HOUSE OF REPRESENTATIVES

                      Olympia, Washington

Bill Analysis      Bill No. HB 2974

Regulating Competitive Bidding on Public Contracts   Hrg. Date: 2/4/98 

Brief Title

Reps. D. Schmidt/Scott                                    Staff Contact: Steve Lundin

Sponsor                                    Comm. on Govt. Admin.

                                           Phone: 786-7127

BACKGROUND:

Each invitation to bid on a contract for the construction, alteration, or repair of a public building or public work, that is expected to cost in excess of $100,000, must require a bidder to submit the name or names of every subcontractor who is proposed to be used if the subcontract amount is more than 10 percent of the total bid price.  The bidder must include the subcontractor names as part of the bid or within one hour of the published bid submittal time.  Failure to name each of these subcontractors renders the bid nonresponsive and void.

SUMMARY:

Requirements are altered for contractors to name subcontractors they intend to use as part of a bid submitted for the construction, alteration, or repair of a public building or public work with an expected cost in excess of $100,000.

1.Naming subcontractors in a bid.

A contractor submitting such a bid is required to name each subcontractor who will perform the following work:  (1) Any work described in Aconstruction specification institute division 15" of the contract specifications; (2) any work described in Aconstruction specification institute division 16" of the contract specifications; and (3) any subcontract amount that is more than 15 percent of the bid price.

[Construction specification institute divisions 15 or 16 are not defined in Washington State statute or administrative rule.]

The naming of two or more subcontractors for the same work renders the bid nonresponsive and void.

                                                     Continued

HB 2974 - Page 2

2.Substituting subcontractors for named subcontractors.

A contractor who has been awarded a contract for a public works or repair project may not substitute another subcontractor for a subcontractor named in the bid, except in certain circumstances.  A subcontractor may be substituted if the awarding authority objects to the subcontractor and requests in writing a change.  In addition, the awarding authority may approve a substitution if:

oThe subcontractor fails or refuses to execute a contract with the bidder within a reasonable time, if the terms were offered to the subcontractor that were similar to terms offered all other subcontractors on the project;

oThe subcontractor files for bankruptcy or becomes insolvent;

oThe subcontractor does not perform within a reasonable time;

oThe subcontractor does not furnish a performance bond and payment bond, if the subcontractor agreed in writing to furnish the performance and payment bond;

oThe bidder demonstrates to the awarding agency that a subcontractor was listed as a result of a good faith, inadvertent clerical error;

oThe subcontractor is not registered as a contractor or electrical contractor; or

oIf the bidder determines that the work performed by the subcontractor is substantially unsatisfactory and not in substantial accordance with plans and specifications, or that the subcontractor is substantially delaying or disrupting work progress.

Any bidder who substitutes a subcontractor in violation of these requirements is liable to the named subcontractor in the amount of 10 percent of the substantiated subcontractor=s bid price or subcontract price.  Legal action to enforce these requirements shall be brought in the superior court where the work is to be performed and the prevailing party is entitled to reasonable attorneys= fees, costs, and disbursements.

FISCAL NOTE:  Not requested.

EFFECTIVE DATE:  Ninety days after adjournment of session in which bill is passed.