Public works contracting

AN ACT Relating to public works contracting; and reenacting and 1
amending RCW 54.04.070, 35.23.352, 35.22.620, 57.08.050, and 2
52.14.110. 3
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:4
Sec. 1. RCW 54.04.070 and 2023 c 395 s 32 and 2023 c 255 s 1 are 5
each reenacted and amended to read as follows: 6
(1) Any item, or items of the same kind of materials, equipment, 7
or supplies purchased, the estimated cost of which is in excess of 8
$30,000, exclusive of sales tax, shall be by contract. However, a 9
district may make purchases of the same kind of items of materials, 10
equipment, and supplies not exceeding $12,000 in any calendar month 11
without a contract, purchasing any excess thereof over $12,000 by 12
contract. 13
(2) Any work ordered by a district commission, the estimated cost 14
of which is in excess of $150,000 exclusive of sales tax if more than 15
a single craft or trade is involved with the public works project, or 16
a public works project in excess of $75,500 exclusive of sales tax if 17
only a single craft or trade is involved with the public works 18
project, shall be by contract. However, a district commission may 19
have its own regularly employed personnel perform work which is an 20
accepted industry practice under prudent utility management without a 21
H-1357.1
HOUSE BILL 1966
State of Washington 69th Legislature 2025 Regular Session
By Representatives Zahn and Tharinger
Read first time 02/13/25. Referred to Committee on Local Government.
p. 1 HB 1966
contract. For purposes of this section, "prudent utility management" 1
means performing work with regularly employed personnel utilizing 2
material of a worth not exceeding $300,000 in value without a 3
contract. This limit on the value of material being utilized in work 4
being performed by regularly employed personnel shall not include the 5
value of individual items of equipment. For the purposes of this 6
section, the term "equipment" includes but is not limited to 7
conductor, cabling, wire, pipe, or lines used for electrical, water, 8
fiber optic, or telecommunications. 9
(3) Before awarding a contract required under subsection (1) or 10
(2) of this section, the commission shall publish a notice once or 11
more in a newspaper of general circulation in the district at least 12
13 days before the last date upon which bids will be received, 13
inviting sealed proposals for the work or materials. Plans and 14
specifications for the work or materials shall at the time of 15
publication be on file at the office of the district and subject to 16
public inspection. Any published notice ordering work to be performed 17
for the district shall be mailed at the time of publication to any 18
established trade association which files a written request with the 19
district to receive such notices. The commission may, at the same 20
time and as part of the same notice, invite tenders for the work or 21
materials upon plans and specifications to be submitted by the 22
bidders. 23
(4) As an alternative to the competitive bidding requirements of 24
this section and RCW 54.04.080, a district may let contracts using 25
the small works roster process under RCW 39.04.151 through 39.04.154.26
(5) Whenever equipment or materials required by a district are 27
held by a governmental agency and are available for sale but such 28
agency is unwilling to submit a proposal, the commission may 29
ascertain the price of such items and file a statement of such price 30
supported by the sworn affidavit of one member of the commission, and 31
may consider such price as a bid without a deposit or bond.32
(6) Pursuant to RCW 39.04.280, the commission may waive the 33
competitive bidding requirements of this section and RCW 54.04.080 if 34
an exemption contained within RCW 39.04.280 applies to the purchase 35
or public work. 36
(7)(a) A district may procure public works with a unit priced 37
contract under this section, RCW 54.04.080, or 54.04.085 for the 38
purpose of completing anticipated types of work based on hourly rates 39
or unit pricing for one or more categories of work or trades.40
p. 2 HB 1966
(b) For the purposes of this section, unit priced contract means 1
a competitively bid contract in which public works are anticipated on 2
a recurring basis to meet the business or operational needs of a 3
district, under which the contractor agrees to a fixed period 4
indefinite quantity delivery of work, at a defined unit price, for 5
each category of work. 6
(c) Unit priced contracts must be executed for an initial 7
contract term not to exceed three years, with the district having the 8
option of extending or renewing the unit priced contract for one 9
additional year. 10
(d) Invitations for unit price bids shall include, for purposes 11
of the bid evaluation, estimated quantities of the anticipated types 12
