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15THE WEITZ COMPANY // GOVERNMENT CENTER ANNEX, RFQ NO. 15-08-02 / CITY OF SUNNY ISLES BEACH, FL SECTION D// PROJECT APPROACH AND UNDERSTANDING Weitz Tax Exempt Savings Program If you elect to implement a tax exempt component to your project, our Direct Order Purchase program has been developed into and easy-to-use format for our tax exempt clients and historically saves them approximately 1.2% of the cost of work. For the Government Center Annex project, based on the published budget amount, our tax savings format would potentially save your project over $350,000. With our DPO Flow Chart below, your job specific requirements can be managed to even the smallest Packages, including your owner selected items, maximizing tax savings. Construction Phase Management During the construction phase of the project, we will incorporate all of our preconstruction knowledge into a well-planned approach. Our team will manage all cost control and scheduling procedures diligently to ensure that the goals established during the construction phase are recognized and that your new facility opens as scheduled. Below are some of the methods the Weitz project manager uses to manage the construction process: Purchasing schedule: The purchasing matrix relates different scopes of work to their respective budgets, setting target buyout goals along with target dates subcontracts must be awarded. This log allows the project manager to prioritize the order in which contracts need to be awarded, and facilitates the early awards for “key subcontractors,” or trades that could either affect the critical path and/or costs of the project. Buyout process: Our procedure is to award all subcontracts over $10 thousand within 45 days after the execution of Owner contract and/or notice to proceed. During the buyout phase, the project manager meets with at least three subcontractors before the award of any subcontract over $100 thousand dollars. This allows the award to be made to the most qualified and cost effective subcontractor and includes time for Owner and Architect input. Scheduling and product substitution: These two factors occur throughout the project and can have major impacts on the financial success of the project. The project team is constantly looking for ways to expedite, compress, and stack activities in order to accelerate the contract schedule, thus allowing the Owner to move in earlier and realize the cost savings of a project completed on time. A C C O U N T I N G P U R C H A S I N G Vendors submit invoices (via Contractor) addressed directly to the City for verification. Contractor reviews invoices for accuracy, approves, and sends to City PM for processing (see sample invoice summary form in Attachment E). PAYMENT Monthly During Construction City prepares Direct Purchase Order agreement without tax and sends to vendor for signature with a copy of form DR-5 for vendor’s files. Vendor approves, signs, and sends back for Owner signature. City purchasing maintains final copy and returns one copy to the vendor. Vendor (via Contractor) submits a purchase order form request (see sample order from in Attachment C) to City (must be addressed directly to the City) with a copy of the vendor’s W-9 and EIN for DPO materials. (If vendor is already a Broward City vendor, provide BC Vendor number). City establishes tax savings goal for project, and a minimum threshold dollar amount per vendor to determine which materials get purchased under the tax savings program. Copy provided to Contractor and DPO added to Contractor’s DPO Tracking Log (see sample tracking log Attachment D). CLOSEOUT End of Project Contractor prepares a reconciliatory change order to account for any unused portions of DPOs issued by the owner. Unused portions of DPO’s are reconciled with Contractor. PROJECT SET UP Pre-Contractor Award DPO amount and tax is deducted from associated cost code in Contractor’s Schedule of Values. A tax deductive change order is written to Contractor and funds allocated to DPO line in schedule of values for tracking (or CPEAM moves amount to Owner-controlled line item. Contractor inputs the invoiced costs into the job under the DPO section of the SOV (see sample pay application in Attachment F). For Reconciliation: Contractor submits updated DPO log referencing latest invoice totals to City for payment with each pay application. Owner processes payments to vendor within the Prompt Payment Act timeframe to avoid material delivery delays (checks must be made payable to vendors directly). Contractor can verify payments through Broward City online portal or report of check dates. City confirms application to State for Consumer Certificate of Exemption (Form DR-5) is current. DPO SET UP & PURCHASES Month 2- 3 Final DPO contingency line item is reconciled and tax savings records finalized. Contractor provides material lists and anticipated purchase order amounts the City will need to issue. City PM reviews and approves invoice and sends to accounting for processing. City provides Direct Purchase Order Program language in Project Manual and contract agreement with Contractor (see Attachment A for sample language). Include language for City Vendor Registration enrollment (see sample vendor request form in Attachment B). PROJECT SET UP continued Month 1 DDPPOO FFLLOOWWCCHHAARRTT OOPPTTIIOONNSS FFOORR CCIITTYY TTAAXX EEXXEEMMPPTT PPRROOJJEECCTTSS INFO NEEDED FROM CITY: • What does Purchasing need in order to setup vendors in their system? How long does it take? • Does Purchasing have its own “order form”? • Will Purchasing need to see proof of a competitive selection process / CBE for vendors? • How does Purchasing set up their ledger? What is the correct vehicle to move money within the project budget and avoid the change order process? • Risk Management input on the passage of title and assumption of risk? Participation in the program commits the City to the following State of Florida requirements: 1. All purchase orders must be issued directly to the vendor with a copy of Broward City’s Florida Consumer Certificate of Exemption. 2. The vendor’s invoice must be issued directly to Broward City (not the contractor or subcontractor). 3. Broward City must make payment directly to the vendor from public funds. 4. Broward City must take title from the vendor at the time of purchase or delivery by the vendor. 5. Broward City must assume the risk of damage or loss at the time of purchase (this should be discussed with Risk Management and Purchasing so that the risk is understood). *Can Risk Management add contract language to make the Contractor responsible?