99.01

OPINION NO. 99-01

The Department of General Services (DGS) has requested Ethics Commission advice regarding application of the procurement ethics provisions of §15-508 of the Public Ethics Law to an architect engineering firm (the Architect) that prepared program and preliminary schematic design documents in connection with a capital construction project for which detailed design services are now being procured. We advise that the work performed by the Architect, even though it included some schematic drawings, constituted architectural and engineering activities intended to be excepted from the procurement assistance restrictions of §15-508 in accordance with §15-508(b)(4) of the Law.

The project at issue here involves renovations/additions to an Annapolis office building (the Project). Pursuant to an Indefinite Delivery Contract (IDC) between DGS and the Architect, in the Fall of 1997 the Architect was asked to provide program and preliminary design services in connection with the Project. The Architect met with DGS and the user agency regarding the building requirements, and submitted a program for review and approval in February/March 1998. The document was reviewed and accepted after consideration by DGS, the Department of Budget and Management, and the user agency. Subsequently, based on a decision to reduce the scope of the project, the Architect was requested (still under the IDC) to pull out certain portions of the original submission as a separate program. This was done for a negotiated fee and a revised program was submitted in September 1998 along with drawings reflecting a preliminary schematic design.

Notices were thereafter published in the Maryland Register requesting interested parties to respond for the design of the reduced project. At this point what is requested is submission of team data and other information about potential designers that would be the basis for the selection of a designer. The price for the contract would be negotiated after an evaluation process that leads to selection of the best qualified submission. The deliverable under the contract that will result from this procurement is the actual detailed design for the project and bidding documents that will be the basis for a procurement for the construction phase of the project. The winner of the detailed design contract would be expected (pursuant to specific requirements in the contract) to be involved as a consultant/contract monitor to the State in the subsequent, construction phases of the project and is clearly precluded from any subsequent participation as a part of the construction contract team.

The Architect here was responsible for submission of a program document and schematic drawings for the project. A program is a document that is the first required step in the process for capital construction or improvement of a State facility, its purpose being to justify and define the rationale and scope of work for the capital improvement projects of State agencies. It is described as providing a planning tool that is the basis for funding requests to the Legislature, and a focus for review by various involved State agencies. Our information in connection with this and other requests involving this process is that program documents tend to be prepared by architect and engineering firms, but need not necessarily be done by these firms. They may be acquired under a general professional services contract, but may also be acquired through standard purchase of services agreements.1

Subsequent phases of a capital project are considered to be general professional services that are (if over $100,000) acquired under the specific statutory requirements of §13-306 of the State Finance and Procurement Article and DGS regulations published at COMAR 21.12.04. General Services regulations for this process apply by their terms to procurement of architectural and engineering services for a complete project, including six phases: preliminary and schematics phase, design development phase, contract document phase, bidding phase, construction phase and post- construction phase. Architectural services include "professional or creative work in connection with the design and supervision of construction or alteration of a building or its parts, requiring architectural education, training, and experience in consultation, investigation, evaluation, planning, architectural design and preparation of related documents, and coordination of services furnished by structural, civil, mechanical, electrical engineers, and other consultants."

This request involves application of the procurement ethics provision of §15-508 of the Ethics Law (State Government Article, §15-508, Annotated Code of Maryland). Added to the Law in 1994, this section prohibits an individual who assists an executive unit in the drafting of specifications, an invitation for bids, or a request for proposals for a procurement, or a person who employs the individual, from submitting a bid or proposal for that procurement, or assisting or representing another person, directly or indirectly, who is submitting a bid or proposal for that procurement. A general information memo was issued in August 1994 addressing potential issues under the provision, including an indication that individuals who are paid by the State to assist in covered activities are barred from bidding on the later procurement. Several opinions have been issued dealing with the section of the Law. In Opinion 95-13, we considered the types of documents and processes at issue here and suggested that participation in program documents in these types of situations would likely be viewed as participation in specifications drafting. This approach has been reiterated in subsequent informal advice as well as in Advisory Opinion No. 96-5 involving a project at the University of Maryland.

In part, however, apparently as a result of concerns raised by procurement personnel and vendors in response to implementation of §15-508, amendments were enacted in the 1996 Session of the Legislature. These amendments added several exceptions to clarify application of the Law, as well as a specific provision addressing architect engineering activities. Specifically, subsection (b)(4) now provides that assisting in specification drafting for purposes of §15-508 does not include "providing architectural and engineering services for programming, master planning, or other project planning services." This exception was added to the legislation late in the legislative process, and apparently the architectural and engineering reference was added to the provision in conference, to clarify the intention that the exception apply only to these types of services rendered in connection with capital projects. Generally, the amendment reflects the view that the new exception was intended to avoid situations where in capital projects the elimination of architect and engineering contract services providers at early phases of a program from subsequent architectural and engineering phases of a project resulted in a reluctance of providers to participate in generally smaller fee early phases.

In a more recent Opinion (No. 98-1) we considered this specific language as applied to an architectural firm that had prepared program documents and a Request for Proposals for a State facility. The conclusion in that situation was that the firm was not permitted by this exception to bid on the procurement for the design of the project, as this exception to the procurement ethics provision was not intended to apply where the individual/entity actually prepared the bid documents. In the situation presented here, though the program documents are referenced in the Request for Proposals and are intended to be a starting point document for the successful design contractor, the Architect's activity apparently stopped short of the actual preparation of bid documents in connection with this project. The Architect's involvement in the ongoing design procurement would thus not be precluded based on the approach taken in Opinion No. 98-1.

Nor do we believe that the inclusion of the schematic drawings in this situation has the effect of taking the Architect out of the exception coverage. Though this work may have gone beyond what may be viewed as program or other project planning as these processes are understood in the capital construction procurement process, we believe based on our understanding of the intended purpose of the exception taken as a whole, that it should be considered as encompassing the architectural and engineering services provided here. We are aware that the intention was to narrowly allow an exception only for architectural and engineering work in connection with capital projects, and believe that this situation fits within that intention.

In conclusion, the fundamental legislative decision to value availability of quality preliminary services in capital projects supports the conclusion that the exception to the section's general prohibition is intended to apply to the preliminary planning and design activities that occurred in this project. We therefore advise in the circumstances here that the Architect is not barred by its preparation of the documents described here from bidding on the procurement of detailed design services for the Project.

 Michael L. May
     Mark C. Medairy, Jr.
     April E. Sepulveda

Date: January 26, 1999

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1 Note that this Opinion does not deal with the specifics of the contracts process or address any considerations relating to limitation of participation by a vendor in subsequent related procurements by contract agreements between the vendor and the State.