Chapter 6: Letting

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Section 1: Final Processing and Letting

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Overview

This section describes the final processes for the completed PS&E package (geometric standards, drawings, specifications, project estimates, and certifications relating to completion of right-of-way acquisition and relocation, utility work, and railroad work), supporting documents, and proposal.

TxDOT releases the plans and proposal to contractors for bidding through a request for submission of bids made by advertisement. The competitive bid process, also known as design-bid-build, is the method of project delivery; electronically submitted bids shall be publically posted within 48 hours after bids are opened. Bids are forwarded to the Transportation Commission for approval and the approved contract is awarded (let) to the lowest responsive bid submitted by a qualified bidder.

Districts have primary responsibility for PS&E review. Design Division does compliance and completeness reviews before PS&E/Proposal or addenda are posted to the public.

FHWA will be involved with projects according to the Oversight Agreement. Additionally, FHWA will have cradle-to-grave involvement with Major Projects having federal funding and total cost greater than $500 Million or TIFIA loan projects. Involvement is due to the inherent high risk of these projects. FHWA NEPA oversight is excluded, since the NEPA responsibility has been assumed by the department. Department projects considered a Major Project are automatically an FHWA Project of Division Interest (PODI).

Final review by the district generally involves, but is not limited to the following tasks:

This section includes the following tasks. The tasks are listed in approximate chronological order, but some tasks may be performed concurrently.

60100. Perform financial clearance analysis

60110. Prepare and review proposal

60120. Funding and approval of PS&E

60130. Release final proposal

60132. Advertise request for bids

60134. Provide earthwork construction cross section data to contractors (if requested)

60136. Amend issued proposal documents or plans

60140. Conduct prebid conference

60150. Conduct bid opening

60152. Tabulate and review bids

51050. Collect outside, additional funding based on advance funding agreements

60154. Award contract

60160. Notify the public in advance of construction

60170. Store and retain project records

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60100: Perform financial clearance analysis

Description. For projects having Advance Funding Agreements (AFAs), a Notice of Financial Clearance is needed prior to the bid process. The Notice is a standardized form available from the Contracts and Purchasing Division, Contract Services. See Task 10510: Prepare and execute advance funding agreements and Task 51050: Collect outside, additional funding based on Advance Funding Agreements.

Projects with outside funds arranged through AFAs are conditionally awarded, and contracts are not released until the District Engineer indicates all funds are received.

Pertinent Project Types. Projects having Advance Funding Agreements

Responsible Party. District engineer

Resource Material.

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60110: Prepare and review proposal

Description. The district prepares the proposal document that includes all the information necessary for bidders to bid a project’s construction work. The proposal is the legal project document covering the itemized material quantities to construct the project and the regulations, agreements, and specifications under which the contract will be executed. The proposal document does not include construction plan drawings.

The district is responsible for reviewing the proposal for completeness and agreement with the PS&E. The proposal document includes the following information:

Pertinent Project Types. All projects

Responsible Party. District reviewers

Critical Sequencing.

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  • Review the proposal to ensure any necessary changes are made before the proposal is released to prospective bidders.
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60120: Funding and approval of PS&E

Description. Funding obligation and project authorization to advertise for physical construction bids will be issued when applicable state and federal laws and regulations have met the following:

