Rule Chapter 14-79, F.A.C., is being amended to update, reorganize, and clarify the Construction Management Development Program and Bond Guarantee Program.

DEPARTMENT OF TRANSPORTATION

Rule No.: RULE TITLE
14-79.006: Construction Management Development Program
PURPOSE AND EFFECT: Rule Chapter 14-79, F.A.C., is being amended to update, reorganize, and clarify the Construction Management Development Program and Bond Guarantee Program.
SUMMARY: The Construction Management Development Program and Bond Guarantee Program requirements are addressed.
SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS: No Statement of Estimated Regulatory Cost was prepared.
Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.
SPECIFIC AUTHORITY: 334.044(2), 339.0805 FS.
LAW IMPLEMENTED: 334.044(28), 337.141, 339.0805 FS.
IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE SCHEDULED AND ANNOUNCED IN FAW.
THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Deanna R. Hurt, Assistant General Counsel and Clerk of Agency Proceedings, Florida Department of Transportation, Office of the General Counsel, 605 Suwannee Street, Mail Station 58, Tallahassee, Florida 32399-0458

THE FULL TEXT OF THE PROPOSED RULE IS:

14-79.006 Construction Management Development Program.

This rule implements a voluntary, comprehensive Construction Management Development Program (CMDP) for Disadvantaged Business Enterprises (DBE) and other small businesses. The CMDP and establishes a program to provide for providing financial assistance to DBEs Disadvantaged Business Enterprises through a Bond Guarantee Program (BGP).

(1) For the purpose of administering this program, the following definitions shall apply:

(a) “Bond Guarantee Program” or “BGP” means a plan program in which the state will act as a secondary surety for a DBE Disadvantaged Business Enterprises.

(b) “Certification of Proficiency” means a certificate awarded to those contractors meeting the minimum curriculum standards of ability proficiency.

(c) “Certified Small Business” means a small business which has been approved by the Department or its Contracted Service Provider as meeting the statutory criteria to participate in the CMDP Construction Management Development Program.

(d) “Construction Management Development Program” or “CMDP” means an original course program of instruction taught to groups of individuals who are owners of DBEs Disadvantaged Business Enterprises or Ccertified Ssmall Bbusinesses to enhance, improve, or develop the skills needed to successfully perform construction projects. This course program shall consist of classroom instruction and on-the-job instruction.

(e) “Department” means the Florida Department of Transportation.

(f)(e) “Disadvantaged Business Enterprise” or “DBE” means a small business concern which has been certified under the Florida Unified Certification Program as a Disadvantaged Business Enterprise by either the Department pursuant to Rule Chapter 14-78 or the United States Small Business Administration.

(g)(f) “Minimum Curriculum Standards of Proficiency” means the requirements established as the lowest level of knowledge and ability minimum requirements that a contractor must attain in to demonstrate proficiency and capability regarding the instruction received through the classroom instruction portion of the CMDP Construction Management Development Program.

(h)(g) “Small Business” means any firm with annual gross receipts which do not exceed two million dollars averaged over the previous three year period.

(2) Construction Management Development Program/ Bond Guarantee Program Application.

(a) Disadvantaged Business Enterprises (DBE). All DBE firms seeking admission to the Construction Management Development Program/Bond Guarantee Program (CMDP/BGP) shall complete and submit an Application For Construction Management Development Program (CMDP) and Bond Guarantee Program (BGP), FDOT Form 275-030-070, Rev. 06/10, incorporated herein by reference, a CMDP/BGP Application to the Department of Transportation, Equal Opportunity Office, Mail Station 65, 605 Suwannee Street, Tallahassee, Florida 32399-0450.

(b) Small Businesses. Any firm seeking classification certification as a Certified Small Business in order to participate in the CMDP Construction Management Development Program shall complete and submit an Application for a Small Business Certification (SBC), FDOT Form 275-030-071, Rev. 06/10, incorporated herein by reference, and CMDP Application to the Department of Transportation, Bureau of Equal Opportunity Office, Mail Station 65, 605 Suwannee Street, Tallahassee, Florida 32399-0450.

