Posts Tagged ‘Mike Purdy’

Ignorance of Law Can Cost You Debarment on Federal and State Construction Projects

On May 25, 2011        

I recently came across an interesting blog post on Mike Purdy’s Public Contracting Blog that includes a report by the Washington State Department of Labor & Industries releasing an updated list of debarred contractors in Washington.  The post itself highlights the hugely important issue of contractor debarment that every state or federal contractor should be aware of.

Basically, if you significantly violate certain laws as a contractor on a state or federal construction project (i.e. prevailing wage laws and workers’ compensation laws), you may be debarred and no longer allowed to work on a state or federal construction project. Pretty serious stuff.

Debarment may last until all penalties are paid in full or, if those laws are violated on numerous occasions, a contractor might be debarred for a period of years on top of monetary fines.

The report by the Washington State Department of Labor cited above provides folks with some concrete data on this issue so we can all better understand what most frequently causes debarment. The report includes the names of all Washington State contractors who are debarred, why they were debarred, how long they are debarred for, and whether or not their penalties have been paid.

Though this report only regards debarment by Washington State authorities for Washington State projects, each state has its own annually updated list you can refer to online, as does the federal government. All in all, they look a lot like the Washington list.

So, most importantly, how can public contractors avoid debarment? The answer here I can give you: focus on prevention.

First, be certain that you are not violating any prevailing wage laws, workers’ compensation laws, contractor registration laws, apprenticeship requirements, and/or industrial insurance laws. Read up on the laws yourself if possible (we have some information about state and federal contracting laws on this blog), or hire a lawyer to help you.  In the long run, the money you spend with an attorney to understand and accommodate these legalities will be worth it.

Second, check the relevant state or federal list of debarred contractors to make sure you’re not signing a contract with a debarred contractor or subcontractor.

Finally, keep meticulous records and be extra careful to make sure you are complying with these laws.

Doing whatever it takes to keep your contracting business alive and thriving is key here, so make sure to remain proactive.

Posted in:     Prevailing Wages, State & Federal Contracting  /  Tags: , ,   /   Leave a comment

How To Get Your Small Contracting Business Considered for King County Public Works Projects

On November 4, 2010        

Not every public works contract is worth millions of dollars…and legislatures across the country (including the U.S. Congress) is interested in giving some public work to small and/or minority contractors.

An example of this public interest can be found in RCW 39.04.155, which establishes “small works roster contract procedures” for Washington counties.    This statute authorizes counties to create a “roster” of qualifying small contractors.   When a public works project fits the bill (is less than a certain amount of money), the county can submit the project to a contractor on the roster…as opposed to advertising the project and accepting bids.

This statute gives counties the authority to create a small works roster – it does not required it.

Relying on §39.04.155, King County has established a construction roster for small contractors.   Thanks to Mike Purdy’s Public Contracting Blog for pointing this out with his October 26th blog post:  County Establishes Construction Roster for Small Contractors.

The “Limited Public Works Roster” is explained on King County’s website here.   Here is a snippet that really explains how the roster will work in King County:

Public Works projects estimated to cost less than $35,000 may be awarded using the Limited Public Works Roster process in accordance with the Revised Code of Washington. These projects are not advertised in the newspaper. Instead where possible, a minimum of three contractors on the Roster are invited to bid for each project. These bidders are then rotated, so that all bidders in a trade category are invited to bid before any bidder receives a second invitation to bid.

Do You Qualify? The first question to ask is whether your company qualifies as a small contractor to get on this roster.    To be eligible for inclusion in the King County Limited Public Works Roster, a contractor must have either:  (i) gross revenues under $250,000 annually as reported on their Federal Tax Returns; or (ii) gross revenues under $1,000,000 annually as reported on their Federal Tax Returns.

So, what’s the difference between companies with less than $250k revenue and those with less than $1m revenue?

It’s not entirely clear.   As Mike Purdy explains:

It’s unclear to me how the County intends to use these two categories, especially since there doesn’t appear to be authority to restrict competition to contractors with revenues less than $250,000, but only to “encourage” these firms to submit bids.

How Do You Get On The Roster? This is easy.  You just provide all the information requested in the Limited Public Works Roster Application Form, which you can download from the King County website at this link.

