[27 Pa.B. 1798]
[Continued from previous Web Page] § 457.5. Classification.
(a) The contractor or subcontractor shall be classified according to the type of work and amount of work for which his experience and financial capacity will qualify him to bid. The types of work, as described in Department of Transportation Specifications, Publication 408, are listed as follows:
WORK CODE SECT. CLASSIFICATION EARTHWORK A 200 CLEARING & GRUBBING B 200 BUILDING DEMOLITION C 200 EXCAVATING & GRADING BASE COURSE D 300 RIGID BASE COURSE E 300 FLEXIBLE BASE COURSE PAVEMENT F 400 BITUMINOUS PAVEMENT F1 400 BITUMINOUS PAVEMENT PATCHING AND REPAIR G 500 RIGID PAVEMENT G1 500 RIGID PAVEMENT PATCHING & REPAIR INCIDENTAL CONSTRUCTION H 600 DRAINAGE, WATER MAIN, STORM SEWER J 600 GUIDE RAIL, STEEL MEDIAN BARRIER, FENCES J1 600 CONCRETE MEDIAN BARRIER K 600 CURBS, SIDEWALKS, INLETS, MANHOLES, ETC. L 600 SLABJACKING-SUBSEALING ROADSIDE DEVELOPMENT M 800 LANDSCAPING N REST AREA STRUCTURES, BUILDINGS TRAFFIC ACCOMMODATIONS AND CONTROL O 900 PAVEMENT MARKINGS P 900 HIGHWAY/SIGN LIGHTING, SIGNAL CONTROL Q 900 MAINTENANCE AND PROTECTION OF TRAFFIC R 900 SIGN PLACEMENT (POST/STRUCTURE MOUNTED) R1 900 SIGN STRUCTURES STRUCTURES S 1000 CEMENT CONCRETE STRUCTURES S1 1000 CULVERTS & SINGLE SPAN BRIDGES TO 80 FT S2 1000 REPAIR AND REHABILITATION OF STRUCTURES S3 1000 MODIFIED CONCRETE DECK OVERLAYS T 1050 ERECTION (STRUCTURAL MEMBERS) T1 1018 BRIDGE REMOVAL U 1005 PILE DRIVING V 1070 STEEL PAINTING (HIGH PERFORMANCE) V1 1071 STEEL PAINTING (CONVENTIONAL) MISCELLANEOUS Y OTHERS (b) Miscellaneous work as determined by the Chief Counsel, as not within the purview of the act, will be excluded by the Deputy Secretary for Highway Administration from the requirements of this chapter. When this is done, the bid proposal shall so state.
(c) The classifications of work listed in subsection (a) may be further defined by the Contract Management Division, if needed, to provide for additional types of specialties generated with expanded programs.
(d) Each prequalified contractor shall be eligible to bid on projects in which the types of work for which he is classified constitute at least 50% of the project.
(e) Each contractor or subcontractor shall be classified for one or more types of work in accordance with his adequacy of plant and equipment, organization, prior experience, record of construction and other pertinent, relevant and material facts which may affect the classification. A contractor or subcontractor who has been assigned classifications of excavation and grading; bituminous pavement or rigid pavement; drainage, water mains, storm sewers; and cement concrete structures (all types) will be considered a general highway contractor. A proposal from a contractor with a general highway contractor designation need not be reviewed for the 50% classification requirement unless specialty items predominate. The contractor or subcontractor shall be assigned an ability factor and given a capacity rating which will designate the quantity of work upon which he will be eligible to bid. The Prequalification Office shall give notice of the classification and rating.
(f) The maximum capacity rating shall be a flat sum determined as follows:
(1) The formula, Q = F (C+1/2L+1/2E), shall be used to determine the maximum capacity rating. A contractor whose maximum capacity exceeds $100 million as determined by this formula, will be considered to have unlimited financial capacity.
(2) When the contractor elects to exercise the option as specified in § 457.4(a)(5), the contractor shall be assigned in lieu of the Contractor's Financial Statement, Form 4300, Part 1, a flat sum factor of $50,000; and the formula Q = F ($50,000) shall be used to determine the maximum capacity rating.
