State Procurement Regulations

Regulation Authority:

RIGL Section 37-2-39

Purpose and Reason:

The purpose of this emergency amendment is to establish criteria by which public agencies would be authorized to select methods of construction contract management services. This emergency amendment repalces Rule 8.11.

Brief statement of Reason for Finding Imminent Peril:

Pursuant to R.I. Gen. Laws §37-2-39 “the Chief Purchasing Officer shall issue regulations providing for as many alternative methods of management of construction contracting as he or she may determine to be feasible, setting forth criteria to be used in determining which method of management of construction is to be used for a particular project, and granting to the purchasing agent, or the purchasing agency responsible for carrying out the construction project, the discretion to select the appropriate method of construction contracting for a particular project, provided, however, that the Chief Purchasing Officer 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 management of construction contracting in each instance.” As required by §37-2-39, in 1990 the Chief Purchasing Officer adopted Purchasing Regulations 8.11, 8.11.1 and 8.11.2. From 1990 onward, all construction management services contracts for state agencies and public agencies were procured pursuant to these Purchasing Regulations. However, as a result of civil action captioned as A.F. Lusi Construction, Inc. v. Rhode Island Department of Administration and Gilbane Building Company, C.A. No. PB 07-1104, (“the Lusi Case”), on May 7, 2007 the Superior Court (Silverstein, J.) issued a decision which invalidated Purchasing Regulation 8.11.2. Because the Superior Court’s decision in the Lusi Case invalidated Purchasing Regulation 8.11.2, state agencies and public agencies were no longer authorized to select methods of construction contracting management services. In response to the Lusi Case, the Chief Purchasing Officer adopted emergency amendments to the invalidated rule so that a number of specific state construction projects could continue moving forward without interruption. During this time, a public hearing on the amendments was held and resulted in the Chief Purchasing Officer receiving numerous comments on the proposed amendments. Based on the volume and content of the comments received from the public hearing, the Chief Purchasing Officer was unable to promulgate appropriate amendments to the rule prior to the expiration of the emergency amendments. Because the Department of Transportation had numerous road and bridge repair and construction projects already underway at the time the emergency regulation expired, the Chief Purchasing Officer adopted a new emergency amendment applicable only to the Department of Transportation projects. While the Department of Transportation emergency amendments were in effect, the Chief Purchasing Officer worked with all interested parties to draft an appropriate amendment to apply to all projects. Although the Chief Purchasing Officer intends to notice this amendment and conduct a public hearing, there are numerous state construction projects currently underway which would be halted. Currently there are five State construction projects underway estimated to cost eighty-nine million dollars. Specifically, the new Rhode Island State Police headquarters at a cost of twenty-five million dollars, the renovation of the Virks building for use by DHS at a cost of six and a half million dollars, the renovation of the Forand building for use by the DMV at a cost of seventeen and a half million dollars, the renovation of the former training school for use by the Department of Information Technology at a cost of nearly nine million dollars, and the renovation of the Rhode Island School for the Deaf at a cost of thirty-one million dollars. Halting these projects even for a short period of time will cause the taxpayers considerable expense. The Chief Purchasing Officer has therefore determined that an emergency amendment must be adopted pursuant to subsection (b) of R.I. Gen. Laws §42-35-3 in order for the State to select necessary construction contracting management services for all state projects without further delay.