1.1                          A bill for an act 
  1.2             relating to public administration; providing for 
  1.3             design-build contracts; providing for exempt rules; 
  1.4             amending Minnesota Statutes 2000, section 16B.31, 
  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 2000, section 16B.31, 
  1.9   subdivision 1, is amended to read: 
  1.10     Subdivision 1.  [CONSTRUCTION PLANS AND SPECIFICATIONS.] 
  1.11  (a) The commissioner shall (1) have plans and specifications 
  1.12  prepared for the construction, alteration, or enlargement of all 
  1.13  state buildings, structures, and other improvements except 
  1.14  highways and bridges, and except for buildings and structures 
  1.15  under the control of the board of trustees of the Minnesota 
  1.16  state colleges and universities; (2) approve those plans and 
  1.17  specifications; (3) advertise for bids and award all contracts 
  1.18  in connection with the improvements; (4) supervise and inspect 
  1.19  all work relating to the improvements; (5) approve all lawful 
  1.20  changes in plans and specifications after the contract for an 
  1.21  improvement is let; and (6) approve estimates for payment.  This 
  1.22  subdivision does not apply to the construction of the zoological 
  1.23  gardens. 
  1.24     (b) The commissioner may use a design-build method of 
  1.25  project development and construction and award a design-build 
  1.26  contract under section 16C.091. 
  2.1      Sec. 2.  [16C.091] [DESIGN-BUILD CONTRACTS.] 
  2.2      Subdivision 1.  [DEFINITIONS.] (a) The definitions in this 
  2.3   subdivision apply to this section. 
  2.4      (b) "Acceptance" means a formal resolution of the 
  2.5   commissioner authorizing the execution of a design-build 
  2.6   contract.  
  2.7      (c) "Agency" has the meaning given in section 16C.02 and 
  2.8   includes the University of Minnesota and the Minnesota state 
  2.9   college and university system. 
  2.10     (d) "Capitol area architectural and planning board" means 
  2.11  the board established under section 15.50. 
  2.12     (e) "Commissioner" means the commissioner of administration.
  2.13     (f) "Design-build contract" means a state contract between 
  2.14  the commissioner and a design-builder to furnish the 
  2.15  architectural, engineering, and related design services as well 
  2.16  as the labor, materials, supplies, equipment, and construction 
  2.17  services for a project.  A design-build contract may be 
  2.18  conditioned upon later refinements in scope and price and may 
  2.19  permit the agency to make changes in the scope of the project 
  2.20  without invalidating the design-build contract. 
  2.21     (g) "Design-builder" means the person who proposes to 
  2.22  design and build a project governed by this section. 
  2.23     (h) "Person" means an individual, partnership, joint 
  2.24  venture, corporation, professional corporation, business 
  2.25  association, or other legal entity. 
  2.26     (i) "Project" means an undertaking to design, construct, 
  2.27  erect, or remodel a building by or for the state or an agency 
  2.28  under the supervision and control of the commissioner according 
  2.29  to section 16B.30. 
  2.30     (j) "Proposal" means an offer by a design-builder to enter 
  2.31  into a design-build contract for a project in response to a 
  2.32  request for proposal, including a phase one or phase two 
  2.33  proposal under subdivisions 7 and 8. 
  2.34     (k) "Request for proposal" has the meaning given in section 
  2.35  16C.02, subdivision 12, and is the document or publication 
  2.36  through which the commissioner solicits proposals for a 
  3.1   design-build contract. 
  3.2      Subd. 2.  [AUTHORITY.] (a) For projects undertaken by the 
  3.3   University of Minnesota, the powers granted in this section to 
  3.4   the commissioner may be exercised by the board of regents. 
  3.5      (b) For projects undertaken by the Minnesota state college 
  3.6   and university system, the powers granted in this section to the 
  3.7   commissioner may be exercised by its trustees.  
  3.8      (c) Notwithstanding any law to the contrary, the 
  3.9   commissioner may solicit and award a design-build contract under 
  3.10  this section without competitive bids. 
