1.1 	A bill for an act
1.2 	relating to state government; regulating state
1.3 	construction contracts; amending Minnesota Statutes
1.4 	2004, sections 16B.31, subdivision 1; 16B.33,
1.5 	subdivision 1; proposing coding for new law in
1.6 	Minnesota Statutes, chapter 16C.
1.7 	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

1.8 	Section 1. Minnesota Statutes 2004, section 16B.31,
1.9 	subdivision 1, is amended to read:
1.10 		Subdivision 1.Construction plans and specifications;
1.11 	design-build, construction manager at risk, or job order
1.12 	contracting.  (a) The commissioner shall (1) have plans and
1.13 	specifications prepared for the construction, alteration, or
1.14 	enlargement of all state buildings, structures, and other
1.15 	improvements except highways and bridges, and except for
1.16 	buildings and structures under the control of the Board of
1.17 	Regents of the University of Minnesota or of the Board of
1.18 	Trustees of the Minnesota State Colleges and Universities; (2)
1.19 	approve those plans and specifications; (3) advertise for bids
1.20 	and award all contracts in connection with the improvements; (4)
1.21 	supervise and inspect all work relating to the improvements; (5)
1.22 	approve all lawful changes in plans and specifications after the
1.23 	contract for an improvement is let; and (6) approve estimates
1.24 	for payment.  This subdivision does not apply to the
1.25 	construction of the Zoological Gardens.
1.26 	(b) MS 2002 (Expired)
2.1 	(c) MS 2002 (Expired)
2.2 	(b) Notwithstanding any other law to the contrary, the
2.3 	commissioner may:
2.4 	(1) use a design-build method of project delivery and award
2.5 	a design-build contract as provided in sections 16C.32 and
2.6 	16C.33;
2.7 	(2) use a construction manager at risk method of project
2.8 	delivery and award a construction manager at risk contract on
2.9 	the basis of the selection criteria described in section 16C.34;
2.10 	or 
2.11 	(3) use a job order contracting contractor selection as
2.12 	described in section 16C.35.
2.13 	(c) The commissioner may require a primary designer and a
2.14 	construction manager at risk, by contract, to cooperate in the
2.15 	design, planning and scheduling, and construction process.  The
2.16 	contract must not make the primary designer or construction
2.17 	manager at risk a subcontractor or joint venture partner to the
2.18 	other or limit the primary designer's or construction manager at
2.19 	risk's independent obligations to the commissioner.
2.20 	(d) For projects undertaken by the Minnesota State Colleges
2.21 	and Universities system, the powers and duties granted in
2.22 	paragraphs (b) and (c) may be exercised by its board of trustees.
2.23 	(e) The commissioner, the board, the Board of Regents of
2.24 	the University of Minnesota, and the Board of Trustees of the
2.25 	Minnesota State Colleges and Universities shall create a panel
2.26 	of representatives, including representatives of the
2.27 	construction industry and the architecture and engineering
2.28 	professions, to evaluate the use of design-build and the
2.29 	procedures for design-builder selection under section 16C.31,
2.30 	and shall report to the legislature on or before January 1,
2.31 	2004, as to the success of design-build as a method of
2.32 	construction and the need and desirability for any changes in
2.33 	the selection procedure.

2.34 	Sec. 2. Minnesota Statutes 2004, section 16B.33,
2.35 	subdivision 1, is amended to read:
2.36 		Subdivision 1.Definitions.  As used in this section, the
3.1 	following terms have the meanings given them:
3.2 	(a) "Agency" has the meaning given in section 16B.01.
3.3 	(b) "Architect" means an architect or landscape architect
3.4 	registered to practice under sections 326.02 to 326.15.
3.5 	(c) "Board" means the state Designer Selection Board.
3.6 	(d) "Design-build" means the process of entering into and
3.7 	managing a single contract between the commissioner and the
3.8 	design-builder in which the design-builder agrees to both design
3.9 	and construct a project as specified in the contract at a
3.10 	guaranteed maximum or a fixed price.
3.11 	(e) "Design-builder" means a person who proposes to design
3.12 	and construct a project in accordance with the requirements of
3.13 	section 16C.33.
3.14 	(f) "Designer" means an architect or engineer, or a
3.15 	partnership, association, or corporation comprised primarily of
3.16 	architects or engineers or of both architects and engineers.
3.17 	(e) (g) "Engineer" means an engineer registered to practice
3.18 	under sections 326.02 to 326.15.
3.19 	(f) (h) "Person" includes an individual, corporation,
3.20 	partnership, association, or any other legal entity.
3.21 	(g) (i) "Primary designer" means the designer who is to
3.22 	have primary design responsibility for a project, and does not
3.23 	include designers who are merely consulted by the user agency
3.24 	and do not have substantial design responsibility, or designers
3.25 	who will or may be employed or consulted by the primary designer.
3.26 	(h) (j) "Project" means an undertaking to construct, erect,
3.27 	or remodel a building by or for the state or an agency.
3.28 	(i) (k) "User agency" means the agency undertaking a
3.29 	specific project. For projects undertaken by the state of
3.30 	Minnesota, "user agency" means the Department of Administration
3.31 	or a state agency with an appropriate delegation to act on
3.32 	behalf of the Department of Administration.

