Subject: HUB Subcontracting on Purchases Over
$100,000
Issue Date: February 1, 2003
Revised Date: N/A
The University of
Texas-Pan American is required to include The University of Texas System
Policy on Utilization of Historically Underutilized Businesses (HUBs) in
all invitations for bid, requests for proposal, or other purchase
solicitation documents where subcontracting opportunities are probable
and to follow the procedures set out therein for award and
administration of all contracts with an expected value of $100,000 or
more (reference Business Procedures Memorandum 58-06-00). This policy,
which is included below, may be modified to address particular local
conditions for The University of Texas-Pan American.
Policy on Utilization of Historically
Underutilized Businesses (HUBs)
Introduction
In
accordance with the Texas Government Code, Sections 2161.181-182 and
Section 111.11 of the Texas Administrative Code (TAC), state agencies
shall make a good faith effort to utilize Historically Underutilized
Businesses (HUBs) in contracts for construction; services, including
professional and consulting services; and commodities contracts. The
Texas Building and Procurement Commission’s (TBPC) HUB Rules, 1 TAC
Sections 111.11-111.28 encourage the use of HUBs by implementing these
policies through race-, ethnic- and gender-neutral means.
The purpose of the
HUB Program is to promote full and equal business opportunities for all
businesses in State contracting in accordance with the following goals
as specified in the State of Texas Disparity Study:
11.9% for heavy construction other than
building contracts;
26.1% for
all building construction, including general contractors and operative
builders contracts:
57.2% for all special trade construction
contracts;
20% for professional services contracts
33% for all other services contracts,
and
12.6% for commodities contracts.
Each
state agency shall make a good faith effort to meet or exceed these
goals to assist HUBs in receiving a portion of the total contract value
of all contracts that the agency expects to award in a fiscal year.
State agencies may achieve the annual program goals by contracting
directly with HUBs or indirectly through subcontracting opportunities in
accordance with the Texas Government Code, Chapter 2161, Subchapter F.
Procedures
The
following procedures are specified pursuant to TBPC’s HUB Rules, 1 TAC
Sections 111.13 and 111.14:
a.U. T. System Administration and
component institutions entering into a contract (design-build and
construction manager-at-risk contracts are addressed separately below)
with an expected value of $100,000 or more shall, before the agency
solicits bids, proposals, offers, or other applicable expressions of
interest, determine if subcontracting opportunities are probable under
the contract.
b.If subcontracting opportunities
are probable, System Administration and component institutions will
declare such probability in its invitations for bids, requests for
proposals, or other purchase solicitation documents and require
submission of the HUB Subcontracting Plan (HSP) specified in (1) below
with bids, proposals, offers, or other applicable expressions of
interest; or the HUB Subcontracting Plan specified in (2) below if the
potential professional/contractor/vendor can perform all subcontracting
opportunities with its employees and resources.
(1)When subcontracting opportunities
are probable, the HUB Subcontracting Plan shall include (a) a letter of
transmittal attesting that the professional/ contractor/vendor has read
and understands the Policy on Utilization of Historically Underutilized
Businesses (HUBs); (b) the tabulation of annual procurement utilization
goals; (c) the Historically Underutilized Business Letter(s) of Intent
(HUB-LOI) identifying the subcontractor(s) that will be used during the
course of the contract, the expected percentage of work to be
subcontracted, and the approximate dollar value of that percentage of
work; and (d) the Determination of Good Faith Effort (DGFE – Parts 1 and
2) explaining in what ways the potential professional/contractor/vendor
has made a good faith effort in developing the HUB Subcontracting Plan
(see Attachments A, B, C, and E).
(2)When subcontracting opportunities
are probable, but the potential professional/ contractor/vendor can
perform such opportunities with its employees and resources, the HUB
Subcontracting Plan shall include (a) a letter of transmittal attesting
that the professional/contractor/vendor has read and understands the
Policy on Historically Underutilized Businesses (HUBs), (b) the
tabulation of annual procurement utilization goals, and (c) the
Historically Underutilized Business Statement of Intent (HUB-SOI) (See
Attachments F, B, and G).
