LPA:136.4 Consultant Selection and Consultant Contract Management

From Engineering_Policy_Guide
Jump to navigation Jump to search
"How To" PowerPoint Tutorials
Federal-Aid Essential Videos
Prequalification Processes


136.4.1 Introduction

If the LPA (local public agency) is not adequately staffed to provide the necessary engineering, architectural, land surveying, right of way and related services (including utility negotiations), they may hire a consultant to provide professional services. Professional services are defined under the federal law, the Brooks Act, 40 USC 1102. Please note that Right of Way Acquisition and Negotiations are NOT defined as a professional service and therefore the Brooks Act does not apply to those services. For more information on Right of Way please refer to EPG 136.8 Local Public Agency Land Acquisition.

MoDOT has a website dedicated to the LPA Program. Please see MoDOT’s Consultant Resources for more LPA-Consultant information. Federal Law

The Brooks Act, 40 USC 1102, 23 CFR 172.3 (Public Law 92-582, 1972) requires agencies to “promote open competition by advertising, ranking, selecting and negotiating contracts based on demonstrated competence and qualifications for the type of engineering and design services being procured, and at a fair and reasonable price.” This requirement applies to all projects that utilize Federal Aid Highway Program funds for engineering. This is commonly referred to as Qualifications Based Selection or QBS, meaning a firm is chosen based on qualifications and not price. State Law

Commonly referred to as the “Mini-Brooks Act”, the State of Missouri, in sections 8.285 thru 8.291 RsMO, requires Qualification Based Selection (QBS) for all architectural, engineering and land surveying professional services and reflects the language contained in the federal legislation. This requirement applies to ALL projects in Missouri regardless if it contains federal funds or not. Keep in mind that the Federal Laws supersede the State Laws if the project has federal funding. Funding

Consultant selection, including execution of the contract, is a process done BEFORE any federal dollars are obligated to the project. Therefore any dollars spent in this process are NOT eligible for federal reimbursement.

In Missouri, the same consultant can be hired to perform Preliminary Engineering (PE) and Construction Engineering (CE) work. Please refer to EPG 136.3 Federal Aid Basics for more information on funding. Preliminary Engineering (PE)

PE charges are permitted through the construction contract award. Any engineering charges to the project after the construction contract award are considered construction engineering (CE) and will not be charged against the design portion of the project. If a modification is made to the plans during construction, all funding for this will be CE funds not PE funds.

Right of way project cost estimates; title work, right of way plan development and legal description writing may be included in the same agreement with Design Services and are reimbursable as preliminary engineering (PE) expenses. All other eligible right of way acquisition activities cannot begin until the A-Date has been approved and the LPA has been notified, any acquisition activities that occur before the A-Date will not be eligible for reimbursement. See EPG 136.8 for more right of way information. Preliminary Engineering Activities by Local Forces

PE activities can be performed in-house by LPA staff. Please see EPG Federal-aid Participation for In-House Services for more details. If the LPA is not requesting reimbursement for the in-house design services, they still must have the plans signed and sealed by a registered professional engineer in the state of Missouri. Keep in mind, however, if the design includes any right of way, temporary easements included, then the LPA must still follow the Uniform Act. Even if no federal dollars are utilized for PE or for right of way, the LPA must still follow the Uniform Act because federal dollars are utilized on at least one phase of the project. For more right of way information see EPG 136.8 Local Public Agency Land Acquisition.

Additional Information
Construction Inspection Construction Engineering/Construction Inspection (CE)

Construction Engineering can be performed by a consultant or can be done as in-house services if the LPA is staffed to do so. If the CE is to be performed in-house please see EPG Federal-aid Participation for In-House Services for more details. Responsible Person in Charge

The LPA is required to have a person of responsible charge for every project. The hired consultant cannot be the person of responsible charge. Please see EPG 136.1 for more information. Consultant Qualification

Effective January 1, 2013, all prime consultants must be prequalified to perform engineering services on any project. To become prequalified the consultant will be required to do the following:

1. Statement of Qualifications (SOQ) on file with MoDOT
2. Registered to do business in Missouri (Certificate of Good Standing) and hold a certificate of authority with the Missouri Board for Architects, Professional Engineers, Professional Land Surveyors and Professional Landscape Architects. (Note: A Certificate of Authority is not required for sole proprietorships or partnerships. It is only required if the firm is incorporated or registered as a limited liability company. For sole proprietorships and/or partnerships, individual professional license certificates must be submitted in lieu of the Certificate of Authority. In addition, the certificate of authority is not required for firms that do work outside the jurisdiction of the Missouri Board for Architects, Professional Engineers, Professional Land Surveyors and Professional Landscape Architects.)
3. Have current E-Verify MOU and E-Verify Affidavit
  • E-Verify MOU – one time submittal
  • E-Verify Affidavit - yearly
4. Have current Annual Financial Prequalification with MoDOT
  • This annual financial prequalification is good for one year.
5. Have taken the Federal Aid Basic Training Course (LPA Consultants ONLY, not required for MoDOT Consultants)

The prequalification process complies with AASHTO guidelines published in the Uniform Audit & Accounting Guide, 2012 Edition. This prequalification process ensures that projects are in compliance with state and federal regulations.

The prequalification is only required for prime consultants. Subconsultants are strongly encouraged to become prequalified in order to reduce repetitive paperwork for future projects. For more information on subconsultant requirements see EPG Subconsultants.