(c) The CMDP applicant may also request exemption from the classroom and on-the-job instruction.

(3) Needs Assessments.

(a) Within 90 days of receipt of the CMDP/BGP application, the Department or its Contracted Service Provider will shall conduct a needs assessment of the Certified Small Business/Disadvantaged Business Enterprise. The purpose of the assessment shall be to:

1. Determine the applicant’s areas of strengths and weaknesses of the applicant in terms of proficiency and capability to perform in performing on highway construction and transportation support related projects;

2. Identify those applicants who should receive an exemption from the CMDP Construction Management Development Program because of demonstrated satisfactory project performance. This determination will be based on a scoring system which evaluates evaluation of the applicant on the scoring system in this rule using the following sources:

a. Needs assessment report;,

b. Application;,

c. Document(s) accompanying application;,

d. Interviews with the applicant;,

e. Interviews with the Department staff familiar with the applicant’s work;,

f. Review of applicant’s past performance record from the Department’s Department records and reference;, and

g. Any other reports or information that inform about the applicant’s performance and capacity.;

3. Determine the specific courses for which the applicant should register in order to improve skills and correct weaknesses or deficiencies; and

4. Identify areas of need for technical assistance through on-the-job training.

(b) Within 45 days of after completion of the needs assessment, each applicant will shall be notified in writing of the findings and recommendations of the needs assessment.

(4) Eligibility for the CMDP Construction Management Development Program. Participants in the CMDP Construction Management Development Program will consist of those DBEs and Certified Small Businesses, which have obtained a needs assessment by the Department or its Contracted Service Provider. This program will consist of two primary components: Classroom Instruction and On-the-Job Instruction.

(5) To enroll in the CMDP, each applicant shall submit a completed application form to the Department or its Contracted Service Provider along with the appropriate application fees set by the Department.

(a) The Department or its Contracted Service Provider shall forward written notification to the educational institution conducting the classroom instruction advising to advise of the applicant’s approval to register. It will be the applicant’s responsibility to complete registration and pay registration fees as required by the institution.

(b) Each institution conducting classroom instruction will submit completed registration information to the Department or its Contracted Service Provider.

(6) Classroom Instruction shall include instruction in project planning methods for identifying manpower, equipment, and financial resource needs; bookkeeping; project scheduling; state bidding and bonding requirements; state and federal tax requirements; strategies for obtaining loans and surety bonding; and techniques for negotiating and drafting joint venture agreements.

(a) A classroom curriculum will be established by the Department or its Contracted Service Provider in conjunction with the State University System, the community college system, school district vocational technical centers, or a private consultant firm.

(b) Classes, course requirements, and class testing requirements shall be established by the educational institutions.

(c) Conduct of Classroom Instruction.

1. The Department or its Contracted Service Provider will approve the number of courses and types of courses that shall compose a complete program of instruction, by trade or profession, for DBEs desiring admission to the Bond Guarantee Program. Satisfactory Ccompletion of the classroom curriculum will be required of all applicants for the Bond Guarantee Program which have not received an exemption from the CMDP.

2. Curriculum Standards. The Department or its Contracted Service Provider shall approve the program of courses established by the educational institutions and/or private sector firms for specific trade and professional groups that must be successfully completed (to meet minimum curriculum standards of proficiency) in order to receive a certificate of proficiency for each definitive group. Those groups shall include:

a. General contractors, highway construction;

b. Special trade/professional contractors, including asphalt paving, building, construction/modification, concrete, miscellaneous, drainage, earthwork, erosion control, fencing, guardrail, landscaping, painting, steel, traffic control, trucking, architecture, business and financial management, consultants, and materials supply.

(d) Follow-up of Classroom Instruction. Participants who desire to take additional classroom instruction will be permitted to do so without paying an additional application fee, however, but all course registration fees will have to be paid.

(7) On-the-Job Instruction. On-the-job instruction shall also be known as technical assistance. The instruction shall include the following areas: setting up the job site; cash flow method; project scheduling; making quantity take-offs and cost estimating; reading plans and specifications; Department procedures on billing and payments; quality assessment and control methods; and bid preparation methods.

