SB 388 Modifies provisions relating to construction management services and allows political subdivisions to use construction manager-at-risk and design-build methods
Sponsor: Wasson
LR Number: 1484S.02I Fiscal Notes
Committee: Commerce, Consumer Protection, Energy and the Environment
Last Action: 2/24/2015 - Second Read and Referred S Commerce, Consumer Protection, Energy and the Environment Committee Journal Page: S424
Title: Calendar Position:
Effective Date: August 28, 2015

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Current Bill Summary

SB 388 - This act modifies provisions relating to construction contracts.


Under current law, a construction manager is not allowed to bid on or perform any construction on a public works project, nor is the firm that controls, is controlled by, or shares control with the construction manager allowed to engage in such activities. This act repeals those restrictions and allows the construction manager to bid on or perform construction on a public works project if the construction manager submits a sealed bid in the same manner as other bidders.

Current law also forbids construction management services contracts from being awarded by a public owner if the construction manager or associated firm assumes financial responsibility for the work of others, provides the public owner with a guaranteed maximum price for the work of others, or guarantees or furnishes a performance or payment bond for other contractors. This act allows such activities. In addition, this act repeals a requirement that contracts for construction management be let by competitive bidding like contracts for construction work.

These provisions are similar to provisions of SB 359 (2015) and SB 367 (2015).


This act allows political subdivisions to use the construction manager-at-risk method for construction projects. Before selecting a construction manager-at-risk, or during the selection process, the political subdivision must select an engineer or architect to prepare the construction documents.

The political subdivision may use a one-step or two-step process to select the construction manager-at-risk. This act outlines the necessary procedures for both processes. The political subdivision may determine how to publish its notice that it is seeking a construction manager-at-risk.

This act requires the political subdivision to publicly open and read aloud the names of the bidders, and to evaluate and rank each bidder within 45 days of the opening of the bids. The political subdivision must select the construction manager-at-risk that offers the best value. If the political subdivision fails to negotiate a satisfactory contract with the selected construction manager-at-risk, the political subdivision must negotiate with the next highest ranked construction manager-at-risk.

This act requires the construction manager-at-risk to publicly bid its subcontracts for the performance of all major elements of the work. If the construction manager-at-risk seeks to perform the work, it must be selected by the political subdivision and provide the best value. Both the political subdivision and the construction manager-at-risk evaluate the bids, and the political subdivision may compensate the construction manager-at-risk if the political subdivision requires a different bid be accepted than the one recommended by the construction manager.

This act specifies the procedures for when a selected subcontractor defaults in the performance of its work.

This provision is substantially similar to HCS/HB 1042 (2015) and a provision in SCS/HCS/HB 844(2015).


This act allows political subdivisions to enter into contracts for design-build projects that exceed an expenditure of $25 million.

Definitions are provided for "design-build", "design-build contract", "design-builder", "design-build project", "design criteria consultant", "design criteria package", "design professional services", "proposal", "public facility construction project", "qualifications-based selection", "request for proposal", and "stipend".

This act requires political subdivisions that do not employ certain types of full time staff to employ a design criteria consultant.

The act also requires political subdivisions to advertise the request for proposal in a certain manner and include certain information in the request for proposal.

This act creates a three-stage process for the solicitation of proposals. The political subdivision must award the project to the highest-scoring bidder. If the political subdivision determines it is not in its best interest to proceed with the project with the highest scoring bidder, the political subdivision must reject all the proposals. All the design-builders who submitted bids must receive stipends, and the highest-scoring design-builder must receive double the stipend. If all the proposals are rejected, the political subdivision may solicit new proposals using different qualifications, costs, and criteria. Design-builders who accept stipends give the political subdivision a nonexclusive right to use their designs and the design-builders have no liability for the use of the designs.

Under this act, the payment requirements that apply to public works contracts also apply to design-build projects.

Any person or firm providing architectural, engineering, landscape architecture, or land-surveying services must be licensed. The design-builder is exempt from the requirements involving certificates of registration or authority if the architectural, engineering, or land-surveying services are performed by subcontractors who are properly licensed.

The design-build provisions expire on September 1, 2025.

This provision is substantially similar to HCS/HB 1042 (2015) and a provision in SCS/HCS/HB 844(2015).