Senator Neal Hunt, Chair, and Representative Dean Arp, House Co-Chair, helm the Purchase and Contract Study Committee, which is currently considering prequalification reform in North Carolina.
Statutes governing the procurement of public construction contracts are intended to promote honest and open bidding procedures, thereby placing interested contractors on an equal footing when competing for the work. A Pennsylvania court observed way back in 1908 that it is the duty of public awarding authorities “to see that the purposes aimed at by the laws shall be effected in good faith.”
Many contractors are skeptical that standard is being met in North Carolina.
As I’ve previously written, a number of prime contractors recently testified before the General Assembly’s Purchase and Contract Study Committee about how the statute permitting prequalification of bidders is often misused so that certain contractors are favored over others, particularly in the construction management at-risk context. The opportunity for misuse arises from the utter lack of any statutory direction for exercising the right to prequalify under existing law (click image below for larger version):
Thankfully, the Committee appears ready to recommend extensive and significant modifications to this bare-bones statute.
With last year’s passage of House Bill 857 in the North Carolina General Assembly, public contracting agencies in the Tar Heel State have no shortage of project delivery methods from which to choose. From design-bid-build to construction management at-risk, design-build, design-build bridging and P3s, our state statutes now authorize a veritable cornucopia of options for procuring public construction contracts.
But the following tweet from ENR’s Tom Sawyer earlier this week got me wondering: is the state overlooking another viable procurement option?
This past summer, the N.C. General Assembly passed and Governor McCrory signed into law groundbreaking legislation authorizing the use of design-build, design-build bridging and public-private partnerships in the delivery and financing of public construction projects in the state. The legislation is sure to alter North Carolina’s public procurement landscape drastically and influence the complexion of the state’s construction industry, particularly at the design and prime contractor levels.
Last Wednesday, October 23, I attended an excellent panel discussion covering key aspects of House Bill 857 (“HB 857”) sponsored by Carolinas AGC Foundation, AIA North Carolina (@AIA_NC), the Professional Engineers of NC (@ProfEngNC), United Minority Contractors of North Carolina and the American Council of Engineering Companies of North Carolina. Based on that discussion and my own review and analysis of the legislation, here are my top ten observations:
A bill was introduced in the North Carolina Senate yesterday that would give “local” bidders on public construction projects an advantage over “non-local” bidders. A copy of Senate Bill 232 can be found here.
SB 232 would give the lowest responsible, responsive “local bidder” the opportunity to match the bid of the lowest responsible, responsive “non-local” bidder, but only if the local low bid is no greater than five percent (5%) or ten thousand dollars ($10,000) of the bid of the “non-local” low bid. “Local bidder” would be defined as a bidder that has paid unemployment or income taxes in North Carolina and whose principal place of business is located within the boundaries of the county or municipality giving the preference. A “non-local bidder” would be any entity other than a “local bidder.” Continue reading