  3.11     (d) If the project is within the capitol area, as defined 
  3.12  in section 15.50, the capitol area architectural and planning 
  3.13  board shall serve as the selection team under subdivision 6, and 
  3.14  the project must comply with section 15.50. 
  3.15     (e) For each project for which the commissioner intends to 
  3.16  use the design-build method, the commissioner shall make a 
  3.17  written determination that it is in the best interest of the 
  3.18  state to enter into a design-build contract to complete the 
  3.19  project.  In making this determination, the commissioner shall 
  3.20  consider the following criteria: 
  3.21     (1) the extent to which the project requirements can be 
  3.22  adequately defined; 
  3.23     (2) time constraints for delivery of the project; 
  3.24     (3) the capability and experience of potential teams with 
  3.25  the design-build method of project delivery; 
  3.26     (4) the suitability of the project for use of the 
  3.27  design-build method of project delivery; and 
  3.28     (5) other criteria the commissioner considers relevant. 
  3.29     Subd. 3.  [RULES.] The commissioner shall adopt rules 
  3.30  consistent with this section for the award of design-build 
  3.31  contracts.  The rules must include, at a minimum, procedures 
  3.32  governing the following: 
  3.33     (1) preparing requests for proposals, including procedures 
  3.34  for determining the appropriate content of each request for 
  3.35  proposal; 
  3.36     (2) standards to be used to qualify or prequalify 
  4.1   design-builders; 
  4.2      (3) preparing and submitting proposals; 
  4.3      (4) evaluating proposals; 
  4.4      (5) negotiations between the selection team or commissioner 
  4.5   and those submitting proposals prior to the acceptance of a 
  4.6   proposal if negotiations are contemplated, including safeguards 
  4.7   to preserve confidential information and proprietary information 
  4.8   supplied by those submitting proposals; 
  4.9      (6) awarding and executing design-build contracts; and 
  4.10     (7) acting on formal protests relating to the solicitation 
  4.11  of proposals or award of design-build contracts. 
  4.12  For University of Minnesota and Minnesota state college and 
  4.13  university system projects, the board of regents or the trustees 
  4.14  must prepare written procedures covering the items in clauses 
  4.15  (1) to (7). 
  4.16     The initial rules may be adopted under section 14.386, 
  4.17  which provides for adoption of exempt rules that are effective 
  4.18  for two years.  After adoption of the initial rules, the 
  4.19  commissioner shall adopt permanent rules under chapter 14.  Any 
  4.20  costs of rulemaking must be paid out of the agency's budget. 
  4.21     Subd. 4.  [LICENSING REQUIREMENTS.] (a) Each design-builder 
  4.22  must be, employ, or have as a partner, member, coventurer, or 
  4.23  subcontractor, persons duly licensed and registered under 
  4.24  chapter 326 to provide the services required to complete the 
  4.25  project and do business in this state. 
  4.26     (b) A design-builder may contract with the commissioner to 
  4.27  provide professional or construction services that the 
  4.28  design-builder is not itself licensed, registered, or qualified 
  4.29  to perform, so long as the design-builder provides those 
  4.30  services through subcontracts with architects or engineers 
  4.31  registered under chapter 326. 