of work or trades, and specify how the district will issue or release 13
work assignments, work orders, or task authorizations pursuant to a 14
unit priced contract for projects, tasks, or other work based on the 15
hourly rates or unit prices bid by the contractor. Where electrical 16
facility construction or improvement work is anticipated, contractors 17
on a unit priced contract shall comply with the requirements under 18
RCW 54.04.085 (1) through (5). Contracts must be awarded to the 19
lowest responsible bidder as per RCW 39.04.010. 20
(e) Unit price contractors shall pay prevailing wages for all 21
work that would otherwise be subject to the requirements of chapter 22
39.12 RCW. Prevailing wages for all work performed pursuant to each 23
work order must be the prevailing wage rates in effect at the 24
beginning date for each contract year. Unit priced contracts must 25
have prevailing wage rates updated annually. Intents and affidavits 26
for prevailing wages paid must be submitted annually for all work 27
completed within the previous 12-month period of the unit priced 28
contract. 29
(8) For the purposes of this section, "lowest responsible bidder" 30
means a bid that meets the criteria under RCW 39.04.350 and has the 31
lowest bid ((; provided, that if the district commission issues a 32
written finding that the lowest bidder has delivered a project to the 33
district within the last three years which was late, over budget, or 34
did not meet specifications, and the commission does not find in 35
writing that such bidder has shown how they would improve performance 36
to be likely to meet project specifications then the commission may 37
choose the second lowest bidder whose bid is within five percent of 38
the lowest bid and meets the same criteria as the lowest bidder)).39
p. 3 HB 1966
Sec. 2. RCW 35.23.352 and 2023 c 395 s 21 and 2023 c 255 s 2 are 1
each reenacted and amended to read as follows: 2
(1) Any second -class city or any town may construct any public 3
works, as defined in RCW 39.04.010, by contract or day labor without 4
calling for bids therefor whenever the estimated cost of the work or 5
improvement, including cost of materials, supplies and equipment will 6
not exceed the sum of $150,000 if more than one craft or trade is 7
involved with the public works, or $75,500 if a single craft or trade 8
is involved with the public works or the public works project is 9
street signalization or street lighting. A public works project means 10
a complete project. The restrictions in this subsection do not permit 11
the division of the project into units of work or classes of work to 12
avoid the restriction on work that may be performed by day labor on a 13
single project. ((However, a second-class city or any town may have 14
its own regularly employed personnel perform work which is an 15
accepted industry practice under prudent utility management without a 16
contract. For purposes of this section, "prudent utility management" 17
means performing work with regularly employed personnel utilizing 18
material of a worth not exceeding $300,000 in value without a 19
contract. This limit on value of material being utilized in work 20
being performed by regularly employed personnel shall not include the 21
value of individual items of equipment. For purposes of this section, 22
"equipment" includes, but is not limited to, conductor, cabling, 23
wire, pipe, or lines used for electrical, water, fiber optic, or 24
telecommunications.))25
(2)(a) Second-class cities and towns may address exigent public 26
works needs through the use of their own regularly employed in-house 27
personnel up to a project cost of $300,000. Project costs must 28
include all labor, materials, supplies, and equipment. A project may 29
not be divided into units or classes of work in order to avoid this 30
restriction. A declaration of exigent public works circumstances may 31
be established by an action of the governing body of the city or 32
town, or pursuant to written policies and procedures adopted by the 33
city or town. Whenever a second-class city or any town determines 34
there is an exigency, it must document the factual basis for the 35
decision, and must make this documentation open to public inspection 36
within two weeks of the beginning of the project.37
(b) The amount of exigent public works needs addressed through 38
personnel is limited to a dollar value not exceeding 10 percent of 39
the public works construction budget over the city's or town's annual 40
p. 4 HB 1966
or biannual budget period. The amount of public works that a second-1
class city or any town has a county perform for it under RCW 2
35.77.020 must be included within this 10 percent limitation. If a 3
second-class city has public works performed by public employees in 4
any budget period that are in excess of this 10 percent limitation, 5
the amount in excess of the permitted amount is reduced from the 6