(a) Initiating Procedure. As a result of the needs assessments or classroom instruction, areas of deficiency shall be identified for which technical assistance may be appropriate. Any participant in the CMDP may also request technical assistance in any area of training provided as part of the program.

(b) Technical Assistance Plans.

1. Upon receipt of the Ttechnical Aassistance Rrequest, FDOT Form 275-030-073, Rev. 06/10, incorporated herein by reference, from a participant, the Department or its Contracted Service Provider shall review the request and develop a technical assistance plan. The That plan shall will contain the following information:

a. Approach to resolving the problem.

b. The type of training required to resolve the problem.

c. The number of technical assistance days (eight hours per day) estimated to resolve the problem.

d. Cost of assistance.

2. The Department or its Contracted Service Provider shall submit a plan to the participant within 30 days of receiving the request for technical assistance. Upon payment of the required fee, the Department or its Contracted Service Provider shall assign a consultant or Ddepartment employee to provide the technical assistance at the participant’s place of business or jobsite.

3. Upon completion of the needs assessment which identified areas of needed technical assistance, or receipt of information from an institution providing classroom instruction, that a participant is in need of technical assistance in certain delineated areas, the Department or its Contracted Service Provider shall review the information and develop a technical assistance plan to address the identified needs. The That plan will contain the following information:

a. Approach to resolving the problem.

b. The type of training required to resolve the problem.

c. The number of technical assistance days (eight hours per day) estimated to resolve the problem.

d. Cost of assistance.

(8) Exemption from the CMDP Construction Management Development Program.

(a) The Department or its Contracted Service Provider shall determine exemption from the classroom and on-the-job training based on an evaluation of the applicant’s project performance compared through comparison with the minimum curriculum standards of proficiency. Evaluation shall be based on the following scoring system:

1. Administration/Management of Business – Maximum 15 Points

a. Holds all relevant licenses and meets all other legal requirements regarding firm’s his business.

b. Shows the capability to develop an overall business plan.

c. Produces the firm’s credit history of the firm.

d. Maintains adequate staff and employees required to carry out the work associated with the firm’s business.

e. Maintains a payroll system set up to feed accurate and complete information into the job costing system.

f. Able to generate accurate financial statements in accordance with generally accepted accounting principles.

g. Has policies and procedures regarding timely billing and collection from customers.

2. Bidding/Estimates – Maximum 20 Points

a. Demonstrates an understanding of to implement all requisite steps in the preparation of Department bids.

b. Demonstrates competence in accurately estimating project cost accurately.

3. Contract Negotiating and Knowledge – Maximum 15 Points

a. Demonstrates an understanding of contract terms concerning the rights, obligations, and liabilities for the Small Businesses/Disadvantaged Business Enterprises.

b. Demonstrates an understanding of the basic elements of Department contracts.

c. Demonstrates an ability to adequately negotiate, draft, and interpret subcontracts.

4. Project Planning – Maximum 20 Points

a. Demonstrates capability in scheduling and phasing the work of a project, and in allocating manpower to timely complete projects the project.

b. Demonstrates skill in developing schedules for ordering, and assuring delivery of materials and equipment, and hiring of work force.

c. Demonstrates knowledge of the reports and other paperwork, required by the Department and/or the prime contractor.

5. Project Performance – Maximum 30 Points

a. Maintains a system of project monitoring, which includes jobsite inspections by management, as well as periodic reporting from the their project superintendent.

b. Maintains a field monitoring and reporting system to warn of any deviations from project schedule or cost overruns.

c. Maintains a system for keeping accurate records of the time expended and materials used on a project, and reporting the records on a same on the monthly progress pay estimate.

d. Demonstrates capability to maintain an updated and accurate job costing system.

e. Maintains a system for dealing with change orders; including requiring written change order and method for calculating prices to cover the changes.

f. Demonstrates knowledge of project closeout procedures.

TOTAL MAXIMUM POINTS: 100

(b) The Department or its Contracted Service Provider shall assign the score that is most representative of the Small Business/Disadvantaged Business Enterprise’s proficiency.

