Federal government contracting comes with a myriad of challenges, not the least of which are sometimes opaque procedures for getting paid (or taking action if you’re not getting paid). A bill has just been introduced in the House of Representatives that would help simplify that process, especially for smaller contractors. The legislation, H.R. 2350, the “Small Business Know-Before-You-Bid Construction Transparency Act of 2017,” would require a federal agency to:
- Include in its requests for proposals or invitations for bid on federal construction projects likely to be performed by small businesses any clear information on its policies and procedures for processing requests for equitable adjustment (i.e., change orders). This bill would provide prospective federal construction contractors and subcontractors with information they need to factor into their bids and offers to the federal government the risk and resulting cost of delayed payment for change orders.
- Post on a website each payment made to a prime construction contractor, including the date of payment and the amount paid, specifying any amounts withheld from the amount requested by the prime contractor and a general explanation of why an amount was withheld. This information will allow a subcontractor or supplier to determine when its payment is due (i.e., under the Prompt Payment Act, seven days after the government pays the prime contractor), without having to rely on the contracting officer or the prime contractor, and let prime contractors know immediately if the federal government is claiming a problem on the job.
- Post on a website a copy of any payment bond provided for under the contract and any modification to the bond required by the federal agency. Again, this bill would allow a subcontractor or supplier to obtain a copy of the payment bond without resorting to directly contacting the contracting officer or the prime contractor.
H.R. 2350 was referred to the House Small Business Committee, which is expected to hold a hearing on the bill in the very near future. Hat tip to the American Subcontractors Association for bringing it to our attention. We will post further updates as they occur.