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	Silviculture Manual	C O N T R A C T S General – Pre Award

2.4 Silviculture Contract Competition Matrix

2.5 Preparing the Tender Package

2.6 Creating Multi-year and Multi-activity Contracts

2. General Items - Pre Contract Award

2.1 Pre-Contract Checklist

Figure 1 below contains a pre-contract checklist for ensuring nothing is overlooked in the contract preparation stage. Use this checklist in conjunction with the Tender Package Checklist in the Contract Management Manual. EMS checklists for the Small Business Forest Enterprise Program may also be required.

SILVICULTURE CONTRACT PREPARATION CHECKLIST

1. Common Items - All Silviculture Contracts

Silviculture prescription or stand management prescription in place (Forest Practices Code requirement - not necessarily applicable to surveys contracts), OR
Silviculture treatment prescription prepared (not a Code requirement - not necessarily applicable to surveys contracts).
Contract schedules are consistent with the prescription.
Land status confirmed as unencumbered Crown land.
Access confirmed (e.g., no road or bridge weight limits will be in effect at time of treatment).
Specialized equipment requirements are clearly stated.

2. Contracts Involving Heavy Equipment

Allowable soil disturbance limits specified.
No-treatment and/or no-equipment zones clearly specified on attached maps.
Water bodies, streams and stream crossings clearly marked.
Detailed equipment specifications included as necessary (e.g., maximum ground pressure allowed, minimum/maximum engine ratings).

3. Contracts Involving Tree Planting

All necessary pre-treatment surveys and assessments completed.
Planned site preparation completed.
Number of plantable spots checked on each area to ensure that prescription obligations can be met.
Planting stock availability confirmed, available seedlots are within Forest Practices Code seed transfer rules Seed and Vegetative Material Guidebook, and originally ordered stock is still suitable for actual site conditions.
Seedling shipping and storage arrangements made (if appropriate).
If contractors will wish to use nearby Ministry of Forests recreation sites, district Recreation Officer consulted to ascertain if such use is acceptable.
Overflow/substitute units available for the different species or seed zones in the contract in the event planned planting areas are not ready or unavailable. (Overflow or substitute units may be included at the time of tendering.)

4. Contracts Involving Pesticide Application

Pesticide use permit issued or pesticide management plan approved and contract consistent with permit or plan requirements.
Holder of a water licence in a community watershed notified in advance of the intended pesticide application section 14, Silviculture Practices Regulation.
Checks made for locations of irrigation and licensed domestic water supply intakes, and intakes clearly shown on project maps.
Pesticide purchased and shipping arranged.
Pesticide storage facility checked.
Spill plan developed.
Monitoring plan prepared.

5. Contracts Involving Aircraft

Staging/loading/treatment areas confirmed clear of hazards.
Monitoring plan prepared.

6. Contracts Involving Fertilizer Application

Checks made for locations of irrigation and licensed domestic water supply intakes, and intakes clearly shown on project maps.
Fertilizer purchase and shipping arranged.
Spill plan developed.
Monitoring plan prepared

7. Contracts Involving Animals

Requirements of the Sheep Vegetation Management Guidelines met.
MoWLAP notified before the arrival of livestock as required by Section 10, Silviculture Practices Regulation.
Checks made for locations of irrigation and licensed domestic water supply intakes, and intakes clearly shown on project maps.
Monitoring plan prepared.

8. Contracts Involving Surveys or Data Collection

Completed by: ______________________ Date: ____________________

Figure 1. Silviculture contract preparation checklist

2.2 Project Numbering

The standard format for contract administration project numbering is as follows:

2-letter project prefix indicating the type of project (see list below);
fiscal year of the contract (designated by the 2nd calendar year - e.g., FY 2000/2001 = 2001)
3-letter district or region code (obtain codes from ISIS)
consecutive contract number for the project type, year and district.

Example:


SS	2001	DCK	07

Project Prefix	Fiscal Year	Forest District or Region	Project Number

Normally there are no dashes or spaces between components, except a dash (-) may be used between the district/region letter code and the project number.

Table 1. Project type codes

Code	Project Type
AU	Audit
BR	Brushing
DS	Direct Seeding
FE	Fertilization
FH	Forest Health
JS	Juvenile Spacing
PL	Planting
SP	Site Preparation
SU	Surveys
SX	Silviculture Trials
IM	Implementation
ST	Stand Tending (multi-activity projects)
SI	Silviculture (multi-activity projects)

2.3 Contract Forms and Attachments

2.3.1 Obtaining Forms

Electronic documents for the following activities can be accessed through the MoF forms index. Currently all of the documents are on the intranet (only available to MoF staff) at http://wwwinternal.for.gov.bc.ca/iscripts/isb/forms/forms.asp.

