CONTRACT

GENERAL CONDITIONS

FOR

CONSTRUCTION MANAGER AT RISK WITH

GUARANTEED MAXIMUM PRICE PROJECTS

THE CALIFORNIA STATE UNIVERSITY

Prepared by:

OFFICE OF THE CHANCELLOR

CAPITAL PLANNING, DESIGN AND CONSTRUCTION

(www.calstate.edu/cpdc)

Revised March 2026 http://www.calstate.edu/cpdc)

Contract General Conditions for Construction Manager at Risk for

Guaranteed Maximum Price Projects Revisions Made Since Last Major Update:

Article No. Revision Description 4.03(i) Division 1 Reference removed.

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TABLE OF CONTENTS

CONTRACT GENERAL CONDITIONS FOR CONSTRUCTION MANAGER AT RISK

WITH GUARANTEED MAXIMUM PRICE PROJECTS

1.00 - DEFINITIONS

2.00– PROPOSALS / GUARANTEED MAXIMUM PRICE

2.01 Duty to Carefully Examine These Instructions / Mistake in Proposal

2.02 Competence of Proposers

2.03 Necessity for Careful Examination of Site, Plans, and Specifications

2.04 Proposal Regulations

2.05 Proposal Documents

2.06 Clarification Prior to Guaranteeing the Maximum Price

2.07 California Company; Reciprocal Preference against Nonresident Contractors; Certification

2.08 Small Business Five Percent Proposal Advantage

2.09 Disabled Veteran Business Enterprise Participation Requirement and Incentive

3.00 - AWARD AND EXECUTION OF CONTRUCTION CONTRACT

3.01 Award of Construction Contract

3.02 Contract Bonds

3.03 Execution of Contract

3.04 Failure or Refusal to Execute Contract

4.00- CONDUCT OF THE WORK

4.01 Laws to be Observed - Generally

4.02 Laws to be Observed--Regarding Labor

4.03 Environmental Requirements

4.04 Substitution of Trade Contractors

4.05 Delegation of Performance and Assignment of Money Earned

4.06 Assignment of Trade Contracts to Trustees

4.07 Insurance Requirements

4.08 Indemnification

4.09 CM’s Responsibility for the Work

4.10 Occupancy by Trustees Prior to Acceptance

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4.11 Payments by CM

4.12 Responsibility to Secure and Pay for Permits, Licenses, Utility Connections, Etc

4.13 Patented or Copyrighted Materials

4.14 Property Rights in Materials and Equipment

4.15 Taxes

4.16 Contract Time

4.17 Schedule

4.18 Labor Force and Superintendent

4.19 Limitation of Construction Operations

4.20 Coordination with Other Work

4.21 Drawings Reflecting Actual Construction

4.22 Access for Inspection

4.23 Cleanup of Project and Site

4.24 Project Sign, Advertising

5.00 - INTERPRETATION OF AND ADHERENCE TO CONTRACT REQUIREMENTS

5.01 Interpretation of Contract Requirements

5.02 Issuance of Interpretations, Clarifications, Additional Instructions

5.03 Product and Reference Standards

5.04 Shop Drawings, Samples, Alternatives or Equals, Substitutions

5.05 Quality of Materials, Articles and Equipment

5.06 Testing Materials, Articles, Equipment and Work

5.07 Rejection

5.08 Offsite Testing

5.09 Responsibility of Quality

6.00 - CHANGES IN THE WORK

6.01 Change Orders

6.02 Emergency Changes

7.00- CLAIMS AND DAMAGES

7.01 Claims

7.02 Delay in Completion--Liquidated Damages

7.03 Termination for Cause

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7.04 Termination for Convenience

7.05 Assignment of Trade Contracts

7.06 Third-Party Claims

8.00 - PAYMENT AND COMPLETION

8.01 Acceptance

8.02 Partial Payments

8.03 Direct Construction Cost of the Work

8.04 Construction Phase Services

8.05 Costs Not Included in Construction Phase Services

8.06 Discounts, Rebates and Refunds

8.07 Escrow in Lieu of Retention

8.08 Stop Payment Notices

8.09 Guaranteed Maximum Price and Cost Savings Split

8.10 Payment

8.11 Guarantee

8.12 CM Evaluation

ARTICLE 9.00 - MISCELLANEOUS

9.01 Governing Law

9.02 Successors and Assigns

9.03 Rights and Remedies

9.04 Waiver

9.05 Survival

9.06 Complete Agreement

9.07 Severability of Provisions

9.08 Notices

9.09 Counterparts

SAMPLE FORMS Construction Management Sample Forms | CSU https://www.calstate.edu/csu-system/doing-business-with-the-csu/capital-planning-design-construction/Pages/construction-management-sample-forms.aspx

Contract General Conditions for Construction Manager at Risk with Guaranteed Maximum Price Projects Revised March 2026 - Page 1 of 55 pages

CONTRACT GENERAL CONDITIONS FOR

CONSTRUCTION MANAGER AT RISK WITH GUARANTEED MAXIMUM PRICE PROJECTS

1.00 - DEFINITIONS

Acceptance – When the Project is complete in all respects in accordance with the Plans and Specifications, and the Contract has been otherwise fully performed by CM, to the full satisfaction of the Trustees, the Trustees will accept the Project as complete.