Posted in:     Bidding, State & Federal Contracting, Washington  /  Tags: , , , ,   /   Leave a comment

Joint Ventures and Contractor Licensing – Not A Simple Topic

On August 24, 2010        

You’re looking to work on a construction project…but you don’t have a license.   Surprisingly, this happens quite often.

Perhaps you’re to the industry, or a company trying to work in a neighboring state to take advantage of an opportunity there.   Before you prepare a bid or sign a contract, the first order of business is getting legal.    And depending on where you are, that usually means becoming a licensed contractor.

When our office is approached with these types of situations, we’re frequently asked if a “joint venture” with a licensed contractor can resolve any licensing deficiencies with the unlicensed party.   The answer to this question depends on where you are, and the circumstances of the project.

In the past, we’ve highlighted Mike Purdy’s Public Contracting Blog (it’s an excellent resource on prevailing wage and public contracting issues – previous posts here).   Last week, Mike discussed this interesting and popular question on the contractor licensing requirements for joint ventures.

His post focuses on Washington law.    In Washington, RCW 18.27.065 provides as follows:

A partnership or joint venture shall be deemed registered under this chapter if any one of the general partners or venturers whose name appears in the name under which the partnership or venture does business is registered.

The key here, as Mike points out in his well-written blog post, is whether the registered member of the venture is in the JV’s name.

Louisiana’s contractor licensing law treats this situation exactly opposite from Washington.    Here is a snippet from the Louisiana State Board of Contractor’s website, on their FAQ page:

I want to do a joint venture with a licensed Louisiana contractor. How does that work?

All parties in a joint venture are required to be licensed at the time the bid is submitted. Each party to the joint venture may only perform within the applicable classifications of the work of which he is properly classified to perform (Section 1103 of the Rules and Regulations of the Board).

So indeed, where you are is critical to the question of whether you can or cannot by-pass contractor licensing or registration requirements by partnering with a registered company.

And this becomes another example of how working on a construction project in one state can be legally much different than working in another state.   What are some of the other examples?    How state laws treat Pay When Paid Clauses, and the different requirements for Mechanic Liens and Preliminary Notices.

Posted in:     Licensing  /  Tags: , , , , ,   /   Leave a comment

Great Resources on Louisiana Construction Law

On June 8, 2010        

I spent a great deal of time over the past five years working hard to provide the Louisiana building industry with a comprehensive construction law resource.   The by-products of that work is this blog, along with our topic and location specific blogs:  Louisiana Construction Law Blog, the Louisiana Green Building Law Blog, and the Chinese Drywall Blog.

But, of course, I’m not the only game in town.   And I couldn’t possibly be.   There are tons of other great blogs and resources out there for folks to stay abreast on construction law issues.   In fact, I subscribe to all of these blogs and resources and get a lot of information from them.

Here are some of my favorites:

-  Louisiana Law Blog.   Not updated often, but whenever something is posted, it’s something worth reading.   Published by the KeanMiller firm, the only downside here is that the posts aren’t always about construction law issues.   It’s more of a general blog that touches on construction law issues.

- Louisiana Construction Law Blog on Blogspot.  Aside form our firm, this is the only other firm that blogs exclusively about Louisiana Construction Law.   Their blog, while new, is also very resourceful, and they are doing a great job of blogginThis article was originally posted on Wolfe Law Group’s topic-specific Louisiana Construction Law Blog.g about issues that affect Louisiana contractors.

- Mike Purdy Public Contracting Blog.  Not a blog specifically about Louisiana issues, but there is plenty here that can help a Louisiana contractor who does public construction work.

- Shields Mott Lund Newsletters.   While not a blog, and a bit reminiscent of how newsletter content was disseminated by law firms in the 1980s, there’s no denying that once you find this information, it is good.

- Louisiana State Board of Contractors Announcements.   Not only is the board’s website a good place to find information on the state’s licensing requirements, but they also have an “announcements” page, where they sometimes alert folks to changes in the law that affect the construction industry.

This article was originally posted on Wolfe Law Group’s topic-specific Louisiana Construction Law Blog.

