2007 Legislation Affecting Public Works Contracting & Purchasing

Contents

• Introduction
• Training/Workshops
• Legislation
• Presentations (APWA - CASC & MRSC, June, 2007)

Introduction

While there were several bills proposed in the 2007 legislative session that would have impacted purchasing, bidding, and public works contracting for a number of local governments, the following 6 are the only bills that passed the Legislature: SHB 2010, SHB 1328, HB 1370, SSHB 1506, ESSB 5770, EHB 1898 and SB 6075. As of May 5 2007, the Governor had not signed SSHB 1506, ESSB 5770, or EHB 1898.

SHB 2010 and SSHB 1506 have the biggest impact and for a larger number of agencies than the other bills. SHB 2010 amends Ch. 39.04 RCW and adds a new section defining basic statutory responsibility requirements for public works contracts (see below) and is effective July 22, 2007. SSHB1506 establishes the Capital Projects Advisory Review Board (CPARB) to advise the Legislature on alternative public works procurement and bidder responsibility issues and reauthorizes the use of GC/CM and other alternative public contracting methods. This legislation will take effect July 1, 2007.

Training/Workshops

The Associated General Contractors and the University of Washington are offering training on the changes (SSHB 1506) to the GC/CM law. These classes are scheduled at the Lynnwood Convention Center & Seattle AGC Building: Days 1 & 2 - May 16 & 17 and Days 3 & 4 - May 30 & 31 or Sept. 12 & 13. Cost: (lunch included each day): Day 1 only: $100, Day 1 & 2: $150, All 4 days: $350. See the following link for information about the class: http://www.agcwa.com/Public/education/gs_class_flyers/GC.CM4day.pdf

MRSC and APWA (CASC) have scheduled mini-workshops that will cover all six bills that passed the legislature, with emphasis on SHB 2010, SHB 1328, and SSHB 1506. These classes are from 10 a.m. to 2:30 p.m. on June 12th in Everett, June 21st in Renton, and June 27th in Camas. Classes are free. Registration will be available in mid-May at http://www.apwa-wa.org/training/training.aspx

MRSC has contracted with Washington State Technology Transfer Center (WST2) to provide four one day workshops:
Purchasing, Bidding and Contract Management for Local Agencies: $75.
http://www.wsdot.wa.gov/TA/T2Center/Training/PBBrochure2007.pdf
    June 7, 2007 - Yakima
    September 13, 2007 - Vancouver
    October 9, 2007 - Spokane
    November 14, 2007 - Shoreline
These workshops will incorporate the 2007 legislative changes into the presentations.

Legislation

Legislation Contents:

• SUBSTITUTE HOUSE BILL 2010 - RESPONSIBLE BIDDER CRITERIA
• SUBSTITUTE HOUSE BILL 1328 - SMALL WORKS ROSTER CONTRACTING PROCEDURES
• HOUSE BILL 1370 - PUBLIC WORKERS--PREVAILING WAGES
• SECOND SUBSTITUTE HOUSE BILL 1506 - CHANGING ALTERNATIVE WORKS PROVISIONS
• ENGROSSED SUBSTITUTE SENATE BILL 5770 - CHANGING PUBLIC WORKS PROVISIONS FOR INSTITUTIONS OF HIGHER EDUCATION
• ENGROSSED HOUSE BILL 1898 - APPRENTICESHIP UTILIZATION REQUIREMENTS ON SCHOOL DISTRICT PUBLIC WORKS PROJECTS
• SB 6075 - INCREASING COMPETITIVE BID LIMITS FOR THE PURCHASE OF MATERIALS, EQUIPMENT, OR SUPPLIES (COUNTIES)
• Purchasing and Bidding Chart for Local Agencies in Washington State

SUBSTITUTE HOUSE BILL 2010 - RESPONSIBLE BIDDER CRITERIA

    Chapter 133, Laws of 2007
    Effective Date: 07/22/2007

Brief Description:
    Providing responsible bidder criteria and related requirements for public works contracts.

Documents:
    Session Law
    Senate Bill Report
    House Bill Report

RCW Sections Affected:
AN ACT relating to bidder responsibility; amending RCW 39.04.010 and 39.04.155; adding a new section to chapter 39.04 RCW; and adding a new section to chapter 39.06 RCW.

Summary of Substitute Bill:
Responsible bidder is defined for purposes of public works contracts. In order to be considered a responsible bidder, the bidder must have a certificate of registration at the time of bid submittal; a current state unified business identifier number; and if applicable, industrial insurance coverage for the bidder's employees working in Washington, an Employment Security Department number, and a state excise tax registration number. In addition, the bidder must not be disqualified from bidding on any public works contracts. A state or municipality may adopt relevant supplemental criteria for determining bidder responsibility that is applicable to a particular project. Any supplemental criteria must be included in the invitation to bid or the bidding documents. At the request of a potential bidder, and after evaluation by the state or municipality, the bid criteria may be modified. If a change in criteria results, an addendum to the bidding documents must be issued identifying the new criteria.