3.33 	Sec. 3. [16C.32] DESIGN-BUILD, CONSTRUCTION MANAGER AT
3.34 	RISK, AND JOB ORDER CONTRACTING CONTRACTS.
3.35 		Subdivision 1.Definitions. As used in sections 16C.32
3.36 	to 16C.35, the following terms have the meanings given them,
4.1 	unless the context clearly indicates otherwise:
4.2 	(1) "acceptance" means a formal resolution of the
4.3 	commissioner authorizing the execution of a design-build,
4.4 	construction manager at risk, or job order contracting contract;
4.5 	(2) "agency" means any state officer, employee, board,
4.6 	commission, authority, department, or other agency of the
4.7 	executive branch of state government.  Unless specifically
4.8 	indicated otherwise, as used in sections 16C.32 to 16C.35,
4.9 	agency also includes the Minnesota State Colleges and
4.10 	Universities;
4.11 	(3) "architect" means an architect or landscape architect
4.12 	registered to practice under sections 326.02 to 326.15;
4.13 	(4) "board" means the state Designer Selection Board;
4.14 	(5) "Capitol Area Architectural and Planning Board" means
4.15 	the board established to govern the capitol area under chapter
4.16 	15B;
4.17 	(6) "commissioner" means the commissioner of administration
4.18 	or the Board of Trustees of the Minnesota State Colleges and
4.19 	Universities, whichever controls a project;
4.20 	(7) "construction manager at risk" means a person who is
4.21 	selected by the commissioner to act as a construction manager to
4.22 	manage the construction process, which includes, but is not
4.23 	limited to, responsibility for the price, schedule, and
4.24 	workmanship of the construction performed in accordance with the
4.25 	procedures of section 16C.34;
4.26 	(8) "construction manager at risk contract" means a
4.27 	contract for construction of a project between a construction
4.28 	manager and the commissioner, which contract shall include a
4.29 	guaranteed maximum price, construction schedule, and workmanship
4.30 	of the construction performed;
4.31 	(9) "design-build contract" means a contract between the
4.32 	commissioner and a design-builder to furnish the architectural,
4.33 	engineering, and related design services as well as the labor,
4.34 	materials, supplies, equipment, and construction services for a
4.35 	project;
4.36 	(10) "design and price-based proposal" means the proposal
5.1 	to be submitted by a design-builder in the design and
5.2 	price-based selection process, as described in section 16C.33,
5.3 	which proposal meets the requirements of section 16C.33,
5.4 	subdivision 7, paragraph (c), in such detail as required in the
5.5 	request for proposals;
5.6 	(11) "design and price-based selection" means the selection
5.7 	of a design-builder as described in section 16C.33, subdivision
5.8 	8;
5.9 	(12) "design criteria package" means performance criteria
5.10 	prepared by a design criteria professional who shall be either
5.11 	an employee of the commissioner or shall be selected in
5.12 	compliance with section 16B.33, 16C.08, or 16C.095;
5.13 	(13) "design criteria professional" means a person licensed
5.14 	under chapter 326, or a person who employs an individual or
5.15 	individuals licensed under chapter 326, required to design a
5.16 	project, and who is employed by or under contract to the
5.17 	commissioner to provide professional, architectural, or
5.18 	engineering services in connection with the preparation of the
5.19 	design criteria package;
5.20 	(14) "guaranteed maximum price" means the maximum amount
5.21 	that a design-builder, construction manager at risk, or
5.22 	subcontractor will be paid pursuant to a contract to perform a
5.23 	defined scope of work;
5.24 	(15) "guaranteed maximum price contract" means a contract
5.25 	under which a design-builder, construction manager, or
5.26 	subcontractor is paid on the basis of their actual cost to
5.27 	perform the work specified in the contract plus an amount for
5.28 	overhead and profit, the sum of which must not exceed the
5.29 	guaranteed maximum price set forth in the contract;
5.30 	(16) "job order contracting" means a project delivery
5.31 	method that requests a limited number of bids from a list of
5.32 	qualified contractors, selected from a registry of qualified
5.33 	contractors who have been prescreened and who have entered into
5.34 	master contracts with the commissioner, as provided in section
5.35 	16C.35;
5.36 	(17) "past performance" or "experience" does not include
6.1 	the exercise or assertion of a person's legal rights;
6.2 	(18) "person" includes an individual, corporation,
6.3 	partnership, association, or any other legal entity;
6.4 	(19) "project" means an undertaking to construct, alter, or
6.5 	enlarge a building, structure, or other improvements, except
6.6 	highways and bridges, by or for the state or an agency;
6.7 	(20) "qualifications-based selection" means the selection
6.8 	of a design-builder as provided in section 16C.33;
6.9 	(21) "request for qualifications" means the document or
6.10 	publication soliciting qualifications for a design-build,
6.11 	construction manager at risk, or job order contracting contract
6.12 	as provided in sections 16C.33 to 16C.35;
6.13 	(22) "request for proposals" means the document or
6.14 	publication soliciting proposals for a design-build or
6.15 	construction manager at risk contract as provided in sections
6.16 	16C.33 and 16C.34; and 
6.17 	(23) "trade contract work" means the furnishing of labor,
6.18 	materials, or equipment by contractors or vendors that are
6.19 	incorporated into the completed project.  Work performed by
6.20 	trade contractors involves specific portions of the project, but
6.21 	not the entire project.
