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Office of Planning, Environment, & Realty (HEP)

Right-of-Way Program Administration

A Guide For Developing A Right-Of-Way Service Contract

Responsibilities of the State or LPA
The following issues should be considered by States and LPA's when developing all right-of-way services contracts:

Name a project coordinator. This person is the lead contact person for the Agency.

Name a project manager who has final authority for the Agency. This person has authority for all matters regarding this contract.

Determine a pay schedule for the consultants. Determine what documentation is needed in order to make progress payments.

Address revisions and/or corrections of work products, to be completed to the satisfaction of the Agency. Address accuracy of work, timeliness, errors and omissions. Work should be acceptable to the project manager.

Provide for a process to amend the contract, if and when needed. Amendments should be in writing.

Provide a statement to terminate the contract. This should specify that the consultant is to deliver all documents and completed material to the Agency if the contract is terminated.

Provide for appeals on relocation matters. The Agency should provide for prompt review of appeals in accordance with applicable law. The Agency should make a written determination of the appeal including explanation and furnish the person making the appeal a copy.

Provide for appearance in court and at meetings, if needed. Compensation for preparation and appearance in court should be provided for and agreed to by the Agency.

Provide an incentive/disincentive clause for completion of work on the project. Decide whether to compensate the contractor an amount of money for each day work is completed ahead of schedule and/or assess a deduction for each day the contractor overruns the completion date.

Provide for disadvantaged business (DBE) program requirements, as applicable.

Provide a specific list of what materials are to be provided to the contractors. This includes materials such as right-of-way plans, plats, title information, appraisals, and appraisal reviews. These should be provided within the agreed upon time frame.

Provide guidance regarding the process to be used to resolve problems caused by the untimely submission of such materials, or materials that are inadequate or defective.

Provide specifications for certain experts, when needed, such as certified relocation specialists.

Provide specifications regarding the project office, when needed, or specifications that personnel are to be available locally during certain set hours.

Responsibilities of the Consultant
Name a project manager. This person is the consultant's project manager, contact person, and authority on matters for this contract.

Assure compliance with laws, regulations and ordinances. The consultant is to comply with all applicable Federal, State and local laws, regulations, and ordinances. Describe quality control and quality assurance programs used by the contractor to assure compliance.

Provide equipment to perform the contracted services. Agree upon office furniture and copies of documents to be provided by the Agency. Address the need for an on site right-of-way office.

Assure that the qualified personnel identified in the RFP are used to perform the work. This provision provides that the contractor will identify any changes to personnel working on the contract, and their qualifications. This notification will be provided to the contracting agency in advance of changes. The contracting agency should retain the ability to question, with cause, any such assignments.

Schedule the order of activities on the project. A progress schedule should be provided the Agency when work commences. A Gantt chart can be used, for example.

Submit progress reports for payment, as specified in the contract.

Complete required work on parcels, with documentation in files, on or before the completion date.

Indemnify the agency from all claims. The consultant should indemnify and save harmless the Agency and its officers by providing an insurance policy to cover their activities.

Adhere to provisions regarding subcontractors. The consultant should not sublet or transfer any work without the advance approval of the Agency.

Assure availability of records and staff to the State DOT and FHWA.

Comply with nondiscrimination provisions specified in the contract.

Methods of Procurement
A State is to use the same procedures it uses on non-Federal projects. States in which contractors are paid by billable hours use pre-award audits where overhead rates are agreed upon prior to the notice to proceed with work. Care is used when reviewing contractor billings to assure that charges accurately reflect the contractor's progress toward project completion.

Agency contracting procedures determine how fees are to be paid, subject to rules and regulations promulgated by the State. These may allow payments based on hours, parcels, ownership, qualifications based negotiation, lump sum, low bid, cost plus fixed fee (with or without a specified upset limit), per diem with upset limit, or retainer contracts, as long as the means are allowed under State procedure. Common methods of procurement are:

  1. 1. Combined Qualifications Based and Competitive Negotiations (Two Step). This method combines qualifications based negotiation with competitive negotiations. It qualifies as a competitive negotiation method for those agencies that cannot use qualifications based negotiations alone. The first step begins with a request for proposals. Discussions regarding qualifications, staffing, scheduling, delivery of a quality product, and work experience occur during this phase. The most highly qualified contractors are selected and are asked to submit a bid, which is step two. It is the bidding process that qualifies this method as a competitive procurement.
  2. Competitive Proposals. Under this technique more than one source submits an offer and either a fixed-price or cost reimbursement contract is usually awarded. If this method is used, the following usually apply:
    • Requests for proposals are publicized and all significant evaluation factors and their relative importance are identified.
    • Proposals are evaluated.
    • Awards are made to the responsible firm whose proposal is most advantageous to the program, with price and other factors considered.
  3. Noncompetitive Proposals (Sole Source). This technique allows solicitation of a proposal from only one source. This sometimes occurs when, after solicitation of proposals from a number of sources, competition is determined inadequate. This method is usually used when one of the following applies:
    • The item is available only from a single source.
    • Public need will not permit the delay resulting from competitive solicitation.
    • After solicitation of a number of sources competition is inadequate.
  4. Qualifications Based Procedures. For this method, procedures often state that professional services will be solicited from an adequate number of qualified sources without regard to price. When using this method, a fair and reasonable price is negotiated after the best qualified firm is selected. If an agreement on price is not reached, negotiations begin with the next best-qualified firm.
  5. Sealed Bids. Under this technique bids are publicly solicited and a fixed-price contract (lump sum or unit price) is awarded to the responsible bidder whose bid conforms to the material terms and conditions of the invitation for bids and is lowest in price.
  6. Small Purchase Procedures. These are relatively simple procurement methods for securing services, supplies, or other property in which costs often do not exceed a threshold amount. When small purchase procedures are used, price or rate quotations are usually obtained from an adequate number of qualified sources
Updated: 9/5/2014
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