Actual Direct Construction Cost – All costs necessary to complete the Project, as proposed by CM at the time of award, excluding CM site management fee, CM Contingency, and CM overhead and profit.

Addendum - A document that modifies or supersedes portions of the Contract Documents, which is produced by the Architect, approved by the Trustees, and issued to the Construction Manager at Risk, prior to the agreement on the Guaranteed Maximum Price.

Agreement - A form executed by both CM and the Trustees, that provides the Work will be done in accordance with the Contract Documents, which collectively represent the entire agreement between the Trustees and CM, including Guaranteed Maximum Price, and which supersede any prior negotiations, representations, or agreements, either written or oral. Reference Contract Documents.

Allowance – Allowances are allocations of the Contract Amount to portions of the Work that could not be specified sufficiently for competitive bidding.

Architect - The person or organization, including the authorized representatives thereof, commissioned by the Trustees for the design of the Project. For projects on which an engineer or landscape architect is commissioned instead of an architect, the term “Architect” shall mean the design professional so commissioned for the Project.

Bid Date - the date fixed for submission of technical and cost proposals.

Bidder – Any person or business entity acting directly or through an authorized representative who submits a technical and cost proposal for the Work, in response to a Request for Proposals. Reference Proposer.

BRIP – The Trustees’ Builders Risk Insurance Program. Reference Article 4.07-c, Builders Risk Insurance Program.

Budgeted Direct Construction Cost – The budgeted total cost of the Work, excluding CM site management fee, CM contingency, and CM overhead and profit.

Business Day – Calendar day excluding Saturdays, Sundays, national holidays and state holidays; same as Working Day.

Campus - The campus of the California State University system on which the Project is located.

Capital Planning, Design and Construction (CPDC) - Department within Business and Finance, a division in the Office of the Chancellor of the California State University, responsible for all major capital outlay projects.

Change Order - A written agreement entered into after the award of the Contract that alters or amends the executed Contract.

CM Contingency – CM Contingency funds are budgeted funds to cover the cost of unforeseen factors related to the Work that arise after a construction contract is awarded, such as an ambiguity in the Construction Documents. Eligible uses of CM Contingency are specified in the Request for Proposals.

Construction Administrator - The person delegated by the Trustees to manage the construction phase of the Project and authorized to approve changes to the Contract.

Construction Documents – The Contract General Conditions, Plans, Specifications, and Addenda related to the bidding and construction of the Project.

Construction Inspector - The Inspector on the Project Site who receives technical direction from the Architect and administrative direction from the Construction Administrator.

Construction Manager (CM) – The person or entity that has entered into this Agreement with the Trustees. Same as Contractor.

Construction Schedule – CM’s time use plan for completing the Work within the Contract Time.

Contract - The Contract Documents which collectively represent the entire agreement between the Trustees and the Contractor, and which supersede any prior negotiations, representations, or agreements either written or oral.

Contract Amount – The amount of compensation stated in the Agreement for the performance of the Work, as adjusted by Change Order.

Contract Documents - The Request for Proposals, Technical and Cost Proposals, Plans, Specifications, Addenda, Agreement, Bonds, Contract General Conditions, Supplementary General Conditions, Special Conditions, Change Orders, and any other documents so designated by the Trustees.

Contractor - The person or business entity that has entered into this Agreement with the Trustees. Same as Construction Manager

(CM).

Revised March 2026 - Page 2 of 55 pages

Contract Time – The period of time, set out in Calendar Days, established in the Contract Documents within which the Work must be completed. The Contract Time may be adjusted by time extensions through Change Orders.

Day – Unless otherwise indicated herein, day is a calendar day.

Direct Cost of the Work – Costs necessarily incurred by CM to perform the construction shown on the Construction Documents.

Executive Facilities Officer – University official who oversees the capital outlay process.

Field Instruction - A written order from the Trustees to the Contractor, signed by the Construction Administrator.

GMP Budget – The total of the Budgeted Direct Construction Cost, CM site management fee, CM Contingency, and CM overhead and profit.

Guaranteed Maximum Price (GMP) – The maximum price that the Trustees and Construction Manager at Risk agree upon as payment for managing and for supplying and installing all the Work. The GMP is a total of the Actual Direct Construction Cost (including allowances) as bid by CM, and includes CM site management fee, CM Contingency, and CM overhead and profit.

OCIP – The Trustees’ Owner Controlled Insurance Program. Reference Article 4.07-b, Owner Controlled Insurance Program.

Plans - The drawings prepared by the Architect and approved by the Trustees, which include elevations, sections, details, material and equipment schedules, diagrams, information, notes, or reproductions or any of these, and which show the location, character, dimension, or details of the Work.

Prevailing Wages - The general prevailing rate of wages identified by the Director of the Department of Industrial Relations of the State of California pursuant to section 1770 of the Labor Code.

Progress Schedule - The periodically updated Construction Schedule that reflects the actual progress of the Work and impacts on the Work thereby maintaining a current projected date of completion. Impacts on the Work include, but are not limited to, anticipated delays, re-sequencing of tasks, and Change Orders.

Project - The total Work required by the Contract.

Project Manager - The onsite representative of the Construction Administrator, but without the authority to approve changes to the Contract.

