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Procurement, Management, and Administration of Engineering and Design Related Services - Questions and Answers

I. Competitive Negotiation/Qualifications Based Selection Procurement Procedure

  1. What is the competitive negotiation procurement procedure? (Updated 08.01.2016)
  2. When must competitive negotiation/qualifications based selection (Brooks Act) procedures be used for procuring engineering and design related services? (Updated 08.01.2016)
  3. What are engineering and design related services? (Updated 08.01.2016)
  4. Are competitive negotiation/qualifications based selection (Brooks Act) procurement procedures required for FAHP funded consultant services that are not directly related to a construction project or not considered engineering and design related, such as for planning studies? (Updated 08.01.2016)
  5. If there is no FAHP funding participating in engineering and design related services contract, are the Federal competitive negotiation/qualifications based selection (Brooks Act) procurement procedures still applicable? (Updated 08.01.2016)
  6. Under competitive negotiation/qualifications based selection (Brooks Act) procurement procedures, do engineering and design related services contracts have to be solicited by public announcement/advertisement? (Updated 08.01.2016)
  7. Under competitive negotiation/qualifications based selection (Brooks Act) procurement procedures, may price be an evaluation criterion during the advertisement and selection phase? (Updated 08.01.2016)
  8. Under competitive negotiation/qualifications based selection (Brooks Act) procurement procedures, may an in-State preference be used in the advertisement and selection phase? (Updated 08.01.2016)
  9. Under competitive negotiation/qualifications based selection (Brooks Act) procurement procedures, may a local office presence be an evaluation criterion during the advertisement and selection phase? (Updated 08.01.2016)
  10. May a contracting agency require that a consultant performing engineering work have a State Professional Engineer license to work in that State? (Updated 08.01.2016)
  11. May a contract be modified to add engineering and design related services that were not included in the advertised scope of services and evaluation criteria of the announcement/advertisement from which a qualification based evaluation and selection were conducted? (Updated 08.01.2016)

1. What is the competitive negotiation procurement procedure? (Updated 08.01.2016)

Competitive negotiation (as specified in 23 U.S.C. 112 (b)(2)(A) and 23 CFR 172.7(a)(1)) is based on qualifications based selection procedures (as specified in 40 U.S.C. 1101-1104 (Brooks Act)) and is the primary method of procurement for Federal-aid highway program (FAHP) funded engineering and design related service contracts associated with a construction project.

The Brooks Act requires the selection of engineering and design related services on the basis of demonstrated competence and qualifications for the type of professional services required and negotiation of fair and reasonable compensation for the services provided. The qualifications based selection procedures prescribed in the Brooks Act require public announcement/advertisement of all requirements for the desired services (as specified in 40 U.S.C. 1101 and 23 CFR 172.7(a)(1)) (See Competitive Negotiation Question & Answer No. 6). The Brooks Act further requires evaluation of current statements of qualifications, performance data, and statements regarding the proposed project or services submitted by prospective consulting engineering firms. Contracting agencies shall then select and rank a minimum of three firms based on demonstrated competence and qualifications in accordance with the established/advertised criteria (as specified in 40 U.S.C. 1103) (See Competitive Negotiation Question & Answer Nos. 7-10).

Upon completion of the qualifications based evaluation and ranking of proposals, the contracting agency initiates negotiations with the most highly qualified firm to arrive at a fair and reasonable compensation for the solicited services. Fair and reasonable compensation involves consideration of the scope, complexity, professional nature, and estimated value of the services to be rendered (as specified in 40 U.S.C. 1104). If the contracting agency and most highly qualified firm are unable to negotiate a fair and reasonable contract, the agency may formally terminate negotiations and undertake negotiations with the next most qualified firm, continuing the process until an agreement is reached (See Contract Negotiation Question & Answer No.1).

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2. When must competitive negotiation/qualifications based selection (Brooks Act) procedures be used for procuring engineering and design related services? (Updated 08.01.2016)

In general, competitive negotiation/qualifications based selection procedures must be followed when procuring engineering and design related services using FAHP funds where those services are directly related to a construction project (as specified in 23 U.S.C. 112(b)(2)(A) and 23 CFR 172.7(a)(1)). Small purchases and noncompetitive procedures are the only other procurement methods that may be utilized under limited conditions applicable to each method. For additional guidance regarding these procurement methods, please reference the Other Procurement Procedures Section.

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3. What are engineering and design related services? (Updated 08.01.2016)

Engineering and design related services are defined as: program management, construction management, feasibility studies, preliminary engineering, design, engineering, surveying, mapping, or architectural related services (as specified in 23 U.S.C. 112(b)(2)(A) and 23 CFR 172.3). The Brooks Act further defines architectural and engineering related services as professional services of an architectural or engineering nature, as defined by State law, if applicable, that are required to be performed, approved, or logically/justifiably performed by a person licensed, registered, or certified as an engineer or architect to provide the services (as specified in 40 U.S.C. 1102(2)).