6.22 		Subd. 2.Authority. (a) Subject to limitations in
6.23 	sections 16B.31, subdivision 1; 16B.33, subdivision 1; and
6.24 	16C.32 to 16C.34, and notwithstanding any other law to the
6.25 	contrary, the commissioner may:
6.26 	(1) solicit and award a design-build contract on the basis
6.27 	of either a qualifications based or a design and price-based
6.28 	selection process provided in section 16C.33 if the conditions
6.29 	in clause (4) are met;
6.30 	(2) select a construction manager at risk as provided in
6.31 	section 16C.34, and award a guaranteed maximum price contract
6.32 	for a construction manager at risk if the conditions of clause
6.33 	(5) are met;
6.34 	(3) select a contractor by a job order contracting delivery
6.35 	method as provided in section 16C.35;
6.36 	(4) the commissioner may not utilize design-build contracts
7.1 	for more than five percent of its total projects let, by number,
7.2 	in each of the fiscal years 2006 and 2007, and ten percent of
7.3 	its total projects let, by number, in each fiscal year
7.4 	thereafter, that are funded in whole or in part with proceeds
7.5 	from the sale of state general obligation bonds; and 
7.6 	(5) the commissioner may not utilize construction manager
7.7 	at risk contracts for more than five percent of its total
7.8 	projects let, by number, in each of the fiscal years 2006 and
7.9 	2007, and ten percent of its total projects let, by number, in
7.10 	each fiscal year thereafter, that are funded in whole or in part
7.11 	with proceeds from the sale of state general obligation bonds.
7.12 	(b) Pursuant to section 16B.31, subdivision 4, if the
7.13 	project is within the Capitol area, the project shall comply
7.14 	with sections 15B.03, subdivision 3; 15B.08, subdivision 2;
7.15 	15B.10; and 15B.15, subdivision 4.
7.16 	(c) The commissioner shall, for each design-build or
7.17 	construction manager at risk contract, make a written
7.18 	determination, including specific findings, indicating whether
7.19 	use of the design-build or construction manager at risk
7.20 	procurement serves the public interest.
7.21 	(d) The solicitation of requests for qualifications or
7.22 	proposals does not obligate the commissioner to enter into a
7.23 	design-build or construction manager at risk contract.  In
7.24 	accordance with the stated criteria and subcriteria for
7.25 	evaluating qualifications or proposals, the commissioner may
7.26 	accept or reject any or all responses received as a result of
7.27 	the request.  The solicitation for qualifications or proposals
7.28 	may be canceled at any time in the commissioner's sole
7.29 	discretion if it is considered to be in the public's best
7.30 	interest.  If the commissioner rejects all responses or cancels
7.31 	the solicitation for proposals, the commissioner may resolicit a
7.32 	request for qualifications or proposals using the same or
7.33 	different requirements or request selection of a primary
7.34 	designer pursuant to section 16B.33, 16C.08, or 16C.095 and
7.35 	proceed with competitive bidding pursuant to sections 16C.25 to
7.36 	16C.29.

8.1 	Sec. 4. [16C.33] DESIGN-BUILD.
8.2 		Subdivision 1.Conflict of interest. A board member may
8.3 	not participate in the review, discussion, or selection of a
8.4 	primary designer, a design-builder, or a firm in which the
8.5 	member has a financial interest.
8.6 		Subd. 2.Design builder licensing requirements. (a) Each
8.7 	design-builder must be, employ, or have as a partner, member,
8.8 	coventurer, or subcontractor, persons or a firm with persons who
8.9 	are duly licensed and registered to provide the services
8.10 	required to complete the project and do business in this state.
8.11 	(b) A design-builder may contract with the commissioner to
8.12 	provide professional or construction services for which the
8.13 	design-builder is not itself licensed, registered, or qualified
8.14 	to perform, so long as the design-builder provides such services
8.15 	through subcontracts with duly licensed, registered, or
8.16 	otherwise qualified persons in accordance with this section.
8.17 	(c) Nothing in this section or section 16C.32 is intended
8.18 	to limit or eliminate the responsibility or liability owed by an
8.19 	architect or engineer on a design-build project to the
8.20 	commissioner and third parties under existing law.  The design
8.21 	service portion of a design-build contract is considered a
8.22 	service and not a product.
8.23 		Subd. 3.Solicitation of qualifications or proposals. (a)
8.24 	Every user agency, except the Capitol Area Architectural and
8.25 	Planning Board, shall submit a written request for a
8.26 	design-builder for its project to the commissioner who shall
8.27 	forward the request to the board.  The University of Minnesota
8.28 	shall follow the process in subdivision 4 to select
8.29 	design-builders for projects that are subject to section
8.30 	16B.33.  The written request must include a description of the
8.31 	project, the total project cost, a description of any special
8.32 	requirements or unique features of the proposed project, and
8.33 	other information requested by the board which will assist the
8.34 	board in carrying out its duties and responsibilities set forth
8.35 	in this section.