Project Schedule – The time use plan for completing the entire Project from date of Notice to Proceed of the Preconstruction Services phase through the date of final completion of construction. Major tasks included in the Project Schedule shall include but not be limited to consultant selection and award, design phases, code approvals, bid and award, construction, move-in, and closeout.

Proposal Documents: Request for Proposals (Advertisement), Request for Qualifications, Statements of Qualifications, Request for Proposals, and the Technical and Fee Proposals.

Proposer – Any person or business entity acting directly or through an authorized representative who submits a technical and cost proposal for the Work, in response to a Request for Proposals. Reference Bidder.

Sample Forms – Many of the forms referenced herein, are available on CPDC website.

Site - The area specified in the Contract for the Project and the area made available for CM’s operation.

Specifications - The instructions and requirements prepared by the Architect, which complement the plans and describe the manner of performing the Work or the quantities, qualities and types of materials to be furnished.

State - State of California.

Subcontractor - Contractor that is under contract to CM or another subcontractor for completion of a portion(s) of the Work.

Same as Trade Contractor.

Superintendent - The representative of CM at the construction Site, authorized to receive instructions from the Architect and the Construction Administrator, and who is authorized to direct the performance of the Work on behalf of CM.

Supplier or Vendor - Any person or business entity that contracts with CM or trade contractor to provide materials or equipment.

Trade Contractor – Contractor that is under contract to CM or another subcontractor for completion of a portion(s) of the Work. Same as Subcontractor.

Trustees - The Board of Trustees of the California State University and their authorized representatives who act on behalf of the Trustees. Reference also Executive Facilities Officer and Construction Administrator.

University - The California State University campus upon which the Project is located and the University President and other University officers and employees acting within the scope of their duties.

Work - That which is proposed to be constructed or done under the Contract, including the furnishing of all design services, labor, materials, and equipment.

Working Day – Day excluding Saturdays, Sundays, national holidays and state holidays; same as Business Day.

Revised March 2026 - Page 3 of 55 pages

2.00 – PROPOSALS / GUARANTEED MAXIMUM PRICE

2.01 Duty to Carefully Examine These Instructions / Mistake in Proposal

a. Duty to Carefully Examine These Instructions

Prospective Proposers (Construction Manager at Risk (CM) and trade contractors) for this Project shall carefully examine the instructions contained herein and be cognizant of the conditions that must be satisfied prior to submitting a proposal, and the conditions that affect the award of the Contract.

b. Mistake in Proposal As required by Public Contract Code section 5100 et seq., a Proposer shall not be relieved of a proposal without consent of the Trustees, nor shall any change be made in a proposal because of mistakes. However, a Proposer may pursue relief of its proposal in accordance with Public Contract Code section 5100 et seq.

2.02 Competence of Proposers

a. License and Public Works Registration.

(1) License.

No Bidder may bid on Work for which it is not properly licensed. The Trustees shall disregard any bid received from a Bidder who is not properly licensed (Business and Professions Code section 7028.15). Nor will the Trustees award a Contract to a Proposer who does not possess the appropriate contractor’s license, which is that specified in the Proposal Documents. Bidders participating in a joint venture must individually possess a current license when submitting the joint venture bid, and the joint venture must possess a joint venture license at the time of award (Public Contract Code section 3300).

(2) Public Works Registration with Department of Industrial Relations The Trustees will only issue public works bids and award public works contracts to currently registered contractors and subcontractors on the Trustees’ public works projects. All bidders and subcontractors of all tiers must register to bid public works projects with the Department of Industrial Relations (DIR) and obtain and maintain current registration numbers (Labor Code section 1725.5). Note: DIR will assess a penalty on any public works contractor who allows its registration to lapse. DIR will also assess a penalty on any contractor who subcontracts to any contractor who is not registered with the DIR for each day the subcontractor is not registered.

For more information review the DIR public works registration requirements at https://www.dir.ca.gov/Public- Works/Contractors.html The following applies to this Contract:

• A contractor will not be in violation for working on a private Project that is later determined to be public work;

• Contractor shall check the public works registration for all subcontractors that it proposes to list to ensure that each subcontractor is registered to bid public works projects with the DIR;

• An unregistered contractor or subcontractor can be replaced with one who is registered;

• A contract with an unregistered contractor or subcontractor is subject to cancellation but is not void as to past work.

b. Prequalification Rating.

The Trustees shall issue proposal packages only to firms who have prequalified with the Trustees (Public Contract Code section 10764). To prequalify, a bidder must file their prequalification applications online; and the application includes bidders’ responses to a standard questionnaire, a statement of financial condition and previous experience in performing public works, all in accordance with the instructions contained in the Proposal Documents.

Bidders shall go to: http://www.calstate.edu/contractor-prequalification under ‘Contractor Prequalification’ and log in to the database using the link provided (PlanetBids). Bidders shall verify the information contained in the prequalification application under oath and submit the completed prequalification application online at least ten (10) Business Days prior to the deadline identified in the Proposal Documents. The Trustees’ Prequalification Coordinator must approve Bidders not less than one Business Day prior to the deadline identified in the Proposal Documents.