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4. Are competitive negotiation/qualifications based selection (Brooks Act) procurement procedures required for FAHP funded consultant services that are not directly related to a construction project or not considered engineering and design related, such as for planning studies? (Updated 08.01.2016)

Under 23 U.S.C. 112 (b)(2), Brooks Act procurement must have a construction related nexus.  For engineering services not related to construction, 2 CFR 200.317 provides that when procuring services under a Federal award, unless a Federal statute, like 23 U.S.C 112(b)(2)/ 23 CFR Part 172 provides otherwise, State (and local public agencies pursuant to 2 CFR 1201.317) follow the same policies and procedures the State uses (or permits the local public agency to use) for procurement with its non-Federal funds.

Thus, the applicable procurement requirements for the engineering services unrelated to highway construction is generally dependent upon the definition of engineering and the procurement code within State and local laws, regulations, policies, and procedures. If the services in question require qualifications based selection under State and local requirements, compliance with these requirements and use of qualifications based selection procedures is required as a condition for participation of Federal-aid funding in the services.

It is important to note that planning studies or other services which are not included in the definition of engineering and design related services (See Competitive Negotiation Question & Answer No. 3), and generally are not directly related to a construction project, will not require procurement through a qualifications based selection process under Federal laws and regulations pertaining to the FAHP. Planning studies, for example, are typically based on a regional or corridor assessment of a facility or network (not project specific) where subsequent engineering and project development services for a specific project must be undertaken prior to letting the project for construction. Although Brooks Act procurement is not required under 23 U.S.C. 112(b)(2) in those situations, State and local licensing and procurement laws and regulations may require use of a State qualifications based selection procedures to procure these services.

The determining factor for the required use of competitive negotiation/qualifications based selection procedures is whether the services being procured are related to a specific construction project (subject to the provisions of 23 U.S.C. 112(a)) and/or whether the services require work to be performed, provided by, or under the direction of a registered engineer or architect (as specified in 40 U.S.C. 1102(2)). If a planning study is to determine the need for improvements within a corridor, conduct travel demand studies, or to obtain information on costs for planning and programming processes, the consultant may not need to be procured under a qualifications based selection process. If a planning study involves development and consideration of detailed alternatives in a corridor or any activities or analyses that pertain to development and furtherance of a specific project, the consultant may need to be procured under a qualifications based selection process. The determination is based upon the scope of services needed and the applicable State and local laws, regulations, policies, and procedures.

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5. If there is no FAHP funding participating in an engineering and design related services contract, are the Federal competitive negotiation/qualifications based selection (Brooks Act) procurement procedures still applicable? (Updated 08.01.2016)

No, Federal laws and regulations for procuring, managing, and administering engineering and design related services contracts are specific to the use of FAHP funds for the engineering and design related services.

If FAHP funds are not participating in an engineering and design related services contract, the contracting agency may procure the services in accordance with its own established policies and procedures which reflect applicable State and local laws. However, the costs of consultant service contracts that utilize only State or local funding which were not procured, negotiated, or administered in accordance with applicable Federal laws and regulations would not be eligible to be applied toward the non-Federal share of costs for subsequent phases (e.g., construction) of a FAHP funded project (as the cost is not authorized by FHWA and may not be in compliance with applicable federal requirements specified in 23 CFR 1.9(a)). More information on non-Federal match requirements may be found at: http://www.fhwa.dot.gov/legsregs/directives/policy/memonfmr20091229.htm.

6. Under competitive negotiation/qualifications based selection (Brooks Act) procurement procedures, do engineering and design related services contracts have to be solicited by public announcement/advertisement? (Updated 08.01.2016)

Yes, in order to assure that in-state and out-of-state consulting firms are given a fair opportunity to be considered for award of an engineering and design related services contract, the contracting agency must solicit services by public announcement/advertisement and identify all requirements that consulting engineering firms must fulfill along with all other factors to be used in evaluating proposals (as specified in 40 U.S.C. 1101 and 23 CFR 172.7(a)(1)).

The solicitation should include the evaluation criteria with its weighting/relative importance that will be used to rate the firms for their competency and qualifications to perform the type of work requested. The solicitation should provide a clear and precise statement of the work to be performed, estimated schedule to accomplish the services, and method of compensation/payment. The solicitation must also allow sufficient time for firms to prepare and submit a proposal in response to the solicitation (as specified in 23 CFR 172.7(a)(1)(ii)(G)).

State-imposed conditions unrelated to performance of the contract or contractor that limit qualified firms from fairly competing or provide advantages to certain classes of potential firms are inconsistent with the competitive negotiation/qualifications based selection process, the guiding principle of Federal laws and regulations applicable to procurement of engineering and design related consultant services. Applicable Federal laws and regulations do not permit any State or local requirements that limit competition except those related directly to the qualifications of consulting firms to perform the work in a competent and responsible manner.

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7. Under competitive negotiation/qualifications based selection (Brooks Act) procurement procedures, may price be an evaluation criterion during the advertisement and selection phase? (Updated 08.01.2016)

No.  Competitive negotiation procurement is based upon demonstrated competence and qualifications for the type of professional services desired (as specified in 40 U.S.C. 1101 and 23 CFR 172.7(a)(1)(iii)(A)).