If the state or municipality determines that a bidder is not responsible, it must provide the bidder the reasons, in writing, for that determination, and must provide the bidder an opportunity to provide additional information. If the final determination is that the bidder is not responsible, the state or municipality cannot execute a contract with another bidder until two business days have elapsed since the final determination was received by the bidder.

Public works contractors and subcontractors must verify that any subcontractors they directly hire meet the responsibility criteria for the project at the time of award. Verification that a subcontractor have an electrical contractor license or an elevator contractor license, if required by statute, must be included in the verification process.

The Capital Projects Advisory Review Board (see SSHB 1506) is to develop guidelines to assist the state and municipalities in developing supplemental responsibility criteria. For purposes of public works contracts, "award" is defined as the formal decision by the state or municipality notifying a responsible bidder with the lowest responsive bid of the state or municipality's acceptance of the bid and intent to enter into a contract with the bidder.

SUBSTITUTE HOUSE BILL 1328 - SMALL WORKS ROSTER CONTRACTING PROCEDURES

    Chapter 210, 2007 Laws
    Effective date: 07/22/2007

Brief Description:
    Concerning small works roster contracting procedures.

Documents:
    As Passed Legislature
    Senate Bill Report
    House Bill Report

RCW Sections Affected:
AN ACT Relating to small works roster contracting procedures; and amending RCW 39.04.155, 60.28.051, 39.08.010, and 39.12.040.

Summary of Substitute Bill:
A state agency or authorized local government may use the limited public works process to solicit and award small works roster contracts to small businesses that are registered contractors with gross revenues under $1 million annually as reported on their federal tax return.

A state agency or authorized local government may adopt additional procedures to encourage small businesses that are registered contractors with gross revenues under $250,000 annually as reported on their federal tax returns to submit quotations or bids on small works roster contracts.

The alternative administration of the prevailing wage contract requirement that applies to public works projects of $2,500 or less applies to public works projects under $35,000 that use the limited public works process found in RCW 39.04.155 (3).

The reporting threshold to the Department of Revenue under RCW 60.28.051 is raised from $20,000 to $35,000. In RCW 38.08.010, the threshold for the contractor option for retainage has been raised to $35,000 from $25,000.

MRSC Project Closure/Retainage Release Guidelines (Effective 07/22/2007)
This chart describes requirements for retainage, bonding and prevailing wages for public works contracts and items need before release of retainage.

HOUSE BILL 1370 - PUBLIC WORKERS: PREVAILING WAGES

    Chapter 169, Laws of 2007
    Effective date: 07/22/2007

Brief Description:
    Regarding public workers excluded from prevailing wages on public works provisions.

Documents:
    Session Law
    Senate Bill Report
    House Bill Report

RCW Sections Affected:
AN ACT Relating to public workers excluded from prevailing wages on public works provisions; and amending RCW 39.12.020.

Summary of Bill:
Governmental employees are specifically excluded from the application of the prevailing wage statute regardless of how often the employee is paid. As a result, governmental employee wages will not be included in surveys to determine the prevailing wage rate in the locality where the work is performed.

SECOND SUBSTITUTE HOUSE BILL 1506 - CHANGING ALTERNATIVE WORKS PROVISIONS

    Effective date: 07/01/2007 [Except for Section 108, Project Review Committee- Project Approval Process, which takes effect upon passage.]

Documents:
    As Passed Legislature
    Senate Bill Report
    House Bill Report

RCW Sections Affected:
AN ACT Relating to alternative public works; amending RCW 39.10.010, 39.10.020, 39.10.800, 39.10.810, 39.10.080, 39.10.070, 39.10.130, 39.10.120, 60.28.011, and 70.150.070; reenacting and amending RCW 39.10.051 and 39.10.061; adding new sections to chapter 43.131 RCW; adding new sections to chapter 39.10 RCW; recodifying RCW 39.10.010, 39.10.020, 39.10.800, 39.10.810, 39.10.051, 39.10.080, 39.10.070, 39.10.061, 39.10.130, 39.10.100, 39.10.090, 39.10.120, 39.10.900, and 39.10.901; repealing RCW 39.10.902, 39.10.030, 39.10.040, 39.10.063, 39.10.065, 39.10.067, 39.10.068, 39.10.115, and 39.10.117; providing effective dates; and declaring an emergency.

Summary of Bill: