New Jersey DOT Contractor Performance Rating System Procedure
Pilot Program

Draft
Prepared by Quality Management Services

Performance Evaluations

Evaluation of work performed by the Contractor will be made to determine the Contractor's performance rating for each contract. The Contractor Performance Rating System will generate a Performance Rating of the Prime Contractor, which will:

• provide an objective and consistent method for measuring Contractor performance
• provide a beneficial effect on Contractor performance
• increase quality, cost effectiveness and efficiency of the construction process and the finished product
• provide the Contractor opportunities to improve job performance between rating periods

The Contractor Performance Rating System is based on objective data that will lead to fair and prudent ratings. The ratings provide the Department with essential information to be used to encourage and ensure the best quality product by awarding projects to the lowest responsible bidder that continually provides high quality work. The system is designed to recognize Contractors performing exceptional work, as well as identify Contractors repeatedly failing to perform satisfactory work.

Interim and Final Ratings

Every six months, the Resident Engineer will complete Interim Ratings for the project work executed to date and forward the rating to the Field Manager for concurrence.Subsequently, the rating and rating calculation forms will be submitted to the Regional Construction Office for processing.

Interim and Final Ratings will be prepared for all projects. Two Interim Ratings per year will be prepared for the duration of the project with due dates of January 1 and July 1. When a project is substantially completed within a six month period before due dates, the project rating will be completed and retained in the file until the appropriate due date (January or July); upon Final Acceptance of the project, the Final Rating will be completed by the rating review team as soon as practicable thereafter (i.e., independent of the regular due dates).

All projects will have at least one Interim Rating in addition to a Final Rating. Accordingly, for short duration projects, the rating period will be adjusted so that an Interim Rating is performed upon the Contractor's completion of 50% of the project.

Upon submission of an Interim Rating by a Resident Engineer, additional or revised ratings will not be accepted for the same six-month rating period. The Resident Engineer must therefore assure that all ratings are accurate and submitted to the appropriate Regional Construction office within two weeks of the close of the six-month rating period. A copy of the Interim Rating will also be forwarded to the Contractor, concurrent with the submission to the Regional Construction office.

Final Ratings will be completed immediately after Final Acceptance of the Project. A Rating Review Team consisting of the Resident Engineer, Department representatives from the Bureau of Construction, Operations, Quality Management Services, Construction Services/Procurement, and FHWA will meet to review and discuss project history and documentation and to determine the Final Rating. The Final Rating for the project will be considered the official performance rating.

The Final Rating for a Contractor will be utilized by the Department for pre-qualification status (see Ratings lower than Satisfactory (3.0).

Rating Key

The rating key for Contractor Performance Ratings will be:

5.0 = OUTSTANDING performance
4.0 = ABOVE SATISFACTORY performance
3.0 = SATISFACTORY performance
2.0 = BELOW SATISFACTORY performance
1.0 = UNACCEPTABLE performance

Rating Categories

Contractor performance on Department projects will be rated in the following four categories:

1. Progress Schedule
2. Safety/Traffic Control/Environmental
3. Contractor Project Management
4. Quality/Contract Compliance (Project Specific Rating Work Items):
   1. Earthwork/Grading
   2. Structures
   3. Paving/Bituminous Pavements
   4. Milling of Bituminous Pavement
   5. Paving/Concrete Pavements
   6. Drainage
   7. Landscaping
   8. Beam Guide Rail/End Treatments
   9. Electrical
   10. Traffic Stripes
   11. Signs
   12. Sheeting/Cofferdams
   13. *Etc.
   14. *Other subcategories may be added to the listing shown at a future date.

Category Weighting Criteria

Prior to the Start of Construction, the Contractor Performance Rating package (rating criteria, rating forms and checklists) will be discussed by the Contractor and the Resident Engineer to assure understanding by all parties. The rating forms will include the applicable category weight percentages to be applied to the rating (totaling 100 percent).

The applicable weight criteria indicated below will be used for all projects and WILL NOT modified with the exception of Category IV. Category IV and the subcategory weight criteria for each project will be determined prior to advertising by the NJDOT Bureau of Contract Administration Services based on the major work disciplines of the project.

The category weight criteria for all projects shall be as noted below and shall be applied to the Contractor Rating Form as shown:

Contractor Performance Checklists

The Contractor Performance Checklists will be completed by the Resident Engineer and/or project inspection personnel and will remain in the project file through completion of the contract. The Contractor Performance Checklists provide detailed information to be used by the Resident Engineer and Contractor in identifying non-compliance in methods, materials or performance that must be improved to provide acceptable quality. The level of importance of issued non-compliance notifications, as well as the frequency and duration of the notices, and resultant scoring of the other items of the checklists will be used to determine the Contractor Performance Rating ratings.

To maintain objectivity, the project specific Contractor Performance Check lists will be completed by the Resident Engineer and inspection personnel concurrent with the Contractor's execution of the work. Checklists will be completed by inspection personnel, as required, for a given work item. Any work item in non-compliance that will negatively impact project cost, schedule or duration will be photographed by inspection personnel and reported to the Resident Engineer. Upon submission of a checklist from inspection personnel indicating non-compliance, the Resident Engineer will immediately submit a Notice of Non-Compliance Form and checklist with the noted non-compliance item(s) to the Contractor. A Contractor receiving a Notice of Non-conformance Form may be required to submit a Corrective Action Plan, if noted on the Notice of Non-Compliance Form.

