Are your Public Works Agreements Up To Date?

POST DATE: 7.27.17
Ccha  Government

Recent Indiana General Assembly sessions have made significant changes to public bidding requirements and have affected how projects are bid and administered. Some of the most notable statutory changes are the repeal of the common construction wage and the requirement that certain contractors must prequalify with the State.

Regarding the common construction wage, unless federal or state law provides otherwise, a public agency may not include a wage scale for a public works contract. Keep in mind that some federally funded projects could override this provision. If your project has federal funding, be aware of wage scale provisions and what you are required or prohibited from doing.

Another piece of legislation is the requirement that as of December 31, 2016 certain contractors in each tier must qualify with the Indiana Department of Administration (“IDOA”) or the Indiana Department of Transportation (“INDOT”). However, material suppliers and contractors with agreements under a certain threshold are not required to prequalify. Contractors doing any work on a public works project are exempted from the prequalification requirement when (1) the amount of the contract awarded to the contractor for work on the public works project is less than $300,000; and (2) the public agency complied with public works bidding laws.

In addition to the prequalification changes, public units should be aware that Tier 1 and 2 contractors who work on public works projects and employ ten or more employees must provide access to a training program that is approved by I.C. § 5-16-13-12(c). Also, Tier 1 and 2 contractors who employ fifty or more journeyman, must participate in an apprenticeship or training program and meet the standards set forth in I.C. § 5-16-13-12(d).

Finally, some of the last legislative changes that are now effective are payroll and reporting requirements. Contractors, regardless of tier, who are awarded Public Works contracts after June 30, 2016 must preserve payroll and related records for three years after completion of the project work and must make these records open to inspection by the Indiana Department of Workforce Development. When a public agency suspects that a contractor, regardless of Tier, misclassified one or more workers working on the public project is required to provide the department of workforce development information concerning the misclassification. The department of workforce development may then elect to investigate.

In addition to the changes above, Indiana Code 5-16-13 contains other statutory requirements that must be included in all public works contracts. These requirements range from contractor duties and qualifications to compliance with other state laws. Keep all of these changes in mind when your public agency is vetting a public works project and make sure that your agreements reflect the most current state law requirements. If you are a contractor bidding on public works projects make sure that you are aware of all of the requirements. For additional information regarding the legislative changes, or if you need assistance amending your contract forms to reflect these changes, contact CCHA.