For the prequalification requirements for MoDOT consultants, see EPG 134.1.3 Consultant Qualification. Conflict of Interest

A conflict of interest occurs when a consultant has a financial or personal interest in a federally funded project. To avoid a potential conflict of interest, see 23 CFR 1.33 for the Federal Law governing Conflict of Interest. To certify that no conflict of interest has taken place on any given project, the LPA and consultant must fill out Attachment G of the engineering services contract (Fig 136.4.1). If the LPA and consultant choose not to use the standard template engineering services contract found in Fig 136.4.1 the consultant and LPA must fill out the Conflict of Interest Disclosure Form (Fig 136.4.15) and submit it to MoDOT along with the executed engineering services contract for each project. For additional information, refer to 134.1.4.

A consulting engineering firm under contract to serve as the city engineer to provide oversight of engineering functions and the work of engineering consultants procured by the city will not be allowed to perform engineering work for the city for which they are city engineer. A potential conflict of interest would arise if the consulting firm were awarded the project-related design services. Using Consultants for Preliminary Project Documents

There are situations when conflicts of interest commonly arise during LPA projects. Development of Preliminary Project Documents

Preliminary project documents may include, but are not limited to, grant and TIP applications, projects scopes, filling out the programming data form and project estimates.

If the LPA needs professional consulting services to develop preliminary project documents, the LPA must execute an engineering services contract. The contract must be at fair market value, and the cost of selecting and negotiating a consultant contract is not eligible for federal funding.

A consultant providing preliminary project deliverables must complete all preliminary activities and receive payment in full from the LPA in order to be eligible to bid on PE or CE services for the project. If the consultant provides preliminary project documents as an in-house consultant or engineer on retainer, all invoices for these services must be paid in full to be to be considered for a PE or CE contract

The LPA must include all consultant developed preliminary project documents in the Request for Qualifications (RFQ). If a consultant develops the RFQ or participates in the consultant selection process, regardless of payment, that firm will not be eligible for the next phase of the project. Contracts with LPAs and Contractors

A consultant cannot work for both the LPA and the contractor on the same project as this is seen as a conflict of interest. However, the consultant can provide surveying and staking on the project for the contractor but it is limited to that task alone. Suspension/Debarment

All consultants receiving individual awards for $100,000 or more and all subrecipients/subconsultants must certify that the organization and its principles are not suspended or debarred. Each LPA must check SAM.gov | Exclusions. If a consultant has an exclusion, it is suspended or debarred and cannot be used. Frequently Asked Questions (FAQ)

A list of FAQs regarding consultant issues can be found in Fig 136.4.13. FHWA also has a webpage that lists FAQs.

136.4.2 Solicitation & Selection Process

When an LPA needs consultant services, specific processes for soliciting and selecting a consultant must be followed. LPA’s must use Qualifications Based Selection (QBS) for the procurement of engineering and design related services. This is mandated by both the Federal and State law. See EPG and EPG for the applicable laws. If an LPA does not follow the solicitation and selection process, federal funds could be jeopardized. When selecting a consultant for consultant services, the LPA may choose to use the standard solicitation process (Advertisement/RFQ) or the LPA On-Call Consultant List as described in EPG for professional consultant services. Qualification Based Selection (QBS) Flowchart

Fig. 136.4.12.jpg

A step-by-step process for following the QBS process is outlined below. Step 1 – Scope of Services

The LPA should determine a project specific scope of services. Sample scopes of service can be found on the last sheet of Fig. 136.4.7. These samples can be used in the Request for Qualifications (RFQ) form. Keep in mind that the Engineering Services Contract (ESC) cannot contain any scope that was not listed in the Advertisement/RFQ, so it is important to develop the scope of services for the RFQ that will cover all necessary work items for the project. For instance, if the LPA wishes for the consultant to design the plans and perform construction inspection, the RFQ needs to spell out both of those items, otherwise the LPA will have to post another RFQ to cover the work items not covered in the original RFQ. A scope of services must still be developed if the LPA is going to utilize the LPA On-Call Consultant List. This scope will then be negotiated with the selected consultant. The scope should not be determined by the consultant; it must be developed by the LPA prior to contract negotiation. If the LPA is going to use an on-call consultant go to EPG

In general, the RFQ scopes should be broadly written but the scope of services contained in the ESC should be detailed to mitigate the risk to both the LPA and the consultant.

In addition to the scope of services, the LPA shall also develop an Independent Cost Estimate (ICE) in compliance with 23 code of Federal Regulations (CFR) Part 172.7(a)(1)(v)(B) to serve as the basis for the negotiation of the contract. The ICE is a work hour estimate used to have an idea of the level of work required to perform tasks in the scope of services and will serve as the basis for the negotiation of the contract. It is recommended that the person(s) who develops the ICE is involved with negotiations between the LPA and consultant.

To develop both the scope of services and ICE, the LPA can use other resources as necessary, such as looking at past projects, reaching out to other LPAs, respective planning partners, and/or MoDOT District LPA Contact. In addition, this template could be used as a starting point for the ICE. Step 2 – Creating an RFQ Document

"How To" PowerPoint Tutorial

How to Complete the RFQ and Get it Advertised

An LPA must create an RFQ to solicit professional services. MoDOT provides a solicitation form, or an LPA may use its own solicitation with prior approval. Fig. 136.4.7 provides a sample solicitation/RFQ form.

