Procurement Policies and Procedures

5.0 Construction Projects

This section delineates how the city should approach construction projects to comply with numerous state laws regulating construction projects.

5.01 Required Use of Architects, Engineers, and Landscape Architects

As mandated by TCA 62-2-107, when performing construction or maintenance projects involving architecture, engineering, or landscape architecture services over $50,000 and the project alters the structural, mechanical, or electrical systems of the project, the city shall engage a state of Tennessee registered architect, engineer, or landscape architect as outlined in Section 3.03 to prepare plans, specifications, and cost estimates.

5.02 Required Bonds for Construction Projects

As required by TCA 12-4-207, construction, maintenance, or repair projects over $10,000 require a bond from the contractor to guarantee prompt payment of all taxes, licenses, assessments, contributions, penalties, and interest due to the state or city directly connected with the performance of the awarded contract.

As authorized by TCA 12-4-201 and 12-4-202, construction projects over $100,000 shall require:

• bid bond from all bidders in the amount of 10% of the bid amount collected at the time of bid submittal to guarantee the selected bidder will proceed with an awarded project. The bid bond will be returned to all bidders once the project is under contract with the awarded bidder. If the awarded bidder does not execute a contract with the city within ten business days after receiving a Notice of Award, the bid bond will be redeemed and the proceeds retained by the city and used to obtain another bidder or to rebid the project.

• performance bond from the awarded bidder in the amount of 100% of the contract price to guarantee the awarded bidder will complete the project.

• payment bond from the awarded bidder in the amount of 100% of the contract price to guarantee the awarded bidder will pay all subcontractors.

Such bond requirements shall be included in the bid document and bid advertisements. The bonds shall be written by a surety or insurance company listed on the U.S. Department of the Treasury financial management service list of approved bonding companies and licensed and authorized to do business in the state of Tennessee. Failure to obtain the required bonds will result in a Class C misdemeanor.

5.03 Required Insurances and Documents for Construction Projects

See Section 3.05 for required insurances and documents for construction projects.

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