There is a dust storm stirring in North Carolina that could have a ripple effect on contractors throughout the country. At issue is the bid process for school construction projects.

According to the Business Journal of Charlotte, Charlotte-Mecklenberg school district officials are trying to line up support for state legislation that would change the bid process. Officials believe changes to the process could save them up to 25%.

The proposed changes are a move away from the open bid process to an invited bid process. This would restrict the number of contractors who could compete for bids and set up a system of prequalified businesses.

But officials representing local hvacr, plumbing, and electrical contractors oppose the legislation, saying a shorter list would favor large contractors with ties to elected officials. This, they say, would possibly lead to more expensive contracts rather than more economical ones.

“The local contractors are livid,” said Henry Jones, an attorney representing electrical and plumber associations.

“They will lose what work they are getting to one or two of the bigger players.”

Under the surface

One area contractor said there is more to the proposed legislation than meets the eye. The current “multi-prime” system could give way to a “single-prime” process.

“The legislation goes a lot further than limiting or qualifying the bidders,” said Wes Styers, owner of Gastonia Plumbing & Heating and chairman of the legislative task force for the North Carolina Plumbing Contractors Association.

“The legislation includes adding the option of using the design-build process instead of the current plan and spec for single or multiple bidders.”

Dave Simpson, North Carolina building director of the Carolinas AGC Building Division, said the legislation could have been a lot worse: “The bill is better than it was initially written. At first it allowed for pure negotiations without any bidding.”

However, he added that “We favor preservation of open bidding because it gives contractors the chance to compete on a level playing field, and it gives taxpayers the best price.”

Speeds up process?

Supporters of the bill said the bidding process is slow and inefficient. They added that schools could be built faster with fewer backlogged projects.

“Right now, anyone with a 33-cent stamp and a copy of the [request for proposals] can submit bids,” said John Lassiter, a school board member.

“We have work going undone right now and dollars we want to spend, but we can’t get into the marketplace because of the [current] Byzantine rules.”

Kit Cramer, Charlotte Chamber of Commerce vice president, said, “The way things are now — with each aspect having to be bid separately — is a tremendous waste of time and resources. This is one of our top-two legislative priorities in terms of education, so we intend to become increasingly involved.”

The sponsor of the bill, N.C. Rep. Ed McMahan, said the legislation is stalled. He hopes to attach it to a construction bill now being considered in the Senate.

Styers said McMahan’s interest in the bill should not be a surprise. “He works for the largest architectural firm in the state,” explained Styers. “This is not a coincidence.”

Quality questions

Taking a different spin on the controversy is attorney Fenton Erwin, counsel to the American Subcontractors Association of the Carolinas, Inc. He said the quality might suffer if the existing bid process is changed.

“This may be a quality-of-work issue,” he said. “In single prime, subcontractors are paid by the general contractor rather than the school board, in this case. In co-prime work, the bidder is directly responsible to the business owner.”

Opponents of the bill added that there still seems to be a bit of confusion as to the language of the legislation and who the real players are.

“Each side is saying that the other side is the problem,” said Jones. “Meanwhile, the [school] design work is not getting done. Politicians are not getting schools built fast enough and they are under pressure. But instead of attacking the problem, they are taking on the bid process.”

Styers stated that the bid laws are in place for three reasons: to maximize quality, maximize construction dollars, and limit corruption.

“This is going to have an impact on local and national contracts,” he predicted. “It is bad legislation. It is vague and swings the door wide open to corruption.”