The Trustees’ Prequalification Coordinator will review the bidder’s statement of experience and financial condition upon receipt of a complete application, check Bidder’s references, and notify the Bidder of the rating established based on information contained in the application. The Bidder’s assigned prequalification rating will be the maximum amount of a contract or contracts that the Bidder may undertake with the Trustees. Proposer may request an increase in its rating from the Trustees’ Prequalification Coordinator. The request shall be in writing and specify the reason(s) for the increase.

The Trustees’ Prequalification Coordinator will review Proposer’s request, check new references submitted, and notify the Proposer of the resulting decision. The Prequalification Coordinator’s decision is final.

The Trustees shall disregard any proposal received either from a Bidder that is not currently prequalified or from a bidder that is prequalified, but the rating is not high enough to accommodate its bid. Although this prequalification permits https://www.dir.ca.gov/Public-Works/Contractors.html https://www.dir.ca.gov/Public-Works/Contractors.html http://www.calstate.edu/contractor-prequalification https://www.planetbids.com/portal/portal.cfm?CompanyID=15331

Revised March 2026 - Page 4 of 55 pages participation in the submitting of a Proposal for the Project, it does not mean that the bidder satisfies the requirements of being a “responsible bidder.” This determination occurs later in the process (reference Article 8.12, CM Evaluation).

c. Joint Ventures.

If two or more prospective firms desire to submit a proposal as a joint venture on a single project, they must file an affidavit of joint venture form 703.12 with the Trustees at least five (5) Days prior to the deadline identified in the Proposal Documents, on a form obtained from the Trustees. The affidavit of joint venture is valid only for the specific project for which it is filed. Each party to the joint venture must be prequalified, as provided herein, at least one (1) Business Day prior to the deadline identified in the Proposal Documents.

If the Trustees announce that the joint venture is the successful Proposer, the joint venture shall, prior to the Trustees’ award of the Contract:

(1) obtain the joint venture license (Business and Professions Code sections 7029 and 7029.1), and

(2) register the joint venture with the Department of Industrial Relations.

d. Trade Contractor Prequalification.

CM shall require prequalification of the trade contractors [at least the mechanical, electrical, plumbing and trades where the estimated cost of the trade work is greater than five percent of the construction budget] utilizing the Trade Contractor Prequalification documents found in the Request for Proposal documents and any additional documents or process required by CM. Once this process is completed, CM shall provide a list of the prequalified trade contractors to the Trustees.

2.03 Necessity for Careful Examination of Site, Plans, and Specifications CM and trade contractors shall carefully examine the Site, the Plans, and Specifications for the Project, be satisfied as to the conditions to be encountered, and shall also investigate:

a. the character and quantity of surface and subsurface materials or obstacles to be encountered,

b. rights of way and easements at or near the Site,

c. the Work to be performed, and

d. materials to be furnished and as to the requirements of the proposal, plans, and specifications for the Project (reference

Article 4.12, Responsibility to Secure and Pay for Permits, Licenses, Utility Connections, Etc.).

CM certifies that CM has complied with the requirements of this provision by the submission of its bid.

Any failure by CM and trade contractors to acquaint themselves with information that is available or with reasonable investigation may be available will not relieve them from responsibility to estimate properly the difficulty or cost to perform the Work. Such examination does not require independent underground soil borings unless required elsewhere in the Contract Documents.

a. Subsurface Investigations.

Where the Trustees have made investigations of subsurface conditions, and makes that information available to CM, such information is limited in scope to that which the Trustees actually encountered in the investigations, and is included only for the convenience of CM.

The Trustees assume no responsibility whatsoever in respect to the sufficiency or accuracy of borings or of the log of test borings or other preliminary investigations or any interpretation of the above. There is no guarantee or warranty, either expressed or implied, that the conditions indicated are representative of those existing throughout the Site or that unforeseen conditions or developments may not occur. Making such information available to CM is not to be construed in any way as a waiver of this provision. CM must satisfy itself through its own investigations as to the actual conditions to be encountered.

b. Differing Site Condition.

During the progress of the Work, if CM encounters a subsurface or latent condition at the Site that is substantially different from those indicated in the Contract Documents or made available for examination, a differing Site condition may exist. CM shall immediately notify the Architect and the Construction Inspector in writing of the error, conflict, inconsistency, omission or any variance on the Project as required herein and as required by laws, ordinances, codes, rules or regulations. CM shall immediately report such condition to the Construction Administrator, the Architect, and the Construction Inspector in writing. The Architect shall investigate the assertion of a differing site condition by collecting the facts and applying the facts as expressed by the Architect to the appropriate provisions of the Contract Documents. If, in the exercise of reasonable discretion, the Architect determines that a differing site condition exists and that the differing site condition directly results in extra Work, and if the Trustees concur, CM shall be entitled to a change order that shall compensate CM for the extra Work.

2.04 Proposal Regulations

a. Submission of Proposals.

Proposers shall submit proposals as instructed in the RFP. It is the Proposer’s responsibility to ensure that its proposal https://www2.calstate.edu/csu-system/doing-business-with-the-csu/capital-planning-design-construction/Documents/pq_affidavit_of_joint_venture.pdf https://www2.calstate.edu/csu-system/doing-business-with-the-csu/capital-planning-design-construction/project-center/academic-project/Construction/Pages/Construction-Manager-at-Risk/forms.aspx

Revised March 2026 - Page 5 of 55 pages is received in the proper time and location. Delays in timely receipt of the proposal caused by the United States or the Trustees’ mail system, independent carriers, acts of God, or any other cause shall not excuse late receipt of the proposal.