(3) The symbols used in the formula in paragraphs (1) and (2) shall have the following meaning:
(i) Q = Maximum capacity rating.
(ii) C = Net working capital.
(iii) F = Assigned ability factor (1 to 15).
(iv) L = Line-of-credit statements.
(v) E = Book value of equipment.
(4) The following limitations apply to the terms in paragraph (3):
(i) Net working capital shall be current assets less current liabilites.
(ii) Current assets shall be easily negotiable assets that may readily be turned into cash.
(iii) Current liabilities shall be obligations due within a 1-year period.
(iv) A Line-of-Credit statement shall be the form, executed by a bank on page number 20 of the financial statement of the contractor.
(v) Book value of equipment shall be total cost less depreciation actually applied. This equipment factor shall include not only book value of company-owned equipment but also the book value of the contractor's share of equipment owned by a joint venture.
(5) If the maximum capacity rating (Q) is a positive number, a certificate as a prime contractor will be issued. If the contractor has had a negative working capital for 2 consecutive fiscal years, the Department will request additional documentation to support the contractor's financial capabilities even if the maximum capacity rating (Q) is a positive number as a result of a line of credit or book value of equipment, or both. If the Department still considers the contractor's financial status to be questionable, the Department will prequalify the contractor to perform work only as a subcontractor.
(6) If the net working capital (C) is a negative amount, the Department has the right to reduce the qualification amount or to reject the application.
(g) The qualification amount, determined by the applicable formula in subsection (f) shall establish the maximum capacity rating of the applicant. Award of contract shall be restricted to the assigned maximum capacity rating less monetary value of the uncompleted contract and subcontract work under § 457.16 (relating to sublettings).
§ 457.6. Classification appeals procedure.
The following procedures apply to classification appeals:
(1) Informal meeting. A contractor or subcontractor dissatisfied with his classification may submit, in writing, a request for an informal meeting to the Prequalification Office within 10 working days after receipt of notice of prequalification or denial thereof or other related action of the Department. At the meeting, which shall be scheduled by the Department within 30 days after receipt of a request therefor the contractor or subcontractor may present further evidence with respect to financial responsibility, organization, plant and equipment or experience and other relevant facts, as might tend to justify a different classification or other determination by the Department.
(2) Notification of determination/formal classification hearing. After hearing the additional evidence, the Department will change or retain the classification within 10 working days after the meeting and and will notify, in writing, the contractor or subcontractor, accordingly. A contractor or subcontractor, if dissatisfied with the determination of the Department following the informal meeting, may, within 10 working days of the mailing date of the determination, request in writing a formal classification hearing setting forth the reasons therefor.
(3) A contractor or subcontractor may forgo the informal meeting described at paragraph (1) and directly appeal the classification determination of the Department by requesting in writing a formal classification hearing setting forth the reasons therefor, within 10 working days after receipt of notice of prequalification or denial thereof or other related action of the Department.
(4) Classification hearings will be held in conformity with 1 Pa. Code Part II (relating to general rules of administrative practice and procedure) as supplemented by Chapter 491 (relating to administrative practice and procedure). As set forth in § 491.4 (relating to institution of proceedings), requests for classification hearings, and all other papers relating to the case, shall be filed with the Administrative Docket Clerk at the following address:
Secretary of Transportation, Administrative Docket Clerk, c/o Office of Chief Counsel, 9th floor, Forum Place, 555 Walnut Street, Harrisburg, Pennsylvania 17120(5) Under § 491.5 (relating to filing fee), a filing fee in the required amount shall accompany a request for a classification hearing.
§ 457.7. (Reserved).
§ 457.8. Certification of classification and capacity.
(a) Bids will be accepted only from contractors who have a current prequalification certificate in accordance with this chapter. In those cases when either the bidder does not have adequate current prequalification capacity rating, as required by subsection (b) or the types of work on which the contractor has been classified and eligible to bid do not constitute over 50% of the total bid price, the bid will be excluded and rejected. Items noted in the proposal as specialty items may be excluded.
