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Iowa State University--Becoming the Best

MnDOT Indefinite Delivery/Indefinite Quantity Contracting

Researcher(s)

Principal investigators:

Project status

Completed

Start date: 08/09/12
End date: 08/31/14

Publications

Report: Indefinite Delivery/Indefinite Quantity Contracting (NA pdf) August 2014

Tech transfer summary: Leveraging the Advantages of Indefinite Delivery/Indefinite Quantity Contracts Aug 2014

Sponsor(s)/partner(s)

Sponsor(s): Minnesota Department of Transportation

About the research

Abstract:

This study developed a generic indefinite delivery/indefinite quantity (IDIQ) contractive framework upon which MnDOT can produce its IDIQ contracting procedures based on this agency’s policies, preferences, and applicable regulations. This report covers several aspects of this alternative contracting method, including successful contracting techniques and procedures, terminology in use by public transportation agencies, contract advertising and award practices, pricing methods, risk management issues, and effective contract administration practices. Besides benchmarking the state-of-practice of IDIQ contracting in federal and state transportation agencies, the report addresses three key aspects identified by the authors: mobilization cost payment, escalation of construction pricing on multi-year IDIQ contracts, and impact of IDIQ contracting on surety bonds.

The study found that IDIQ contracting creates a capacity to expedite project delivery through an on-call contractor that can be mobilized and working in a much shorter period than traditional project delivery methods. It also found a number of distinct advantages for repetitive construction and maintenance projects including the ability to obligate unused fiscal year funding, incentivizing construction quality and economy of scale reductions in unit pricing. It also finds that once the IDIQ contract is awarded, the agency is able to utilize the contractor to furnish a number of preconstruction services in much the same manner as Construction Manager/General Contractor projects, which results in better pricing due to more constructable designs.