otherwise permitted amount of public works that may be performed by 7
public employees for that city in its next budget period. The state 8
auditor shall report to the state treasurer any second-class city or 9
any town that exceeds this amount and the extent to which the city or 10
town has or has not reduced the amount of public works it has 11
performed by public employees in subsequent years.12
(c) In addition to the accounting and recordkeeping requirements 13
contained in RCW 39.04.070, every second-class city or any town must 14
annually prepare a report subject to review by the state auditor 15
indicating the total public works construction budget and 16
supplemental public works construction budget for that year, the 17
total construction costs of public works performed by public 18
employees for that year, and the amount of public works that is 19
performed by public employees above or below 10 percent of the total 20
construction budget. However, if a second-class city or any town 21
budgets on a biennial basis, this annual report may indicate the 22
amount of public works that is performed by public employees within 23
the current biennial period that is above or below 10 percent of the 24
total biennial construction budget.25
(d) Whenever a second-class city or town has had public works 26
performed in any budget period up to the maximum permitted amount for 27
that budget period, all remaining public works within that budget 28
period must be done by contract pursuant to public notice and call 29
for competitive bids.30
(3) Whenever the cost of the public work or improvement, 31
including materials, supplies and equipment, will exceed these 32
figures, the same shall be done by contract. All such contracts shall 33
be let at public bidding upon publication of notice calling for 34
sealed bids upon the work. The notice shall be published in the 35
official newspaper, or a newspaper of general circulation most likely 36
to bring responsive bids, at least 13 days prior to the last date 37
upon which bids will be received. The notice shall generally state 38
the nature of the work to be done that plans and specifications 39
therefor shall then be on file in the city or town hall for public 40
p. 5 HB 1966
inspections, and require that bids be sealed and filed with the 1
council or commission within the time specified therein. Each bid 2
shall be accompanied by a bid proposal deposit in the form of a 3
cashier's check, postal money order, or surety bond to the council or 4
commission for a sum of not less than five percent of the amount of 5
the bid, and no bid shall be considered unless accompanied by such 6
bid proposal deposit. The council or commission of the city or town 7
shall let the contract to the lowest responsible bidder or shall have 8
power by resolution to reject any or all bids and to make further 9
calls for bids in the same manner as the original call.10
When the contract is let then all bid proposal deposits shall be 11
returned to the bidders except that of the successful bidder which 12
shall be retained until a contract is entered into and a bond to 13
perform the work furnished, with surety satisfactory to the council 14
or commission, in accordance with RCW 39.08.030. If the bidder fails 15
to enter into the contract in accordance with his or her bid and 16
furnish a bond within 10 days from the date at which he or she is 17
notified that he or she is the successful bidder, the check or postal 18
money order and the amount thereof shall be forfeited to the council 19
or commission or the council or commission shall recover the amount 20
of the surety bond. A low bidder who claims error and fails to enter 21
into a contract is prohibited from bidding on the same project if a 22
second or subsequent call for bids is made for the project.23
If no bid is received on the first call the council or commission 24
may readvertise and make a second call, or may enter into a contract 25
without any further call or may purchase the supplies, material or 26
equipment and perform the work or improvement by day labor.27
(((2))) (4) For the purposes of this section((,)):28
(a) "((lowest)) Lowest responsible bidder" means a bid that meets 29
the criteria under RCW 39.04.350 and has the lowest bid; ((provided, 30
that if the city issues a written finding that the lowest bidder has 31
delivered a project to the city within the last three years which was 32
late, over budget, or did not meet specifications, and the city does 33
not find in writing that such bidder has shown how they would improve 34
performance to be likely to meet project specifications then the city 35
may choose the second lowest bidder whose bid is within five percent 36
of the lowest bid and meets the same criteria as the lowest bidder )) 37
and38
(b) "Exigent public works needs" means those situations that 39
