Bidding Mistakes
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COMMON ROOF BIDDING MISTAKES

Roofing replacement, large waterproofing projects and other large maintenance projects tend to be costly. Because of the importance and cost of such work, boards need to avoid as many complications as possible. Following are common mistakes boards should avoid.

#1.  Soliciting Bids Without Specifications. This process results in bids that cannot be compared, causing confusion and poor decision making. A specification can be as small as one page for a small project and could be prepared by a professional community manager. But it must be complete and detailed for large projects (prepared by an architect or roofing consultant). The job specifications should be prepared only after the final product selection is made. Product manufacturers’ specifications are generic and cannot contain all the special details that every project has. The details are critical for roofing projects.

#2.  Signing Contracts Without Consulting Legal Counsel. This mistake is made by many associations attempting to save money. All major contracts should have, at minimum, a thorough review and comment by legal counsel.

#3.  Making the Manager the Project Manager for Major Construction. Community managers are well-trained in the duties of association management, especially those who have achieved their CCAM or PCAM. However, there is no formal training for them in management of construction projects. It takes years of training and experience to be a competent construction manager. Many of the largest management firms have a policy against their managers’ performing project management for construction due to high liability exposure for the firm.

#4.  Giving Large Deposits for Materials to Contractors. Many associations are led to believe they are obligated to give contractors material deposits before starting the project. This is a mistake that can place the CID’s funds in jeopardy. All successful contractors have credit accounts with their suppliers, usually for 30 days or more. If a bidder cannot fund their payroll until the first payment, the association should reconsider doing business with that company.

#5.  Paying Percentage of Completion Instead of Measurable Work. Measuring the amount of progress in percentage is difficult for both parties, especially for the association and its manager. A good rule is to pay only for pre-agreed benchmarks of construction completed and materials verified onsite.

#6.  Failure to Start Planning in Advance of Need. This is a common mistake, and there are many reasons this can happen. Five years is not too early to start planning a major roof project. Better planning can help to limit or eliminate emergency assessments, disgruntled members and excess cost, not to mention delay causing high emergency repair costs.

#7.  Accepting Lowest Bid Without Proper Evaluation. Associations try to save themselves personal time by simply selecting the low bid, assuming all contractors are the same and bids are the same, which is not true. The lowest bid may have critical exclusions that could result in the highest final cost. Boards should meet with contractors and make sure they properly compare the strengths of the companies and their experience.

#8.  Believing that City Inspectors Ensure Proper Work. The typical city permit/inspection service is limited to a structural wood inspection and a final (completed) inspection. Seldom do city inspectors make sufficient job-in-progress visits to verify the work is done per code or manufacturer’s specs.

#9.  Making Final Payment Without Closeout Documents. The closeout documents (permit, warranty, lien releases) should be demanded and a final payment withheld until they are in the manager’s hands and verified correct for the project. There are two kinds of warranties: workmanship and product, and they are different documents. Nearly all local city or county building departments provide a signed-off permit card when they are notified the roof is done.

ASSISTANCE: Associations needing legal assistance can contact us. To stay current with issues affecting community associations, subscribe to the Davis-Stirling Newsletter.

Adams Stirling PLC