8.36 	(b) A request for qualifications or proposals soliciting
9.1 	design-builders shall be prepared for each design-build contract
9.2 	pursuant to subdivision 5 or 7.  The request for qualifications
9.3 	or proposals shall contain, at a minimum, the following elements:
9.4 	(1) the identity of the agency for which the project will
9.5 	be built and that will award the design-build contract;
9.6 	(2) procedures for submitting qualifications or proposals,
9.7 	the criteria for evaluation of qualifications or proposals and
9.8 	the relative weight for each criterion and subcriterion, and the
9.9 	procedures for making awards according to the stated criteria
9.10 	and subcriteria, including a reference to the requirements of
9.11 	this section;
9.12 	(3) the proposed terms and conditions for the contract;
9.13 	(4) the desired qualifications of the design-builder and
9.14 	the desired or permitted areas of construction to be performed
9.15 	by named members of the design-build team, if applicable.  The
9.16 	primary designer shall be a named member of the design-build
9.17 	team;
9.18 	(5) the schedule for commencement and completion of the
9.19 	project;
9.20 	(6) any applicable budget limits for the project;
9.21 	(7) the requirements for insurance and statutorily required
9.22 	performance and payment bonds;
9.23 	(8) the identification and location of any other
9.24 	information in the possession or control of the agency that the
9.25 	user agency determines is material, which may include surveys,
9.26 	soils reports, drawings or models of existing structures,
9.27 	environmental studies, photographs, or references to public
9.28 	records;
9.29 	(9) for a design-build design and price-based selection
9.30 	process, the request shall also include the design criteria
9.31 	package, including the performance and technical requirements
9.32 	for the project, and the functional and operational elements for
9.33 	the delivery of the completed project.  The request shall also
9.34 	contain a description of the drawings, specifications, or other
9.35 	submittals to be included with the proposal, with guidance as to
9.36 	the form and level of completeness of the drawings,
10.1 	specifications or submittals that will be acceptable, and the
10.2 	stipend to be paid to the design-builders selected to submit the
10.3 	above described information; and 
10.4 	(10) the criteria shall not impose unnecessary conditions
10.5 	beyond reasonable requirements to ensure maximum participation
10.6 	of qualified design-builders.
10.7 	(c) Notice of requests for qualifications or proposals must
10.8 	be advertised in the State Register.
10.9 		Subd. 4.University of minnesota projects. (a) The
10.10 	University of Minnesota may elect to use the design-build method
10.11 	of project delivery for projects involving construction or major
10.12 	remodeling, as defined in section 16B.335, subdivision 1, with
10.13 	an estimated cost greater than $2,000,000, in which case the
10.14 	University of Minnesota shall submit a written request for a
10.15 	design-builder to the commissioner of administration, who shall
10.16 	forward the request to the board, as provided in subdivision 3.
10.17 	For design-build projects undertaken by the University of
10.18 	Minnesota under this subdivision, the Board of Regents shall
10.19 	exercise the powers and duties of the commissioner granted in
10.20 	subdivisions 5, 6, 7, and 8.
10.21 	(b) When the University of Minnesota undertakes any other
10.22 	project involving construction, renovation, repair, replacement,
10.23 	or rehabilitation, the Board of Regents may, in addition to any
10.24 	other method of project delivery available to the University of
10.25 	Minnesota, submit a written request for a design-builder to the
10.26 	commissioner of administration, who shall forward the request to
10.27 	the board, as provided in subdivision 3.
10.28 	(c) For projects for which the University of Minnesota
10.29 	requests a design-builder, the University of Minnesota may use
10.30 	either the design-build qualification-based selection process
10.31 	under subdivision 5 or the design-build design and price-based
10.32 	selection process under subdivision 7.  The board shall score
10.33 	proposals in accordance with subdivision 5 or 7, as applicable,
10.34 	and narrow the selection to the two highest scoring proposers
10.35 	for recommendation to the Board of Regents.  The Board of
10.36 	Regents shall make the final selection and shall notify the
11.1 	board of the selection.  Meeting records or written evaluations
11.2 	that document the final selection are public records.
11.3 	(d) The University of Minnesota may not utilize
11.4 	design-build contracts for more than five percent of its total
11.5 	projects let, by number, in each of the fiscal years 2006 and
11.6 	2007, and ten percent of its total projects let, by number, in
11.7 	each fiscal year thereafter, that are funded in whole or in part
11.8 	with proceeds from the sale of state general obligation bonds.
11.9 		Subd. 5.Design-build qualification-based selection
11.10 	process. In a design-build qualification-based selection
11.11 	process, the following shall apply:
11.12 	(a)(1) the commissioner shall establish procedures for
11.13 	determining the appropriate content of each request for
11.14 	qualifications, the weighted criteria and subcriteria to be used
11.15 	to evaluate the design-builders, and the procedures for
11.16 	evaluating qualifications in an open, competitive, and objective
11.17 	manner; (2) the criteria and subcriteria shall include, but are
11.18 	not limited to, the proposer's experience as a constructor or
11.19 	primary designer, including capacity of key personnel, technical
11.20 	competence, capability to perform, the past performance of the
11.21 	proposer and its employees, including its safety record and
11.22 	compliance with state and federal law; and (3) the commissioner
11.23 	shall issue a request for qualifications that includes the
11.24 	information as described in subdivision 3.
11.25 	(b) After obtaining and evaluating qualifications from each
11.26 	design-builder, in accordance with the weighted criteria and
11.27 	subcriteria and procedures set forth in the request for
11.28 	qualifications, the board shall select a short list of at least
11.29 	three and no more than five proposals.  The board must receive
11.30 	at least three proposals from design-builders or the
11.31 	commissioner shall either:
11.32 	(1) solicit new proposals;
11.33 	(2) revise the request for qualifications and thereafter
11.34 	solicit new proposals using the revised request for
11.35 	qualifications; or 
11.36 	(3) request selection of a primary designer pursuant to
12.1 	section 16B.33, 16C.08, or 16C.095 and proceed with competitive
12.2 	bidding pursuant to sections 16C.25 to 16C.29.
12.3 	(c) The board shall conduct formal interviews with the
12.4 	short list of proposers, but shall not disclose any proprietary
12.5 	or confidential information contained in one proposal to another
12.6 	proposer.