(b) So that the Department may have the necessary information to pass upon the ability of a contractor to satisfactorily complete a project, contractors shall submit with their proposal a certification of capacity to do the particular work. If the contractor desires credit for subcontracted items of work on the particular project, the contractor shall include the names of the subcontractors in the proposal. Subcontractors so named shall have the necessary capacity and classification. In making this certification, the contractor shall certify that the current qualification amount, less amount of all uncompleted work which includes subcontracts except as permitted by § 457.16 (relating to sublettings) the contractor has under contract is sufficient to cover the amount of the proposal. The making of a false certification shall constitute cause for rejection of the proposal of the contractor.
(c) The Department may reject a bid at any time prior to the actual awarding of a contract if, in its judgment, the best interest of the Commonwealth will be promoted thereby, or if there have been developments subsequent to prequalification, which, in the opinion of the Department would affect the responsibility of the contractor. In addition to the right of the Department to reject, a bid may be rejected if it appears that after the contractor was prequalified, the contractor was declared in default on a project, or prequalification was suspended or withdrawn by the Department, or a major change occurred in the management of the contractor's firm. Before taking the action, the Department will as soon as possible notify the contractor and give the contractor an opportunity to present additional information to the Department.
§ 457.9. False certification with bid.
If a contractor makes a false certification with regards to § 457.8(a) or (b), or both (relating to certification of classification and capacity), the contractor shall pay to the Department as liquidated damages an amount equal to 5% of the total amount of the bid or the contractor may be disqualified from bidding on future work for 90 days, or both, as deemed appropriate. If the contractor fails to make the payment within 30 days of notification, the contractor shall be disqualified for 1 year. An application for renewal of prequalification will not be considered by the Department until the contractor makes payment. In lieu of the assessment of liquidated damages or disqualification, or both, the Secretary may issue a warning to the contractor making a false certification when the infraction is the first offense of the contractor.
§ 475.10. Past performance report.
(a) The Secretary may require the District Engineer, the Inspector General or other designee to submit a confidential past performance report on a contractor performing work for the Department.
(b) This report, and reports received from outside entities, shall be used in conjunction with the other past performance information for determining the past performance rating of the contractor which rating shall be considered in determining the classification of the contractor and his responsibility as a contractor. The past performance report shall include evaluation of a contractor's attitude and cooperation, equipment, organization and management, scheduling and work performance. Poor or unsatisfactory ratings for specific work classifications shall constitute justification for revoking classifications previously granted. A contractor who has an overall unsatisfactory rating on performance reports will not be prequalified. Reports shall be confidential.
§ 457.11. Audit of contractor or subcontractor records.
The Department reserves the right, upon 10 days notice to the contractor or subcontractor, to review records of the contractor or subcontractor either as part of a random periodic review or as part of a specific inquiry. These records would include records that substantiate information in Parts 1, 2 and 3 of the prequalification application.
§ 457.12. False statements in prequalification application or at hearing.
A contractor, subcontractor or individual who knowingly makes or causes to be made, a false, deceptive or fraudulent statement on the prequalification application required to be submitted or in the course of a hearing held under this chapter may be temporarily suspended or may be debarred for a set period or permanently from bidding on or participating in State supervised or funded highway construction work.
§ 457.13. Suspension or debarment.
(a) Reasons for suspension or debarment. The Department may temporarily suspend or may debar, for a set period or permanently, a contractor, subcontractor or individual from bidding on or participating in State supervised or funded highway construction work for any of the following reasons:
(1) Commission of embezzlement, theft, forgery, bribery, falsification or destruction of records, making false statements or receiving stolen property.
(2) Commission of fraud or a criminal offense or other improper conduct or knowledge or approval of, or acquiescence in these activities by a contractor or an affiliate, officer, employe or other individual or entity associated with either obtaining, attempting to obtain or performing a public contract or subcontract. The contractor's acceptance of the benefits derived from the conduct shall be deemed evidence of knowledge, approval or acquiescence.
(3) Violation of Federal or State antitrust statutes.