As such, price shall not be used as a criterion in the evaluation and ranking/selection of the most highly qualified firm (as specified in 23 CFR 172.7(a)(1)(iii)(B)). All price/cost related items which include, but are not limited to direct salaries/wage rates, indirect cost rates, and other direct costs are prohibited from being used as an evaluation criterion under competitive negotiation/qualifications based selection procedures (as specified in 23 CFR 172.7(a)(1)(iii)(B)).

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8. Under competitive negotiation/qualifications based selection (Brooks Act) procurement procedures, may an in-State preference be used in the advertisement and selection phase? (Updated 08.01.2016)

No, an in-State preference does not assess the qualifications of potential service providers and application would limit competition from qualified out-of-State firms.

The intent of a competitive negotiation/qualifications based selection (Brooks Act) process is to develop a wide pool of potential service providers to asses qualifications for the advertised work or task,  and selection must be based on qualifications. Therefore, the use of in-State preference as a criterion is prohibited (as specified in 23 CFR 172.7(a)(1)(iii)(C)). Through public advertisement, in-State and out-of-State firms must be given a fair opportunity to be considered for award of a FAHP funded engineering and design related services contract (as specified in 23 CFR 172.7(a)(1)). (See Competitive Negotiation Question & Answer No. 6)

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9. Under competitive negotiation/qualifications based selection (Brooks Act) procurement procedures, may a local office presence be an evaluation criterion during the advertisement and selection phase? (Updated 08.01.2016)

Yes, historically a local office presence has been authorized to be used as a nominal evaluation criterion where appropriate in assessing the qualifications of firms to perform the solicited services (as specified in 23 CFR 172.7(a)(1)(iii)(D)(1).

A nominal local office  criterion of no more than ten (10) percent of the total evaluation criterion may be used. This criterion cannot be based on political boundaries and should be used on a project-by-project basis for projects where a need has been established for a consultant to provide a local presence (office).  If a firm currently outside the locality area indicates that, as part of its proposal, it will satisfy that criterion in some manner, such as establishing a local project office, that commitment should be considered to have satisfied the local presence criterion. The intent is to only apply this evaluation criterion on projects where a local presence will add value to the quality and efficiency of the project provided that application of this criterion leaves an appropriate number of qualified firms, given the nature and size of the project, available to compete for the services.

To maintain the integrity of a competitive negotiation/qualifications based selection procurement, the total of all allowable non-technical evaluation criterion (including local presence and/or Disadvantaged Business Enterprise (DBE) participation) should not exceed ten (10) percent of the total evaluation criteria. (See DBE Considerations Question and Answer No. 2 regarding DBE participation as an evaluation criterion).

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10. May a contracting agency require that a consultant performing engineering work have a State Professional Engineer license to work in that State? (Updated 08.01.2016)

Yes, as licensure as a Professional Engineer serves as a means to validate the competence and qualifications to perform the desired engineering and design related services.

While such a requirement is based on the licensing and procurement laws of a State, the requirement to hold a license as a Professional Engineer is directly related to the qualifications of a consultant to perform the desired engineering and design related services. Furthermore, licensure as a Professional Engineer serves as a means to protect the public interest of the State in employment of professional engineers familiar with State procedures and requirements and satisfying professional liability standards of the State.

Similarly, a consultant may also be required to maintain any State business permits to practice/provide engineering services in a State as required by State laws and regulations.

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11. May a contract be modified to add engineering and design related services that were not included in the advertised scope of services and evaluation criteria of the announcement/advertisement from which a qualification based evaluation and selection were conducted? (Updated 08.01.2016)

No, as the addition of work not included in the advertised scope of services and evaluation criteria would be contrary to the intent of the competitive negotiation/qualifications based selection (Brooks Act) process to publicly announce all requirements and ensure qualified firms are provided a fair opportunity to compete and be considered to provide the prescribed services (as specified in 23 U.S.C. 112 b)(2)(A) and 23 CFR 172.7(a)(1)).

A modification to a contract that adds services beyond the publicly advertised services for which the consultant was selected as the most highly qualified to perform would, in effect, circumvent the qualifications-based evaluation and selection process. Only services included in the original solicitation may be incorporated into a contract. Necessary or desired additional services which were not included in the original solicitation from which the qualifications-based selection was made should be procured under a new advertisement, accomplished with in-house contracting agency staff, or performed under an existing on-call contract which allows for the desired services, necessary qualifications, costs, and schedule.

For example, if a consulting firm was selected to conduct an environmental assessment of a project and the advertised scope and evaluation criteria related to only environmental work, the contract could not be modified to include design tasks. However, if the scope and selection criteria also included design elements for evaluation and ranking of consultants, then it would be permissible to modify the contract to include the design elements advertised.

As another example, if a consulting firm was selected to complete the design of a roadway and the advertised scope and evaluation criteria included only geometric, drainage, and other roadway design elements, the contract could not be modified to include the design of a bridge unless structure/bridge design was included in the advertised scope and evaluation criteria from which the consultant was selected based on qualifications to perform.

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Updated: 08/17/2016
Federal Highway Administration | 1200 New Jersey Avenue, SE | Washington, DC 20590 | 202-366-4000