12.7 	(d) The board shall select the design-builder that scores
12.8 	the highest on the evaluation criteria and subcriteria.  The
12.9 	commissioner shall make the award to the design-builder who
12.10 	scores the highest score pursuant to the weighted criteria and
12.11 	subcriteria as determined by the board, unless the commissioner
12.12 	rejects all proposals or proceeds pursuant to paragraphs (f) and
12.13 	(g).  In the case of the Minnesota State Colleges and
12.14 	Universities, the board shall narrow the selection to the two
12.15 	design-builders that score the highest on the evaluation
12.16 	criteria and subcriteria for recommendation to the respective
12.17 	commissioner, and the commissioner shall make the final
12.18 	selection and shall notify the board of the selection.
12.19 	(e) The commissioner shall conduct fee and contract
12.20 	negotiations with the selected design-builder and shall enter
12.21 	into the contract consistent with subdivision 6.
12.22 	(f) If the selected design-builder declines the appointment
12.23 	or is unable to reach agreement with the commissioner on the
12.24 	terms of the contract, the commissioner may, within 60 days
12.25 	after the first selection, request the board to make another
12.26 	selection.
12.27 	(g) If the board fails to make a selection and forward its
12.28 	recommendation to the commissioner within 60 days of the request
12.29 	for a second selection, the commissioner may appoint a
12.30 	design-builder without the recommendation of the board.
12.31 	(h) If a project for which a design-builder has been
12.32 	selected by the board becomes inactive, lapses, or changes as
12.33 	the result of a project phasing, insufficient appropriations, or
12.34 	other reasons, the commissioner may, if the project is
12.35 	reactivated, retain the same design-builder to complete the
12.36 	project.
13.1 		Subd. 6.Design-build qualifications-based acceptance by
13.2 	commissioner. The contract between the commissioner and the
13.3 	design-builder selected under subdivision 5 shall require the
13.4 	following:
13.5 	(a) The design-builder shall develop design documents of
13.6 	the project for review and approval by the commissioner prior to
13.7 	project bidding.
13.8 	(b) The design-builder shall competitively bid all trade
13.9 	contract work for the project from a list of qualified firms,
13.10 	subject to availability of such qualified firms for the specific
13.11 	work.  The list of qualified firms shall be based upon an open,
13.12 	competitive, and objective prequalification process in which the
13.13 	selection criteria includes, in addition to the proposed price,
13.14 	the firm's experience as a constructor or primary designer,
13.15 	including capacity of key personnel, technical competence,
13.16 	capability to perform, the past performance of the firm and its
13.17 	employees, including its safety record and compliance with state
13.18 	and federal law, and other considerations as defined by the
13.19 	design-builder and the commissioner.  The design-builder and the
13.20 	commissioner shall jointly determine the composition of the list
13.21 	of qualified firms.
13.22 	(c) With the approval of the commissioner, the
13.23 	design-builder may name either or both a mechanical and
13.24 	electrical subcontractor or subcontractors as a named member of
13.25 	the design-builder's team, and if either or both a mechanical
13.26 	and electrical subcontractor or subcontractors is so named, the
13.27 	design-builder is not required to competitively bid the
13.28 	mechanical or electrical trade contract work.  A named
13.29 	mechanical or electrical subcontractor member of a
13.30 	design-builder's team shall competitively bid all subcontracted
13.31 	portions of the mechanical or electrical subcontractor's work
13.32 	from a list of qualified firms.  Such qualified firms shall be
13.33 	determined as described in paragraph (b).  The commissioner and
13.34 	the design-builder shall agree to a list of materials and
13.35 	equipment that shall be competitively bid.
13.36 	(d) With the commissioner's approval or request, team
14.1 	members of the design-builder, including the design-builder, may
14.2 	also submit bids for trade contract work.
14.3 	(e) Either or both the mechanical or electrical
14.4 	subcontractor or subcontractors who are named subcontractor
14.5 	members of the design-builder's team shall enter into guaranteed
14.6 	maximum price contracts with the design-builder.
14.7 	(f) The design-builder and the commissioner shall enter
14.8 	into a guaranteed maximum price contract.
14.9 		Subd. 7.Design-build and price-based proposals. (a) In
14.10 	a design and price-based selection process the following shall
14.11 	apply:
14.12 	(1) selection must be based on best value, which includes
14.13 	an evaluation of price and design, and may include other
14.14 	criteria including, but not limited to, the proposer's
14.15 	experience as a constructor or primary designer;
14.16 	(2) the commissioner shall establish procedures for
14.17 	determining the appropriate content of each request for
14.18 	qualifications, and the weighted criteria and subcriteria to be
14.19 	used to evaluate the design-builders including, but not limited
14.20 	to, the proposer's experience as a constructor or primary
14.21 	designer, including capacity of key personnel, technical
14.22 	competence, capability to perform, the past performance of the
14.23 	proposer and its employees, including its safety record and
14.24 	compliance with state and federal law, quality and past
14.25 	performance, and the procedures for evaluating qualifications in
14.26 	an open, competitive, and objective manner; and 
14.27 	(3) the commissioner shall issue a request for
14.28 	qualifications that includes the information as described in
14.29 	subdivision 3.
14.30 	(b) After obtaining and evaluating qualifications from each
14.31 	design-builder, in accordance with the weighted criteria and
14.32 	subcriteria and procedures set forth in the request for
14.33 	qualifications, the board shall select a short list of three
14.34 	proposers.  The board must receive at least three proposals from
14.35 	design-builders or the commissioner shall either:
14.36 	(1) solicit new proposals;
15.1 	(2) revise the request for qualifications and thereafter
15.2 	solicit new proposals using the revised request for
15.3 	qualifications; or 
15.4 	(3) request selection of a primary designer pursuant to
15.5 	section 16B.33, 16C.08, or 16C.095 and proceed with competitive
15.6 	bidding pursuant to sections 16C.25 to 16C.29.
