GCAP firmly supports legislation that promotes freedom of choice in delivery methods for the commercial construction industry. The current Separations Act prohibits any Pennsylvania public works projects, over $25,000, the ability to have this freedom and restricts these owners to only a multiple prime delivery system.
Since the law was enacted in 1913, the construction industry has evolved, adapting to delivery methods in response to the customer’s changing circumstances. Cost, quality and time vary from project to project and the customer should be afforded the opportunity to select the most appropriate delivery method for a particular project on a case-by-case basis. Flexibility to choose the most effective and efficient project system will enable local governmental entities to control costs on public building projects and ultimately save taxpayers money.
This Coalition supports a legislative approach that explicitly states the delivery methods a public owner can choose from, which includes: Design-Bid-Build with Multiple Primes; Design-Bid-Build with Single Prime; Construction Management At Risk; and, Design Build. Each of these delivery systems has been used in the commercial construction industry and each system provides different advantages and disadvantages depending on project variables.
Key Points of the Separations Act
- The PA Separations Act was enacted in 1913; the law is outdated and needs to be updated.
- This law requires public entities to solicit separate bids and award separate contracts to at least four (4) prime contractors per construction project. This is referred to as the multiple prime project delivery method.
- The multiple prime delivery method requires the public entity to hold and manage multiple prime contracts, making the public entity responsible for the coordination of the contracts. Consequently, the public entity increases its contractual liability exposure and is forced to be involved in contractual disputes among the primes.
- The multiple prime requirement is cumbersome and sets the stage for adversarial relationships amongst the prime contractors, resulting in a drastic rise in change orders and claims.
- The private sector is free to choose any construction delivery method and rarely does this sector select the inefficient and ineffective multiple prime delivery method.
- Only three (3) other states require multiple prime for public construction: North Dakota, Illinois, and New York.
More information about our position on the Separations Act can be found here.