Some of the documents are on the internet (available to the public on the web) at http://www.for.gov.bc.ca/pscripts/isb/forms/forms.asp.

The trend is toward more documents being made available on the internet.

Activity	Link to form
Surveys	FS 925a
Mechanical Site Preparation	FS 759a
Planting	FS 767a
Aerial Herbicide	FS 720a
Ground-based Herbicide	FS 719a
Manual (physical) Method of Vegetation Management	FS 717a
Livestock Grazing Method of Vegetation Management	FS 715a
Spacing	FS 751a
Aerial Fertilization	FS 349a
Pruning	FS 348a

2.3.2 Modifying Standard Schedules A, B and C

Table 2 below describes the typical schedules used with silviculture operational contracts and provides guidance on their modification by users. Specific schedules A and B exist for all common silviculture activities and are available for districts to download in Microsoft Word file format (see 2.3.1 Obtaining Forms, above).

Table 2. Description and modification guide for silviculture schedules

Schedule	Schedule Contents	Modification by Users
A	technical standards and standards of work performance	Schedule A's are password protected and cannot be modified. Use schedule C to make additions or changes. Some schedule A's have a section for other conditions where modifications are allowed (e.g., Silv. Surveys - Schedule A)
B	variable information, including identification of work to be performed and payment	Modification is recommended where space has been provided for insertion of contract specifications.
C	blank	Recommended method for including additional contract specifications where space has not been allowed for in schedule B.

2.3.3 Creating a New Schedule A or B

Occasionally, contract requirements are so different from a standard silvicultural activity that the available schedules A and B do not cover them. If confronted with this situation, spending authorities should choose from among the existing schedules those which have the most existing applicable content and adapt them as needed. They should also consult with the appropriate regional silviculture activity specialist or the headquarters silviculture contract specialist.

2.3.4 Schedule D - Camp Standards (FS 776)

Attach Schedule D - Camp Standards (FS 776) to all contracts where a camp situation is a possibility. This schedule is mandatory for all planting contracts, unless the contract specifies a camp will not be permitted on Crown land.

The ministry recognizes that the schedule D camp standards may be inappropriate for some small projects that require only small crews. While the preference in such cases is that crews use off-site accommodation (i.e., motels, hotels, etc.), if this is not practical the general guideline is that the camp standards may be reduced for projects expected to have a crew size less than 7 workers. To do this, amend the camp standards schedule to suit the particular situation using the Final Report of the Silviculture Subcommittee to the Board of Governors of the Workers' Compensation Board as a guide. (Obtain a copy of this report from the regional planting specialist or the silviculture contracts specialist in Forest Practices Branch). If the contract is to be tendered, make the changes to the camp standards before tendering, not after. If done afterwards, unsuccessful contractors could complain that they would have submitted lower bids had they known the ministry was going to require different the standards.

2.3.5 Project Map

At a minimum, a project map should show:

scale
distance to town
road types (e.g., 4x4 access)
treatment unit boundaries
no treatment areas

Figure 2 below contains a sample project map. A contract having multiple treatment areas may require several project maps.

2.3.6 Location Map

In addition to the project map, contracts should also have a location map to indicate the whereabouts of the project relative to local towns or other landmarks. It is particularly important that such maps be available at the bidding stage, so that contractors can readily locate the site for self-guided viewing.

At a minimum, a location map should show:

scale
the nearest town
road types (e.g., 4x4 access)

Figure 3 below contains a sample location map.

Figure 2. Sample Project Map

Figure 3. Sample Location Map

2.4 Silviculture Contract Competition Matrix

Figure 4 below is a general guide to matching silviculture contract schedules with the appropriate form of contract and competition methods. It shows common usage. Variation from the matrix is acceptable where permitted under Chapter 7 of the Contract Management Manual.

Figure 4. Guide to choosing a form of contract and competition method

2.5 Preparing the Tender Package

2.5.1 Other Sources of Information

The Contract Management Manual contains complete instructions for preparing an ITT package (Chapter 11) or an ITQ package (Chapter 13).