If the LPA wishes not to use the sample solicitation they may do so provided that that solicitation contains the following:

  • a statement requiring the consultant to submit a Statement of Qualifications (SOQ) along with the letter of interest
  • a statement saying the DBE firms must be listed in the MRCC directory to be considered
  • the selection rating criteria along with the weighted values/points associated with each selection criteria
  • Detailed Scope of Consultant Services needed
  • Deadline date when the letters of interest are to be submitted
  • Contact information
  • A statement indicating where to get a copy of any preliminary project documents, if applicable.

Each RFQ must include a consultant selection criteria with the weighted percentages of each category. RsMO 8.289 lists the criteria that should be used. MoDOT’s sample solicitation includes these criteria, with the exception of proximity/familiarity. This criteria has been eliminated because the criteria is unclear and often misused. An LPA may use alternate criteria with rating values only with prior MoDOT approval. Each RFQ must be submitted to MoDOT and reviewed for a DBE Goal prior to advertisement. Step 3 – Advertising the RFQ Solicitation

MoDOT suggests LPAs use the sample solicitation form from the EPG when advertising a RFQ solicitation, however, an LPA may also use an alternative advertising plan with prior MoDOT approval. The RFQ must be advertised at least one time allowing a minimum of 14 calendar days prior to the due date, but it may be advertised multiple times if desired.

In addition, each RFQ must be reviewed by MoDOT’s External Civil Rights group for Disadvantage Business Enterprise (DBE) opportunities. Submit requests for a DBE goal to: DBEConsultGoal@modot.mo.gov. The request must include a work breakdown with the percentage of each anticipated work scope. Fig. 136.4.20, Estimated Breakdown of Work on Engineering Consultant Contracts, shall be used to ensure all items are covered. MoDOT will notify the LPA, so that the DBE goal can be inserted into the RFQ. Possible activities that offer opportunities for DBE firms include but are not limited to surveying, plan sheet development, design, geotechnical services and borings. Only firms listed in the MRCC Directory are eligible to meet DBE goals. If the DBE goal is not met, the consultant must document that a Good Faith Effort was made to meet the DBE goal. Disadvantaged Business Enterprise (DBE) requirements are also covered in EPG 146 Disadvantaged Business Enterprise (DBE). Advertising on MoDOT’s Site

The sample RFQ solicitation form (Fig. 136.4.7) should be filled out and submitted to the appropriate MoDOT District LPA Contact. When advertising on MoDOT's website, the LPA can choose to also advertise in a newspaper, but it is not required. Advertising Using an Alternative Method

An LPA does not have to advertise on the MoDOT website, and when an LPA wishes to use another method to advertise the consultant solicitation, the LPA must submit a written request with an advertising plan to MoDOT. This request to advertise using an alternative method must be approved by MoDOT and FHWA prior to advertising the RFQ. The plan must comply with state and federal laws and include:

  • Advertisement in a major newspaper of general circulation
  • Plan to disseminate information to organizations qualified to do specified work. These organizations may include professional societies and recognized DBE organizations. Step 4 – Response to the RFQ

Interested firms who wish to respond to the RFQ can submit a letter of interest. If the firm has no experience with the LPA process, they must submit a Statement of Qualifications (SOQ), also. The SOQ can be in the form of a brochure or other format which outlines the qualification of the firm’s employees and recent past experience in similar work. (See Missouri Revised State Statue Chapter 8 Section 8.289.) A firm MUST be prequalified to perform work. MoDOT's Approved Consultant Prequalification List contains all the information to determine whether or not firms are prequalified. Step 5 – Selection of Consultant

When the RFQ expires, the LPA evaluates the letters of interest or statement of qualifications and determines whether or not the firms are prequalified. MoDOT's Approved Consultant Prequalification List contains all the information to determine whether or not firms are prequalified. If the LPA determines a firm is not prequalified or determines a firm should be disqualified for other reasons, then prior to rating any firms the LPA shall submit the firm name and reason for disqualification to MoDOT for concurrence. The LPA rates all firms based on the criteria that was outlined in the RFQ. Price quotations shall not be requested or used for consideration prior to selecting a firm. Price can only be determined AFTER the consultant is selected.

MoDOT/FHWA can attend the selection/rating meeting and provide guidance on the selection process but cannot give opinions on selection of the firm. RsMO 8.289 (except proximity/familiarity) and Fig. 136.4.2 Consultant Selection Criteria Guidance and Rating Sheet must be used in the rating and selection of the consultant.

According to federal and state law, the LPA must rate a minimum of 3 firms and then select the firm best qualified to perform the work, based on the rating criteria outlined in the RFQ, and not based on price quotations. It is preferred, however, to rate as many firms as necessary (6 to 8 firms) to provide for more competition and quality. It is not necessary for the LPA to interview the firms, but should be considered. When less than three responses are received, it is suggested that the RFQ be re-advertised at least once. If the LPA still receives less than three responses, the LPA must then determine whether or not this is a suitable number of responses based on the nature and size of the project. The LPA should also consider whether there was some aspect of the RFQ that was overly restrictive or otherwise had an adverse impact on the completion of the project. If the LPA still wants to move forward, then they should document that the RFQ requirements were not restrictive, it was adequately publicized and that the one or two firms who responded were capable of performing the tasks outlined for the project. It is desired that more than one person in the LPA rate/score the consultants.

Each individual shall rate the firms independently. It is required that each of the evaluators write how they determined the scores for each consultant at the bottom of the score sheet. It is suggested that all independent scores be added together and averaged on a combined score sheet. These documents must be submitted to the MoDOT District LPA Contact along with all the individual score sheets and the ICE for concurrence prior to entering into negotiations with the selected consultant. Scores that reflect little or no thought or scores that appear skewed towards the winning consultant may result in the loss of federal funds. The red flags in scoring include but are not limited to:

  • Same scores for each consultant in a particular category except for the winning consultant,
  • 100% scores in every category for the winning consultant or
  • No documentation (written text) to show how the scores were determined.