The Trustees shall return unopened any proposal received after the time specified in the RFP or in any addendum (Public Contract Code sections 4104.5 and 10766).

All proposals shall be submitted to the Trustees under sealed cover, shall be identified plainly as a proposal for the Project, and shall be addressed as directed in the RFP. The Trustees will disregard proposals not marked properly.

b. Withdrawal of Proposals.

Any proposer may withdraw its proposal be at any time prior to the time fixed in the public notice for the opening of proposals, but only by a written request from the Proposer or its authorized representative. The request shall be executed by the Proposer or its authorized representative and filed with the Trustees. A request to withdraw a proposal that is communicated orally in person, or by the use of telegram or telephone is not acceptable. The withdrawal of a proposal shall not prejudice the right of a Proposer to file a new proposal. This paragraph does not authorize the withdrawal of any proposal after the time of the public notice for the opening of proposals (Public Contract Code section 10767).

c. Public Opening of Cost Proposals.

Cost proposals will be publicly opened and read at the time and place indicated in the RFP. Proposers or their agents are invited to be present.

d. Rejection of Irregular Cost Proposals.

The Trustees may reject any cost proposal if it shows any alterations of forms, additions not called for, conditional proposals, incomplete proposals, unsigned proposals, erasures, or irregularities of any kind. If Proposer changes the proposal amount after the amount has been inserted, Proposer shall initial the change.

e. Power of Attorney or Agent.

When an agent signs the proposal, a power of attorney shall either be on file with the Trustees before the opening of proposals, or be submitted with the proposal. Failure to submit a necessary power of attorney may result in the rejection of the proposal as irregular and unauthorized. A power of attorney is not necessary in the case of a general partner of a partnership.

f. Waiver of Irregularities.

Trustees reserve the right to waive minor irregularities in proposals submitted.

2.05 Proposal Documents

Once the Trustees have completed the review of the responses to the RFQ and published the list of qualified proposers, the Trustees will issue an RFP to only the qualified proposers. In response to the requirements of the RFP, each Proposal will consist of two separate submittals, the cost proposal and the technical proposal. Proposer shall tender the following forms with its Proposal:

a. Cost Proposal.

The Trustees will furnish a cost proposal package, which when completely filled out and executed by the Proposer, may be submitted as its cost proposal. Cost Proposals not presented using the furnished cost proposal package shall be disregarded (Public Contract Code section 10764). Proposer may not transfer the cost proposal package to another Proposer, and must submit it in the same name as is used on the Proposer’s license and prequalification.

The Trustees’ cost proposal package contains a standard cost or fee proposal form that shall be used for Proposer’s proposal. Each proposal shall give the prices proposed in the manner required by the proposal and shall be signed by the Proposer or by the Proposer’s duly authorized representative, with its address and telephone number.

(1) If an individual makes the proposal, the individual’s name, postal address, and telephone number must be shown.

(2) If made by a partnership, a limited partnership, or other type of legally recognized partnership, the proposal shall have the signature of all partners, or an affidavit signed by all partners empowering one partner as an agent to act in their behalf, and shall include the address and telephone number of the partnership.

(3) A proposal submitted by a corporation, or a limited liability company (LLC), or other type of legally-recognized firm, shall show the name of the state in which the firm is chartered, the name of the firm, its address and telephone number, and the title of the person who signs on behalf of the firm. The firm shall also submit a certified copy of firm’s board action that identifies and authorizes the person who may sign and submit bids for the firm. The Trustees shall reject any proposal submitted that is not signed by the Bidder or by the Bidder’s duly authorized representative.

b. Proposer’s Bid Security.

No bid security is required for this Project.

c. Listing of Trade Contractors For each proposed trade contractor that will perform Work or labor or render services for CM in excess of one-half of one percent of CM’s total GMP, CM shall solicit a minimum of three qualified trade contractors in a manner most appropriate to obtain competitive bidding. Identify in the trade contractor solicitation the construction budget for that

Revised March 2026 - Page 6 of 55 pages trade, and clearly state the amount of bonds required by the trade contractors, and whether CM or the trade contractor will be responsible for the cost of the bonds (Public Contract Code section 4108).

With the submission of the GMP, CM shall submit to the Construction Administrator the “List of Trade Contractors for CM at Risk Projects” form 701.04A.CM, whereon CM shall list the following:

trade contractor’s name, California Contractors State License Board-issued contractor license number, California Department of Industrial Relations Public Works Registration number, location of the place of business, and the portion of Work or labor or rendition of services that each such trade contractor will do in accordance with

Public Contract Code sections 4104, 4105 and 4106. For each alternative, CM shall list any trade contractor not included in the base contract subcontractor listing.

(1) Non-small Business Bidders Claiming the Small Business Preference.

If CM is a Non-small Business Bidder and claimed the small business preference, CM shall list all trade contractors certified as California small businesses, and the total of these subcontracts shall be at least 25% of the total bid price, including awarded alternatives.

(2) Disabled Veteran Business Enterprises (DVBE) Participation Requirement.

