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PMU Launches Bidding Process for Three New Schools in Pohnpei

Palikir, Pohnpei (FSM Information Services): July 2, 2010 - On June 24, 2010, the FSM Program Management Unit (PMU) held a pre-bidding meeting with 8 local construction companies, 2 local insurance companies, representatives from Pohnpei State Government, and the Principals from the Nett, Saladak and Sapwalap schools. The Project range is from $1 to $5 Million. PMU presented their bidding instructions for the construction of one new school in each of these municipalities.

Marcelino Actouka, PMU Contracting Officer, welcomed all participants and introduced Gary Wiggins, PMU Contracting Officer Representative, to outline the bidding instructions that the construction companies will have to comply with to take part in the selection process. In his presentation, Wiggins spotlighted an amendment to the bonding requirements usually expected for these type of projects: the issuance of a performance bond and a payment bond, both for 100% of the original contract price.

All contractors present at the meeting expressed their dismay regarding the new bonding requirements, they explained that none of them had been able to obtain such bonds locally. Larry Adams of ABCOR Engineering & Construction, as an example, stated that for a $3,000,000 project, one insurance company had asked him to deposit $1,000,000 in an escrow account for the issuance of a performance bond. Adams said it represented a cost he could not afford, nor he believes, can any other company in Pohnpei afford it.

Actouka explained that the US Department of the Interior (DOI) had passed this requirement as a result of certain FSM construction projects not having been successfully completed. In addition, by imposing such a stringent requirement, Actouka said that DOI is hoping local construction companies, in order to obtain bonding, will come to terms with the need to prepare adequate audited financial statements, as well as a proven history of project completion.

Actouka advised that if none of the local contractors could obtain bonding, that in itself will assist PMU in future negotiations with the DOI and maybe allow for waiver requests on a case-by-case basis. Currently two unbonded local companies, VCS and PLEC, are completing three school buildings located at Kolonia Elementary School, Nanpei Memorial School, and Madolenihmw High School. These schools are scheduled to be completed in August 2010.

The bidding period for the school construction projects closes on August 10, 2010, at 4PM, and the award notification is planned for August 25, 2010.

For more information, please contact programmanagementunit@pmu.fm or Gary Wiggins at (691)320-2080 or by e-mail at garywiggins@pmu.fm.