Consultant Presentations and Interviews

The majority of projects do not require interviews or presentations and the selection team may select by scoring the consultants and choosing the top ranked firm. Specific conditions that allow the selection to take place without interviews or presentations are as follows:

  • The scope and cost of the contract is considered to be minor or routine in nature.
  • The LPA district or division is very familiar with the qualifications and capabilities of all the short-listed firms from previous services or presentations and believes presentations or interviews will not increase knowledge of the short-listed firms.
  • The need for an accelerated selection process due to the critical nature of the contract.

If interviews and/or presentations are required, the selection team will first rate all the consultants based on the rating criteria published in the solicitation using Fig. 136.4.2 and as outlined above under Rating/Scoring the Consultants. Then the selection team will select the top 3-5 highest scoring firms and place them on a short list for further evaluation during presentations and/or interviews.

Refer to Refer to EPG Solicitation and Selection Step 5 – Selection of Consultant for details regarding presentations and interviews. Step 6 – Consultant Contract Negotiations

Price is negotiated after a consultant is selected and notified and the previously developed ICE should serve as the basis for the negotiation of the contract. This is the only time in the selection process when price can be considered. Fig. 136.4.6 lists a number of common Unallowable Costs that are ineligible federal reimbursement. Additional scope beyond what was advertised in the RFQ cannot be negotiated into the contract.

The selected firm will need to use the overhead rate that was approved by MoDOT in that firm's prequalification process with MoDOT. If the firm elects to voluntarily reduce their overhead rate the following language must be incorporated into the contract:

“The Company has voluntarily reduced its overhead rate to ___%. This rate will be used on all billings. Upon completion of these services outlined under this Agreement the final payment for these items will be based on accounting records of the Consultant incurred during the period of the Agreement. The LPA reserves the right to require the actual audited overhead rates be used if those rates are less than the voluntarily reduced rate noted previously.”

For expectations on consultant inspection and administration, see EPG 136.11.12 Construction Administration. Fixed Fee Review

The fixed fee is based on the complexity of the project, risk to the consultant, and the amount of sub consultant management and is the profit to the consultant. Fixed fees are calculations are based upon direct salary costs. The percentage of the fixed fee to the direct salary costs should not exceed the MoDOT maximum allowable profit curve shown in Fig. 136.4.3. However, MoDOT does not allow a profit of more than 15 percent.

Fixed fees may not be calculated for direct expenses. Sub consultants are a direct expense to the prime consultant. Therefore, sub consultant expenses may not be included in the fixed fee calculations for the prime consultant. It should be noted that the “fixed fee” is fixed and will be paid in full even if the consultant does not use all of the hours in the contract. Care should be taken not to overestimate man-hours. Basis of Payment

The Engineering Services Contract in the Fig. 136.4.1 is an actual cost contract. This means that all cost estimates must be based on actual wages and overhead. Federal regulations (FAR Part 16.102) prohibit the use of cost plus a percentage of cost or percentage of construction costs as a method of compensation. The following methods maybe used as the basis of payment in a contract:

  • Actual Cost Plus Fixed Fee
  • Specific rates of pay (for emergency situations only)

In order to establish a measure of “Fair & Reasonable” a pre-negotiation estimate is required by federal regulations in 2 CFR 200.324. The LPA PM/CA shall develop an estimate based on the tasks and work-hours of similar previous projects. The consultant work-hour estimate is reviewed and compared to the LPA estimate. The consultant’s fee proposal submittal must include detailed hours and cost breakdowns by sub-task and by job title. For any subtask on the scope, it should be known how many different people, how many hours per person, any direct expenses, etc. for the prime and any subs. Negotiations should occur to assure that work-hours in the contract are comparable to the LPA estimated hours and those from similar projects.

Each subconsultant must be identified in the contract. Subconsultant expenses should be calculated based upon actual costs. Prompt payment of subconsultants is required per FAR Subpart 32.9.

Retainage is not allowed as a routine part of the contract i.e. blanket retainage is prohibited. Payment may be withheld on any particular work item that has not been completed in accordance with the contract. This can include work incidental to the work item, and required documentation directly related to the work.

Direct costs must be estimated using current Privately Owned Vehicle (POV) mileage reimbursement rates and per diem rates for Missouri. These rates can be found on the following web pages.

Mileage, subsistence and lodging must follow federal travel regulation guidelines. Subconsultants

The use of subconsultants is allowed provided that each firm is identified in the engineering services contract. DBE firms should be listed under Article II, and other sub consultants should be listed in Article IX Subletting, Assignment or Transfer. The use of 2nd and 3rd Tier subconsultants is not allowed. Subconsultants do not have to be prequalified but it is strongly encouraged especially if the subconsultants routinely performs work >$25,000. Subconsultant cost exceeding $25,000

If the consultant is using a subconsultant with a cost exceeding $25,000, then the subconsultant shall include Attachments B and C of Fig. 136.4.1, a detailed estimate of cost and a detailed overhead rate schedule. If the subconsultant is prequalified, the overhead rate listed must be the current overhead rate accepted by MoDOT through the annual financial prequalification process. In this case, a detailed overhead schedule would not be required.