CM is required to achieve three percent DVBE participation in its GMP and, if Trustees awarded CM points in the RFP process for a DVBE incentive, CM is required to achieve that level of DVBE participation in its GMP, including alternatives. The Trustees will calculate CM’s DVBE participation on the GMP, including awarded alternatives. CM is required to achieve at least its proposed level of participation at Contract Completion.

CM shall list on the ‘List of Trade Contractors for CM at Risk Projects’ form, the DVBEs participating in the GMP and the dollar amount of participation by each DVBE. The total of the DVBE participation amounts that CM provides on the List of Trade Contractors for CM at Risk Projects shall equal at least CM’s proposed percentage of DVBE participation. For each alternative CM shall list any DVBE participating in work to be performed on the alternative. If the Trustees grant the DVBE Bid Incentive to CM, then the total amount of DVBE participation shall equal at least the incentive percentage of the total GMP, including awarded alternatives.

At Contract completion, the Trustees shall compare CM’s actual DVBE participation percentages to the percentages proposed at bid (reference Article 2.09-h, Prime Contractor’s DVBE Subcontracting Report). CM’s failure to achieve the proposed percentages may subject CM to penalties (as described in Article 2.09-i, Sanction for CM’s Failure to Achieve the DVBE Incentive), and/or may cause the Trustees to question CM’s responsibility in future Trustees’ bids.

(3) Subcontractor Directory.

CM shall provide and maintain current information requested on the Subcontractor Directory for all tiers of trade contractors/subcontractors working on the Project and shall submit the Subcontractor Directory with its signed Contract and with all payment requests. All tiers of trade contractors/subcontractors working on the Project shall register with the Department of Industrial Relations in accordance with Article 2.02-a (2), Public Works Registration with Department of Industrial Relations.

2.06 Clarification Prior to Guaranteeing the Maximum Price

CM shall examine the plans and specifications in preparing the GMP and shall report to the Architect any omissions, discrepancies, or errors found in the plans and specifications. Before the date of agreeing to the GMP, CM shall submit a written request for clarification to the Architect who may give such clarification in the form of an addendum. Otherwise, in obtaining the cost of the Project, CM shall consider that any conflicts shall be governed by Article 5.01, Interpretation of Contract Requirements.

CM firm is advised that the time period for submitting a proposed product as “an equal” is limited to the period prior to the date of agreeing to a GMP. Reference Article 5.04-c, Alternatives or Equals.

Only the Architect is authorized to answer questions or prepare addenda relative to the Project. Information obtained verbally from any source has no contractual authority, may not be relied upon, and shall have no standing in any event that may occur.

2.07 California Company; Reciprocal Preference against Nonresident Contractors; Certification The Trustees shall grant a California company a reciprocal preference as against a nonresident contractor from any state that gives or requires a preference to be given contractors from that state on its public entity construction contracts. The amount of the reciprocal preference shall be equal to the amount of the preference applied by the state of the nonresident contractor with the lowest responsive bid, except where the resident contractor is eligible for a California small business preference, in which case the preference applied shall be the greater of the two, but not both.

Each CM shall certify at the time of proposal opening that CM qualifies as a “California company,” which means a business entity licensed in California on the date of bid opening and which is one of the following:

https://www2.calstate.edu/csu-system/doing-business-with-the-csu/capital-planning-design-construction/Documents/bd_list_of_subcontractors_cmr_projects.docx

Revised March 2026 - Page 7 of 55 pages

a. a business entity with its principal place of business in California,

b. an out-of-state contractor whose state does not provide a local contractor preference, or

c. an out-of-state contractor that has paid at least $5,000 in sales or use taxes in the immediately preceding five years.

If CM does not qualify as a California company, then it shall indicate the name of the state in which its principal place of business is, and the amount of the local contractor preference in that state (Public Contract Code section 6107).

2.08 Small Business Five Percent Proposal Advantage

a. Preference for Small Businesses.

The Trustees calculate the small business preference as a percentage of the highest technical proposal score. For bid evaluation purposes only, if the highest-scored proposer is a California certified small business, the only proposers eligible for the DVBE incentive will be California certified small businesses.

The Trustees shall give a small business preference or bid advantage of five percent of the highest technical proposal score to contracting firms that have been certified as a “Small Business” by the Office of Small Business & DVBE Services, in the Procurement Division of the Department of General Services. Reference Government Code section 14835 et seq. and Title 2, California Code of Regulations, section 1896 et seq. To receive the five percent advantage, certified small businesses shall:

(1) Submit with the proposal a completed “Request for Small Business Five Percent Preference Certification” form 701.09,

(2) Be certified Small Business upon verification in accordance with section 1896.2, having applied for certification no later than 5:00 PM on proposal submittal date,

(3) Submit a timely and responsive proposal,

(4) Be determined to be a responsible Proposer.

b. Preference for Non-small Businesses.

(1) Preference.