arise as a result of unforeseen circumstances and that result in the 40
p. 6 HB 1966
compromise of the proper performance of essential government 1
functions, a need for action to prevent or alleviate serious impacts, 2
financial or otherwise, and in which the use of a competitive 3
procurement process would prevent the urgent action required to 4
address the situation. 5
(((3))) (5) The allocation of public works projects to be 6
performed by city or town employees shall not be subject to a 7
collective bargaining agreement. 8
(((4))) (6) In lieu of the procedures of subsection (1) of this 9
section, a second -class city or a town may let contracts using the 10
small works roster process provided in RCW 39.04.151 through 11
39.04.154. 12
Whenever possible, the city or town shall invite at least one 13
proposal from a certified minority or woman contractor who shall 14
otherwise qualify under this section. 15
(((5))) (7) The form required by RCW 43.09.205 shall be to 16
account and record costs of public works in excess of $5,000 that are 17
not let by contract. 18
(((6))) (8) The cost of a separate public works project shall be 19
the costs of the materials, equipment, supplies, and labor on that 20
construction project. 21
(((7))) (9) Any purchase of supplies, material, or equipment, 22
except for public work or improvement, with an estimated cost in 23
excess of $40,000, shall be by contract. Any purchase of materials, 24
supplies, or equipment with an estimated cost of less than $50,000 25
shall be made using the process provided in RCW 39.04.190.26
(((8))) (10) Bids shall be called annually and at a time and in 27
the manner prescribed by ordinance for the publication in a newspaper 28
of general circulation in the city or town of all notices or 29
newspaper publications required by law. The contract shall be awarded 30
to the lowest responsible bidder. 31
(((9))) (11) For advertisement and formal sealed bidding to be 32
dispensed with as to purchases with an estimated value of $15,000 or 33
less, the council or commission must authorize by resolution, use of 34
the uniform procedure provided in RCW 39.04.190. 35
(((10))) (12) The city or town legislative authority may waive 36
the competitive bidding requirements of this section pursuant to RCW 37
39.04.280 if an exemption contained within that section applies to 38
the purchase or public work. 39
p. 7 HB 1966
(((11))) (13) This section does not apply to performance-based 1
contracts, as defined in RCW 39.35A.020(6), that are negotiated under 2
chapter 39.35A RCW. 3
(((12))) (14) Nothing in this section shall prohibit any second-4
class city or any town from allowing for preferential purchase of 5
products made from recycled materials or products that may be 6
recycled or reused. 7
(((13))) (15)(a) Any second-class city or any town may procure 8
public works with a unit priced contract under this section for the 9
purpose of completing anticipated types of work based on hourly rates 10
or unit pricing for one or more categories of work or trades.11
(b) For the purposes of this section, "unit priced contract" 12
means a competitively bid contract in which public works are 13
anticipated on a recurring basis to meet the business or operational 14
needs of the city or town, under which the contractor agrees to a 15
fixed period indefinite quantity delivery of work, at a defined unit 16
price for each category of work. 17
(c) Unit priced contracts must be executed for an initial 18
contract term not to exceed three years, with the city or town having 19
the option of extending or renewing the unit priced contract for one 20
additional year. 21
(d) Invitations for unit price bids shall include, for purposes 22
of the bid evaluation, estimated quantities of the anticipated types 23
of work or trades, and specify how the city or town will issue or 24
release work assignments, work orders, or task authorizations 25
pursuant to a unit priced contract for projects, tasks, or other work 26
based on the hourly rates or unit prices bid by the contractor. 27
Contracts must be awarded to the lowest responsible bidder as per RCW 28
39.04.010. Whenever possible, the city or town must invite at least 29
one proposal from a certified minority or woman contractor who 30
otherwise qualifies under this section. 31
(e) Unit price contractors shall pay prevailing wages for all 32
work that would otherwise be subject to the requirements of chapter 33
39.12 RCW. Prevailing wages for all work performed pursuant to each 34
work order must be the prevailing wage rates in effect at the 35
beginning date for each contract year. Unit priced contracts must 36
have prevailing wage rates updated annually. Intents and affidavits 37
for prevailing wages paid must be submitted annually for all work 38
completed within the previous 12-month period of the unit priced 39
contract. 40
p. 8 HB 1966