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  1. The PS&E must be approved for letting by the district engineer. Approval signifies that the project meets the scope of work, the plans were checked, and all federal and state requirements have been met.
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  2. Delayed start work special provision request for right of way acquisitions, relocations, hazardous material removal, remediation, railroad coordination, or utilities will require an Administration-approved Management Plan to demonstrate how these activities will not impact construction operations.
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  3. Design Division verifies compliance and completeness of the PS&E before plans and proposal are posted to the public.
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  4. Right of way clearance, utility, and railroad work have been completed or arrangements have been made to be complete, as required, for proper coordination with the physical construction schedule. If it is determined there are operational or economic problems to complete this work prior to physical construction, appropriate notifications shall be provided in the proposal.
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  5. Letter of Authority - Upon environmental clearance, Environmental Affairs Division (ENV) populates their ECOS database. The information is transferred and uploaded to DCIS and populates the environmental information. For local projects, ENV requests electronic forms from the Financial Management Division (FIN); these forms can be saved as a printable file and forwarded to the local sponsor.
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  6. Appropriate environmental measures are included in the PS&E to ensure that conditions and commitments made in project development to mitigate environmental harm will be kept. In keeping with approved guidelines, water pollution and soil erosion will be minimized as a result of highway construction operations.
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  7. There are no conditional lettings for incomplete environmental permits. The area of concern shall be placed on the EPIC sheet as an area where construction is not authorized until permits are obtained.
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  8. Rights of way:
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    1. Have been acquired, including access control. Legal and physical possession has been obtained. Occupants have vacated.
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    2. Not fully acquired. Right to occupy and use all rights of way for proper execution of the project has been acquired. Trial or appeal for some parcels may be pending. Occupants have vacated.
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    3. Right of use or occupancy is not complete. All occupants have had replacement housing made available to them; however, not all occupants have moved from the right of way. The department may request authorization on this basis only in very unusual circumstances. The department shall ensure that occupants, who have not moved from the right of way, are protected against unnecessary inconvenience, injury, or coercion. Full explanation of the unacquired parcels shall be provided and notification shall be included in the proposal. Request for authorization under these conditions should be the exception and not the rule.
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  9. District provides Performance End Date (PED) on DCIS P1 screen before FIN will request federal funding authorization.
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  10. The project agreement must be supported by a documented current cost estimate aligned with the eligible work being completed.

Project authorizations with conditional approvals should be used under very limited circumstances and should not be used to reserve funding before the project is ready to proceed.

Authority.

Project Types. All projects

Responsible Party. District engineer assures compliance with state and federal laws, policies, and procedures by signing the PS&E title sheet.

Resources.

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60130: Release final proposal

Description. The district builds, reviews, and revises proposals before they are released to bidders.

Contracts cannot be awarded for proposal solicitation that do not meet minimum advertising time. See Task 60132: Advertise request for bids.

Online Bid Proposal Request System (BPRS) allows bidders to request/download proposal solicitation packages. Bidders create a secure online account.

Pertinent Project Types. All projects

Responsible Party. Construction Division

Helpful Suggestions.

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  • The district or area engineer offices must not distribute proposal copies under any circumstances. Construction Division controls release of bid proposals to qualified bidders.

Resource Material.

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60132: Advertise request for bids

Description. The department shall publish notice of the time and place at which bids on contracts will be read and awarded.

The Department posts online advertisement at Electronic State Business Daily (ESBD) and on TXDOT.gov.

Contract summary for maintenance projects is obtained from the Construction/Maintenance Contract System (CMCS). Bid contract information for construction contracts is obtained from the Design/Construction Information System (DCIS).

Bids are received through the department online electronic bidding system known as the integrated Contractor Exchange (iCX). Electronic bid bonds are required. A secure online administrative account is set up for bidders; account set up can be facilitated by surety agents using department-approved electronic bond clearinghouses.

Pertinent Project Types. All construction and maintenance projects

Responsible Party. Finance Division

Authority Requirements.

Resource Material.

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60134: Provide earthwork construction cross section data to contractors (if requested)

Description. Contractor access to construction cross section data in electronic format allows the contractor to prepare more accurate and concise bids, particularly on projects with significant earthwork items.

Construction cross section data typically includes the following information:

Upon contractor request, district or area offices should provide earthwork construction cross section data to the requestor for bid preparation. This information should be in ASCII format (plain text file), GEOPAK XSR files, or PDF formatted cross section plots and made available prior to letting at no cost. Consultant engineering firms involved in TxDOT design projects should include this data as part of their deliverable to the district.