15.7 	(c) The commissioner shall issue a request for proposals to
15.8 	the selected design-builders.  The submitted proposals shall
15.9 	consist of, at a minimum, the following elements:
15.10 	(1) preliminary plans and specifications and other
15.11 	information in sufficient detail to describe the character,
15.12 	quality, and scope of the project;
15.13 	(2) a design and construction critical path schedule;
15.14 	(3) the price at which the design-builder will complete all
15.15 	design and construction requested in the proposal for the
15.16 	project if selected; and 
15.17 	(4) other materials the board determines are necessary to
15.18 	fix the design, schedule, and cost of the project.
15.19 	(d) Proposals must be sealed and may not be opened until
15.20 	the expiration of the time established for making proposals as
15.21 	set forth in the request for proposals.
15.22 	(e) Proposals must identify the primary designer and the
15.23 	primary construction contracting entity that are members of the
15.24 	design-builders team.
15.25 	(f) The amount and type of design services requested by the
15.26 	board shall not be exceeded by those submitting proposals.
15.27 	Proposals exceeding the amount and type of design services
15.28 	requested by the board may be rejected by the board.  Unless
15.29 	compensated in excess of the minimum stipend for their effort,
15.30 	design-builders must not be required to submit detailed
15.31 	architectural or engineering design or construction documents as
15.32 	part of the proposal.
15.33 	(g) Except as described in paragraph (h), the commissioner
15.34 	shall award to each design-builder that submits a responsive
15.35 	design-build proposal under this subdivision, a stipend in an
15.36 	amount of not less than 0.3 percent of the commissioner's
16.1 	estimated cost of design and construction.  If the request for
16.2 	proposals requires extensive design services beyond preliminary
16.3 	plans and specifications as requested as part of the proposal,
16.4 	the stipend shall be adjusted to an amount commensurate with the
16.5 	amount of design services requested for each proposal.
16.6 	(h) No stipend shall be awarded to the design-builder
16.7 	selected to complete the project.
16.8 	(i) For projects where the design-builder accepts the
16.9 	stipend offered by the board, the commissioner shall be deemed
16.10 	the owner of the design, subject to the rights of the proposer
16.11 	to such design for publication and use in other projects.
16.12 	However, the use of the design in its totality, or near
16.13 	totality, by the commissioner is prohibited.
16.14 	(j) The commissioner may require each design-builder to
16.15 	submit with its proposal a cash deposit, letter of credit in a
16.16 	form acceptable to the commissioner, or bid bond not to exceed
16.17 	five percent of the maximum cost of the design-builder's
16.18 	proposal.  If the proposal is accepted but the design-builder
16.19 	fails, without good cause to execute the design-build contract,
16.20 	the deposit or bond is forfeited in an amount not to exceed the
16.21 	difference between the proposal in question and the next highest
16.22 	proposal.
16.23 		Subd. 8.Design-build and price-based selection
16.24 	process. (a) The board shall review submissions as described in
16.25 	subdivision 7; conduct formal interviews with all three
16.26 	proposers but not allow the disclosure of any price,
16.27 	proprietary, or confidential information contained in one
16.28 	proposal to another proposer; and select the proposal that
16.29 	scores the highest based on the weighted evaluation criteria and
16.30 	subcriteria, except for projects under the control of Minnesota
16.31 	State Colleges and Universities.  The commissioner shall make
16.32 	the award to the design-builder who scores the highest score
16.33 	pursuant to the weighted criteria and subcriteria as determined
16.34 	by the board, unless the commissioner rejects all proposals or
16.35 	proceeds pursuant to paragraph (c) or (d).  For Minnesota State
16.36 	Colleges and Universities projects, the board shall narrow the
17.1 	selection to the two highest scoring proposers for
17.2 	recommendation to the commissioner, and the commissioner shall
17.3 	review the submissions as described in subdivision 7; conduct
17.4 	formal interviews with both proposers recommended by the board,
17.5 	but not allow the disclosure of any price, proprietary, or
17.6 	confidential information contained in one proposal to another
17.7 	proposer; and select the proposal that scores the highest based
17.8 	on the commissioner's application of the weighted evaluation
17.9 	criteria and subcriteria; and shall notify the board of the
17.10 	selection.
17.11 	(b) After a proposal is accepted, the commissioner is
17.12 	deemed the owner of the design, subject to the rights of the
17.13 	proposer to such design for publication and use in other
17.14 	projects.
17.15 	(c) After a proposal is accepted, the commissioner and the
17.16 	design-builder shall enter into a fixed-price contract.
17.17 	(d) If the design-builder selected for a project declines
17.18 	the appointment or is unable to reach agreement with the
17.19 	commissioner concerning the terms of the contract, the
17.20 	commissioner may, within 60 days after the first selection,
17.21 	request the board to make another selection.
17.22 	(e) If the design-builder selected for a project, prior to
17.23 	executing a design-build contract, replaces either the primary
17.24 	designer or the primary construction contracting entity, the
17.25 	commissioner shall notify the board of the replacement and
17.26 	request the board to either approve the new design-builder or to
17.27 	select another design-builder.
