HF 564 — A bill relating to contracts for the construction of public improvements
Overview
HF 564, introduced February 24, 2025, would modify how governmental entities award contracts for public improvement projects that use construction manager-at-risk (CMAR) delivery. The bill changes bidding preferences, increases transparency in plans and specifications for certain cost levels, and clarifies bid-contingency handling. It is currently in a legislative subcommittee (Kaufmann, Bossman, and Cooling).
Purpose and intent
- Align CMAR contract awards with a lowest-cost proposal standard based on published criteria.
- Repeal or modify provisions that allow awarding based on “best value” rather than strictly lowest cost per published criteria.
- Improve project transparency when project costs exceed certain bid thresholds by ensuring plans and specifications are prepared and publicly available.
Key provisions
1) Contingent bids rejected
- Any bid that includes a contingent amount must be rejected.
2) Lowest-cost selection for CMAR
- A governmental entity or its representative must select the construction manager-at-risk that submits the lowest cost proposal, based on the published selection criteria and its ranking evaluation.
- This change replaces the prior approach of selecting based on “best value.”
3) Limitation on best-value considerations
- The bill strikes the requirement that the governmental entity consider whether awarding to the CMAR who was not the apparent lowest bid would be in the best interest of the project.
4) Plans and specifications when costs exceed threshold
- If the estimated cost of trade contract work and materials packages exceeds the adjusted competitive bid threshold, the CMAR must direct the designated licensed engineer, architect, or landscape architect to prepare and make available plans and specifications for the public improvement project.
Affected entities and roles
- Governmental entities (cities, counties, school districts, state agencies, and other public bodies) that undertake public improvement projects.
- Construction managers-at-risk (CMARs) bidding on these projects.
- Design professionals (licensed engineers, architects, and landscape architects) whose plans and specifications would be prepared and made available under the threshold provision.
- Bidders responding to CMAR solicitations, particularly those proposing contingent bids or attempting to leverage “best value” considerations.
Procedural and timeline aspects
- Introduced: February 24, 2025.
- Subcommittee action: February 25, 2025 (Kaufmann, Bossman, Cooling).
- Primary referral: State Government.
- Status: In subcommittee as of the latest action noted.
Sponsorship
- Primary: GOSA
- Primary: Barker
Potential impact and considerations
- Procurement approach: The shift to strictly lowest-cost selection for CMAR proposals may reduce flexibility to optimize total project outcomes (schedule, risk, lifecycle costs) that might be captured under a best-value framework.
- Contingency bids: Rejection of bids with contingencies could lead bidders to submit contingency-free proposals, potentially affecting apparent bid prices and project budgeting.
- Transparency: Requiring plans and specifications to be prepared and publicly available when costs exceed a threshold enhances public access to project scope and design details.
- Thresholds: The bill references an “adjusted competitive bid threshold” without providing numeric values in the excerpt. The practical effect will depend on how that threshold is defined in the final text or accompanying administrative rules.
Note: The summary reflects the provisions available in the introduced text excerpt. The full bill text may contain additional provisions or clarifications.
