OAR 137-049-0670
Design-Build Contracts


(1)

General. The Design-Build form of contracting, as defined at OAR 137-049-0610 (Definitions for Alternative Contracting Methods)(3), has technical complexities that are not readily apparent. Contracting Agencies shall use this contracting method only with the assistance of knowledgeable staff or consultants who are experienced in its use. In order to use the Design-Build process, the Contracting Agency must be able to reasonably anticipate the following types of benefits:

(a)

Obtaining, through a Design-Build team, engineering design, plan preparation, value engineering, construction engineering, construction, quality control and required documentation as a fully integrated function with a single point of responsibility;

(b)

Integrating value engineering suggestions into the design phase, as the construction Contractor joins the project team early with design responsibilities under a team approach, with the potential of reducing Contract changes;

(c)

Reducing the risk of design flaws, misunderstandings and conflicts inherent in construction Contractors building from designs in which they have had no opportunity for input, with the potential of reducing Contract claims;

(d)

Shortening project time as construction activity (early submittals, mobilization, subcontracting and advance Work) commences prior to completion of a “Biddable” design, or where a design solution is still required (as in complex or phased projects); or

(e)

Obtaining innovative design solutions through the collaboration of the Contractor and design team, which would not otherwise be possible if the Contractor had not yet been selected.

(2)

Authority. Contracting Agencies shall utilize the Design-Build form of contracting only in accordance with the requirements of these OARs 137-049-0600 (Purpose) to 137-049-0690 (Construction Manager/General Contractor Services (“CM/GC Services”)) rules. See particularly 137-049-0620 (Use of Alternative Contracting Methods) on “Use of Alternative Contracting Methods” and 137-049-0680 (Energy Savings Performance Contracts (ESPC)) pertaining to ESPCs.

(3)

Selection. Design-Build selection criteria may include those factors set forth above in OAR 137-049-0640 (Competitive Proposals; Procedure)(2)(a), (b) and (c).

(4)

QBS Inapplicable. Because the value of construction Work predominates the Design-Build form of contracting, the qualifications based selection (QBS) process mandated by ORS 279C.110 (Selection procedures for consultants to provide services) for State Contracting Agencies in obtaining certain consultant Personal Services is not applicable.

(5)

Licensing. If a Design-Build Contractor is not an Oregon licensed design professional, the Contracting Agency shall require that the Design-Build Contractor disclose in its Written Offer that it is not an Oregon licensed design professional, and identify the Oregon licensed design professional(s) who will provide design services. See ORS 671.030 (Activities not considered as “practice of architecture”)(2)(g) regarding the offer of architectural services, and 672.060 (Activities not requiring registration)(11) regarding the offer of engineering services that are appurtenant to construction Work.

(6)

Performance Security. ORS 279C.380 (Performance bond)(1)(a) provides that for Design-Build Contracts the surety’s obligation on performance bonds, or the Bidder’s obligation on cashier’s or certified checks accepted in lieu thereof, includes the preparation and completion of design and related Personal Services specified in the Contract. This additional obligation, beyond performance of construction Work, extends only to the provision of Personal Services and related design revisions, corrective Work and associated costs prior to final completion of the Contract (or for such longer time as may be defined in the Contract). The obligation is not intended to be a substitute for professional liability insurance, and does not include errors and omissions or latent defects coverage.

(7)

Contract Requirements. Contracting Agencies shall conform their Design-Build contracting practices to the following requirements:

(a)

Design Services. The level or type of design services required must be clearly defined within the Procurement documents and Contract, along with a description of the level or type of design services previously performed for the project. The Personal Services and Work to be performed shall be clearly delineated as either design Specifications or performance standards, and performance measurements must be identified.

(b)

Professional Liability. The Contract shall clearly identify the liability of design professionals with respect to the Design-Build Contractor and the Contracting Agency, as well as requirements for professional liability insurance.

(c)

Risk Allocation. The Contract shall clearly identify the extent to which the Contracting Agency requires an express indemnification from the Design-Build Contractor for any failure to perform, including professional errors and omissions, design warranties, construction operations and faulty Work claims.

