Archive for Sunday, November 7, 2004

Not all KU projects require competitive bidding

November 7, 2004


When Kansas University officials recently chose J.E. Dunn Construction to build a $40 million research building, no state law governed the selection.

KU could have chosen any contractor -- at any price -- for the project because it doesn't involve state tax money.

"If you're putting in your $50 million bell tower and you like a certain contractor, you could have them build it," said Joe Fritton, director of facilities management for the Kansas Department of Administration. "Hypothetically that could happen."

KU officials say they always examine potential contractors to choose the best one for the project, though no law requires a competitive bid process when a building is funded with private money or, as in the case of the Multidisciplinary Research Building going up on west campus, federal research dollars.

"We work in a fishbowl," said Warren Corman, university architect. "We don't work privately behind the scenes."

The process

When a building is constructed using state tax dollars, state law dictates the process, including proposals to a state building committee from architects and a competitive bid process from which the low bidder is selected for the project.

Only a handful of less-restrictive regulations exist for campus buildings built with other funds. They include project approval by the Kansas Board of Regents and the legislative building committee.

Despite the reduced oversight, Corman said the process was just as scrupulous.

The university typically sends requests for proposals to potential contractors outlining the project and usually interviews several of them to determine which is best suited for a project.

The winning contractor, which is responsible for managing the project and hiring subcontractors, doesn't have to agree to a construction fee until after it is selected for the project. Corman said the industry standard was 5 percent of the construction project, though KU negotiates for less than that on some projects.

In the case of the Multidisciplinary Research Building, Corman said officials from KU and the KU Endowment Association, which donated land for the building, interviewed two large contractors -- J.E. Dunn and Turner Construction, both in Kansas City, Mo. -- because the project must be completed by the end of next year. He said KU chose J.E. Dunn because it seemed best suited to complete the project by the deadline.

Turner Construction officials did not return phone messages seeking comment about the process.

Contractor support

Contractors generally say they're comfortable with regulations regarding privately funded state buildings, even if favoritism could be part of the selection process.

"I'd be surprised if there would be too many sweetheart deals on the endowment projects," said Corey Peterson, executive vice president for Associated General Contractors of Kansas, a lobbying group. "They want to get the best value for the donors' money."

Peterson said his association upheld the idea that public sector projects should undergo a "fair, open and objective" bid process. He said he'd never heard contractors or anyone else push for more regulation in the private sector -- or in construction of public buildings funded by private dollars.

Chuck Cianciaruso, vice president for corporate development at J.E. Dunn, said his company was satisfied with the rules as they stood. Publicly funded projects are more difficult to administer than privately funded ones, he said.

"We much prefer the latter because it gives us a chance to get in earlier in the process," Cianciaruso said. "With a state project, you might have to change more things after the fact because there was no input from the contractor."

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