Judges: RICHARD P. IEYOUB
Filed Date: 11/7/2002
Status: Precedential
Modified Date: 7/5/2016
Dear Mr. Spruell:
On behalf of the Calcasieu Parish School Board (Board), you have requested the opinion of this office on the following issues:
A. May a public body enter into a construction management agreement without publicly bidding the contract for services as a construction manager?
B. May a public works project, under a construction management agreement, be divided into separate trade packages, with each trade package being competitively bid when required by the Public Bid Law, without violating R.S.
38:2212 H?C. Does a construction management agreement, which provides that the construction manager will supervise, control, approve payments and have the right to terminate the contractors on a project, comply with the Louisiana Contractors' Licensing Law?
You indicate that the Board is considering entering into a construction management agreement with a licensed contractor (Construction Manager) to oversee construction projects on properties owned by the Board. The Construction Manager would not do any actual construction but would oversee separate trade contracts which would be competitively awarded as required by the Public Bid Law. The construction management agreement would require that the Construction Manager assist the Board and its agents in developing bid documents, evaluation of bids and overseeing, directing and coordinating the individual duly licensed and bonded trade contractors selected and awarded contracts by the Board. As agent for the Board, the Construction Manager could terminate a contractor for good cause.
SELECTION OF THE CONSTRUCTION MANAGER
The proposed contract with a Construction Manager is one for services. It has long been held by our courts that contracts for services are not subject to the Public Bid Law. Wallace Stevens, Inc. v. LaFourche ParishHospital District No. 3,
CONSTRUCTION MANAGER'S RESPONSIBILITIES
Your opinion request details extensive responsibilities which the Board, as owner, would delegate to the Construction Manager as the authorized agent of the Board to carry out these responsibilities. We find no problem with this arrangement, except to point out that many of the delegated responsibilities fall within the definition of "contractor" set forth in R.S.
Even in the more familiar owner/architect/general contractor/sub-contractor arrangement the owner delegates its responsibilities to one of these as its agent, usually the architect and general contractor. Interposing a Construction Manager and delegating oversight and management decision making to that party is no problem under the law.
The contractual arrangement proposed between the Board and the Construction Manager avoids the deficiency found by the court in HospitalService District No. 1 of Tangipahoa Parish v. Louisiana State LicensingBoard for Contractors,
COMPLIANCE WITH LSA-R.S.
Under the Public Bid Law, contracts for public works costing $100,000 or more must be advertised and let by contract to the lowest responsible and responsive bidder. Public works means the erection, construction, alteration, improvement, or repair of any public facility or immovable property owned, used, or leased by a public entity. LSA-R.S.
LSA-R.S.
It is our opinion that should the public works project, taken as a whole, equal or exceed the statutory contact limits of $100,000, then each and every trade package or contract relating to the particular project must comply with the advertising and bidding requirements of the Public Bid Law. The separate trade packages cannot be evaluated as a separate and distinct project within a project for purposes of complying with the Public Bid Law. To do otherwise would be a clear violation of R.S.
COMPLIANCE WITH CONTRACTORS' LICENSING LAW
As indicated above, the person contracted as Construction Manager would necessarily be licensed by the Contractors' Licensing Board for "building construction" under R.S.
I trust that this answers your inquiries. Please let me know if you need additional information or guidance on this issue.
Very truly yours,
RICHARD P. IEYOUP Attorney General
BY: _____________________________ RICHARD L. MCGIMSEY Assistant Attorney General
RPI/RLM/dam