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Measure S – Construction Contract Procurement Modernization
Fact Sheet

The San José City Council has placed a measure on the November ballot that updates the City’s process for hiring contractors to build public works projects.  Known as Measure S, it would amend the biding process established in the City Charter for evaluating contractor bids, and would update contracting rules for inflation and changes in technology.

What the Measure Would Do

Measure S will make the following amendments to the City Charter:
  • Best Value Contracting: Currently the City Charter only allows the Council to award public works contracts to the lowest responsive and responsible bidder.  Measure S would allow the City to use an alternative process for bidding public works contracts known as “Best Value Contracting.”  Under the Best Value Contracting process, price would be the primary criteria for evaluating a contractor, but the City could also score contractors on additional criteria, including past performance, relevant experience, demonstrated management competence, financial condition, compliance with labor laws, and safety record.  This process can be useful for complicated projects where the lowest bidder might not be the bidder with the best experience and expertise to deal with project complexity. If Measure S passes, the City Council would need to enact an ordinance providing for the specific terms governing use of Best Value Contracting in San José before the City could use the Best Value Contracting procurement method.
  • Minor Project Threshold: Measure S would adjust the threshold for minor public works projects.  Currently, projects costing $100,000 or less are considered minor and are eligible for a less labor-intensive procurement process. The $100,000 threshold was established in 2000 and has not been updated for inflation in the past 18 years.  Measure S would adjust the threshold to $600,000, an amount comparable to thresholds used by other jurisdictions, and would authorize annual adjustments for inflation in the construction industry.
  • Bid Noticing: Measure S would change the Charter’s bid noticing provision, which currently requires the City to publish bid notices in a “newspaper of general circulation.”  The revised requirement would allow the City to publish notices online electronically.
  • Design-Build Threshold: Measure S would change the threshold for using design-build contracting.  Design-build is a process under which the City bids for the design and construction of a project at the same time and makes both design and construction the responsibility of a single contractors.  It can be useful on complicated projects that require close coordination between design staff and construction staff.  Currently, the Charter allows the City to use design-build on projects costing more than $5 million.  State law allows for use of design-build on projects over $1 million.  Measure S would adjust the Charter threshold to be consistent with the State law threshold of $1 million.

How Would Public Works Procurement Change?

For many projects, the public works procurement process would remain the same.  These changes are intended to increase the efficiency of the City’s procurement process and to help the City select the best qualified contractors for complicated projects.

Read the Measure S FAQ

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