advertisement shall:]
55 [(i) require sealed proposals for the building project in accordance with plans and
56 specifications furnished by the local school board;]
57 [(ii) state where and when the proposals will be opened and shall reserve the right of
58 the board to reject any and all proposals; and]

59 [(iii) require a certified check or bid bond of not less than 5% of the bid to accompany
60 the bid.]
61 [(3) (a) The board shall meet at the time and place specified in the advertisement and
62 publicly open and read all received proposals.]
63 [(b) If satisfactory bids are received, the board shall award the contract to the lowest
64 responsible bidder.]
65 [(c) If none of the proposals are satisfactory, all shall be rejected.]
66 [(d) The board shall again advertise in the manner provided in this section.]
67 [(e) If, after advertising a second time no satisfactory bid is received, the board may
68 proceed under its own direction with the required project.]
69 [(4) (a) The check or bond required under Subsection (2)(d) shall be drawn in favor of
70 the local school board.]
71 [(b) If the successful bidder fails or refuses to enter into the contract and furnish the
72 additional bonds required under this section, then the bidder's check or bond is forfeited to the
73 district.]
74 [(5) A local school board shall require payment and performance bonds of the
75 successful bidder as required in Section 63G-6a-1103 .]
76 [(6)] (3) (a) [A local school board] An LEA may require in the proposed contract that
77 up to 5% of the contract price be withheld in retention until the project is completed and
78 accepted by the [board] LEA.
79 (b) All money held in retention by an LEA shall be retained in accordance with the
80 requirements of Section 13-8-5 .
81 [(b) If money is withheld, the board shall place it in an interest bearing account, and the
82 interest accrues for the benefit of the contractor and subcontractors.]
83 [(c) This money shall be paid upon completion of the project and acceptance by the
84 board.]
85 [(7) (a) A local school board may not bid on projects within the district if the total
86 accumulative estimated cost exceeds $80,000.]
87 [(b) The board may use its resources if no satisfactory bids are received under this
88 section.]
89 [(8) If the local school board determines in accordance with Section 63G-6a-1302 to

90 use a construction manager/general contractor as its method of construction contracting
91 management on projects where the total estimated accumulative cost exceeds $80,000, it shall
92 select the construction manager/general contractor in accordance with the requirements of Title
93 63G, Chapter 6a, Utah Procurement Code.]
94 [(9) A local school board member may not have a direct or indirect financial interest in
95 the construction project contract.]
96 (4) (a) An LEA may self-perform work on a construction project up to $100,000.
97 (b) A construction project over $100,000 shall be procured in accordance with the
98 requirements of Title 63G, Chapter 6a, Utah Procurement Code.
99 Section 2. Section 63G-6a-103 is amended to read:
100 63G-6a-103. Definitions.
101 As used in this chapter:
102 (1) "Architect-engineer services" means:
103 (a) professional services within the scope of the practice of architecture as defined in
104 Section 58-3a-102 ; or
105 (b) professional engineering as defined in Section 58-22-102 .
106 (2) "Bidder" means a person who responds to an invitation for bids.
107 (3) "Change directive" means a written order signed by the procurement officer that
108 directs the contractor to suspend work or make changes, as authorized by contract, without the
109 consent of the contractor.
110 (4) "Change order" means a written alteration in specifications, delivery point, rate of
111 delivery, period of performance, price, quantity, or other provisions of a contract, upon mutual
112 agreement of the parties to the contract.
113 (5) "Chief procurement officer" means the chief procurement officer appointed under
114 Subsection 63G-6a-302 (1).
115 (6) (a) "Construction" means the process of building, renovating, altering, improving,
116 or repairing a public building or public work.
117 (b) "Construction" does not include the routine operation, routine repair, or routine
118 maintenance of an existing structure, building, or real property.
119 (7) (a) "Construction manager/general contractor" means a contractor who enters into a
120 contract for the management of a construction project when the contract allows the contractor

121 to subcontract for additional labor and materials that are not included in the contractor's cost
122 proposal submitted at the time of the procurement of the contractor's services.
123 (b) "Construction manager/general contractor" does not include a contractor whose
124 only subcontract work not included in the contractor's cost proposal submitted as part of the
125 procurement of the contractor's services is to meet subcontracted portions of change orders
126 approved within the scope of the project.
127 (8) "Contract" means an agreement for the procurement or disposal of a procurement
128 item.
129 (9) "Contractor" means a person who is awarded a contract with a procurement unit.
130 (10) "Cooperative procurement" means procurement conducted by, or on behalf of,
131 more than one procurement unit, or by a procurement unit and an external procurement unit.
132 (11) "Cost-plus-a-percentage-of-cost contract" means a contract where the contractor is
133 paid a percentage over and above the contractor's actual expenses or costs.
134 (12) "Cost-reimbursement contract" means a contract under which a contractor is
135 reimbursed for costs which are allowed and allocated in accordance with the contract terms and
136 the provisions of this chapter, and a fee, if any.
137 (13) "Days" means calendar days, unless expressly provided otherwise.
138 (14) "Definite quantity contract" means a fixed price contract that provides for the
139 supply of a specified amount of goods over a specified period, with deliveries scheduled
140 according to a specified schedule.
141 (15) "Design-build" means the procurement of architect-engineer services and
142 construction by the use of a single contract with the design-build provider.
143 (16) "Director" means the director of the division.
144 (17) "Established catalogue price" means the price included in a catalogue, price list,
145 schedule, or other form that:
146 (a) is regularly maintained by a manufacturer or contractor;
147 (b) is either published or otherwise available for inspection by customers; and
148 (c) states prices at which sales are currently or were last made to a significant number
149 of any category of buyers or buyers constituting the general buying public for the supplies or
150 services involved.
151 (18) "Fixed price contract" means a contract that provides a price, for each

