131.5 Proprietary Items and Public Interest Findings

Key Points

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Public Interest Finding Letter

131.5.1 Introduction

131.5.1.1 Proprietary Items

Any patented material, specification, or process that can only be obtained from one manufacturer is known as a proprietary item. These items are generally identified by the use of a trade name. In the interest of promoting competition and allowing for the development of new products, neither FHWA nor MoDOT will participate in payment for any proprietary item, except in the following cases:

• MoDOT certifies the proprietary item is essential for synchronization with existing highway facilities and that no equally suitable alternative exists (requires a letter of public interest finding from the district office to the Central Office).
• The proprietary item is used for research or for a special type of construction on relatively short sections of road (requires a letter of public interest finding from the district office to the Central Office).
• Only proprietary items are acceptable, and at least three proprietary items are offered as alternatives (does not require a letter of public interest finding).
• The proprietary item is offered as an alternative to an equally suitable non-proprietary item (does not require a letter of public interest finding).
• FHWA finds the utilization of the proprietary item is in the public interest.

Use of the term “or equal” following the name of a proprietary item is permitted under terms of Missouri Standard Specifications for Highway Construction. However, use of the term “or equal” with a proprietary product name does not supersede the need to obtain a public interest finding. It is not necessary to obtain a public interest finding when at least three proprietary product names are listed in the proposal as possible sources for a specific item necessary to construct the proposed improvement. If less than three proprietary product names are mentioned in the job special provision, the term “or equal” will be used. Additionally, the specific characteristics of the proprietary product that is mentioned are to be included in the job special provision. Construction personnel can use this information to determine if the substitute product is indeed “or equal”. Examples of specific characteristics are the reflective properties of pavement marking tape, width and length of crashworthy end treatments, signal controller units that are compatible with existing units in the field or other applications in which the district core team can specifically name product characteristics. When requested by a contractor to approve the use of a substitute product based upon the “or equal” provisions contained in the JSP, construction field personnel will coordinate their response to this request with the district project manager. Approval by the Construction and Materials Division must be obtained prior to use of the substitute product.

Section 106.14 of the standard specifications outlines a procedure to follow in the event a proprietary item included in a project becomes unavailable during construction. The resident engineer will share the contractor’s request to use an alternative product with the district project manager (information is also to be shared with the originating work unit who requested the proprietary item be used) and by working together determine if it is acceptable. The contract unit price for this replacement item will need to be negotiated between MoDOT and the contractor. This unit price will be based upon market conditions. Cost for this item on previous MoDOT projects can be helpful in arriving at an appropriate “negotiated” unit price. In most cases the use of a nonproprietary item as a substitute for a proprietary item will result in a lower unit cost. However, in a few instances this might not be the case. If the cost of a substitute for a proprietary item is higher than the unit bid price for the proprietary item the additional cost of the item is not eligible for federal participation (23 CFR 635.411). Therefore, this higher cost will be the responsibility of the local (city, county, developer, etc.) entity, which requested the item be included in the project or MoDOT itself. If additional state funds are required to pay for the substitute item, an adjustment to future funding allocations to the district will be necessary.

131.5.1.2 Public Interest Findings

In order to demonstrate to FHWA and Design that the utilization of a proprietary item is in the public interest, the district must submit a letter of public interest finding to Design.

Any use of a proprietary item in a full oversight project as defined in the Federal-Aid Highway Program article will require FHWA approval of the Public Interest Finding. Design will submit the finding to FHWA. Use of a proprietary item on any other project will only require approval from Design.

To gain approval, the letter must include the brand name and manufacturer of the item in question as well as a detailed discussion of the factors that necessitate the item's use (synchronization with existing facilities, no equally suitable alternative is available, substantial cost savings, benefit/cost analysis when more than one proprietary item is available, etc.). This information must be supported by relevant figures and documentation, and will be as complete and detailed as possible. In order to expedite the processing of the request, the bid opening date must be included. A sample letter for submittal to the Design Division is available.

Design will notify the district of the decision that is made concerning the public interest finding.