17.28 	(f) If the board fails to make a second selection as
17.29 	described in paragraph (d) or (e) and forward its recommendation
17.30 	to the commissioner within 60 days of the commissioner's request
17.31 	for a second selection, the commissioner may appoint a
17.32 	design-builder to the project without the recommendation of the
17.33 	board.

17.34 	Sec. 5. [16C.34] CONSTRUCTION MANAGER AT RISK.
17.35 		Subdivision 1.Solicitation of qualifications. (a) Every
17.36 	user agency, except the Capitol Area Architectural and Planning
18.1 	Board, shall submit a written request for proposals for a
18.2 	construction manager at risk for its project to the
18.3 	commissioner.  The written request for proposals must include a
18.4 	description of the project, the estimated cost of completing the
18.5 	project, a description of any special requirements or unique
18.6 	features of the proposed project, and other information which
18.7 	will assist the commissioner in carrying out its duties and
18.8 	responsibilities set forth in this section.
18.9 	(b) A request for qualifications shall be prepared for each
18.10 	construction manager at risk contract as provided in this
18.11 	section.  The request for qualifications shall contain, at a
18.12 	minimum, the following elements:
18.13 	(1) the identity of the agency for which the project will
18.14 	be built and that will award the construction manager at risk
18.15 	contract;
18.16 	(2) procedures for submitting qualifications, the criteria
18.17 	and subcriteria for evaluation of qualifications and the
18.18 	relative weight for each criteria and subcriteria, and the
18.19 	procedures for making awards in an open, competitive, and
18.20 	objective manner, and according to the stated criteria and
18.21 	subcriteria, including a reference to the requirements of this
18.22 	section;
18.23 	(3) the terms and conditions for the contract;
18.24 	(4) the qualifications that the construction manager at
18.25 	risk shall be desired to have;
18.26 	(5) the desired or permitted areas of construction to be
18.27 	performed by either or both the named mechanical and electrical
18.28 	subcontractor or subcontractors to the construction manager at
18.29 	risk, if applicable;
18.30 	(6) a schedule for commencement and completion of the
18.31 	project;
18.32 	(7) any applicable budget limits for the project;
18.33 	(8) requirements for insurance, statutorily required
18.34 	performance and payment bonds; and 
18.35 	(9) identification and location of any other information in
18.36 	the possession or control of the agency that the user agency
19.1 	determines is material, which may include surveys, soils
19.2 	reports, drawings or models of existing structures,
19.3 	environmental studies, photographs, or references to public
19.4 	records.
19.5 	(b) Notice of requests for qualifications must be
19.6 	advertised in the State Register.
19.7 		Subd. 2.Construction manager at risk selection process.
 19.8 	In a construction manager at risk selection process, the
19.9 	following shall apply:
19.10 	(a)(i) Upon receipt of a written request from a user agency
19.11 	for a construction manager at risk for its project, the
19.12 	commissioner shall create a selection committee composed of a
19.13 	minimum of three persons, at least one of whom has construction
19.14 	industry expertise; (ii) the selection committee shall establish
19.15 	procedures for determining the appropriate content of each
19.16 	request for qualifications, the weighted criteria and
19.17 	subcriteria to be used to score the proposals of the
19.18 	construction managers at risk, and shall establish procedures
19.19 	for evaluating qualifications in an open, competitive, and
19.20 	objective manner; and (iii) the commissioner shall issue a
19.21 	request for qualifications that includes the information as
19.22 	described in subdivision 1.
19.23 	(b) In accordance with the criteria and procedures set
19.24 	forth in the request for qualifications, the selection committee
19.25 	shall evaluate the construction manager at risk's experience as
19.26 	a constructor, including capacity of key personnel, technical
19.27 	competence, capability to perform, the past performance of the
19.28 	construction manager at risk and its employees, including its
19.29 	safety record and compliance with state and federal law, and
19.30 	other appropriate facts submitted by the construction manager at
19.31 	risk in response to the request for qualifications.  The
19.32 	commissioner must receive at least three proposals from
19.33 	construction managers or the commissioner may either (i) solicit
19.34 	new proposals; (ii) request the selection committee to revise
19.35 	the request for qualifications and thereafter solicit new
19.36 	proposals using the revised request for qualifications; (iii)
20.1 	select another allowed procurement method; or (iv) reject all
20.2 	proposals.
20.3 	(c)(i) The selection committee shall review the proposers'
20.4 	qualifications and create a short list of three to five
20.5 	proposals of construction managers at risk; (ii) the
20.6 	commissioner shall issue a request for proposal requiring fee
20.7 	and expense proposals and other information as desired from the
20.8 	short-listed construction managers at risk, which request shall
20.9 	also include the fee and expense proposals from any named
20.10 	mechanical or electrical subcontractor member of the
20.11 	construction manager at risk's team; (iii) the selection
20.12 	committee shall conduct formal interviews with the short-listed
20.13 	construction managers at risk but shall not disclose any
20.14 	proprietary or confidential information contained in one
20.15 	proposal to another proposer; (iv) the selection committee shall
20.16 	recommend the construction manager at risk achieving the highest
20.17 	score on the evaluation criteria as described in subdivision 1,
20.18 	paragraph (b).
20.19 	(d) If the project is within the Capitol area, the Capitol
20.20 	Area Architecture and Planning Board shall participate in the
20.21 	evaluation processes.
20.22 		Subd. 3.Construction manager at risk contract. (a) The
20.23 	commissioner shall conduct contract negotiations with the
20.24 	recommended construction manager at risk.