152 procurement item obtained under the contract, that is not subject to adjustment except to the
153 extent that:
154 (a) the contract provides, under circumstances specified in the contract, for an
155 adjustment in price that is not based on cost to the contractor; or
156 (b) an adjustment is required by law.
157 (19) "Fixed price contract with price adjustment" means a fixed price contract that
158 provides for an upward or downward revision of price, precisely described in the contract, that:
159 (a) is based on the consumer price index or another commercially acceptable index,
160 source, or formula; and
161 (b) is not based on a percentage of the cost to the contractor.
162 (20) (a) "Grant" means furnishing, by a public entity or by any other public or private
163 source, financial or other assistance to a person to support a program authorized by law.
164 (b) "Grant" does not include:
165 (i) an award whose primary purpose is to procure an end product or procurement item;
166 or
167 (ii) a contract that is awarded as a result of a procurement or a procurement process.
168 (21) "Head of a procurement unit" means:
169 (a) as it relates to a legislative procurement unit, any person designated by rule made
170 by the applicable rulemaking authority;
171 (b) as it relates to an executive branch procurement unit:
172 (i) the director of a division; or
173 (ii) any other person designated by the board, by rule;
174 (c) as it relates to a judicial procurement unit:
175 (i) the Judicial Council; or
176 (ii) any other person designated by the Judicial Council, by rule;
177 (d) as it relates to a local government procurement unit:
178 (i) the legislative body of the local government procurement unit; or
179 (ii) any other person designated by the local government procurement unit;
180 (e) as it relates to a local district, the board of trustees of the local district or a designee
181 of the board of trustees;
182 (f) as it relates to a special service district, the governing body of the special service

183 district or a designee of the governing body;
184 (g) as it relates to a local building authority, the board of directors of the local building
185 authority or a designee of the board of directors;
186 (h) as it relates to a conservation district, the board of supervisors of the conservation
187 district or a designee of the board of supervisors;
188 (i) as it relates to a public corporation, the board of directors of the public corporation
189 or a designee of the board of directors;
190 (j) as it relates to a school district or any school or entity within a school district, the
191 local school board of the school district, or the local school board's designee;
192 (k) as it relates to a charter school, the [individual or body] charter school governing
193 board with executive authority over the charter school, or the [individual's or body's] charter
194 school governing board's designee;
195 (l) as it relates to an institution of higher education of the state, the president of the
196 institution of higher education, or the president's designee; or
197 (m) as it relates to a public transit district, the board of trustees or a designee of the
198 board of trustees.
199 (22) "Indefinite quantity contract" means a fixed price contract that:
200 (a) is for an indefinite amount of procurement items to be supplied as ordered by a
201 procurement unit; and
202 (b) (i) does not require a minimum purchase amount; or
203 (ii) provides a maximum purchase limit.
204 (23) "Independent procurement authority" means authority granted to a procurement
205 unit, under Subsection 63G-6a-108 (2), to engage in a procurement without oversight or control
206 of the division.
207 (24) "Invitation for bids" includes all documents, including documents that are attached
208 or incorporated by reference, used for soliciting bids to provide a procurement item to a
209 procurement unit.
210 (25) "Issuing procurement unit" means:
211 (a) the division, if the division issues the invitation for bids or the request for
212 proposals; or
213 (b) the procurement unit, with independent procurement authority, that issues the

