New case confirms competitive bidding exception for lease lease-back projects award by school districts

A court of appeal case published on September 18, 2014, Los Alamitos Unified School District v. Howard Contracting, Inc., confirmed the existence of an exception to competitive bidding for "lease-leaseback" agreements awarded by school districts pursuant to Education Code section 17406. Many involved in school district construction have held the view that "lease-leaseback" agreements were exempt from competitive bidding, despite the fact that these agreements result in new construction projects which are ultimately owned by a school district. This case confirms that view by applying a plain meaning interpretation of section 17406.

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California legislature enacts several new laws concerning prevailing wage requirements

The California legislature has enacted a number of laws that impact prevailing wage requirements, including provisions that affect charter cities, requirements to inform the Labor Commissioner of the completion of public works projects, exposure to liquidated damages for prevailing wage violations, and applying prevailing wage requirements to refinery construction projects. These laws went into effect on January 1, 2014, and are summarized below.

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Bay Bridge Construction: Don't Put Your Party Dress On Just Yet . . .

The Labor Day Bay Bridge celebration for the opening of the eastern span may be postponed. In the last few weeks, concern about issues with the Self Anchored Suspension Span (SAS) of the San Francisco-Oakland Bay Bridge, and specifically the cracked anchor bolts, has greatly increased from Governor Jerry Brown’s enlightened comment on May 7, 2013, that “shit happens.” Indeed, the problems with the bolts have heightened concern about public safety and a real possibility that the SAS will not be ready for use until 2014. After all, we are talking about the structural integrity of the state’s most traversed bridge, and at a cost of $6.4 billion, the largest public works project in California history.

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Demise of the "de minimis" exception to prevailing wage requirements?

The legislature is considering adopting a statute that would require workers on private projects to be paid prevailing wage if public subsidies exceed the lesser of $10,000 or 1% of the project cost.  This would effectively eliminate the de minimis exception and likely change the landscape for public subsidies on private projects.

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Amazing photographs of Transbay Terminal construction

Curbed San Francisco posted an article yesterday with a number of great photographs of the construction work in progress on the Transbay Terminal in San Francisco.  I have not seen images this detailed before, and they are fascinating.  Apparently, the web of steel crossbeams are temporary supports.  It is worth a look, click here.

Interesting article on "accelerated bridge construction"

This New York Times article describes a relatively new "accelerated bridge construction" technique using a self-propelled modular transport to lift a bridge into place.  The article focuses on the River Street Bridge in Boston, but the technique is being used increasingly around the country.  When done correctly, the bridge is lowered in place "like a lid fitting onto a box."  The primary benefit of this technique is the incredible increase in speed of project completion, shaving months or even yeras off of a project.   Click here to read the article.

New law caps retention on public works projects at 5%

On October 9, 2011, Governor Brown signed SB 293 in to law.  SB 293 addressed a variety of issues in public works related statutes, including prompt payment periods between a prime contractor and subcontractor, procedures for filing 20-day preliminary notices, and procedures for making claims on payment bonds.  Most noteworthy, however, is the adoption of a new Public Contract Code section 7201 which caps retention of progress payment for all public works projects at 5%.  

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Appellate court clears way for Presidio Parkway Project to move forward as a Public-Private Partnership

On August 8, 2011, the 1st District Court of Appeal broke new ground when it published a decision holding that Phase 2 of the Presidio Parkway project can move forward as a public-private partnership (P3). The Presidio Parkway Project is the first project to reach award under California’s new public-private partnership statute, Streets and Highways Code section 143. The project was challenged on three separate grounds by the Professional Engineers in California Government (PECG), an engineers' union. The Court of Appeal affirmed the trial court's ruling approving the California Department of Transportation's (Caltrans) use of the new statute, and should encourage the consideration of P3s as a project delivery method in California.

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Interesting BIM video from Disney

I just came across this short video regarding Disney's use of Building Information Modeling on the construction of their new Fantasyland.  It demonstrates the benefits of BIM in a little over 3 minutes.  Watch it here.

Ninth Circuit decision makes it harder to bring a Federal False Claims Act case

On March 24, 2011 the Ninth Circuit Court of Appeals made it more difficult to bring a complaint claiming a violation of the Federal False Claims Act (FCA). The Court held that FCA complaints must not only “state with particularity the circumstances constituting fraud or mistake” (under Federal Rule of Civil Procedure 9(b)), but must “also plead plausible allegations” (under Federal Rule of Civil Procedure 8(a). In Mary Angela Cafasso v. General Dynamics C4 Systems, Inc. (March 24, 2011) 11 C.D.O.S. 3557 the Court upheld the dismissal of the plaintiffs’ False Claims Act complaint before trial because, although the “complaint alleges unsavory conduct ... unsavory conduct is not, without more, actionable under the [False Claims Act].”

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Design-build gaining traction in the public sector

The use of design-build in the public sector appears to be growing.  As more public agencies achieve positive results with this project delivery method, the legislature appears to be more comfortable with expanding the statutory authority.  My colleague, Lisa Dal Gallo, and I recently co-authored an article about this trend as well as the many benefits of design-build.  Click here for a copy of the article.


Doyle Drive project sued for impermissible use of P3 authority

The Professional Engineers in California Government, the union representing state engineers, has filed suit to stop the project to replace Doyle Drive, the 1.6 mile highway that connects the Golden Gate Bridge with the City of San Francisco. The lawsuit alleges that the project impermissibly uses a Private Public Partnership (P3) contrary to the State law authorizing the project. Instead, the engineers union asserts that the project should be awarded to the lowest bidder pursuant to a traditional design-bid-build process, with the design component being performed by State engineers.  Under the current arrangement, Hochtief Concessions and Meridiam Infrastructure will design, construct, operate and maintain the road. 

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By many measures, the state of American infrastructure is concerning

I recently received a link to a very informative blog post on the Blogineering blog which includes a compilation of 50 separate articles and videos addressing the current state of infrastructure in the United States.   It paints a disconcerting portrait of our considerable infrastructure needs over the near term, while also linking to articles which offer potential solutions.  Needless to say, it is an informative resource.  You can find the blog post here.

Governor signs SB 972, clarifying design professionals' duty to defend

Governor Schwarzenegger has now signed SB 972, a new law that clarifies when design professionals will owe a "duty to defend" to public agencies when lawsuits are filed that implicate the services provided by such professionals. The new statute, which will be effective on January 1, 2011, was adopted in response to two court decisions (Crawford v. Weather Shield Mfg., Inc. (2007) 44 Cal.4th 541 and UDC v. CH2M Hill (2010) 181 Cal.App.4th 10), which held that parties could be required to bear the costs of defense under common contractual indemnity provisions, even if they are not ultimately found to have been negligent.

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New case delineates boundaries between bidder responsiveness and responsibility

A court of appeal case published on August 31, Great West Contractors, Inc. v. Irvine Unified School District, refined the rules for public agencies evaluating bids submitted for a low-bid contract by clarifying the distinction between bidder responsiveness and bidder responsibility.  In short, bidder responsiveness can only be determined on the face of the bid, and the rejection of a bid based on information obtained from an investigation external to the bid must be evaluated as an issue of bidder responsibility.  The court also made several observations about the apparent favoritism of the School District in attempting to award the contract to the third low bidder.   Please read on for a discussion of the case.   

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