1. For scores of 85 and above, the Small Business/Disadvantaged Business Enterprise shall be exempt from the CMDP.

2. For scores under 85, the Small Business/Disadvantaged Business Enterprise may be enrolled in the CMDP, if obtaining a certificate of proficiency is desired.

(9) Certificate of Proficiency.

(a) Validation of proficiency in minimum curriculum standards. Each DBE participant must satisfactorily complete each component of the classroom training in order to meet the minimum standard of proficiency, or receive exemption, to gain admission to the Bond Guarantee Program. The DBE shall be awarded a Certificate of Proficiency upon successful completion of the classroom component and completion of all required technical assistance training, or upon receipt of exemption.

(b) Small business participants shall be awarded a Certificate of Proficiency upon successful completion of all relevant classroom courses for their trade/profession, and completion of all required technical assistance training. Certified Small Businesses shall not be allowed admission into the Bond Guarantee Program.

(10) Bond Guarantee Program.

(a) Department Requirements/Limitations.

1. Based on a specific annual appropriation, the Department provides a bond guarantee program on Ddepartment contracts with guarantees of up to 90 percent of a bond provided by an approved surety in the amount of $250,000 or less and 80 percent of a bond amount in excess of $250,000. Therefore, the number, size, and availability of the bond guarantees to DBEs shall be limited by the annual legislative appropriation. The Department shall not commit funds in excess of those funds appropriated specifically for this purpose.

2. As a condition of receiving a bond guarantee on a Department contract, the Department shall retain five percent of the total contract amount designated for the DBE Disadvantaged Business Enterprise. This bond guarantee retainage shall be released upon final acceptance of the project and receipt of a Contractor’s Affidavit and Surety Consent (Form 21-A), FDOT Florida Department of Transportation Form 700-050-21(Form 21-A), Rev. 12/09 08/04, incorporated herein by reference, submitted to the Department of Transportation, Equal Opportunity Office, Mail Station 65, 605 Suwannee Street, Tallahassee, Florida 32399-0450, showing all subcontractors and suppliers have been paid.

(b) Surety Company Requirements/Limitations. The Department shall establish a list of qualified surety companies licensed to write bonds in the State of Florida who have agreed agree to participate in the Bond Guarantee Program. Bonds that are eligible for a Department guarantee under this program must be executed by an approved a surety company on the Department’s approved list.

(c) Disadvantaged Business Enterprise Eligibility Requirements/Limitations.

1. Eligibility to participate in the Bond Guarantee Program shall be specifically limited to DBEs who have received attained a Certificate of Proficiency by meeting the minimum curriculum standards of proficiency in the construction management development program or have received an exemption from the CMDP construction management development program.

2. After admission into the Bond Guarantee Program, each DBE who has never applied for a bond or who has never been granted a bond shall be enrolled in a bonding principles seminar sponsored by the Department or its Contracted Service Provider and carried out by it or one of its representatives. This service shall be optional for DBEs who are currently able to obtain bonding. The bonding principles seminar includes instruction in overview of bonding and construction, types of bonds, rights of the surety, reason for default, description of surety industry bonding criteria, loan and bond package portfolio checklist, and evaluation of bond application. This service shall be optional for DBEs who are currently able to obtain bonding.

(d) Bond Applications. When requested by the DBE, the Department or its Contracted Service Provider will shall provide assistance in preparing bond applications that are to be presented to surety companies in order to obtain a bonding capacity.

1. When the DBE has developed a complete package which is deemed acceptable, it will be forwarded to a surety company that has agreed to participate in this program.

2. Upon review, each DBE applicant will be given bonding capacity by the surety.

(e) When a DBE, which has been accepted in the Bond Guarantee Program, is awarded a Department contract, the Department or its Contracted Service Provider shall will assist the DBE in obtaining a surety bond.

1. The Department shall extend the period for contract execution, of the contract without penalizing contract time, if necessary to complete the bonding process.