If the subconsultant is not prequalified with MoDOT, then the firm shall also include their Consultant Certification of Indirect Cost Form. Each subconsultant in this category must show its overhead in the required format. Fig. 136.4.16 provides an example Overhead Schedule. The detailed overhead schedule should be reviewed for possible unallowable costs per FAR Part 31.2. Fig. 136.4.6 lists common unallowable costs. The prime consultant is responsible for ensuring that all subconsultants comply with state and federal regulations, such as E-Verify, and are registered to do business in Missouri. Subconsultant cost NOT exceeding $25,000

If the consultant is using a subconsultant with a cost that DOES NOT exceed $25,000 then a letter quote from the subconsultant shall be submitted with the engineering service contract. The letter should quote the subconsultant’s cost shown in Attachment B of the contract (Fig. 136.4.1). If the subconsultant is not prequalified with MoDOT, then the subconsultant firm shall also include their Consultant Certification of Indirect Cost Form. The prime consultant is responsible for ensuring that all subconsultants comply with state and federal regulations, such as E-Verify, and are registered to do business in Missouri. Ceasing Negotiation

If the LPA cannot negotiate a reasonable price with the consultant selected, the LPA can cease negotiations and begin negotiations with the next most qualified firm. After the LPA has ceased negotiations with the selected firm and have started negotiations with the next most qualified firm, the LPA cannot go back to the first firm and start another round of negotiations; this is looked upon as price shopping and is unallowable. See FHWA Consultant Services webpage for more information. Contract Execution

The Engineering Services Contract, (Fig. 136.4.1), must be signed by both parties (LPA and consultant). The LPA has one year from the time the RFQ expires to get a consultant contract negotiated and executed. However, it is desirable to have the contract executed in a much shorter timeframe. Liability Insurance

The Engineering Services Contract language includes provisions for the amount of liability insurance that the consultant must provide to cover claims that may result from errors, omissions, or negligent acts of the consultant. Insurance Certificate of Liability must meet Missouri’s Sovereign Immunity Limits. A copy of the certificate of liability insurance for the prime consultant is to be requested by the project manager and kept in the project files with the executed contract. It is the responsibility of the consultant to meet the insurance requirements of the contract. Receipt of the consultant’s certificate of insurance liability does not imply approval of the amounts. Step 7 – Engineering Services Contract (ESC) Submittal to MoDOT

The Engineering Services Contract (ESC) format illustrated in Fig. 136.4.1 is required, unless the LPA gets prior approval from MoDOT to deviate from this form. The LPA must submit the unexecuted ESC to the MoDOT District LPA Contact for review and approval along with the cover letter found in Fig. 136.4.9. For a complete list of items required to be submitted along with the ESC, see Fig. 136.4.11. Also see Fig. 136.4.14 to view a checklist that MoDOT will use when reviewing the ESC. The LPA should also use this checklist prior to submitting to MoDOT to ensure the ESC is complete. Step 8 – MoDOT Review of Consultant Contract

Per the Federal Acquisition Regulation (FAR), a price reasonableness review must be performed prior to contract execution. Each consultant contract will be reviewed by MoDOT staff for reasonableness in man-hours, wage rates, overhead rates, direct costs, etc. Any item found to be unreasonable as compared to industry/consultant history and current trends or any errors will need to be corrected prior to contract execution. Common errors include, but are not limited to, math errors, contract language and costs that do not match exhibits, exclusion of an audit clause, large fluctuation in wage rates from expected amounts or previous rates, and/or overhead rates that are different from information MoDOT has on file. Fig. 136.4.14, Checklist for reviewing Consultant Contracts includes helpful hints for conducting a price-reasonableness review and common errors found.

No work shall begin until the PE funds have been obligated by FHWA and MoDOT has given the LPA notice to proceed. Any funds spent prior to PE Obligation will not be reimbursable. Step 9 – PE Funding Obligation

After MoDOT has reviewed the consultant contract and has found it to be reasonable, MoDOT will request authorization of funds from FHWA for Preliminary Engineering (PE), when these expenses are allowable. FHWA will obligate the funds and MoDOT will notify the LPA that the funds have been obligated and give the notice to proceed. No work shall begin until the PE funds have been obligated by FHWA and MoDOT has given the LPA notice to proceed. Any funds spent prior to PE Obligation will not be reimbursable. Step 10 – CE Funding Obligation

Some consultant contracts contain both preliminary engineering work (PE) and construction engineering/inspection (CE) work. If this is the case, the PE dollars will be obligated. No PE funds can be incurred after the CE funds have been obligated.

Other consultant contracts may only contain CE work. If this is case, CE funds will be obligated with the construction dollars. This obligation takes place after the plans and all supporting documents have been reviewed and approved and Authority to Advertise has been given to the LPA. No work shall begin until the CE funds have been obligated by FHWA and MoDOT has informed the LPA of approval. Any funds spent prior to CE Obligation will not be reimbursable.

In either case, the consultant contract must be executed and then approved by MoDOT prior to requesting CE funding obligation. Using the LPA On-Call Consultant List

The LPA On-Call Consultant List is created through a selection process that is administered by MoDOT and quality assurance provided by Missouri ACEC and Missouri FHWA. MoDOT, together with Missouri’s Local Program Advisory Panel, manage the consultant review and selections. This process of selection is not mandatory and the QBS selection process outlined in Steps 1-3 above can be used at any time.

The LPA must first write the scope of services they need the consultant to perform and the LPA must develop an Independent Cost Estimate (ICE) in compliance with 23 code of Federal Regulations (CFR) Part 172.7(a)(1)(v)(B) to assist with determining whether engineering costs are estimated to be less than $200,000, and therefore eligible for the on-call list. Refer to EPG for additional information regarding the scope of services and the ICE.