(3)When appropriate, U. T. System
Administration/component institutions may establish a “response (bid,
proposal, offer, or other applicable expression of interest) submission
period.” If established, the duration of the “response submission
period” shall not exceed twenty-four (24) hours. The period shall begin
upon the response submission date and time. During the “response
submission period,” all responses shall remain sealed and shall not be
opened prior to the specified HUB Subcontracting Plan submission date
and time. No responses or HUB Subcontracting Plans shall be accepted
after their respectively specified submission dates and times.”
c.Accordingly, potential
professional/contractor/vendor responses that do not include a completed
HUB Subcontracting Plan shall be rejected as a material failure to
comply with advertised specifications in accordance with 1 TAC Section
113.6.
d.U. T. System
Administration/component institutions shall require a potential
professional/contractor/vendor to state whether it is a Texas certified
HUB.
e.Potential
professionals/contractors/vendors shall follow, but are not limited to,
procedures listed below when developing a HUB subcontracting plan.
(1)Divide the contract
work into reasonable lots to the extent consistent with prudent industry
practice.
(2)Notify HUBs of the
work that the professional/contractor/vendor intends to subcontract.
The preferable method of notification shall be in writing. The notice
shall, in all instances, include the scope of the work, information
regarding the location to review plans and specifications, information
about bonding and insurance requirements, and identify a contact person.
The notice shall be provided to potential HUB subcontractors prior to
submission of the professional’s/contractor's/vendor's bid. The
potential professional/ contractor/ vendor shall provide potential HUB
subcontractors reasonable time to respond to the potential
professional’s/contractor's/ vendor's notice. "Reasonable time to
respond" in this context is no less than five working days from receipt
of notice, unless circumstances require a different time period, which
is determined by the agency and documented in the contract file. The
potential professional/ contractor/vendor shall effectively use the
GSC's Centralized Master Bidders List, the HUB Directory, Internet
resources, and other directories as identified by the GSC or agency when
searching for HUB subcontractors. Professionals/Contractors/Vendors
shall effectively use the services of minority, women, and community
organizations contractor groups, local, state, and federal business
assistance offices, and other organizations that provide assistance in
identifying HUBs able to perform all or select elements of the HUB
Subcontracting Plan. The potential professional/contractor/vendor shall
provide the notice described in this subsection to three or more HUBs
that perform the type of work required. The potential
professional/contractor/ vendor shall provide official written
documentation (i.e. phone logs, fax transmittals, etc.) to demonstrate
compliance with the notice required in this subsection. (Form DGFE –
Part 2) (See Attachment E)
(3)
Provide written justification of the selection process, if a non HUB
subcontractor is selected through means other than competitive bidding,
or a HUB bid is the best value responsive bidder to a competitive bid
invitation, but is not selected.
(4)
Advertise HUB subcontracting opportunities in general circulation, trade
association, and/or minority/woman focus media concerning subcontracting
opportunities.
(4)Encourage
a selected noncertified minority or woman- owned business subcontractor
to apply for certification by the commission in accordance with the
procedures set forth in §111.17 of this title (relating to Certification
Process).
f. If the contract
is a lease contract, the lessor shall comply with the requirements of
this section from and after the occupancy date provided in the lease, or
such other time as may be specified in the invitation for bid for the
lease contract.
g. In making a determination whether a good faith effort has been
made in the development of the required HUB subcontracting plan, U. T.
System Administration/component institutions shall require the potential
professional/ contractor/vendor to submit supporting documentation
explaining in what ways the potential professional/contractor/vendor has
made a good faith effort according to each criterion listed above. The
documentation shall include at least the following (Form DGFE – Part 1)
(See Attachment D – Pages 1 and 2):
(1)Whether the potential
professional/contractor/vendor divided the contract work into reasonable
portions in accordance with prudent industry practices.
(2)Whether the potential
professional/contractor/vendor sent notices containing adequate
information about bonding, insurance, the plans, the specifications,
scope of work, and other requirements of the contract to three or more
qualified HUBs allowing reasonable time for HUBs to participate
effectively.