The following disclaimer must be included in the transmittal of the cross section data:

The following data is for non-construction purposes, only. It is the responsibility of prospective bidder to validate the data.

Texas Department of Transportation

If construction cross section data is provided directly in the plans, that data should also be clearly labeled ““FOR INFORMATION PURPOSES, ONLY”.

Pertinent Project Types. All projects with earthwork construction cross section data

Responsible Party. District or Area Office

Critical Sequencing.

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  • Cross section data must be provided upon request and in a timely manner so the contractor can prepare an accurate bid on the project.
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60136: Amend issued proposal document or plans

Description. Occasionally, it may become necessary to amend the proposal or plans after the project goes out for bid, but before contract letting. Contractors must not be given information not contained in the bidding documents to ensure that all prospective bidders receive identical information. An addendum must be approved according to policies in use. After approval to proceed, the district may request the estimate release.

For late addenda, the district shall notify all qualified bidders of the pending addendum. All amendments to the contract shall be processed officially and publicly published online. Changes should never be handled verbally. Reprographics sends out notices overnight (FedEx) to the bidders and iCX sends an email notification to the online bidders when the addendum is released or the proposal is canceled.

The Notification of Addendum lists the changes made to the original plans and proposal after the project was released for advertising. Bidders are required to acknowledge receipt of the addendum on the bidding documents. Failure to acknowledge the addendum will result in an incomplete bid.

Pertinent Project Types. All projects

Responsible Party. Project engineer

Helpful Suggestions.

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  • Amendments result in prospective bidders having to reevaluate their bid packet; therefore, any large amendments should be made as early as possible.
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  • Very minor amendments to the contract (minor quantity errors, misspelled words, etc.), which are not anticipated to impact bid prices, should not be made, unless combined with other essential changes.

Critical Sequencing.

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  • Completed changes must be received by the deadlines shown in the PS&E Review and Processing Schedule, to maintain the letting schedule.
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  • Filenames for amended plan sheets need to retain the same filename and format as the original file they are replacing; the amended files replace the originals. Filename errors can cause additional problems, such as unintentional overwritten plan documents or duplicate titled sheets (revised and its original).
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  • All revised PDF plan sheets shall have the revision/addendum number and the addendum release date on the lower right corner. This information ensures the contractor is using the correct construction information.
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  • When subsequent changes are made to the same PDF plan sheet, retain previous revision numbers on the drawing, but remove any clouds around the previous changes. All revisions should be identified on the drawing as well as the list of revision dates.
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  • An addendum should be issued only when plans or proposal errors may affect the competitiveness of the letting, there are significant quantity errors, or a contract material issue.
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  • For a late addendum, contact all the contractors who have pulled proposals. Document the notification date, time, method of contact, and person contacted. If all bidders have not been contacted, it may require canceling/postponing the project letting.

Resources.

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60140: Conduct prebid conference

Description. Prebid conferences are conducted to explain a project’s special requirements or unusual aspects. Maintain minutes for all prebid conferences, mandatory or optional. Include time, date, and location where the meeting took place. Provide a copy of the minutes to all bidders. Prebid conference information is entered in DCIS through the Contract Summary Screen - Conference Subscreen. Documents from the conference are placed in the project file.

Prebid conferences should be held one week or more after the initial announcement of the invitation for bids to allow prospective bidders enough time to obtain, read, and study the solicitation documents, and prepare a request for clarification, if any.

Mandatory prebid conferences are discouraged. Contractors have concerns for bid confidentiality and scheduling difficulties. Procedural errors may result in bid rejection. Mandatory prebid conference requires approval by the Director of the Design Division. If approved, the person responsible for holding the conference must give the Construction Division a list of bidders attending a mandatory conference. A “mandatory prebid conference” indicator has been added on the department’s website. Projects requiring a mandatory prebid conference will be denoted with a “*” in the control CSJ column. Times and places of conference can be found on the bid item index pages.