2.5.2 Establishing Bidder Eligibility for Silviculture Contracts

Establishing bidder eligibility is one of the most important tasks in contracting. The principle of fair access to government work must be balanced with the government's need to have a quality job done with a minimum of contract supervision. This is partially achieved through specifying bidder eligibility requirements in the conditions of tender or else by pre-qualifying potential bidders.

Chapter 10 of the Contract Management Manual provides detailed instructions on how to establish select lists for select invitation competitions on a rotational basis. It contains a sample pre-qualification notice for tree planting contractors, as well as full details on how to prepare a pre-qualification package and how to evaluate submissions.

Section 11.8.3 of the Contract Management Manual provides general guidance on specifying eligibility requirements as part of the conditions of tender.

2.5.3 The Decision to Hold a Site Viewing

Section 11.5.2 and section 11.15 of the Contract Management Manual provide guidance in making the decision to hold a site viewing and in conducting it. It is recommended that viewing be mandatory for all silviculture contracts other than surveys. Where road access allows viewing may be done by contractors on their own time.

If the ministry is hosting a helicopter accessed viewing, consider pre-qualifying contractors in order to limit the number attending the viewing.

2.5.4 Risk Management

Performance Security Requirements

Section 8.3 of the Contract Management Manual covers performance securities. Table 3 below presents standard requirements for silviculture contracts.

Table 3. Guide to performance security requirements for silviculture projects

Contract Risk	Performance Security Requirement
Some risk to the Crown if the contractor does not start on time (e.g., planting, activities with a narrow biological window, etc.)	10% of contract price, minimum $1,000
No or low risk if contract does not start on time, but some risk if work not performed to standard (e.g., pruning, spacing)	5% of contract price, minimum $1,000
Small, low risk contract, directly awarded	Spending authority may waive performance security requirement.

Holdback Requirements

Section 8.10 of the Contract Management Manual covers holdbacks. Table 4 below presents standard requirements for silviculture contracts.

Table 4. Guide to holdback requirements for silviculture contracts


Contract Type		Holdback Requirement
All operational services contracts except those noted below.		10% of contract price
Small, low risk operational services contract, directly awarded.		Spending authority may waive holdback requirement.
Consulting and General Services contracts.		Normally not required.

Insurance Requirements

Section 8.7 of the Contract Management Manual covers contract insurance requirements, including an explanation of all of the forms of coverage required below.

Table 5 below presents guidelines for silviculture contracts. Silviculture schedule A's generally contain all the needed insurance requirements. Use Table 5 when there is a perceived need to expand or reduce these insurance coverage requirements, or when preparing a customized schedule A.

Table 6 provides a guide to insurance requirements for contracts involving air or water craft.

For any projects that include activities not listed in these tables, spending authorities should carry out a risk analysis to decide whether comprehensive general liability (CGL) and fire fighting expense coverage should be a contract requirement. Make CGL insurance a contract requirement where there is a medium to high risk of property damage or bodily injury.

All operational silviculture contracts must include Automobile Liability coverage on all vehicles owned, operated or licensed in the name of the contractor in an amount not less than $1,000,000.

Table 5. Guide to insurance requirements for silviculture contracts


Treatment Type	CGL¹	FF²
Aerial Fertilization	a	d
Auditing	f	f
Cone Collection - Aerial	a	a
Cone Collection - other methods	bcd	d
Implementation	f	f
Juvenile Spacing	bcd	d
Mechanical Site Preparation	a	d
Prescribed Burn	a	see note³
Pruning	bcd	d
Silviculture Surveys	f	f
Tree Planting	bcd	d
Vegetation Management - Aerial Herbicide Methods	a	a
Vegetation Management - Ground Herbicide Methods	a	d
Vegetation Management - Livestock Methods	a	d
Vegetation Management - Physical Methods	bcde	d

Forest Health Contracts
MSMA Application	a	d
Fall and Burn	a	a
Pheromone Bait Traps - Placement, Assessment, Eradication	bcd	f
Ground Surveys/Probes	f	f

¹CGL - Comprehensive General Liability insurance in an amount not less than $1,000,000.00 per occurrence.
²FF - Forest Fire Fighting Expense Coverage in an amount not less than $1,000,000. Only available as additional coverage to the Comprehensive General Liability Insurance.
³Because it is unlikely that a contractor involved in prescribed burning could obtain fire fighting insurance, a spending authority may waive this insurance requirement in this situation.
a - Required throughout the term of the contract.
b - Required if the work area is adjacent to private property. Adjacent means bordering, unless the term of the project is between April 1 and October 31 or during periods of high to extreme fire hazard, when adjacent means within one kilometre.
c - Required if the work area is near public facilities or recreational areas such as parks, recreational sites, hiking and horseback riding trails, or ski areas. A contract work area is "near" a public facility when the contractor, or any employee of the contractor, will encounter facility users on a regular or periodic basis.
d - Required if the contract term is between April 1 and October 31, or during periods of high to extreme fire hazard.
e - Required for mechanical brushing methods.
f - Not required.

