Date Prepared: July 28, 1994
Purpose and Background: The purpose of this document is to establish a Prenegotiation Position with respect to the Consultant's proposal for design of the Addicks Park and Ride Lot Second Expansion. On December 20, 1993, METRO Board Resolution No. 93-213 was passed authorizing and directing the General Manager to negotiate, execute and deliver a Contract with __________________ for architectural/ engineering design of the Addicks Park and Ride Lot Second Expansion.
Scope of Services: The proposed Consultant shall perform preliminary architectural-engineering design (Phase I) and final architectural-engineering design of the Second Expansion of the Addicks Park & Ride (Phase II) and design support services during construction. It is currently intended that a firm fixed price Contract be negotiated for providing the required design services and that a not-to-exceed amount and unit rates be negotiated for the required design support services during construction.
Request for Proposal: A Request For Proposal No. 94A072P was subsequently issued to ____________ On January 14, 1994. During the proposal period,____________ was requested to consider three (3) alternatives for the pedestrian crossing from the expansion facility to the existing facility: an at-grade crossing, an overhead crossing, and an underground crossing. Their initial proposal was received January 31, 1994. Subsequent to receipt of the Consultant's initial proposal, it was decided that the Consultant would ultimately be directed to perform to the "Underground Crossing" Alternative, and therefore, only this alternative was considered in the computation of this Prenegotiation Position. Additional information was required and was requested with respect to their proposal for an underground crossing and this was received on March 21, 1994.
Proposal: The Consultant's firm fixed price proposal for design of the facility with an underground pedestrian crossing was $302,095.00 plus a Not-to-Exceed allowance of $45,000.00 for design support services during construction, for a total Not-to-Exceed $347,095.00. Please see Attachment "A" for a summary breakdown of the Consultant's proposal for this alternative.
METRO Estimate: The Contract Acquisition Request (CAR) contained the Project Manager's initial estimate based on an at-grade or overhead crossing. The Project Manager subsequently prepared an estimate of $289,000.00 for design of the facility with an underground pedestrian crossing plus a Not-to-Exceed allowance of $45,000.00 for design support services during construction, for a total Not-to-Exceed $334,000.00. For a Discipline comparison of the Project Manager's revised estimate with the Consultant's proposal, please see Attachment "B".
Audit: On February 1, 1994, an audit of the Consultant's payroll and overhead rates was requested. The verbal audit results were received on February 21, 1994, as requested. The Audit-supported overhead rate for the Consultant was determined to be 133.68% versus the Consultant's proposed rate of 171%. Audit disallowed that portion of the overhead attributable to ____________'s corporate headquarters. The audit of the Consultant's payroll determined that the majority of the Consultant's actual direct labor rates were equal to or greater than those proposed.
An audit was also requested for ____________, the structural design subconsultant. ____________ has performed almost $200,000 of work for METRO without an audit. The verbal audit results were received on or about February 25, 1994. Audit determined that 's proposed overhead rate of 172.7% was not substantiated by any documentation and that therefore an approximate industry average overhead rate of 150% was used by the Contract Administrator to develop his position. Audit also determined that ____________'s Civil Engineer was a contract employee, for which, in accordance with Audit's interpretation, is not entitled to overhead and profit.
_____________, the Civil subconsultant; ______________, the Landscaping subconsultant; ____________, the Geotechnical subconsultant; and ____________, the Surveying subconsultant, have all been audited in the recent past in conjunction with other contracts and therefore they were not audited for this procurement. For the most part, each of these subconsultants' proposals conformed to available audit information, with the exception of the base design profit margin proposed by ____________, which exceeded Audit allowable profit of 10% by an additional 5%. This, as well as a portion of ____________'s reimbursables, were regarded as unallowable or excessive, respectively, by the Contract Administrator.
Please see Attachment "C" for a Summary breakdown reflecting all Audit/Contract Administrator derived disallowances with respect to the Consultant's proposal. For a Discipline comparison of the Contract Administrator's computations with respect to the Consultant's proposal please see Attachment "D".
METRO'S Prenegotiation Position: The METRO Project Manager and Contract Administrator met to discuss their two (2) positions of from $289,000.00 to $279,472.00, respectively, for design, when compared with the Consultant's proposal of $302,593.00. Both were agreed that the Not-to-Exceed figure of $45,000.00 for design support services during construction, as proposed by the Consultant, was adequate and appropriate for the Project. They ultimately agreed to a position totaling $282,920.00 for design.
This position represents a slight reduction in the Contract Administrator's position with respect to ____________'s proposal for their own services, to allow for somewhat excessive reimbursables and ultimately conform to the Project Manager's revised estimate; a compromise position with respect to ____________'s proposal for Civil Services; a compromise position with respect to ____________'s proposal for Structural Services; to allow for additional man hours deemed necessary by the Project Manager; and a slight reduction in both positions with regard to ____________'s proposal for Landscaping, to make their figure more appropriately comparative with that of the other participants. Both agreed to accept ' proposal for Geotechnical Services and ____________'s proposal for Surveying exactly as submitted. For a Discipline comparison of the Negotiation Position agreed to by the Project Manager and Contract Administrator, as compared with
the Consultant's proposal, please see Attachment "E".
Conclusion: Based on the information provided above, the METRO negotiation position of $282,920.00 for the design of the Addicks Park & Ride Lot Second Expansion plus a Not-to-Exceed allowance of $45,000.00 for design support services during construction, for a Not-to-Exceed total of $327,920.00 is deemed to be fair and reasonable. Negotiations will commence immediately upon approval of this plan.
Manager of Contracts