2. Once the surety company decides to execute the bond on the basis of the Bond Guarantee Program, a Justification for Bond Guarantee, form (FDOT Fform 275-030-074 a, 06/10, 3/89) incorporated herein by reference, shall will be submitted by the surety company to the Department of Transportation, Equal Opportunity Office, Mail Station 65, 605 Suwannee Street, Tallahassee, Florida 32399-0450 to the Department.

3. Upon receipt of the Justification for Bond Guarantee form, the Department shall will execute and return the Bond Guarantee Agreement form to the surety company.

(f) Project monitoring and technical assistance will shall be provided to all DBEs obtaining Department contracts and receiving a bond guarantee.

(11) Appeal Procedures.

(a) If the Department intends to deny an application for admission into the construction management development program, notice of the Department’s intended action will be provided in accordance with Rule 28-106.111, F.A.C. The Department’s action will become final unless a timely petition for a hearing is filed in accordance with Rules 28-106.104, 28-106.201, and 28-106.301, F.A.C. In order to be timely, the petition must be filed with the Department’s Clerk of Agency Proceedings within 21 days after receipt of the Department’s notice, in accordance with Rule 28-106.111, F.A.C.

(11)(12) Participation Revocation.

(a) Participation in The Department’s acceptance of a DBE in the CMDP/BGP is only available to DBEs and Certified Small Businesses Construction Management Development Program/Bond Guarantee Program shall be revoked if the Department finds the DBE is no longer certified as a DBE by the Department or the Small Business Administration.

(b) A certified Small Business’ participation in the Construction Management Development Program shall be revoked if the Department finds the small business no longer meets the certification requirements as set forth in this rule chapter.

(b)(c) A Certified Small Business/Disadvantaged Business Enterprise’s shall not be allowed to participate participation in the CMDP/BGP Construction Management Development Program/Bond Guarantee Program shall be revoked if the Department finds the Small Business/Disadvantaged Business Enterprise intentionally willfully made a false, deceptive, or fraudulent statement in any document submitted to the Department or its Contracted Service Provider.

(d) Prior to revoking Small Business/Disadvantaged Business Enterprise membership in the Construction Management Development Program/Bond Guarantee Program, notice of the Department’s intended action will be provided in accordance with Rule 28-106.111, F.A.C. The Department’s action will become final unless a timely petition for a hearing is filed in accordance with Rules 28-106.104, 28-106.201, and 28-106.301, F.A.C. In order to be timely, the petition must be filed with the Department’s Clerk of Agency Proceedings within 21 days after receipt of the Department’s notice, in accordance with Rule 28-106.111, F.A.C.

(13) Implementation. Implementation of this rule chapter is subject to annual legislative appropriations of funding for this purpose. The Department shall limit participation in the CMDP/BGP based upon annual funding levels.

(12)(14) Forms. The following listed forms are hereby incorporated by reference and made a part of the rules of the Department:

 

Form Number	Form Title	Revision Date
275-030-070 a	Application for Construction Management Development Program (CMDP) and Bond Guarantee Program (BGP)	03/89
275-030-071 a	Application for Small Business Certification (SBC)	03/89
275-030-073 a	Technical Assistance Request	03/89
275-030-074 a	Justification for Bond Guarantee	03/89
700-050-21	Contractor’s Affidavit and Surety Consent (Form 21-A)	08/04

 

Copies of the forms incorporated by this rule chapter these forms are available to be obtained from the Florida Department of Transportation, Equal Opportunity Office, Mail Station 65, 605 Suwannee Street, Mail Station 65, Tallahassee, Florida 32399-0450.

Rulemaking Specific Authority 334.044(2), 339.0805(1)(b) FS. Law Implemented 334.044(28), 337.141, 339.0805(2) FS. History–New 5-24-89, Amended 8-5-96, 10-30-96, 5-6-97, 1-17-99, 3-28-00, 10-19-04,_________.

NAME OF PERSON ORIGINATING PROPOSED RULE: Arthur E. Wright, Manager, Equal Opportunity Office
NAME OF AGENCY HEAD WHO APPROVED THE PROPOSED RULE: Stephanie C. Kopelousos, Secretary
DATE PROPOSED RULE APPROVED BY AGENCY HEAD: September 24, 2010
DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAW: August 6, 2010