Posted in:     Around The Web  /  Tags: , , , , , , , , , ,   /   Leave a comment

New Orleans Declares Felons Not Responsible Bidders on Public Projects and Washington Contemplating Similar Rule

On May 25, 2010        

Mike Purdy’s Public Contracting Blog is so awesome, he got to this unique story that touts a legal link between Seattle, WA and New Orleans, LA before I could.    Before getting to the article, let me comment that if your company does public contracting work anywhere in the nation, Mike Purdy’s blog is going to consistently feed you very relevant information on the topic.   I highly recommend you check it out, and subscribe to his feed.

With that said, what article am I talking about?

Well, if you’re from the New Orleans area you likely remember the spat between former Mayor Ray Nagin and the city council about whether convicted felons are considered “responsible bidders” on city contracts.    After the fight, the vote, the veto, and the veto override, an ordinance (Ordinance Calendar No. 27,892) was adopted designed to stop the city from awarding contracts or grants to folks convicted of felonies in the previous 5 years.

Defining “Responsible Bidder”

What is a “responsible bidder?”   Nearly every state and city’s public bid laws use the term, allowing government entities to award contracts only to “responsible bidders.”    This interesting question of just what makes a bidder “responsible” was squarely in dispute between the New Orleans mayor and city council.

In the mayor’s veto message, he wrote that “under Louisiana law, responsibility [refers to] likely contractor performance, not the conviction history of a contractor’s principals, members and/or officers.”

Council-member Stacey Head lead the fight against the mayor for the council, arguing that responsibility does refer to the qualifications of the bidder him/her/itself, and not simply whether the contractor is likely to perform.    In her veto-override press release, she quotes the Louisiana Attorney General and Louisiana Supreme Court on the subject.

The AG states that “responsibility refers to the character or quality of the bidder – whether it is an entity with which you are safe doing business.”   Understanding Public Bid Law, Michael J. Vallan, Assistant Attorney General, February 20, 2008.

The Supreme Court allows an municipality to look at “financial ability, skill, integrity, business judgment, experience, reputation…and other similar factors bearing on the bidder’s ability to successfully perform the contract.”  Louisiana Associated General Contractors v. Calcasieu Parish School Board, 586 So.2d 1354 (La 1991).

Ordinance Cal. No. 27-892

So, what does this ordinance say?   Simplly, it prohibits the city from contracting with certain felons.   Here is the precise language:

[Prohibits City from contracting with] any person, corporation, or entity, whose principal(s), member(s), and/or officer(s) have within the preceding five years been convicted of, or pled guilty to, a felony under state or federal statutes for embezzlement, theft of public funds, bribery, falsification or destruction of public records.

The ordinance does not cast a terribly wide net, and so it’s surprising that this caused any controversy at all.    The City is not restricted from contracting with any felons, only those who committed a felony that has some sort of public-corruption element.

Responsible Bidder Criteria Important in Washington and Elsewhere

New Orleans is not the only place examining the criteria of a “responsible bidder” in public bid law.  As Mike Purdy points out in his post, bidder responsibility is a hot topic in Washington, where a task force was created by the Capital Projects Advisory Review Board (CPARB) to “address concerns by contractors of how public agencies are using responsibility criteria.”

tThe CPARB has released Guidelines on Bidder Responsibility (check them out, and the CPARB page here).   The criteria guidelines released by CPARB are much broader than the New Orleans ordinance, requiring consideration of things like delinquent state taxes, on-going lawsuits and the like.

One difference between the “Guidelines” and the “ordinance” is, of course, that the New Orleans ordinance actually prohibits a class of persons from being considered a responsible bidder, while the guidelines only offers suggestions as to what municipalities should consider when selecting a responsible bidder.    Will Washington take the next step and mandate the elimination of certain bidders?   Mike Purdy points out that they have the power:

Under RCW 39.04.350, a public agency in Washington State could establish Supplemental Bidder Responsibility Criteria similar to the New Orleans measure on not contracting with firms whose owners are convicted felons.   The Task Force on Bidder Responsibility will hold its second meeting on May 20, 2010.

Posted in:     Louisiana, Miller Act Claims, Regulations, State Bond Claims, Washington  /  Tags: , , , , , , , ,   /   Leave a comment
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