214 invitation for bids or the request for proposals.
215 (26) "Labor hour contract" is a contract where:
216 (a) the supplies and materials are not provided by, or through, the contractor; and
217 (b) the contractor is paid a fixed rate that includes the cost of labor, overhead, and
218 profit for a specified number of labor hours or days.
219 (27) "Multiple award contracts" means the award of a contract for an indefinite
220 quantity of a procurement item to more than one bidder or offeror.
221 (28) "Multiyear contract" means a contract that extends beyond a one-year period,
222 including a contract that permits renewal of the contract, without competition, beyond the first
223 year of the contract.
224 (29) "Municipality" means a city or a town.
225 (30) "Offeror" means a person who responds to a request for proposals.
226 (31) "Preferred bidder" means a bidder that is entitled to receive a reciprocal preference
227 under the requirements of this chapter.
228 (32) (a) "Procure" or "procurement" means buying, purchasing, renting, leasing, leasing
229 with an option to purchase, or otherwise acquiring a procurement item.
230 (b) "Procure" or "procurement" includes all functions that pertain to the obtaining of a
231 procurement item, including:
232 (i) the description of requirements;
233 (ii) the selection process;
234 (iii) solicitation of sources;
235 (iv) the preparation for soliciting a procurement item;
236 (v) the award of a contract; and
237 (vi) all phases of contract administration.
238 (33) "Procurement item" means a supply, a service, construction, or technology.
239 (34) "Procurement officer" means:
240 (a) as it relates to a procurement unit with independent procurement authority:
241 (i) the head of the procurement unit;
242 (ii) a designee of the head of the procurement unit; or
243 (iii) a person designated by rule made by the applicable rulemaking authority; or
244 (b) as it relates to the division or a procurement unit without independent procurement

245 authority, the chief procurement officer.
246 (35) "Professional service" means a service that requires a high degree of specialized
247 knowledge and discretion in the performance of the service, including:
248 (a) legal services;
249 (b) consultation services;
250 (c) architectural services;
251 (d) engineering;
252 (e) design;
253 (f) underwriting;
254 (g) bond counsel;
255 (h) financial advice;
256 (i) construction management;
257 (j) medical services;
258 (k) psychiatric services; or
259 (l) counseling services.
260 (36) "Protest officer" means:
261 (a) as it relates to the division or a procurement unit with independent procurement
262 authority:
263 (i) the head of the procurement unit;
264 (ii) a designee of the head of the procurement unit; or
265 (iii) a person designated by rule made by the applicable rulemaking authority; or
266 (b) as it relates to a procurement unit without independent procurement authority, the
267 chief procurement officer or the chief procurement officer's designee.
268 (37) "Request for information" means a nonbinding process where a procurement unit
269 requests information relating to a procurement item.
270 (38) "Request for proposals" includes all documents, including documents that are
271 attached or incorporated by reference, used for soliciting proposals to provide a procurement
272 item to a procurement unit.
273 (39) "Requirements contract" means a contract:
274 (a) where a contractor agrees to provide a procurement unit's entire requirements for
275 certain procurement items at prices specified in the contract during the contract period; and

276 (b) that:
277 (i) does not require a minimum purchase amount; or
278 (ii) provides a maximum purchase limit.
279 (40) "Responsible" means that a bidder or offeror:
280 (a) is capable, in all respects, to fully perform the contract requirements solicited in an
281 invitation for bids or a request for proposals; and
282 (b) has the integrity and reliability to ensure good faith performance.
283 (41) "Responsive" means that a bidder or offeror submits a response to an invitation for
284 bids or a request for proposals that conforms in all material respects to the invitation for bids or
285 request for proposals.
286 (42) "Sealed" means manually or electronically sealed and submitted bids or proposals.
287 (43) (a) "Services" means the furnishing of labor, time, or effort by a contractor, not
288 involving the delivery of a specific end product other than a report that is incidental to the
289 required performance.
290 (b) "Services" does not include an employment agreement or a collective bargaining
291 agreement.
292 (44) "Specification" means any description of the physical or functional characteristics,
293 or nature of a procurement item included in an invitation for bids or a request for proposals, or
294 otherwise specified or agreed to by a procurement unit, including a description of:
295 (a) a requirement for inspecting or testing a procurement item; or
296 (b) preparing a procurement item for delivery.
297 (45) "Standard procurement process" means one of the following methods of obtaining
298 a procurement item:
299 (a) bidding, as described in Part 6, Bidding;
300 (b) request for proposals, as described in Part 7, Request for Proposals; or
301 (c) small purchases, in accordance with the requirements established under Section
302 63G-6a-408 .
303 (46) "State cooperative contract" means a contract awarded by the division.
304 (47) (a) "Subcontractor" means a person under contract with a contractor or another
305 subcontractor to provide services or labor for design or construction.
306 (b) "Subcontractor" includes a trade contractor or specialty contractor.

307 (c) "Subcontractor" does not include a supplier who provides only materials,
308 equipment, or supplies to a contractor or subcontractor.
309 (48) "Supplies" means all property, including equipment, materials, and printing.
310 (49) "Tie bid" means that the lowest responsive and responsible bids are identical in
311 price.
312 (50) "Time and materials contract" means a contract where the contractor is paid:
313 (a) the actual cost of direct labor at specified hourly rates;
314 (b) the actual cost of materials and equipment usage; and
315 (c) an additional amount, expressly described in the contract, to cover overhead and
316 profit, that is not based on a percentage of the cost to the contractor.




Legislative Review Note
as of 10-16-13 2:35 PM

Office of Legislative Research and General Counsel