If the consultant contract is estimated to be less than $200,000 and the scope of work fits any of the on-call categories listed below, the LPA may use the LPA On-Call Consultant process, as defined herein, to select a firm instead of the RFQ solicitation process. Keep in mind, if the engineering costs are estimated to be close to the $200,000 contract maximum, the LPA should consider using the RFQ solicitation process to procure services.

The LPA must have discussions with at least 3 firms of consideration to determine their qualifications to perform the work identified in the scope. These discussions and evaluation of qualifications shall be documented. During these initial discussions, cost shall not be discussed. The LPA must submit their ICE and selection documentation to their MoDOT District LPA Contact for concurrence prior to entering into negotiations with the selected firm from the On-Call List.

If the LPA is hiring a consultant to design and inspect a project, the consultant MUST be on both the appropriate design category AND in the Construction Inspection category to be eligible for the entire project. The LPA can however hire different consultants to perform the design and inspection if desired. If separate engineering contracts are used for PE & CE, the total of both contracts must be under $200,000 to utilize the on-call list for both phases. If the total work is more than $200,000 for PE & CE combined, but one or both phases are individually under $200,000, the LPA can use the on-call list for one phase and complete the RFQ process for the other contract. Example: (PE = $187,000 and CE estimated to be $41,000), the LPA can use the on-call list for PE, but then must go out to RFQ for CE. If using this process, the LPA can proceed on to Step 6 Consultant Contract Negotiations after this step is completed.

LPA On-Call Consultant Categories and Category Descriptions

  • Structures. This category of work is defined as the production of competently engineered structural plans. The work generally includes plans production, detailing, hydraulic studies, geotechnical work, survey, cost comparisons, environmental clearances, right of way and may include other work related to bridge design.
  • Construction Inspection. This category of work is defined as managing, documenting and inspecting projects associated with the construction of a new and/or modified existing facility. The work may involve the identification and resolution of issues relating to materials, work, progress, change orders and disputes. It may also include geotechnical work, sampling and testing, attending construction related meetings and reviewing shop drawings, but may also include other work related to construction inspection.
  • Roadway. This category of work is defined as the production of competently engineered highway plans and related design studies. The work generally includes widening, resurfacing, pavement reconstruction, utility design and coordination, right of way, environmental clearance, traffic signals and lighting, general lighting, surveying, sidewalks and trails (as part of a roadway design contract), and parking lot design but may include other work as related to roadway design.
  • Trails & Sidewalks. This category of work is defined as the production of competently engineered trail and pedestrian use facilities, environmental clearance, right of way, signal and lighting, landscaping and beautification but may include other work as related to trail and sidewalk design. Landscape Architects will be eligible for consideration in this category.
  • Traffic Engineering and TEAP. Traffic Engineering in this category is defined as design of improvements intended to relieve traffic problems, such as signalization, signing, lighting and pavement markings. Traffic Engineering Assistance Program (TEAP) in this category is defined as studies that may include corridor safety and/or operational analysis, intersection(s) safety and/or operational analysis, speed limit review, sign inventory, pedestrian/bike route analysis, parking issues, and other traffic studies.
  • Environmental. This category of work is defined as the preparation of Categorical Exclusion, Environmental Assessment, and Environmental Impact Statement documents, and re-evaluations of documents in compliance with all requirements of the National Environmental Policy Act (NEPA) under FHWA procedures. Additionally, this category of work will include performance of field surveys for wetlands, streams, hazardous waste, and other specialties. It will require specialized species surveys, habitat assessments, and analysis to support a determination of impact to listed species and protected resources, including reports of those surveys. Other work will include floodplain, farmland, socioeconomic impacts, noise analysis, which will consist of, but is not limited to noise monitoring, modeling, and the preparation of noise reports.
  • Historic Preservation. This category of work is defined as providing compliance with Section 106 of the National Historic Preservation Act, which requires conducting background investigations, Phase I surveys, Phase II National Register evaluations, Phase III adverse effects mitigation (e.g. archeological data recovery, documentation of historic bridges and buildings etc.), and other various tasks as related to cultural resources.
  • Multimodal Planning / Systems and Facilities Design. This category of work is for:
  • Rail planning, feasibility studies, and general grant writing.
  • Rail network planning and design (Freight and Passenger Rail) - Capacity analysis of existing or proposed rail lines. Identifications of improvements to increase capacity. Identification and evaluation of factors affecting rail and connection to other modes of transportation. Design of rail infrastructure and passenger rail facilities. Grant writing and grant administration. Firms should indicate if they specialize in a subset of this category.
  • Port infrastructure design including docks, warehousing, and bulk storage structures.
  • Public port grant writing and port administration. Selecting a Consultant from the LPA On-Call Consultant List

The LPA should choose the most qualified consultant for their project from the appropriate category(s) on the LPA On-Call Consultant list. LPAs shall consider at least 3 firms for each project when reviewing the LPA On-Call Consultant List. This includes having discussions with each firm, evaluating each firms qualifications to perform the work identified in the scope, and then documenting the selection of the most qualified firm. Cost shall not be part of these initial discussions. It is recommended that the LPA consider the following when reviewing firms:

1. What is the current workload at the firm and can they meet the LPA’s expected schedule?
2. Who, at the firm, will be the project manager for the project?
3. Can the firm provide examples of past similar to work?
4. Contact your surrounding LPAs for feedback on consultant usage.