The application of the five percent (5%) small business bidding preference is also extended to any non-small business that commits to subcontracting at least twenty-five percent (25%) of the total Phase 2 GMP amount to California certified small businesses and/or microbusinesses. The Trustees’ calculation of the small business bid advantage is five percent of the highest technical proposal score. To receive this preference the non-small business must satisfy the following criteria:

(a) Submit with the proposal a completed “Request for Small Business Five Percent Preference Certification” form 701.09, indicating its commitment to subcontract at least twenty-five percent (25%) of the total Phase 2 GMP amount with one or more small businesses,

(b) Submit a timely and responsive proposal,

(c) Be determined to be a responsible Proposer,

(d) Submit the California certified small businesses on the “List of Trade Contractors for CM at Risk Projects” form 701.04A.CM with the submission of the GMP, and specify the dollar amount of each small business subcontractor’s bid thereon.

(2) Failure to Subcontract with Listed Small Businesses.

Failure of the non-small business contractor to subcontract with the small businesses listed on its bid, or follow the substitution provisions identified in Article 4.04-b, may be grounds for the Department of General Services to impose sanctions pursuant to Government Code section 14842.5 and California Code of Regulations section 1896.16. In the event such sanctions are to be imposed, the contractor shall be notified in writing and entitled to a hearing pursuant to California Code of Regulations, sections 1896.18 and 1896.20. Since the final project value may change based on savings and/or change orders, the total contractual SBE spend requirement for the purpose of determining the contractual participation requirement shall be calculated as the proposed participation incentive percentage multiplied by the value of the total Phase 2 GMP, including all phase 2 fees and mark-ups, and excludes of the entirety of the phase 1 agreement amount.

c. Trustees’ Reporting of Small Business Participation.

Responsive to direction from the State Legislature, the Trustees are seeking to report increased statewide participation of certified small businesses in contract awards. To this end, the successful Proposer shall inform the Trustees of any contractual arrangements with subcontractors, consultants or suppliers that are certified small businesses.

2.09 Disabled Veteran Business Enterprise Participation Requirement and Incentive California state law requires that its state agencies achieve three (3) percent participation for disabled veteran business enterprises (DVBE) in state contracts. Failure of CM to achieve three (3) percent DVBE participation on this Project will cause the Trustees to assess a penalty in accordance with the Contract Documents. The CM shall comply with rules, regulations, ordinances, and statutes that apply to the California Disabled Veteran Business Enterprise Program as defined in Section 999 of the Military and Veterans Code, including, but not limited to, the requirements of subdivision (d) of https://www2.calstate.edu/csu-system/doing-business-with-the-csu/capital-planning-design-construction/Documents/bd_small_business_preference.docx https://www2.calstate.edu/csu-system/doing-business-with-the-csu/capital-planning-design-construction/Documents/bd_small_business_preference.docx https://www2.calstate.edu/csu-system/doing-business-with-the-csu/capital-planning-design-construction/Documents/bd_list_of_subcontractors_cmr_projects.docx

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Section 999.5 of the Military and Veterans Code.

The successful Proposer understands and agrees that the DVBEs identified on the List of Subcontractors for Design-Build and Collaborative Design-Build Projects form 701.04A.DB/CDB may only be replaced by another DVBE, and that the Trustees and the Department of General Services (DGS) must approve the substitution. DVBE subcontractors may only be awarded work if they are the lowest responsive bidder (or highest scoring bidder if the subcontractor is design-build/assist and selected using qualification-based selection). The CM may not assign points or use “bid leveling” to award trade packages to DVBEs that are not the lowest responsible bidder. Trustees will document changes to the scope of Work that impact the DVBEs identified in the GMP by Contract Change Order and will provide their decision on DVBE substitutions in writing via the subcontractor substitution process per Public Contract Code section 4100. DVBE suppliers, manufacturers, service providers, and other DVBEs that are not licensed contractors shall be listed on the expanded list of subcontractors, when submitted to the Trustees to authorize award of the bids.

Failure of CM to seek substitution and adhere to the DVBE participation level identified in its Proposal may be cause for Contract termination, recovery of damages under rights and remedies due the State, and penalties as outlined in Military and Veterans Code section 999.9, Public Contract Code section 10115.10 or section 4110, and California Code of Regulations, section 1896.73. In accordance with section 999.5 of the Military and Veterans Code, a person or entity that knowingly provides false information shall be subject to a civil penalty for each violation in the minimum amount of two thousand five hundred dollars ($2,500) and the maximum amount of twenty-five thousand dollars ($25,000).

a. Special Definitions

(1) “Disabled veteran” as used herein, means a veteran of the military, naval or air service of the United States, including, but not limited to, the Philippine Commonwealth Army, the Regular Scouts, “New Scouts,” and who has at least a ten (10) percent service-connected disability and who is domiciled in the State of California.

(2) “Disabled veteran business enterprise contractor, subcontractor, or supplier” means a person or entity that has been certified by the Office of Small Business & DVBE Services and that performs a “commercially useful function,” as defined below, in providing services or goods that contribute to the fulfillment of the contract requirements:

(a) A person or an entity is deemed to perform a “commercially useful function” if a person or entity does all of the following:

(i) Is responsible for the execution of a distinct element of the Work of the contract;

(ii) Carries out the obligation by actually performing, managing, or supervising the Work involved;

(iii) Performs Work that is normal for its business services and functions.

(iv) Is responsible, with respect to products, inventories, materials, and supplies required for the

Contract, for negotiating price, determining quality and quantity, ordering, installing, if applicable, and making payment; and

(v) Is not further subcontracting a portion of the Work that is greater than that expected to be subcontracted by normal industry practices.