(((14))) (16) Any second-class city or town that awards a project 1
to a bidder under the criteria described in subsection (((2))) (4) of 2
this section must make an annual report to the department of commerce 3
that includes the total number of bids awarded to certified minority 4
or women contractors and describing how notice was provided to 5
potential certified minority or women contractors. 6
Sec. 3. RCW 35.22.620 and 2023 c 395 s 20 and 2023 s 255 s 3 are 7
each reenacted and amended to read as follows: 8
(1) As used in this section, the term "public works" means as 9
defined in RCW 39.04.010. 10
(2) A first -class city may have public works performed by 11
contract pursuant to public notice and call for competitive bids. As 12
limited by subsection (((3))) (4) of this section, a first -class city 13
may have public works performed by city employees ((in any annual or 14
biennial budget period equal to a dollar value not exceeding 10 15
percent of the public works construction budget, including any amount 16
in a supplemental public works construction budget, over the budget 17
period. The amount of public works that a first-class city has a 18
county perform for it under RCW 35.77.020 shall be included within 19
this 10 percent limitation.20
If a first -class city has public works performed by public 21
employees in any budget period that are in excess of this 10 percent 22
limitation, the amount in excess of the permitted amount shall be 23
reduced from the otherwise permitted amount of public works that may 24
be performed by public employees for that city in its next budget 25
period. Twenty percent of the motor vehicle fuel tax distributions to 26
that city shall be withheld if two years after the year in which the 27
excess amount of work occurred, the city has failed to so reduce the 28
amount of public works that it has performed by public employees. The 29
amount so withheld shall be distributed to the city when it has 30
demonstrated in its reports to the state auditor that the amount of 31
public works it has performed by public employees has been so 32
reduced.33
Whenever a first-class city has had public works performed in any 34
budget period up to the maximum permitted amount for that budget 35
period, all remaining public works within that budget period shall be 36
done by contract pursuant to public notice and call for competitive 37
bids.38
p. 9 HB 1966
The state auditor shall report to the state treasurer any 1
first-class city that exceeds this amount and the extent to which the 2
city has or has not reduced the amount of public works it has 3
performed by public employees in subsequent years)).4
(3) In addition to the percentage limitation provided in 5
subsection (((2))) (4) of this section, a first-class city shall not 6
have public employees perform a public works project in excess of 7
$150,000 if more than a single craft or trade is involved with the 8
public works project, or a public works project in excess of $75,500 9
if only a single craft or trade is involved with the public works 10
project or the public works project is street signalization or street 11
lighting. A public works project means a complete project. The 12
restrictions in this subsection do not permit the division of the 13
project into units of work or classes of work to avoid the 14
restriction on work that may be performed by day labor on a single 15
project. ((However, a first-class city may have its own regularly 16
employed personnel perform work which is an accepted industry 17
practice under prudent utility management without a contract. For 18
purposes of this section, "prudent utility management" means 19
performing work with regularly employed personnel utilizing material 20
of a worth not exceeding $300,000 in value without a contract. This 21
limit on the value of material being utilized in work being performed 22
by regularly employed personnel shall not include the value of 23
individual items of equipment. For purposes of this section, the term 24
"equipment" includes, but is not limited to, conductor, cabling, 25
wire, pipe, or lines used for electrical, water, fiber optic, or 26
telecommunications.))27
(4) ((In addition to the accounting and recordkeeping 28
requirements contained in RCW 39.04.070, every first-class city 29
annually may prepare a report for the state auditor indicating the 30
total public works construction budget and supplemental public works 31
construction budget for that year, the total construction costs of 32
public works performed by public employees for that year, and the 33
amount of public works that is performed by public employees above or 34
below 10 percent of the total construction budget. However, if a city 35
budgets on a biennial basis, this annual report may indicate the 36
amount of public works that is performed by public employees within 37