(d)

Warranties. The Contract shall clearly identify any express warranties made to the Contracting Agency regarding characteristics or capabilities of the completed project (regardless of whether errors occur as the result of improper design, construction, or both), including any warranty that a design will be produced that meets the stated project performance and budget guidelines.

(e)

Incentives. The Contract shall clearly identify any economic incentives and disincentives, the specific criteria that apply and their relationship to other financial elements of the Contract.

(f)

Honoraria. If allowed by the RFP, honoraria or stipends may be provided for early design submittals from qualified finalists during the solicitation process on the basis that the Contracting Agency is benefited from such deliverables.

Source: Rule 137-049-0670 — Design-Build Contracts, https://secure.­sos.­state.­or.­us/oard/view.­action?ruleNumber=137-049-0670.

137‑049‑0100
Application
137‑049‑0110
Policies
137‑049‑0120
Definitions
137‑049‑0130
Competitive Bidding Requirement
137‑049‑0140
Contracts for Construction Other Than Public Improvements
137‑049‑0150
Emergency Contracts
137‑049‑0160
Intermediate Procurements
137‑049‑0200
Solicitation Documents
137‑049‑0210
Notice and Advertising Requirements
137‑049‑0220
Prequalification of Offerors
137‑049‑0230
Eligibility to Bid or Propose
137‑049‑0240
Pre-Offer Conferences
137‑049‑0250
Addenda to Solicitation Documents
137‑049‑0260
Request for Clarification or Change
137‑049‑0270
Cancellation of Solicitation Document
137‑049‑0280
Offer Submissions
137‑049‑0290
Bid or Proposal Security
137‑049‑0300
Facsimile Bids and Proposals
137‑049‑0310
Electronic Procurement
137‑049‑0320
Pre-Closing Modification or Withdrawal of Offers
137‑049‑0330
Receipt, Opening and Recording of Offers
137‑049‑0340
Late Bids, Late Withdrawals and Late Modifications
137‑049‑0350
Mistakes
137‑049‑0360
First-Tier Subcontractors
137‑049‑0370
Disqualification of Persons
137‑049‑0380
Bid or Proposal Evaluation Criteria
137‑049‑0390
Offer Evaluation and Award
137‑049‑0395
Notice of Intent to Award
137‑049‑0400
Documentation of Award
137‑049‑0410
Time for Contracting Agency Acceptance
137‑049‑0420
Negotiation With Bidders Prohibited
137‑049‑0430
Negotiation When Bids Exceed Cost Estimate
137‑049‑0440
Rejection of Offers
137‑049‑0450
Protest of Contractor Selection, Contract Award
137‑049‑0460
Performance and Payment Security
137‑049‑0470
Substitute Contractor
137‑049‑0490
Foreign Contractor
137‑049‑0600
Purpose
137‑049‑0610
Definitions for Alternative Contracting Methods
137‑049‑0620
Use of Alternative Contracting Methods
137‑049‑0630
Findings, Notice and Hearing
137‑049‑0640
Competitive Proposals
137‑049‑0645
Requests for Qualifications (RFQ)
137‑049‑0650
Requests for Proposals (“RFP”)
137‑049‑0660
RFP Pricing Mechanisms
137‑049‑0670
Design-Build Contracts
137‑049‑0680
Energy Savings Performance Contracts (ESPC)
137‑049‑0690
Construction Manager/General Contractor Services (“CM/GC Services”)
137‑049‑0800
Required Contract Clauses
137‑049‑0810
Waiver of Delay Damages Against Public Policy
137‑049‑0815
BOLI Public Works Bond
137‑049‑0820
Retainage
137‑049‑0830
Contractor Progress Payments
137‑049‑0840
Interest
137‑049‑0850
Final Inspection
137‑049‑0860
Public Works Contracts
137‑049‑0870
Specifications
137‑049‑0880
Records Maintenance
137‑049‑0890
Contracting Agency Payment for Unpaid Labor or Supplies
137‑049‑0900
Contract Suspension
137‑049‑0910
Changes to the Work and Contract Amendments
Last Updated

Jun. 24, 2021

Rule 137-049-0670’s source at or​.us