(3)Whether the potential
professional/contractor/vendor negotiated in good faith with qualified
HUBs, not rejecting qualified HUBs who were also the best value
responsive bidder.
(4)Whether the potential
professional/contractor/vendor documented reasons for rejection or met
with the rejected HUB to discuss the rejection.
(5)Whether the potential
professional/contractor/vendor advertised in general circulation, trade
association, and/or minority/women focus media concerning subcontracting
opportunities.
(6)Whether
the potential
professional/contractor/vendor assisted
non-certified HUBs to become certified.
h.The HUB Subcontracting Plan and
supporting documentation shall be reviewed and evaluated by U. T. System
Administration/component institutions to determine if a good faith
effort has been made in accordance with TBPC’s rules and bid
specifications prior to contract award. If accepted, the HUB
Subcontracting Plan shall become a provision of the institution’s
contract. No changes may be made in an accepted HUB Subcontracting Plan
prior to incorporation in the contract.
i.If the U. T. System
Administration/component institutions determine that a submitted HUB
Subcontracting Plan was not developed in good faith, the agency shall
treat the lack of good faith as a material failure to comply with
advertised specifications, and the subject bid or other response shall
be rejected. The reasons for rejection shall be recorded in the
procurement file.
j.If at any time during the term of
the contract, a professional/contractor/vendor desires to make changes
to the approved HUB Subcontracting Plan, such proposed changes must be
received for prior review and approval by the U. T. System
Administration/component institution before changes become effective
under the contract. The potential professional/contractor/vendor must
comply with provisions of 111.14 (b), relating to development and
evaluation of HUB Subcontracting Plans, in order to substitute work or a
subcontractor prior to any alternative under the subcontracting plan. U.
T. System Administration/component institutions shall approve changes by
contract amendments. The reasons for amendments shall be recorded in
the procurement file.
k.If a
potential professional/contractor/vendor
has determined that it can perform all identified subcontracting
opportunities, a statement of the potential professional’s/
contractor's/vendor's intent to complete the work with its employees and
resources without any subcontracting will be submitted with the
potential professional’s/ contractor's/vendor's bid, proposal, offer, or
other expression of interest (See Attachments F, B & G). If the
potential professional/contractor/vendor is selected and decides to
subcontract any part of the contract after the award, as a provision of
the contract, the professional/contractor/vendor must comply with
provisions of this section relating to developing and submitting a HUB
Subcontracting Plan prior to any modifications or performance in the
awarded contract involving subcontracting can be authorized by the
U. T. System Administration/component institution.
If the selected professional/contractor/vendor subcontracts any of the
work without prior authorization and without complying with 1 TAC
Section 111.14, the professional/contractor/vendor
is deemed to have breached the contract and to be subject to any
remedial actions provided by Texas Government Code, Chapter 2161, and 1
TAC §111.14. U. T. System Administration/component institutions may report non-performance relative to its contracts to the commission in
accordance with 1 TAC Chapter 113, Subchapter F (relating to the
Vendor Performance and Debarment Program).
l.The
professional/contractor/vendor shall maintain business records
documenting its compliance with the HUB Subcontracting Plan and shall
submit a compliance report to the contracting agency periodically and in
the format required by the contract documents.
m.During the term of the contract,
U. T. System Administration/component institutions shall determine
whether the value of the subcontracts to HUBs meets or exceeds the HUB
subcontracting provisions specified in the contract.
n.Accordingly, U. T. System
Administration/component institutions shall require a
professional/contractor/vendor to whom a contract has been awarded to
report the identity and the amount paid to its subcontractors (See
Attachments H and I). If the professional/contractor/vendor is
fulfilling or exceeding the plan, U. T. System Administration/component
institutions shall maintain documentation of the
professional’s/contractor’s/vendor’s efforts in the contract file. If
the professional/ contractor/ vendor fails to fulfill the HUB
Subcontracting Plan specified in the contract, the U. T. System
Administration/component institution shall notify the contractor of any
deficiencies. U. T. System Administration/component institution shall
give the professional/contractor/vendor an opportunity to submit
documentation and explain to U. T. System Administration/component
institutions why the failure to fulfill the HUB Subcontracting Plan
should not be attributed to a lack of good faith effort by the
professional/contractor/vendor. In determining whether the
professional/contractor/vendor made the required good faith effort, U.
