BILL REQ. #:  S-1547.1 

Read first time 02/11/09.   Referred to Committee on Government Operations & Elections.

     AN ACT Relating to listing subcontractors on public works projects; amending RCW 39.30.060; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1   It is the intent of the legislature to ensure that the public bidding process be a fair and open one and to protect subcontractors against the possibility of bid shopping by requiring all prime contractors who bid on public works projects to include as part of their bid submittals a list of all subcontractors that the prime contractor will directly contract with on a public works project.

Sec. 2   RCW 39.30.060 and 2003 c 301 s 5 are each amended to read as follows:
     (1) Every invitation to bid on a prime contract that is expected to cost one million dollars or more for the construction, alteration, or repair of any public building or public work of the state or a state agency or municipality as defined under RCW 39.04.010 or an institution of higher education as defined under RCW 28B.10.016 shall require each prime contract bidder to submit as part of the bid, or within one hour after the published bid submittal time, the names of ((the subcontractors with whom the bidder, if awarded the contract, will subcontract for performance of the work of: HVAC (heating, ventilation, and air conditioning); plumbing as described in chapter 18.106 RCW; and electrical as described in chapter 19.28 RCW, or to name itself for the work)): (a) The first tier subcontractors who will perform work valued at fifty thousand dollars or more; and (b) all subcontractors who will perform work valued in excess of three hundred fifty thousand dollars. The prime contract bidder must list all subcontract work that it will perform.
     (2) The prime contract bidder shall not list more than one subcontractor for each category of work identified, unless subcontractors vary with bid alternates, in which case the prime contract bidder must indicate which subcontractor will be used for which alternate. Failure of the prime contract bidder to submit as part of the bid the names of such subcontractors or to name itself to perform such work or the naming of two or more subcontractors to perform the same work shall render the prime contract bidder's bid nonresponsive and, therefore, void.
     (((2))) (3) The public entity shall open all bids submitted by prime contract bidders, alternates, and subcontractors that are required to be listed under this section at the end of the published bid submittal time. Bids submitted by prime contract bidders and their subcontractors may not be opened separately.
     (4) Substitution of a listed subcontractor ((in furtherance of bid shopping or bid peddling)) before or after the award of the prime contract is prohibited, except as provided under subsection (5) of this section, and the originally listed subcontractor is entitled to recover monetary damages from the prime contract bidder who executed a contract with the public entity and the substituted subcontractor but not from the public entity inviting the bid. It is the original subcontractor's burden to prove by a preponderance of the evidence that bid shopping or bid peddling occurred.
     (5) Substitution of a listed subcontractor may only be made by the prime contractor for the following reasons:
     (a) ((Refusal of)) The listed subcontractor fails or refuses to sign a contract with the prime contractor after having a reasonable opportunity to do so. The contract must be a standard or master agreement customarily used by the prime contractor when contracting with subcontractors for projects in similar size and scope in the state of Washington;
     (b) ((Bankruptcy or insolvency of)) The listed subcontractor is bankrupt or insolvent;
     (c) ((Inability of)) The listed subcontractor is unable to perform the requirements of the proposed contract or the project;
     (d) ((Inability of)) The listed subcontractor is unable to obtain the necessary licenses, certifications, bonding, insurance, or to meet any other statutory requirements necessary to perform the work detailed in the contract; ((or))
     (e) The listed subcontractor is barred from participating in the project as a result of a court order or summary judgment;
     (f) The listed subcontractor has demonstrated a repeated history or pattern of being unable to successfully perform the work or meet the terms of public works subcontracts during the five years preceding the award of the contract;
     (g) The listed subcontractor fails to meet the requirements established in RCW 39.04.350 for responsible bidders;
     (h) The listed subcontractor is barred from bidding on or participating in the project as a result of a court order or summary judgment, or in accordance with the terms established in RCW 39.12.065(3);
     (i) The listed subcontractor did not include the entire cost of the subcontract in the bid submittal;
     (j) The listing of the subcontractor was due to an inadvertent clerical error;
     (k) The subcontractor who legitimately presented the lowest bid prior to bid opening was mistakenly not listed and the listed subcontractor was not the lowest bidder for the subcontract;
     (l) The listed subcontractor did not include the entire cost of the subcontract in the bid submittal; or
     (m) Good cause. Good cause includes, but is not limited to, the financial instability of a subcontractor.
     (((3))) (6) Nothing in this section may diminish the prime contractor's right to terminate a contract with a subcontractor for failure to meet the terms of the contract.
     (7) The requirement of this section to name the prime contract bidder's proposed ((HVAC, plumbing, and electrical)) subcontractors applies ((only)) to ((proposed HVAC, plumbing, and electrical)) subcontractors who ((will)) contract directly with the prime contract bidder submitting the bid to the public entity.
     (((4))) (8) A violation of this section entitles the prevailing plaintiff to recover damages. Any action brought pursuant to this section may be resolved through binding arbitration or in the superior court of the county in which the public work is located.
     (9) This section does not apply to job order contract requests for proposals under RCW ((39.10.130)) 39.10.420.