The LPA should also review the firms’ information found on the on-call list. This information can be accessed by simply selecting the firm’s name. The LPA will have access to review such things as employees of the firm, past projects, general firm experience etc. Keep in mind that price is not part of selecting firms from the on-call list rather the firms are chosen based upon quality. LPA Consideration of DBE for On-Call Contracts

All LPA On-Call Consultant contracts will be reviewed individually to establish a DBE goal. Strong consideration of DBE firms as prime and sub-consultants must be taken into account when selecting a consultant team. DBE sub-consultant firms can be found by visiting the MRCC Directory and DBE prime consultant firms are highlighted on the LPA On-Call Consultant list. If the On-Call Consultant selected by the LPA cannot meet the established DBE goal, the consultant must document the Good Faith Efforts made to achieve that DBE goal. Good Faith Effort examples are found in Fig. 136.4.1, Engineering Services Contract (Attachment E, Section 7). DBE requirements are also covered in EPG 146 Disadvantaged Business Enterprise (DBE). Engineering Services Contract (ESC) Execution Process

1. The Engineering Services Contract (ESC) format illustrated in Fig. 136.4.1 is required, unless the LPA gets prior approval from MoDOT to deviate from this contract form. Once the scope of work is defined, the LPA must obtain a DBE Goal by sending the appropriate project information (including scope, county, estimated construction cost, estimated consultant cost, and potential subcontracting opportunities) to the appropriate MoDOT District LPA Contact. The District LPA Contact is to submit the information to MoDOT External Civil Rights (ECR) for review at DBEConsultGoal@modot.mo.gov. The scope for each On-Call Consultant Engineering Services Contract (ESC) must be submitted to MoDOT and reviewed for a DBE Goal prior to selecting the On-Call Consultant. The DBE goal shall be included in the ESC. (DBE requirements are also covered in EPG 146 Disadvantaged Business Enterprise (DBE).) All consultant contracts that utilize federal funds must be reviewed by ECR, regardless of the dollar amount of the contract.
2. If the prime consultant or any sub-consultants are DBE firms, the DBE section of the ESC must be filled out. If the prime or subs are not DBE firms, the DBE section can be left blank.
3. The LPA will submit the unexecuted ESC to MoDOT for review. If the selected On-Call Consultant determines that the DBE goal cannot be met then the LPA shall submit the consultant’s Good Faith Effort documentation for review. See Fig. 136.4.14 to view a checklist that MoDOT will use when reviewing the consultant contract. The LPA should also use this checklist prior to submitting to MoDOT to ensure the contract is complete.
4. The LPA will send the ESC to the consultant for execution.
5. After MoDOT has reviewed the consultant contract and has found it to be reasonable, MoDOT will request authorization of funds from FHWA for Preliminary Engineering (PE). FHWA will obligate the funds and MoDOT will notify the LPA that the funds have been obligated and give the Notice to Proceed (NTP). No work shall begin until the PE funds have been obligated by FHWA and MoDOT has given the LPA notice to proceed. Any funds spent prior to PE Obligation will not be reimbursable.
Note: The LPA MUST wait for federal funds obligation before issuing the NTP to the consultant. The MoDOT District LPA Contact will send an email notification to the LPA indicating the obligation.
6. The LPA distributes copies of the executed agreement to the appropriate MoDOT District LPA Contact; electronic notifications are required.
7. The LPA will send the NTP letter to the consultant AFTER federal funds are obligated. Consultant Evaluations for On-Call Services

The LPAs must evaluate each firm that they have chosen to use from the LPA On-Call list at the completion of the project. The LPA will not be able to utilize the LPA On-Call Consultant List if they have not evaluated the prior consultant. Fig. 136.4.19 LPA On-Call Consultant Evaluation must be filled out and submitted to the MoDOT District LPA Contact. Fig. 136.4.19 must be filled out and signed by the LPA and the consultant and then submitted to the district contact. See EPG for standard consultant contract evaluations. MoDOT will then review the evaluations and these evaluations will be used to aid in scoring consultants in the future when the on-call list is re-created, normally every 3 years.

136.4.3 Consultant Contract Management Payments/Invoicing

The LPA must submit invoices for reimbursement of costs incurred as the work progresses. The invoices may not be submitted more than once every two weeks. Progress invoices must be submitted monthly. The final invoice must be submitted within 30 days of final acceptance. The LPA may use either of the following two methods of seeking progress payments:

  • The LPA pays the contractor/consultant for work performed and then submits a progress invoice for reimbursement.
  • The LPA prepares the pay estimate for work performed and monies due to the contractor/consultant and submits the invoice to MoDOT. If the LPA adopts this method, it must develop cash management procedures to ensure payment is made to the contractor/consultant within two (2) business days of receipt of funds from MoDOT. Failure to disburse the funds promptly will result in a violation of federal cash management provisions and may result in an interest penalty assessment against the funds.

Whichever method above is used, the state will expedite reimbursement to the LPA. It is estimated that the average length of time from invoice submittal to receipt of federal reimbursement will be about 20 working days.

LPAs cannot withhold or make payments to a contractor or consultant contingent upon reimbursement of progress invoices. Refer to EPG for more information.

Reimbursement will not be made for any work complete outside of the period of service as defined in the consultant contract.