Table 6. Insurance requirements for contracts involving air or water craft


Silviculture Contract Type	Insurance Coverage	Coverage Amount ($)
Aerial fertilization	Aerial drift or misapplication of fertilizers	500,000
Aerial herbicide	Aerial drift or misapplication of chemicals	500,000
Any involving use of aircraft	Aviation liability insurance for all owned or non-owned aircraft operated or used in the performance of the work	1,000,000
Any involving use of water craft	Water craft liability insurance for all owned or non-owned craft operated or used in the performance of the work	1,000,000

Penalties and Damages

Section 8.8 of the Contract Management Manual provides guidance on the need for actual or liquidated damages clauses. Spending authorities contemplating including a "penalty" in a contract should review this entire section of the Contract Management Manual. In short, penalties are not permissible in ministry contracts. More acceptable is the use of "liquidated damages", a reasonable pre-estimate of damages agreed to in the contract by the ministry and the contractor.

2.5.5 Preparing the Tender Form

Use a standard Tender Offer Form - FS 629 form to prepare a tender offer for all silviculture operational services contracts. See section 11.11 of the Contract Management Manual for instructions for completing this form. (The Tender Form for Tree Planting Contracts - FS 790 and the Tender Form for Site Preparation Contract - FS 759 are obsolete).

Silviculture tender offers may be specified as revocable (check the "No" box under section 3 (a) of the FS 629) or irrevocable (check the "Yes" box of section 3 (a) of the FS 629). Use irrevocable tenders if there is concern that bid-rigging may occur. Consult section 12.5.5 of the Contract Management Manual for more information regarding bid-rigging and methods to deter it.

Figure 5. Example of a prepared tender offer form (table section) - tree planting

Figure 6. Example of a prepared tender offer form (table section) - site preparation

2.6 Creating Multi-year and Multi-activity Contracts

2.6.1 Multi-year Contracts

A multi-year contract is any contract that spans two or more fiscal years. It is typically for a single activity. Multi-year contracts that are also for a variety of silviculture activities are referred to as multi-year, multi-activity contracts. This latter form of contract is discussed on page 20.

Virtually any silviculture contract can be made into a multi-year contract. Section 6.5.2 of the Contract Management Manual provides guidance on choosing between a standard term contract (i.e., within a single fiscal year), option-to-renew and multi-year contract terms. Ministry "direction" requires that all multi-year contracts be awarded through an open invitation tendering process and that there be a high probability of funding for work in subsequent years.

Making a contract multi-year is simply a matter of specifying the contract term to expire in a later fiscal year. Not so simple is the matter of describing what the work (and payments) will be in future fiscal years. Therefore, it is best to use multi-year contracts when the work units can be precisely specified for each year and the activity is not dependent upon some prior activity having occurred. Multi-year contracts for activities where the future work units cannot be precisely specified or are substantially subject to change are more difficult to design and obtain bids for. Examples are planting contracts where future work units are dependent upon timber harvesting having occurred, or planting rehabilitated areas when funding for site rehabilitation is inconsistent or plans for exactly which areas will be rehabilitated are not well developed.

To ensure clarity, prepare a clearly-labeled tender form (for tender packages) showing work activities in each fiscal year. Following contract award, prepare a separate and clearly-labeled schedule B for each fiscal year.

An option-to-renew contract is preferable when future work cannot be precisely identified. Assuming work is satisfactorily completed in each year, future work is then negotiated between the ministry and the contractor, once the work units can be specified. Unit rates must be comparable to rates bid in the initial year of the contract for similar work. If the work is dramatically different in difficulty and/or cost, it should be tendered. Annual renewal clauses should be part of the agreement. Renewal is subject to meeting the requirements of the annual renewal clause.

Table 7 below provides cross-references for information and clauses in the Contract Management Manual relevant to multi-year contracting.