20.25 	(b) If the construction manager at risk selected for the
20.26 	project declines the appointment or is unable to reach agreement
20.27 	with the commissioner concerning the fee or terms of the
20.28 	contract, the commissioner shall, within 60 days after the first
20.29 	selection, request the selection committee to make another
20.30 	recommendation.
20.31 	(c) If the selection committee fails to make a second
20.32 	recommendation and forward it to the commissioner within 60 days
20.33 	of the commissioner's request for a second recommendation, the
20.34 	commissioner may select a construction manager at risk without
20.35 	the recommendation of the selection committee.
20.36 	(d) The primary designer(s) selected by the board shall
21.1 	develop various design documents for review and approval by the
21.2 	commissioner.
21.3 	(e) With the approval of the commissioner, the construction
21.4 	manager at risk proposal may name either or both a mechanical or
21.5 	electrical subcontractor or subcontractors as a named member of
21.6 	the construction at risk team, and except as described below, if
21.7 	either or both a mechanical or electrical subcontractors or
21.8 	subcontractor is so named, the construction manager at risk is
21.9 	not required to competitively bid the mechanical or electrical
21.10 	trade contract work.  The construction manager at risk shall
21.11 	competitively bid all trade contract work for the project from a
21.12 	list of qualified firms, subject to availability of such
21.13 	qualified firms for the specific work.  The list of qualified
21.14 	firms shall be based upon an open, competitive, and objective
21.15 	prequalification process in which the selection criteria
21.16 	includes the firm's experience as constructors, including
21.17 	capacity of key personnel, technical competence, capability to
21.18 	perform, the past performance of the firm and its employees,
21.19 	including its safety record and compliance with state and
21.20 	federal law, and other considerations as defined by the
21.21 	construction manager at risk and the commissioner.  The
21.22 	construction manager at risk and the commissioner shall jointly
21.23 	determine the composition of the list of qualified firms.  With
21.24 	the commissioner's approval or request, the team members of the
21.25 	construction manager at risk, including the construction manager
21.26 	at risk, may also submit bids for trade contract work.  A named
21.27 	mechanical or electrical subcontractor member of a construction
21.28 	manager at risk's team shall competitively bid all subcontracted
21.29 	portions of the mechanical or electrical subcontractor's work
21.30 	from a list of qualified firms.  Such qualified firms must be
21.31 	determined as described in this paragraph.  The commissioner and
21.32 	the construction manager at risk shall agree to a list of
21.33 	materials and equipment that shall be competitively bid.
21.34 	(f) The named mechanical or electrical subcontractor
21.35 	members of the construction manager's team shall enter into
21.36 	guaranteed maximum price contracts with the construction manager
22.1 	for the work identified in the construction manager at risk
22.2 	proposal as work to be performed by the named subcontractors.
22.3 	(g) The construction manager at risk and the commissioner
22.4 	shall enter into a guaranteed maximum price contract for the
22.5 	project.

22.6 	Sec. 6. [16C.35] JOB ORDER CONTRACTING.
22.7 		Subdivision 1.Authority. The commissioner may undertake
22.8 	construction utilizing job order contracting for projects that
22.9 	do not exceed a construction cost of $250,000.
22.10 		Subd. 2.Job order contracting preselection process. (a)
22.11 	The commissioner is authorized to issue a request for
22.12 	qualifications that includes the criteria that will be used for
22.13 	the projects, provided that these criteria do not unduly
22.14 	restrict competition.
22.15 	(b) The request for qualifications must be publicized in a
22.16 	manner designated by the commissioner.  To the extent practical,
22.17 	this must include posting on a state Web site.  To the extent
22.18 	practical, the commissioner must give notice to representatives
22.19 	of targeted group businesses designated under section 16C.16.
22.20 	(c) Contractors shall submit only qualifications to the
22.21 	commissioner that are responsive to the request for
22.22 	qualifications.
22.23 		Subd. 3.Qualified contractors. (a) The commissioner
22.24 	shall review the responses to the request for qualifications and
22.25 	determine responder's ability to enter into the master contract
22.26 	that will be utilized for the projects.  The commissioner shall
22.27 	establish a list of qualified contractors based on the
22.28 	proposers' ability to enter into a master contract as described
22.29 	in the request for qualifications.
22.30 	(b) The commissioner shall enter into master contracts with
22.31 	all qualified contractors.
22.32 		Subd. 4.Construction services bidding. The commissioner
22.33 	shall request bids for construction services for any project
22.34 	using job order contracting from qualified contractors as
22.35 	follows:
22.36 	(1) for construction projects up to a maximum cost of
23.1 	$50,000, the commissioner shall request a minimum of two bids;
23.2 	(2) for construction projects with a cost greater than
23.3 	$50,000 but less than or equal to $100,000 the commissioner
23.4 	shall request a minimum of three bids;
23.5 	(3) for construction projects with a cost greater than
23.6 	$100,000 but less than or equal to $250,000, the commissioner
23.7 	shall request a minimum of four bids.
23.8 		Subd. 5.Qualified contractor selection. The
23.9 	commissioner shall select the contractor who submits the lowest
23.10 	price bid for the construction services proposed.
23.11 		Subd. 6.Reasonable distribution of bid requests among
23.12 	qualified contractors. The commissioner in requesting bidding
23.13 	for projects using job order contracting as described in this
23.14 	section shall develop a system to ensure a reasonable
23.15 	opportunity for all qualified contractors to bid on construction
23.16 	services on a periodic basis.

23.17 	Sec. 7. EFFECTIVE DATE.
 23.18 	Sections 1 to 6 are effective the day following final
23.19 	enactment.