Construction-Procurement System is Key to Putting Stimulus Funds to Work Fast
March 5, 2009
MAULDIN, SC – March 5, 2009 – City agencies in Chicago, New York and Miami have a head start in the race to put billions of federal stimulus dollars to work repairing, renovating and maintaining America’s roads, bridges and public buildings. These cities, and dozens of others around the country, have job order contracts (JOC) from The Gordian Group in place that will enable them to put funds from The American Recovery and Reinvestment Act of 2009 to work virtually overnight.
JOC is a competitively bid construction-procurement system that enables government agencies to complete large numbers of repair, maintenance and construction projects for less money and time, with complete accountability, compared to traditional job-bidding processes. Programs go from concept to work in weeks, not months. An independent study showed JOC can save public agencies from 8 percent to 15 percent on construction costs alone.
Chicago Mayor Richard M. Daley said recently his city compiled a list of projects that could be under contract within 90 days and completed in one year. Projects include installing or repairing 75 miles of sewer and water mains, replacing 200 miles of city street lights and resurfacing 150 miles of arterial city streets. Nine city agencies and departments employ The Gordian Group’s JOC system.
The Gordian Group’s JOC Solutions put government agencies in control of spending so they can put stimulus funds to work wisely, while also putting people to work faster than the traditional job-bidding process with complete oversight for taxpayers. That’s in stark contrast to the traditional job-bidding process, which will force other agencies to race the clock to start stimulus-funded projects by September 2010, said Robert Coffey, president and co-founder.
About JOC
JOC was developed in 1981 by Harry Mellon, Chief Executive Officer and Founder of The Gordian Group, when he was chief engineer for the Army Corps of Engineers for NATO (North Atlantic Treaty Organization) operations in Europe.
To implement a JOC program, The Gordian Group creates an exhaustive catalog of job tasks based on the agency’s projects. The company assigns a fixed cost for each task based on local labor rates and material and equipment costs. It also writes a technical specification for each task in order to establish quality standards contractors must meet. Examples of the tasks include everything needed to renovate buildings, install building ventilation systems, replace sidewalks, repair roadways or resurface airport runways.
Contractors submit bids based on an entire catalog of job tasks, which typically covers work for three to five years. The price quoted is a percentage of the costs in the catalog of tasks created by The Gordian Group. For example, a bid might quote a rate of 105 percent, meaning the contractor would require 5 percent more than the prices published in the catalog of job tasks in order to complete the work profitably.
Work must be performed according to the technical specifications in order for the contractor to be paid and to receive subsequent jobs. The cost for each project is determined by multiplying the price of job tasks by the quantity and then multiplying that figure by the contractor’s markup. Prices for tasks are never negotiated. The prospect of additional work keeps the contractor motivated to provide timely, responsive and high quality work.
About The Gordian Group
The Gordian Group (www.gordian-group.com) established the first commercial JOC programs in 1990 and remains the only full-service JOC consulting firm in the nation. It provides all products and services from project start to finish, including development of a customized catalog of construction tasks, general conditions and bid documents, and proprietary PROGEN(R) information-management and proposal-preparation software. The Mauldin, S.C.-based company is a member of the Wicks Group of Companies, L.L.C., a New York-based private-equity firm.