Similar to a prebid conference is a “showing the project” meeting. This meeting is intended as an opportunity for interested parties to review the project, ask questions, or request information. All questions and requests are recorded. All questions with answers are provided to all bidders. If errors are pointed out by a contractor, analyze the overall effect on the contract. Major errors will be corrected by issuing an addendum. Under no circumstances should statements be made about possible changes to the PS&E.

No additional project requirements may be added or changed at a prebid conference or a “showing the project” meeting. Bid documents must stand on their own so that all bidders are using the same information. Changes to a contract will be made by addendum.

Pertinent Project Types. All projects

Responsible Party. District area engineer

Helpful Suggestions.

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  • Hold a prebid conference about two weeks before letting, if possible.
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  • A minimum of seven days are required between the conference and bid opening dates. If a prebid conference is scheduled closer than seven days to the bid opening date, questions posed by contractors at the meeting may not be answered with an addendum.
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  • Never give the engineer’s estimate to the contracting community.

Resource Material.

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60150: Conduct bid opening

Description. Bid openings are held in Austin and are conducted by Construction Division (CST) personnel. CST prints a bid sheet for each project to let. The bid sheet is a list, by project, of bidders who have pulled proposals. All conditions of bid acceptance must be reviewed at the opening of each bid.

These conditions include any of the following:

Bid totals are read at bid opening. Unofficial lowest bid received for each contract is announced, but all bids will be analyzed by CST before the Commission announces award to the verified lowest responsive bid.

Pertinent Project Types. All projects

Responsible Party. Construction Division

Authority.

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60152: Tabulate and review bids

Description. After the bid opening, the Construction Division tabulates and reviews the bids.

Bids are checked for accuracy, reasonable conformance to the engineer’s estimate, and for mathematical or material imbalance. Bids determined to be irregular may be rejected.

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  • Unbalanced bids:
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    • A mathematically unbalanced bid is one that contains lump sum or unit bid items based on nominal prices and other work uses inflated prices, which do not reflect reasonable actual costs plus a reasonable, proportionate share of the bidder’s anticipated profit, overhead costs, and other indirect costs. Each bid item must carry a proportional share of total cost of work plus profit. The Transportation Commission may still award these projects.
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    • A materially unbalanced bid is one that generates reasonable doubt that a mathematically unbalanced bid will result in the lowest, ultimate cost to the State. The Texas Transportation Commission must reject a materially unbalanced bid. Although there are other unbalancing methods, unbalanced bids generally result from two situations:
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      • Maximize profits. Quantity errors (too low) in the estimate; the contractor bids a high price on these items. Conversely, the contractor may underprice items that will be used in significantly lesser quantities. In this case, the apparent low bidder might not be the actual low bidder once the quantity errors are corrected.
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      • “Front loading”. The contractor’s bid prices are high on items of work occurring early in the project. This is similar to the evils of an advanced payment. In this case, the apparent low bidder might not be the actual low bidder when the State’s financial loss of potential interest income is calculated.
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    • Tabulates bids in increasing amounts
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    • Verifies the low bidder

Pertinent Project Types. All projects

Responsible Party. Construction Division

Authority.

Resource.

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60154: Award contract

Description. Construction contracts let by the State require award by the Texas Transportation Commission (the “Commission”) before execution of the contract. The Construction Division makes a contract award recommendation to the Commission after all bids are tabulated and reviewed, and after all letting and procedural requirements are checked.

For Federal-aid projects, FHWA concurrence in award is a prerequisite to Federal participation. Concurrence will be given only after receipt and review of the tabulated bids.

Concurrence from an MPO must be obtained for cost overruns on projects selected by the MPO in compliance with the MPO’s policy.

If a local entity is involved in funding a portion of a project, their concurrence is also required if the project overruns the cost estimate.

For projects let by local entities, concurrence in award must be obtained from TxDOT Assistant Executive Director for Engineering Operations before the local entity awards the project. Contact the Local Government Projects office for additional information.