T. System Administration/component institutions may not consider the
success or failure of the professional/contractor/vendor to subcontract
with HUBs in any specific quantity. U. T. System
Administration’s/component institutions’ determination is restricted to
considering factors indicating good faith including, but not limited to,
the following:
1.Whether
the contractor gave timely notice to the subcontractor regarding the
time and place of the subcontracted work.
2.Whether
the contractor facilitated access to the work site provided electrical
power and other necessary utilities.
3.Whether
documentation or information was provided that included potential
changes in the scope of contract work.
o.If a
determination is made that the professional/contractor/vendor
failed to implement the HUB Subcontracting Plan in good faith, U.
T. System Administration/component institutions,
in addition to any other remedies, may report nonperformance to the
commission in accordance with 1 TAC, Chapter 113, Subchapter F (relating
to Vendor Performance and Debarment Program)
p.
Potential
professionals/contractors/vendors responding
to a “design build” or “construction manager-at-risk” purchase
solicitation shall include a letter in their response attesting that the
potential professional/contractor/vendor
has read and understands the Policy on Utilization of Historically
Underutilized Businesses (HUBs). Responses that do not include the
letter required above shall be rejected as a material failure to comply
with advertised specifications (See Attachment J).
q.
Contractors engaged under design-build and construction manager-at-risk
contracts, as a provision of the contract, must comply with provisions
of this policy pertaining to development, and submission of the HUB
Subcontracting Plan at the time trade packages are bid in buying out the
guaranteed maximum or lump sum price and pertaining to fulfillment of
the HUB Subcontracting Plan.
In determining whether
a good faith effort has been made in development of the HUB
Subcontracting Plan, a state agency shall require the potential
professional/contractor/vendor to submit supporting documentation
explaining in what ways the potential professional/contractor/vendor has
made a good faith effort. Please answer the questions below. Provide
necessary documentation to support your answers. Use continuation sheets
as required.
1. Did your company
divide the contract work into reasonable portions in accordance with
prudent
industry practices?
2. Did your company
send notices containing adequate information about bonding, insurance,
the
plans, the
specifications, scope of work, and other requirements of the contract to
three or more
qualified HUBs allowing
reasonable time for HUBs to participate effectively (include Attachment
E)?
3. Did your company
negotiate in good faith with qualified HUBs, not rejecting qualified
HUBs who
were the best value
responsive bidder?
(continued on next page)
BPM 58 / Attachment D (cont’d)
DETERMINATION OF
GOOD FAITH EFFORT (DGFE), PART 1, PAGE 2
Historically
Underutilized Business (HUB)
This form must be
completed and submitted as part of the HUB Subcontracting Plan
Contractor/Vendor
Name:______________________ BID Number _______________________
4. Did your company
document reasons for rejection or meet with rejected HUBs to discuss the
rejection?
5. Did your company
advertise in general circulation, trade association, and minority/women
focus
media concerning
subcontracting opportunities? (Attach copies of advertisements)
6. Did your company
assist non-certified HUBs to become certified?
NOTE: The contracting
agency will review the supporting documentation submitted by the
potential
professional/contractor/vendor to determine if a good faith effort was
made in accordance with applicable 1TAC rules and the contract
specifications. If it is determined that a good faith effort was not
made, the bid or other response shall be rejected as a material failure
to comply with advertised specifications. The reasons for rejection will
be recorded in the project file.