Table 7 below provides an example of annual renewal clauses.

Table 7. Multi-year contract cross-references - Contract Management Manual

Subject	Contract Management Manual Section
Option-to-renew contract clause	Section 9.12.1
Choosing a performance security option	Section 8.3.3
Contract clauses for multi-year or option-to-renew performance security requirements	Section 9.12.6
Holdback clause	Section 9.12.9

Table 8. Example of Annual Renewal Clauses suitable for Operational Services Agreement

	Sample Annual Renewal Clauses
15.22	Annual renewal of this Agreement is subject to the Contractor having achieved:
	a) adherence to the Contractor's proposal;
	b) at least 90% planting quality on each cutblock as provided in this Agreement; and c) less than $1000 in total assessments in any one Fiscal Year of this Agreement
15.23	For the purposes of 15.22 (c), assessments will not include reductions in payment calculated for poor quality or excess trees.
15.24	Prior to annual renewal, during the Term of this Agreement, the Province and the Contractor will enter into a price negotiation for the next year of work. The Province will provide a completed Schedule B, including maps, for Work Areas in the applicable year. The Contractor will be responsible for preparing cost estimates for the Work and submitting these cost estimates to the Province by a specified time.
15.25	Cost estimates will be reviewed by a district team of at least three staff from the Ministry of Forests. Cost estimates will be compared to the first year prices and must reflect fair market value. Where the Province agrees that the cost estimates are reasonable and the conditions of 15.22 have been satisfactorily met, the Province will renew the Agreement.
15.26	If the Ministry fails to agree with any or all of the cost estimates supplied by the Contractor, the Ministry may: a) negotiate with the Contractor for a portion or all of the Work; b) agree to renew the agreement for a portion of the Work; c) follow the dispute resolution process as outlined in article 14 of this Agreement, for a portion or all of the Work; or d) mutually agree to terminate the Agreement.
15.27	Failure to meet the requirements in 15.22 above may result in this Agreement not being renewed.

2.6.2 Multi-activity Contracts

A multi-activity contract combines several silvicultural activities into one contract. When such a contract is also for more than one fiscal year, it is referred to as a multi-year, multi-activity contract. This latter form of contract is discussed in the next section.

Multi-activity/single-year contracts are less common than multi-year contracts for a single activity. This is generally because qualifying contractors across the range of required skill and experience is perceived as more difficult. However, conceptually, multi-activity silviculture contracting is no more complex than awarding a building contract for a house to a general contractor who then uses subtrades to accomplish the work.

The recommended process for multi-activity silviculture contracts is to pre-qualify potential bidders. Chapter 10 of the Contract Management Manual contains pre-qualification procedures. Pre-qualification specifications could stipulate that only companies having specified experience will be eligible.

Following a pre-qualification, the ministry invites bids only from those contractors having demonstrated that they have the capability to undertake and supervise all activities. Until spending authorities gain experience with this contracting model, they may manage risk by specifying a higher performance security (e.g., 15%) requirement in the conditions of tender and in the contract. Alternatively, spending authorities could specify different performance security rates for different activities; for example, 15% for planting and 10% for brushing. While a higher performance security requirement may increase bid prices, the indirect cost savings through less contract administration should offset this. After a few successful multi-activity contracts and all procedures are worked out, spending authorities should lower performance security requirements back to the standard 5-10% level.

2.6.3 Multi-year, Multi-activity Contracts

A multi-year, multi-activity contract is for a variety of silviculture activities spanning two or more fiscal years. Stewardship contracts are the most common usage of this contract form. While permitted under government and ministry policy, for many reasons districts rarely use this form of contract. Reasons include uncertainties of staffing, funding, natural processes, silvicultural planning, etc.

Preparing a multi-year, multi-activity contract is the same as preparing both a multi-year and a multi-activity contract, only all the elements are combined into a single contract. See the preceding two sections for procedures.

2.6.4 Award Considerations

Chapter 17 of the Contract Management Manual contains contract award procedures. The following additional procedures are specific to silviculture contracts.

One of the more critical procedures in the contract award process is that of checking the references regarding the past performance and the current commitments of the planting contractor. In addition to obtaining telephone references, check ISIS for the successful bidder's past performance record.

Refer to the contractor performance spreadsheet to review contractor performance history on previously-held ministry contracts. This spreadsheet is updated annually by Forest Practices Branch from information contained in ISIS records.


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