Ready and waiting
Job order contracting (JOC) is growing in popularity among city, county and state governments as an alternative contracting method for construction projects. In a typical multi-year JOC agreement, contractors provide “on-call” construction services from concept to closeout, becoming an extension of the government’s facility support team.
JOC programs are similar to design-build arrangements in which the government agency contracts with one entity for both the design and construction phases of a project, eliminating conflicts between separate contractors and saving money on procurement. With JOCs, however, government agencies solicit contractors that can complete or manage commonly needed construction tasks — such as renovation, repairs and rehabilitation — without issuing a request for proposals (RFP) for each project. General contractors typically win JOCs and then sub-contract specific tasks. The method saves time by eliminating levels of engineering and design review, and contract procurement.
JOC relies on unit price books (UPB), such as those published by Kingston, Mass.-based R.S. Means, that list generic costs for specific construction work and materials. In the request for proposal (RFP), the government agency can specify every kind of foreseeable work — from updating buildings to comply with the Americans with Disabilities Act, to renovating bathrooms — and the generic UPB for each item. In response, contractors submit their qualifications and proof of past performance, including their safety record, quality of craftsmanship and references. They also estimate a “price coefficient,” or multiplier, for the items described, factoring in the contractor’s overhead and profit, and any adjustments between the UPB prices and the actual prices charged in the local market.
A JOC awards a potential maximum amount of work over a year, but the contractor is not guaranteed a specific amount of revenue. To generate revenue, the contractor has to perform well and build a long-term relationship with the customer to receive additional work orders. Individual orders are negotiated line by line under the guidelines and specifications of the overall contract.
Like many other construction procurement methods, JOC programs can be structured in various ways, depending on state laws. Some states regulate the amount and duration of JOCs to ensure fairness in government contracts.
Fairfax County, Va., has used a JOC for about three years to complete a variety of projects, ranging from an amphitheater renovation, an arts center construction and community pool repairs. The county hired a general contractor, and when a specific department needs work done, it bases the work request on the JOC contract. Approximately $3 million to $4 million worth of repairs and maintenance work is completed annually under the contract.
JOC programs are not the only answer to all the construction needs of a city or county, but they can complement other contracting methods. JOC programs can reduce administration, design and construction-management time, delivering projects faster and at reduced overall costs.
The author is vice president for Vienna, Va.-based Centennial Contractors Enterprises.
