04/20/1999 01:37 PM Senate L&C

           SB 141-PROCUREMENT: CONTRACTS/SUBCONTRACTS                                                                           
                                                                                                                                
MR. JEREMY KERR, UAS Intern for Senator Leman, said SB 141 was                                                                  
introduced at the request of DOTPF to give the Department greater                                                               
flexibility in contracts known as "design build", where the owner                                                               
(in this case, the state) chooses a contractor that will build as                                                               
well as design a project.  Two examples of this are the M/V                                                                     
Kennicott and the Whittier Tunnel.  Usually, the owner picks a                                                                  
design and then has the contractor build it.                                                                                    
                                                                                                                                
This bill is in the best interest of the State and will only affect                                                             
state contracts.  Current law states that construction contractors                                                              
must list the subcontractors they plan on using within five days of                                                             
the award of the contract.  Because of the nature of design build                                                               
contracts, it is not always possible for the contractor to identify                                                             
the needed subcontractors.  This provides flexibility to DOTPF to                                                               
allow contractors to provide that information at a later date.                                                                  
This bill also changes a request to change contractors to be in                                                                 
writing.                                                                                                                        
                                                                                                                                
MR. KERR said there is no opposition from either the design or                                                                  
construction community that they know of.                                                                                       
                                                                                                                                
CHAIRMAN MACKIE asked what was the fiscal impact of this bill.                                                                  
                                                                                                                                
MR. KERR said there were zero fiscal impacts.                                                                                   
                                                                                                                                
Number 320                                                                                                                      
                                                                                                                                
MR. MARK O'BRIEN, Chief Contracts Officer, DOTPF, said that the two                                                             
issues they are trying to address are design/build construction                                                                 
contracts where they cannot list subcontractors within five days.,                                                              
because in a lot of cases, they don't know whether it's going to be                                                             
a piling contractor or a concrete contractor for the design of the                                                              
foundation of a building, for instance.  The second thing this does                                                             
is allow them to substitute or add subcontractors when it's in the                                                              
state's best interest.  An example of this would be discovering                                                                 
that you need an asbestos or lead abatement contractor after                                                                    
starting the project.                                                                                                           
                                                                                                                                
SENATOR LEMAN asked how often the Department uses the design/build                                                              
approach versus the more conventional approach.                                                                                 
                                                                                                                                
MR. O'BRIEN answered rarely.  He is aware of only two last year and                                                             
about five in the last three years.  A number of them have been                                                                 
sand storage buildings.                                                                                                         
                                                                                                                                
SENATOR LEMAN said the CS has a new Section 3 which rewords                                                                     
language to give comfort to the design community about what                                                                     
conditions in AS 36.30.115 may still apply.  It doesn't change any                                                              
of the substance.                                                                                                               
                                                                                                                                
SENATOR LEMAN moved to adopt the Banister CS to SB 141.  There were                                                             
no objections and it was so ordered.                                                                                            
                                                                                                                                
SENATOR LEMAN moved to pass CSSB 141 from committee with individual                                                             
recommendations with the zero fiscal note.  There were no                                                                       
objections and it was so ordered.