(b) A contractor, trade contractor, or supplier will not be considered to perform a “commercially useful function” if the contractor’s, subcontractor’s, or supplier’s role is limited to that of an extra participant in a transaction, contract, or project through which funds are passed in order to obtain the appearance of disabled veteran business enterprise participation.

(c) Equipment Brokers

(i) A DVBE that rents equipment to the Trustees shall be deemed an equipment broker, unless one or more disabled veterans have 51-percent ownership of the quantity and the value of each piece of equipment. If the equipment is owned by one or more disabled veterans, each disabled veteran owner shall, prior to performance under any contract, submit to the Trustees a declaration signed by the disabled veteran owner stating that the owner is a disabled veteran and providing the name, address, telephone number, and tax identification number of the disabled veteran owner.

(ii) A DVBE that rents equipment to the Trustees shall, prior to performing the contract, submit to the Trustees a declaration signed by each disabled veteran owner and manager of the enterprise stating that the enterprise obtained the contract by representing that the enterprise was a DVBE meeting and maintaining all of the requirements of a DVBE. The declaration shall include the name, address, telephone number, and tax identification number of the owner of each piece of equipment identified in the contract.

(iii) State funds expended for equipment rented from equipment brokers pursuant to contracts awarded under this section shall not be credited toward the DVBE participation requirement.

(iv) A DVBE that is a broker or agent and that obtains a contract pursuant to these provisions shall, prior to performing the contract, disclose to the Trustees that the business is a broker or agent. The disclosure shall be made in a declaration signed and executed by each disabled veteran owner and manager of the enterprise, declaring that the enterprise is a broker or agent, and identifying the name, http://www.calstate.edu/cpdc/cm/forms/bid/bd_list_of_trade_contractors_db_cdb_projects.docx https://www2.calstate.edu/csu-system/doing-business-with-the-csu/capital-planning-design-construction/Documents/bd_list_of_trade_contractors_db_cdb_projects.docx

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(3) (a) DVBE as used herein, means a business concern certified by the Office of Small Business & DVBE Services as meeting all of the following:

(i) The business is:

at least 51 percent owned by one or more disabled veterans, or in the case of a publicly owned business, at least 51 percent of its stock is unconditionally owned by one or more disabled veterans;

a subsidiary that is wholly owned by a parent corporation, but only if at least 51 percent of the voting stock of the parent corporation is unconditionally owned by one or more disabled veterans; or a joint venture in which at least 51 percent of the joint venture’s management, control, and earnings are held by one or more disabled veterans.

(ii) The business is one or more disabled veterans who manage and control the daily business operations.

The disabled veterans who exercise management and control are not required to be the same disabled veterans as the owners of the business.

(iii) The business is a sole proprietorship, corporation, or partnership with its home office located in the United States, which is not a branch or subsidiary of a foreign corporation, foreign firm or other foreign-based business.

(b) Notwithstanding subdivision (3) (a), after the death or the certification of a permanent medical disability of a disabled veteran who is a majority owner of a business that qualified as a DVBE prior to that death or certification of a permanent disability, that business shall be deemed to be a DVBE for a period not to exceed three years after the date of that death or certification of a permanent medical disability, if the business is inherited or controlled by the spouse or child of that majority owner, or by both of those persons.

A business is a DVBE pursuant to this subdivision under either of the following circumstances:

(i) for the duration of any contract entered into prior to the death or certification of permanent medical disability for the sole purpose of fulfilling the requirements of that contract;

(ii) after the date of the majority owner’s death or certification of permanent medical disability established by this subdivision for the sole purpose of providing sufficient time to make orderly and equitable arrangements for the disposition of the business, except that the business shall not enter into any new contract as a DVBE for purposes of the program if the contract would not be completed within the three-year period.

b. Participation Requirement.

In order to satisfy and be responsive to this requirement, CM must meet the three (3) percent DVBE Participation requirement, which is attained when:

(1) CM is not a DVBE and is committed to use DVBE trade contractors for not less than three (3) percent of the

Contract dollar amount (including alternatives); or

(2) CM is a DVBE and is committed to performing not less than three (3) percent of the Contract dollar amount (including alternatives) with its own forces or in combination with those of other DVBEs.

c. Documentation Requirements.

CM must document its satisfaction of the DVBE participation requirement. Final determination of DVBE Participation by CM shall be at the Trustees’ sole discretion.

(1) Required Documentation.

In addition to documentation submitted with the GMP, on the List of Trade Contractors for CM at Risk Projects form (reference Article 2.05-c (2)), CM must complete the following DVBE documentation forms. Instructions for completing the required forms correctly are included to assist CM.

(a) DVBE Transmittal Form.

CM must fill out the DVBE transmittal form as a cover sheet to the required documents, attach and submit it and the additional required documentation. CM must complete all requested DVBE documentation on the forms provided and submit with the DVBE Transmittal Form.

(b) Summary of Disabled Veteran Owned Business Participation (Attachment 1).

CM must complete the Summary of Disabled Veteran Owned Business Participation, Attachment 1, showing the type of Work and company proposed for DVBE participation, their trade contractors (if any), and other related information.