  4.32     Subd. 5.  [SOLICITATION OF PROPOSALS.] (a) A request for 
  4.33  proposal must be prepared for each design-build contract 
  4.34  soliciting design-builders to respond in two phases under 
  4.35  subdivision 7.  A request for proposal must contain, at a 
  4.36  minimum, the following elements: 
  5.1      (1) the identity of the agency for which the project will 
  5.2   be built and that will award the design-build contract; 
  5.3      (2) procedures for submitting proposals, the criteria for 
  5.4   evaluation of proposals and their relative weight, and the 
  5.5   procedures for making awards, including a reference to the 
  5.6   requirements of this section and the rules of the commissioner; 
  5.7      (3) the proposed terms and conditions for the design-build 
  5.8   contract; 
  5.9      (4) the qualifications the design-builder will be required 
  5.10  to have; 
  5.11     (5) a schedule for commencement and completion of the 
  5.12  project; 
  5.13     (6) budget limits for the project; 
  5.14     (7) affirmative action, disadvantaged business, and small 
  5.15  business requirements for the design-build contract, if any; 
  5.16     (8) requirements for performance bonds, payment bonds, and 
  5.17  insurance; and 
  5.18     (9) any other information that the commissioner or 
  5.19  selection team in its discretion chooses to supply, including, 
  5.20  but not limited to, surveys, soil reports, drawings or models of 
  5.21  existing structures, environmental studies, photographs, or 
  5.22  references to public records. 
  5.23     (b) Notice of request for proposals must be advertised in 
  5.24  the same manner in which bids are solicited under section 
  5.25  16C.06, subdivision 2, paragraph (a). 
  5.26     Subd. 6.  [SELECTION TEAM.] Before solicitation of 
  5.27  proposals, the commissioner shall appoint a selection team.  No 
  5.28  member of the selection team may otherwise be involved in the 
  5.29  project.  The commissioner may elect to designate the state 
  5.30  designer selection board as the selection team under this 
  5.31  subdivision.  If the project is within the capitol area, as 
  5.32  defined in section 15.50, the capitol area architectural and 
  5.33  planning board shall serve as the selection team. 
  5.34     Subd. 7.  [EVALUATION OF PROPOSALS.] (a) The commissioner 
  5.35  shall solicit and evaluate proposals and select a design-builder 
  5.36  in two phases. 
  6.1      (b) In phase one, the selection team shall evaluate phase 
  6.2   one proposals consisting of statements of qualifications and 
  6.3   performance data submitted by design-builders regarding the 
  6.4   proposed project.  The selection team shall evaluate each 
  6.5   design-builder's experience, technical competence, ability to 
  6.6   perform, the past performance of the design-builder and its 
  6.7   employees, and other appropriate facts submitted by it in 
  6.8   response to the request for proposal.  The selection team shall 
  6.9   qualify at least three potential design-builders for phase two 
  6.10  of the selection process. 
  6.11     (c) In phase two, the commissioner shall evaluate the three 
  6.12  potential design-builders based on which proposal offers the 
  6.13  best value to the state.  The commissioner may not solicit phase 
  6.14  two proposals unless it receives phase one proposals from at 
  6.15  least three qualified design-builders.  If the commissioner 
  6.16  receives fewer than three phase one proposals from qualified 
  6.17  design-builders, the commissioner shall either revise the 
  6.18  request for proposal and solicit new proposals or request 
  6.19  selection of a designer under section 16B.33 and proceed with 
  6.20  competitive bidding under section 16C.25. 
  6.21     (d) In both phase one and phase two, the commissioner may 
  6.22  require clarifications or further information from 
  6.23  design-builders to ensure conformance of proposals with the 
  6.24  request for proposal. 
  6.25     (e) If the project is within the capitol area, the capitol 
  6.26  area architectural and planning board shall participate in the 
  6.27  phase two evaluation process.  
  6.28     Subd. 8.  [ACCEPTANCE OF PROPOSALS.] After obtaining and 
  6.29  evaluating proposals from each design-builder according to the 
  6.30  criteria and procedures set forth in the request for proposal, 
  6.31  the commissioner shall accept the proposal that best meets all 
  6.32  requirements of the request for proposal, considering the 
  6.33  competence and qualifications of the design-builder, the 
  6.34  design-builder's ability to meet schedules, and the feasibility 
  6.35  of implementing the project as proposed, and that provides the 
  6.36  state with the best value.  The commissioner may reject any 
  7.1   proposal, except for the purpose of evading the provisions and 
  7.2   policies of this section.  The commissioner may thereafter 
  7.3   solicit new proposals using the same or different criteria, 
  7.4   budget constraints, or qualifications.