The Contractor Performance Checklists completed by Department personnel will be used as back-up data to substantiate the ratings. The documentation of problems and successes are an essential component of the rating system. The checklist and other documentation shall be used to provide reasoning for all ratings.

Documentation along with Interim Ratings should be used by the Contractor as a measure of project performance to date. The Interim Ratings will also provide the Contractor with the opportunity to make performance adjustments for future ratings during the construction of the project.

Rating Values

The following rating values will be applied to the Contractor Performance Rating Form to indicate Contractor degree of compliance (See Sample Contractor Rating Form) for the items noted:

Rating Values

Category IV Quality/Contract Compliance

Category IV Quality/Contract Compliance will consist of the project specific subcategories comprising the work disciplines or Project Specific Rating Work Items of the project. All performance evaluations for this category will vary based on the work items of the project. The NJDOT Bureau of Contract Administration will prepare and provide the project specific subcategories to be included in The Contractor Performance Rating for each contract.

The project specific Contractor Performance Rating package will be available to interested Contractors prior to bids and included as part of the bid documents. The project specific Contractor Performance Rating package will include:

• procedure for Contractor evaluations
• evaluation report forms
• evaluation checklists
• project rating work items
• Category IV (subcategory weights)
• Incentive provisions

Work performed by subcontractors will not be rated independently. The work of subcontractors will be rated and included in the Prime Contractor's performance evaluation.

A computer database will be developed to facilitate data entry, generation of reports, ratings and schedule tracking.

Calculation of Ratings

The Contractor Performance Rating will be determined from:

• Contractor Performance Checklists
• Notice of Notice of Non-Compliance Form
• Contractor Performance Rating Form
• Contractor Rating Calculation Form
• Project Documentation (correspondence, inspection reports, field diaries, etc.)

Contractor Performance Checklists along with documentation, severity of flagged items, as well as, frequency and duration of non-compliance will determine the Category Rating. The category weights will be applied to the Category Rating to determine the Contractor Rating. (See Contractor Rating Calculations Form page 10).

Use of the Ratings

With establishment of the Contractor Performance Rating System, the NJDOT Division of Procurement will take into consideration the Contractor Performance Ratings while determining Contractor pre-qualification. Further details concerning use of ratings relative to Contractor pre-qualification will be developed and released at a later date by the Division of Procurement.

The following data will be generated for each Contractor:

• Interim Rating six month rating.
• Final Rating final project rating.
• Discipline (Subcategory) Average- overall average of all projects in a discipline.
• Contractor Overall Average- - overall average of all projects in the system.

Ratings Lower than Satisfactory (3.0)

The Contractor shall provide a Corrective Action Plan for ratings lower than satisfactory (3.0), by letter to the Resident Engineer, enumerating the procedures/processes which the Contractor intends to institute to resolve the problems and issues causing the low rating. The Corrective Action Plan shall include procedures to prevent recurrence(s) of non-compliance and or quality issues and must be approved by the Resident Engineer.

Ratings lower than 3.0 will affect a Contractor's bid status with the Department in the following manner:

• The first occurrence of an Interim Category/Subcategory Rating lower than 3.0 will place the Contractor on probation.
• If the Contractor is placed on probation and receives a second Category/Subcategory Rating, that is lower than 3.0 for the same project, the Contractor will be suspended from bidding in the current work type or discipline of the project until the Contractor's rating is 3.0 or higher.
• At the conclusion of the suspension period, the Contractor will be reinstated on a probationary status and allowed to bid on Department projects.
• A Final Rating lower than 3.0, will preclude the Contractor from bidding on work in a specific work discipline for a period of one year.

Rating Review

The Contractor may request a rating review within 14 days from receipt of an Interim Rating that is lower than 3.0. The Contractor shall submit a written request to the Regional Construction Engineer within the 14-day period for a rating de-briefing meeting. The submitted request must include the Contractor's basis for the de-briefing. The Regional Construction Engineer will schedule the debriefing meeting; the debriefing will include review of the rating, rating justification(s) and Corrective Action(s) and required quality improvement(s) to be implemented.

The Resident Engineer and Field Manager along with the Contractor's Key Staff, which shall include the project Field Manager/Supervisor and a senior Administration staff member, will be required to attend the meeting.

Incentive Payment

An incentive payment for above satisfactory performance will be included in the Special Provisions for each project based on the overall project bid amount and the following:

Sample Contractor Rating Calculation Form

IV - Quality / Contract Compliance Rating Calculation

Contractor Performance Rating
Categories I - III

* "All other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
Category IV

*Refer to Contractor Rating Calculation Form

**The type of work items and weights for these items will be assigned on a project to project basis.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Earthwork/Grading

*average will be taken, except when degree indicated is lower than the lowest degree shown will be used for the subcategory.

* "All - other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Paving - Bituminous

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All - other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Milling

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All - other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Paving - Concrete

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All - other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Structures

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All - other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Drainage

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All - other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Electrical

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All - other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Beam Guiderail/End Treatments

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All - other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Landscape

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Traffic Stripes

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.

Contractor Performance Rating
IV. Quality/Contract Compliance
Subcategory: Signs

*average will be taken, except when degree indicated is lower than 3, the lowest degree shown will be used for the subcategory.

* "All other requirements of the Contract Documents" are defined as the items of the Contractor Performance Checklists rated, and considered by their level of importance relative to the project.