(4) Violation of a State or Federal law regulating campaign contributions.
(5) Violation of a State or Federal environmental law.
(6) Violation of a State or Federal law regulating hours of labor, minimum wage standards or prevailing wage standards; discrimination in wages; or child labor violations.
(7) Violation of the Workers' Compensation Act (77 P. S. §§ 1--2626).
(8) Violation of a State or Federal law prohibiting discrimination in employment.
(9) Suspension or debarment by the Commonwealth or an agency thereof or an agency of another state or by an agency or department of the Federal government.
(10) Three or more occurrences where a contractor has been declared ineligible for a contract.
(11) Unsatisfactory performance including failure to comply with the terms of a Commonwealth contract or subcontract including:
(i) Willful failure to perform in accordance with the terms of one or more contracts, or a history of failure to perform, or of unsatisfactory performance of one or more contracts, or offering unbalanced bids.
(ii) Failure to complete the work in the time frame specified in the contract.
(iii) Being declared in default on prior work or project.
(iv) Failure to submit documents, information or forms as required by contract.
(v) Making false statements or failing to provide information or otherwise to cooperate with the contracting agency, the Office of State Inspector General or other Commonwealth authorities.
(vi) Discrimination in violation of laws or regulations in the conduct of business as a contractor.
(12) Providing false or misleading information to the Office of State Inspector General, Office of the Budget, the Department of the Auditor General, the Office of Attorney General, the Treasury Department, the Board of Claims, or other tribunal or court, the Department, or a representative of an agency as part of any investigation, audit, program review, prequalification statement of certification, contract bids or proposals, contractor applications or claims for payment. This information includes:
(i) Financial statements.
(ii) Nondiscrimination forms.
(iii) Affidavits or statements of compliance with prevailing wage statutes.
(iv) Product descriptive literature and documents submitted in connection with claims for payment made or litigation against Commonwealth agencies.
(13) Other acts or omissions indicating a lack of skill, ability, capacity, quality control, business integrity or business honesty that seriously and directly affect the present responsibility of a contractor or any basis for debarment or suspension in the Commonwealth's Contractor Responsibility Program, Management Directive 215.9.
(b) Substantial evidence. The filing of criminal charges or initiation of legal proceedings for any of the reasons in subsection (a)(1)--(8) may constitute substantial evidence for suspension.
(c) Debarment based on criminal conduct. Debarment solely on the basis of any of the reasons in subsection (a)(1)--(8) shall be based on a conviction or plea of guilty or no contest in a court of law or a finding, ruling or adjudication of guilt for noncompliance by a court of law, commission, board or administrative body. It is not required that the appeals process be completed or that a sentence or other penalty be imposed.
(d) Effect of appeal. The filing of an appeal does not constitute a basis for delay or postponement of a suspension/debarment action.
(e) Suspension for criminal conduct. If a contractor, subcontractor or individual is suspended because of the filing of criminal charges or initiation of legal proceedings for other applicable reasons in subsection (a)(1)--(8) and there has been no conviction or ruling sufficient to justify debarment within the suspension period, the Department may, if appropriate, based on all of the relevant facts, initiate debarment proceedings.
(f) Denial or nonrenewal. Denial of prequalification or refusal to renew prequalification for any of the reasons set forth in this section shall constitute a suspension or debarment for the purposes of this chapter. The Department will advise the contractor in writing accordingly.
(g) Suspension procedure. When a suspension is imposed against a contractor or an affiliate, the Department will immediately notify the contractor and any specifically named affiliate, officer, employe or other individual or entity associated with the contractor, by certified mail, return receipt requested and regular mail that it has been:
(1) Suspended for an initial period of up to 3 months accompanied by a concise statement of the reasons for the suspension.
(2) Declared ineligible for Department contracting and subcontracting pending the completion of investigation and ensuing legal proceedings. During the suspension period, the contractor shall make available all relevant documents, records and information to investigators.
