Thursday, March 01, 2012

Kings Park Psychiatric Center's Lowest Bidder - Cause for Concern?

We recently received a copy of the range of bids on the Kings Park Psychiatric Center project.  Though the low bidder is under the budgeted amount of $15 million (see Newsday article), the spread between them and the next bidder is $1.78 million.  The spread between the second and third bidder was only approximately $230,000 and the average bid was $13.988 million.  This spread and the fact the low bidder is half the average bid may or may not be cause for concern.  It is important to remember that lowest bidder must be a responsible bidder.  On this point there are two obvious concerns regarding the lowest bidder, first they are an out-of-state bidder (Indiana) and, as of February 21, 2012, they are not a New York State Licensed Asbestos Contractor.  Under New York State Industrial Code Rule 56-3.1 (c), "a copy of a valid New York State Asbestos Handling License shall be submitted by the bidder prior to award of any contract all or part of which involves an asbestos project." At this point, unless the low bidder has a subcontractor doing the asbestos work involved with this contract, they cannot be awarded bid.  In addition, out-of-state contractors always cause worries because it brings up questions like: 
  • Do they know New York State is a prevailing wage state (meaning you must pay workers on the project the prevailing wage rate for Suffolk County based on their job classification)? 
  • Do they know that New York State has asbestos regulations that are some of strictest in the country? 
  • Do they know  that New York State requires all workers, including the operating engineers to have asbestos supervisor or handler certificates?
  • Do they know that when you do controlled demolition (56-11.5) with asbestos in place in New York State you cannot salvage/recycle/or reuse the building materials, they all (except obvious must be disposed of as regulated asbestos containing materials (RACM)?  This means the material have to be hauled by asbestos licensed hauler to an Environmental Protection Agency approved landfill that accepts RACM materials.
  • Do they meet the insurance requirements in New York State, has their insurance provided riders or attachments for workers compensation and disability?
Controlled Demolition is covered under NYSDOL ICR 56
We have many clients who set-up post bid meetings (some even video tape these meetings) with the contractor and ensure the contractor understands all sections of the contract giving the contractor the opportunity to pull-out of the contract if they missed or misunderstood something.  We strongly recommend the designers/owners of this project give this contractor every opportunity to withdraw their bid and make sure the contract is awarded to someone that understands and can meet all the requirements and intricacies of working inside New York State.

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