Honorable Robert Bunda

President of the Senate

Twenty-First State Legislature

Regular Session of 2002

State of Hawaii

Sir:

Your Committee on Transportation, Military Affairs and Government Operations, to which was referred S.B. No. 2212 entitled:

begs leave to report as follows:

The purpose of this measure is to authorize state purchasing agencies to utilize two-step design-build proposals when procuring construction projects, and to require payment to unsuccessful offerors when a design-build process is used.

Your Committee received testimony in support of this measure from the Department of Accounting and General Services (DAGS), the Hawaii Chapter of the American Public Works Association, the Consulting Engineers Council of Hawaii, and the American Institute of Architects.

Your Committee finds that design-build requests for proposals are beneficial for highly specialized projects that require a high level of creativity and cooperation between the designer and the construction agent. Your Committee believes that the design-build process will lead to more efficient use of government resources in the long run, as the total cost of some projects will be lower and the resulting structures sounder.

Your Committee also recognizes that the time, effort, and resources necessary to develop a proper design-build proposal is significantly higher than most bids. Therefore, your Committee supports this measure insofar as it requires compensation to unsuccessful offerors. In return, the purchasing agency will have proprietary rights over each proposal, and can cull the useful portions of each when crafting the final design.

Your Committee amended this measure based on recommendations submitted by DAGS. As amended, the head of the purchasing agency has the discretion whether to use a two-step design-build process. Also, compensation to unsuccessful offerors will be limited to bidders for projects with a total construction estimate of greater than $5,000,000.

Your Committee finds that these amendments will give the purchasing agency the necessary flexibility to determine when a design-build process should be used, and will not unduly burden purchasing agencies by requiring compensation to unsuccessful offerors on smaller projects.

As affirmed by the record of votes of the members of your Committee on Transportation, Military Affairs and Government Operations that is attached to this report, your Committee is in accord with the intent and purpose of S.B. No. 2212, as amended herein, and recommends that it pass Second Reading in the form attached hereto as S.B. No. 2212, S.D. 1, and be referred to the Committee on Ways and Means.