Invoice Detail. The invoice template found in Fig. 136.4.10 MUST be used for prime consultant invoices. Sub-consultants who have a contract with the prime that is greater than $25,000 must either use Fig. 136.4.10 or provide all the information that is listed in this figure to be considered acceptable. Each invoice must be submitted with the necessary supporting documentation and must be numbered in sequential order and label the final invoice as FINAL. An example invoice can be found in Fig. 136.4.17. This invoice shows example information to help customers fill out the document.

The invoice shall be based on the total incurred cost during the invoice period, minus any non-participating costs incurred. Invoices should identify each task in the scope of work, as well as the employees and hours spent on each task during the invoice period. Direct costs should also be shown by task.

Each invoice MUST show the total DBE payments for each DBE subcontractor, the total for that particular invoice and the DBE% met to date, if applicable.

Fig. 136.4.18 provides a checklist to aid in filling out the invoice. The checklist includes all items that are necessary to be on the invoice or submitted as supporting documentation in order for the invoice to be accepted and paid. Supplemental Agreements

Supplemental agreements, as shown in Fig. 136.4.4, are to be used to add/delete work within the scope of services that was advertised in the RFQ. Supplemental agreements cannot be used to increase scope outside the RFQ or to increase overhead or fixed fee. For example, a no cost supplemental agreement can be executed to extend the period of service as outlined in the original consultant contract.

The LPA or consultant will develop the supplemental agreement. Each supplemental must include new subconsultants, changes to the scope of services, new cost estimates and schedule or period of service adjustments as applicable. ECR will need to evaluate the supplemental to determine the DBE goal for the supplemental. Submit a copy of the supplemental to the ECR email group “LPADBEGoal”.

The supplemental agreement must be executed and submitted to MoDOT for approval.

The LPA can get a verbal acceptance from MoDOT to start the changed/additional work before the paperwork is finished and the additional funds are obligated, but no invoice reflecting the new monies shall be submitted until the additional funds are obligated, and the risk will be on the LPA if they proceed without obligation. In other words, if the supplemental agreement is denied by MoDOT/FHWA then the LPA will be responsible for funding the work associated with the supplemental, if work began prior to obligating the funds. Consultant Performance Appraisals

The LPA, the consultant and MoDOT must review and rate the consultant’s performance. All parties should agree upon the final ratings. These final ratings can be used as backup documentation for future consultant selection ratings. The consultant performance appraisal form can be found in Fig. 136.4.5. The evaluation must contain written comments on how the evaluation was determined. All evaluation comments must be factual and not based upon personal opinion, i.e. all comments must be able to be backed up by actual facts. See EPG for On-Call Consultant Evaluations. Dispute Resolution

Once a consultant is selected to work for the LPA, circumstances may arise that lead to a dispute between the LPA’s PM/CA and the consultant. In most cases, a complete understanding and recognition of each party’s concerns will result in successful resolution of the disagreement. However, when that is not the case, this dispute resolution procedure is used.

The relationship between the consultant and the LPA is a professional contractual relationship. All parties to the contract should understand the dispute resolution process. The PM/CA and the consultant should make every attempt to fully understand the dispute and express honest statements of fact prior to initiating formal dispute resolution. In this context, the PM/CA is defined as the person who authorizes the LPA’s payment of the consultant invoices.

Before initiating formal dispute resolution, the following activities should occur:

1. The LPA prepares a letter to the consultant outlining the contested issues.
2. The disputing parties (project manager level for both the LPA and consultant) participate in a face-to-face meeting.
3. The consulting firm conveys the firm’s recommendations for resolving the dispute.
4. The LPA’s representative discusses the consultant’s proposed resolution and responds in a letter, either accepting the proposal or offering a rebuttal.
5. The LPA and the consultant attempt to negotiate a settlement.

If the PM/CA and the consultant reach an agreement that provides the consultant with payment greater, or less than the contract maximum, the PM/CA needs to initiate a supplemental agreement and follow normal procedures to get the supplemental agreement executed. If no settlement is forthcoming, formal dispute resolution is initiated. If the LPA does not have a formal dispute resolution process, refer to 134.6 Dispute Resolution. Consultant Contract Close-Out

To close out a consultant contract the PM/CA must notify their MoDOT District Contact that the last invoice is the FINAL invoice and no further payments will be processed. Contracts include a requirement for a three-year retention of records after the final voucher for the entire project is submitted in FMIS by Financial Services.

Final Audit. MoDOT conducts a final audit to determine total allowable contract costs. Allowable cost principles are identified based on the experience of MoDOT personnel in administering past contracts and in accordance with applicable requirements of 2 CFR 200.400, Federal Acquisition Regulation (FAR), and 23 CFR 172, Administration of Engineering and Design Related Service Contracts.

136.4.4 Construction Engineering (CE) and Construction Administration

Please see EPG 136.11.12 Construction Administration.

136.4.5 Key Submittals/Requirements

Task/Submittal LPA Responsibility MoDOT Responsibility MoDOT Timeframe
RFQ/Advertisement Develop & Submit to MoDOT Review/Provide DBE Goal RFQ to be posted for 14 days minimum
Selection of Consultant Rate each consultant based on criteria in the RFQ. Attend rating/selection meeting but cannot give opinions on selection Selection to occur after the 14 day advertisement period lapses.
Contract Negotiation Negotiate with consultant n/a n/a
Contract Submittal Submit to MoDOT along with filled out checklist Review and send to FHWA for PE obligation -
Supplemental Agreement Prepare and submit to MoDOT Review and send to FHWA for obligation -
Performance Appraisal of Consultant LPA/Consultant to attend final appraisal meeting MoDOT to attend final appraisal meeting -