A cost justification memorandum is required for all projects when either of the following occurs:

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  • Multiple bidders and the low bid deviation is ±20% or more from the estimate.
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  • One bidder and the low bid deviation is ±10% or more from the estimate.

Justification memoranda are prepared and explained by the district. Submit memo to the Construction Division Director for approval. The memo information is used to explain the bid deviation to the Commission. The Commission officially accepts or rejects bids at their monthly meetings. Construction Division notifies successful bidders of the contract award.

The contractor must obtain the authorization to proceed before activities may begin on a project.

Pertinent Project Types. All projects

Responsible Party.

Authority.

Resource Material.

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60156: Conduct preconstruction conference

Description. Conduct a meeting between district personnel, contractor, and contractor’s staff. This meeting is to establish lines of authority and communication; determine the responsibilities and duties of contractor’s personnel, subcontractors, and department personnel; and clarify potential sources of misunderstanding and work out the detailed arrangements necessary for the successful completion of the contract. Maintain a written record of the meeting (e.g., meeting minutes) in the project construction file. See Task 10215: Project File of Record.

Since the Environmental Management System (EMS) is a core business process, the district and the contractor should introduce their personnel responsible for maintaining the Construction Stage Gate Checklist and the environmental compliance, permit requirements, and quality monitoring of construction activities at the preconstruction conference. The Construction Stage Gate Checklist is completed for projects that have environmental permits or soil disturbing activities. The forms must be kept with the project construction file and retained according to department guidelines.

Resource Material.

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60160: Notify the public in advance of construction

Description. The district public information office should have project-level strategies to inform road users, businesses, area residents, and the general public about specific road construction and its implications for safety and mobility in the area. Public notices may include press releases to various media types, static or dynamic roadway signs, ITS, or notices posted on project-specific websites or social media.

Depending on project size, give public notices far enough in advance of construction start so that motorists can adjust their travel plans accordingly. For larger, long-term projects, a purpose-built application for mobile devices can be designed to provide latest updates to users or a project-specific website can keep the public informed.

To provide accurate public notices, the district public information officer should obtain project information from the project manager, area engineer, or the director of transportation planning and development. As a best practice, manage and provide up-to-date project information. There should be a contact number or email address for the public to communicate with project management.

Pertinent Project Types. Major projects that may affect normal traffic patterns

Responsible Party. District public information officer

Subtasks.

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  • Identify the level of notice needed for the project size and duration.
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  • Notify elected officials before beginning construction.
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  • Prepare and distribute press releases or other notices (e.g., community events, social media).
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60170: Store and retain project records

Description. The File of Record is a collection of files related to project planning, development, design and construction such as, notes, calculations, plan or detail drawings, layouts, schematics or maps, structural or materials records, diaries that may be retained for reference, or other project records. See Task 10215: Project File of Record for a list of typical file documents.

Several individuals may contribute to a project record over a project’s life cycle. Since there may be sensitive data in files, maintain the File of Record in a secured location designated by district policy.

Once the retention period is complete, records may be authorized for destruction. Destruction of records must be performed according to the TxDOT Records Management manual.

Pertinent Project Types. All projects

Responsible Party. Document life-cycle retention contributors:

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  • Project manager
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  • District engineering and design staff.
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  • District designated officer who administers district records management program.
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  • Design Exception files: Documentation related to the approval or denial of design exceptions, variances, and/or waivers are permanently retained for legal reference. Design Exception files are stored in designated filing location used exclusively for these files.
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  • Preliminary/construction project files. District maintains original files. Design Division maintains copies of original files, which become the default Files of Record in event that original files are lost or destroyed.
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  • TxDOT Information Management Division (IMD) Records Manager Officer – Department liaison with the Texas State Library and Archives. Supports compliance with state and federal requirements for records in any media format.

Authority.

Resource Material.

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