Article VI. Specific Procurements
4.20.160 Construction.
A. Source Selection. The source selection process for the procurement of construction contracts, whether it be remodeling or construction of a new structure, shall be made as follows:
1. One Hundred Thousand Dollars ($100,000) and Over. For any construction or remodeling project estimated by the requisitioning department director to cost one hundred thousand dollars ($100,000) or more, the competitive sealed bid procedure shall be used as stated in this chapter.
2. Under One Hundred Thousand Dollars ($100,000). For any construction or remodeling project estimated by the requisitioning department director to cost under one hundred thousand dollars ($100,000), no less than three (3) businesses shall be contacted to submit written quotations. Award shall be given to the lowest responsible and responsive contractor.
B. Contract Administration for Construction Contracts. For construction contracts of less than one million dollars ($1,000,000), the city manager or council shall have discretion to select the appropriate method of construction contracting management for a particular project. For contracts exceeding one million dollars ($1,000,000), the discretion shifts solely to the city council.
1. In determining which method to use, the following shall be considered:
a. The city’s requirements,
b. The city’s resources, and
c. The potential contractor’s capabilities;
2. The city manager shall execute and include in the contract file a written statement setting forth the facts which led to the selection of a particular method of construction contracting management for each project. It is recognized that at least the following methods are currently being used for control and coordination of construction projects:
a. A single prime contractor (including a turnkey or design-build contractor); or
b. Multiple prime contractors managed by:
i. A designated general contractor,
ii. A construction manager, or
iii. The public works director.
C. Bonds. All construction contracts exceeding one hundred thousand dollars ($100,000) shall require the contractor to furnish the following bonds prior to the signing of any final contract:
1. Performance bond with a corporate surety qualified to do business in the state of Alaska, the amount of the performance bond shall be equivalent to the amount of the payment bond;
2. Payment Bond. A payment bond with a corporate surety qualified to do business in the state of Alaska.
a. When the total amount payable by the terms of the contract is not more than one million dollars ($1,000,000), the payment bond shall be in sum equal to one-half (1/2) the total amount payable by the terms of the contract.
b. When the total amount payable by the terms of the contract is more than one million dollars ($1,000,000) but not more than five million dollars ($5,000,000), the payment bond shall be in a sum of forty (40) percent of the total sum payable by the terms of the contract.
c. When the total amount payable by the terms of the contract is more than five million dollars ($5,000,000), the payment bond shall be in the sum of two million five hundred thousand dollars ($2,500,000).
3. Payment and performance bonds shall be for equivalent amounts. [Ord. 14-27 § 4.]