Section 6: Post-letting GuidelinesAnchor: #i1003358
This section includes the following post-letting guidelines:
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- Letting overrun/underrun justification, Anchor: #OWCIBYLS
- Local participation.
Letting Overrun/Underrun Justification
The next subsections discuss:
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- Overrun/underrun justification memorandum guidelines, Anchor: #YKQNTVSE
- Construction Division determination of bid validity, Anchor: #EGGMMMJF
- District review responsibilities.
Overrun Justification Memorandum Guidelines
Accurate estimating is essential in determining the validity of bids. The following are the latest guidelines for overrun/underrun justification memorandums for federal aid and state-funded construction projects.
Letting overrun/underrun justification memorandums are required for all types of projects where the apparent low bid is 20% or more over or under the engineer’s estimate and there are two or more bidders, regardless of project cost. Projects with only one bidder require justification when the apparent low bid varies from the engineer’s estimate by more than +/-10%. These memorandums are prepared by the district and submitted to CST/Letting for further handling and coordination with the letting management office of the Finance Division. This office submits all memorandums to the Construction Division director for ultimate approval of the recommended bid award or rejection by the Texas Transportation Commission.
For more information, refer to the Project Development Process Manual, Task 6210.Anchor: #i1003432
Construction Division’s Determination of Bid Validity
The aforementioned letting overrun/underrun justification memorandums are used by the Construction Division to determine the validity of the bids. The following items are checked:
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- Errors in plans or engineering estimate Anchor: #GEKIWPAH
- Adequate competition Anchor: #TMYOELVO
- Indications of collusion among bidders Anchor: #EJCODKES
- Unbalanced bidding.
Once these points have been considered, the Construction Division recommends award or rejection of the bid overruns/underruns to be acted on by the Texas Transportation Commission during the same month’s scheduled Commission meeting.
For more information, refer to the Project Development Process Manual, Task 6200.
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- Update other participation Field on P2C Screen. Anchor: #ESFVPKWY
As noted in the Additional Payments subsection in Section 4, the district personnel that coordinated the funding agreements with the local entity should update this information. The Contract Services Office (CSO) and the Construction Division uses this information when issuing the construction work order.
- Prepare a Financial Clearance Analysis Anchor: #ENULPNUW
Projects with outside funds are conditionally awarded, and contracts are released only after all terms as outlined in the project’s Advance Funding Agreement (AFA) have been met. The responsibility for the financial clearance function has been delegated to the District Engineer (DE). The Notice of Financial Clearance for Bid Opening and Award form signed by the DE needs to be sent to CSO once 30 days prior to bid opening and once prior to award. If a project overruns after letting, the district needs to discuss the bid prices with the local entity or Metropolitan Planning Organization (MPO) participating in the funding of the project and insure that the outside entity concurs with the acceptance of the higher costs. If they do not concur, the contract is not to be recommended to the Commission for award.