(h) Reply to suspension. A contractor, subcontractor or individual suspended by the Department may, within 21 days after the suspension mailing date, submit, in person, in writing, or through a representative, information in opposition to the suspension. Upon review of the information or the completion of an investigation, or both, the Department will notify the contractor, subcontractor or individual whether the suspension shall be continued or withdrawn or whether debarment proceedings will be initiated.
§ 457.14. Debarment appeals procedure.
(a) General provisions. A contractor, subcontractor or individual debarred by the Department under § 457.13 (relating to suspension or debarment) may appeal the debarment in writing within 10 working days after the mailing date of the notice of debarment. The appeal shall set forth the basis therefor.
(b) Conformity with administrative practice and procedures; requests for hearing. Debarment hearings will be in conformity with 1 Pa. Code Part II (relating to general rules of administrative practice and procedure), as supplemented by Chapter 491 (relating to administrative practice and procedure). A filing fee is not required for a debarment hearing. In § 491.3 (relating to request for hearing), requests for debarment hearings and all other papers relating to the case shall be filed with the Department's Administrative Docket Clerk at the following address:
Secretary of Transportation, Administrative Docket Clerk, c/o Office of Chief Counsel, 9th fl., Forum Place, 555 Walnut Street, Harrisburg, Pennsylvania 17120.(c) Informal meeting. A contractor, subcontractor or individual debarred by the Department may, after filing an appeal, request an informal meeting with the Department prior to the holding of a debarment hearing for the purpose of discussion of the debarment action or presentation of additional evidence which the contractor, subcontractor or individual may want the Department to take into consideration. Requests for informal meetings shall be made in writing to the Prequalification Office. The Department will issue, within 10 working days after an informal meeting, a written notification of whether it is withdrawing or modifying the debarment action. The contractor, subcontractor or individual may then, at his option, continue with, amend or withdraw the appeal.
(d) Debarment by other agencies. A contractor, subcontractor, supplier or individual debarred by the Commonwealth or an agency thereof under the Commonwealth's Contractor Responsibility Program as set forth in Management Directive 215.9 shall be subject to debarment by the Department without right of appeal.
§ 457.15. Joint venture bids.
(a) Permissible combination. A combination of contractors which combination shall be limited to three participants unless otherwise stated in the proposal, and each of whom is prequalified in accordance with this chapter, shall be permitted to bid jointly. Equal proportionate amounts of joint-bid shall be charged against the maximum capacity rating of each participant in a joint venture, unless otherwise indicated by the bidders in their proposal.
(b) Joint and several responsibility. If a joint venture proposal is submitted, it shall be considered to be a proposal by each of the joint participants, jointly and severally, for the performance of the entire contract as a joint venture in accordance with the terms and conditions of the proposal.
(c) Minimum performance capability. Each participant in a joint venture shall be capable of performing at least 50% of the original contract price of the participant's portion of the joint venture, or the bid will be rejected.
§ 457.16. Sublettings.
(a) Credit. The contractor shall be given credit for sublettings on Department and Pennsylvania Turnpike Commission projects to which he makes reference in his proposal form, providing the proposed subcontractors are currently prequalified with the Department. Additional sublettings by the prime contractor shall be permitted if prequalified subcontractors are proposed following the opening of bids; but the prime contractor may not be given credit in his total volume of work for additional sublettings.
(b) Subletting to suspended, debarred or disqualified contractors or subcontractors prohibited. Contractors or subcontractors engaged in State highway work under a contract with the Department, or otherwise participating in State supervised or funded highway construction work, may not sublet any part of the construction work to be performed under the terms of that contract to any contractor or subcontractor who is suspended, debarred or otherwise disqualified from bidding on or participating in State highway construction work under § 457.13 (relating to suspension or debarment).
§ 457.17. Notification.
Contractors are required to notify in writing the Prequalification Office within 30 days when there is a corporate or affiliate change, or a reduction of more than 20% of their maximum capacity rating, or both, as well as changes of information required by § 457.4(b) and (c)(3)(xviii) (relating to statements to be furnished under oath). Failure to make the notification shall be cause for suspension of prequalification.
[Pa.B. Doc. No. 97-551. Filed for public inspection April 11, 1997, 9:00 a.m.]
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