Are Fewer Contractors Bidding Public Works Projects?

Recently, I've been hearing from a number of public agencies that they are not receiving many bids on public works projects, a marked change from fairly recently when many contractors from the commercial and residential markets, were flooding public projects with their bids.

There are a couple of reasons why this decreased number of bids may be occurring:

• Bonding Capacity:  As the nation's fragile economy continues, there is some indication that bonding companies are tightening their standards for what contractors they will bond.  Thus, there may be some contractors who simply cannot qualify to bid on public projects because they can't obtain the required payment and performance bonds.

• Government Paperwork:  Another reason for the decreased number of bids may be that some contractors, after having tasted what it's like to do a public project, with additional procedural and reporting requirements, have simply decided that it's not worth their time and trouble to bid on projects.

• Bankruptcy:  As contractors go out of business in this difficult economy, there are fewer contractors who are able to compete and bid on public works projects.

• Other Work:  While it is theoretically possible that a contributing factor to the decreased number of bids on public works projects is because contractors are getting work from the private sector, it is unlikely to be a major factor given the still wobbly economy.

Your Experiences:  I'm very interested in hearing whether you are noticing a decreased number of bids on public works projects, and what you think the reasons are.  

I've created a poll on my blog for you to respond to.  If you're reading this blog entry via an e-mail, you'll need to go directly to my blog to respond to the poll by clicking here.  Look in the right hand column of the blog, just below the Twitter, Linkedin, and Facebook icons. 

The poll will be active until Friday, August 5, 2011.  I'll publish the results of the poll in a subsequent blog entry.  As always, also feel free to contact me directly.

Mike Purdy's Public Contracting Blog 

© 2011 by Michael E. Purdy Associates, LLC 

http://PublicContracting.blogspot.com