BPM 58 /
Attachment E
Determination of
Good Faith Effort
HISTORICALLY UNDERUTILIZED BUSINESSES
(HUBs)
SOLICITATION (HUB-S)
This form must be
completed and submitted as part of the HUB Subcontracting Plan
(Reproduce as required
to report additional solicitations)
If GSC certified, enter Vendor
Identification Number: _______________ If not GSC certified, please
complete the
following information:
o Black American o Male o Female o Native American o Male o Female o Woman
o Hispanic American o Male o Female o Asian Pacific American o Male o Female
Date certification packet delivered to
HUB subcontractor _________________
(Revised 6-20-00)
BPM 58 /
Attachment F
(BUSINESS LETTERHEAD)
(Name of Official)
The University of Texas
__________________
(Office)
(Address Line)
(Address Line)
Dear ______________:
I am pleased to forward
this HUB Subcontracting Plan as an integral part of our bid
(proposal, offer, or
other expression of interest) in connection with your invitation for
bids (request for
proposals, etc.) #__________________.
I have read and
understand The University of Texas ______________________
Policy on Utilization
of Historically Underutilized Businesses (HUBs). The enclosed
HUB-SOI expresses our
intent to perform and/or supply all contracted goods or
services with our
employees and resources.
Sincerely,
(Signature)
(Printed Name)
(Printed Title)
BPM 58
/Attachment G
HUB SUBCONTRACTING
PLAN
Historically
Underutilized Business
STATEMENT OF INTENT
(SOI)
(Must be completed and
submitted when the professional/contractor/vendor plans to complete all
work with its employees and resources.)
If the potential
professional/contractor/vendor can perform the subcontracting
opportunities identified by (U. T. System Administration/Component
Institution), with its employees and resources, the HUB
Subcontracting Plan must express the potential
professional’s/contractor’s/vendor's intent to complete the work with
its employees and resources. The potential
professional/contractor/vendor must attest to this fact by completion of
the Statement of Intent below.
By completing the
following Statement of Intent, the potential
professional’s/contractor’s/vendor’s HUB Subcontracting Plan may be
considered responsive, qualified and/or valid:
STATEMENT OF INTENT:
I ___________________,
an authorized representative of (professional/contractor/vendor)
have reviewed the purchase solicitation, and have determined that the
entire work of the contract will be completed with
(professional’s/contractor’s/vendor’s) own employees and internal
resources without subcontracting any portion of the contract.
I hereby agree to act
in good faith and understand that if my company is awarded the contract,
that as a provision of this contract, I agree to complete all
subcontracting opportunities, identified by the agency, with my
company’s resources and to report information to the (U. T. System
Administration/Component Institution) regarding my performance of
the contract as specified.
If circumstances
necessitate the use of any subcontractors, I agree to seek the timely
authorization by the contracting agency and to adhere to the provisions
of 1 TAC, Section 111.14 (relating to the submission of HUB
Subcontracting Plan documents). I also agree and understand that if I
fail to comply with this Statement of Intent, I will be in breach of the
performance of the contract.
Printed Name of
Contractor/Vendor Signature of Contractor/Vendor
Date:
___________________________________
If the selected
professional/contractor/vendor decides to subcontract any part of the
contract after the award, as a provision of the contract, the
professional/contractor/vendor must seek authorization and comply with
provisions of 1 TAC, Section 111.14, prior to any modifications or
performance in the awarded contract involving subcontracting.
If the
professional/contractor/vendor subcontracts any of the work without
prior authorization and without complying with contract specifications
including development of a HUB Subcontracting Plan, the
professional/contractor/vendor is deemed to have breached the contract.
The professional/contractor/vendor also is subject to any other remedial
actions provided by Chapter 2161 of the Texas Government Code and 1 TAC,
Section 111.14. U. T. System Administration/Component Institutions also
may report non-performance to the GSC in accordance with the GSC’s
Vendor Performance and Debarment Program.
BPM 58
/Attachment H
HISTORICALLY
UNDERUTILIZED BUSINESS
PROGRESS ASSESSMENT
REPORT
DOCUMENTATION OF
SUBCONTRACTED WORK
Date of
Award_________ Contract/Requisition Number____________ Object Code
(agency use):______
NON-HUB/Prime
Contractor Name ________________________________________________________
HUB Prime Contractor
Name ____________________________________________________________
Contractor/Vendor
Identification Number (VID
Number)________________________________________
Total Contract
Amount Paid this Reporting Period to
Contractor_________________________________