the current biennial period that is above or below 10 percent of the 38
total biennial construction budget. )) (a) First-class cities may 39
address exigent public works needs through the use of its own 40
p. 10 HB 1966
regularly employed in-house personnel up to a project cost of 1
$300,000. Project costs must include all labor, materials, supplies, 2
and equipment. A project may not be divided into units or classes of 3
work in order to avoid this restriction. A declaration of exigent 4
public works circumstances may be established by an action of the 5
governing body of the city, or pursuant to written policies and 6
procedures adopted by the city. Whenever a first-class city 7
determines there is an exigency, it must document the factual basis 8
for the decision, and must make this documentation open to public 9
inspection within two weeks of the beginning of the project.10
(b) The amount of exigent public works needs addressed through 11
the use of the city's own regularly employed in-house personnel is 12
limited to a dollar value not exceeding 10 percent of the public 13
works construction budget over the city's annual or biannual budget 14
period. The amount of public works that a first-class city has a 15
county perform for it under RCW 35.77.020 must be included within 16
this 10 percent limitation. If a first-class city has public works 17
performed by public employees in any budget period that are in excess 18
of this 10 percent limitation, the amount in excess of the permitted 19
amount is reduced from the otherwise permitted amount of public works 20
that may be performed by public employees for that city in its next 21
budget period. The state auditor shall report to the state treasurer 22
any first-class city that exceeds this amount and the extent to which 23
the city has or has not reduced the amount of public works it has 24
performed by public employees in subsequent years.25
(c) In addition to the accounting and recordkeeping requirements 26
contained in RCW 39.04.070, every first-class city must annually 27
prepare a report subject to review by the state auditor indicating 28
the total public works construction budget and supplemental public 29
works construction budget for that year, the total construction costs 30
of public works performed by public employees for that year, and the 31
amount of public works that is performed by public employees above or 32
below 10 percent of the total construction budget. However, if a 33
first-class city budgets on a biennial basis, this annual report may 34
indicate the amount of public works that is performed by public 35
employees within the current biennial period that is above or below 36
10 percent of the total biennial construction budget.37
(d) Whenever a first-class city has had public works performed in 38
any budget period up to the maximum permitted amount for that budget 39
period, all remaining public works within that budget period must be 40
p. 11 HB 1966
done by contract pursuant to public notice and call for competitive 1
bids. 2
(e) Each first -class city with a population of 150,000 or less 3
shall use the form required by RCW 43.09.205 to account and record 4
costs of public works in excess of $5,000 that are not let by 5
contract. 6
(5) The cost of a separate public works project shall be the 7
costs of materials, supplies, equipment, and labor on the 8
construction of that project. The value of the public works budget 9
shall be the value of all the separate public works projects within 10
the budget. 11
(6) The competitive bidding requirements of this section may be 12
waived by the city legislative authority pursuant to RCW 39.04.280 if 13
an exemption contained within that section applies to the work or 14
contract. 15
(7) In lieu of the procedures of subsections (2) and (6) of this 16
section, a first -class city may let contracts using the small works 17
roster process in RCW 39.04.151 through 39.04.154.18
Whenever possible, the city shall invite at least one proposal 19
from a certified minority or woman contractor who shall otherwise 20
qualify under this section. 21
(8) The allocation of public works projects to be performed by 22
city employees shall not be subject to a collective bargaining 23
agreement. 24
(9) This section does not apply to performance-based contracts, 25
as defined in RCW 39.35A.020(6), that are negotiated under chapter 26
39.35A RCW. 27
(10) Nothing in this section shall prohibit any first -class city 28
from allowing for preferential purchase of products made from 29
recycled materials or products that may be recycled or reused.30
(11)(a) Any first-class city may procure public works with a unit 31
priced contract under this section for the purpose of completing 32
anticipated types of work based on hourly rates or unit pricing for 33
one or more categories of work or trades. 34
(b) For the purposes of this section, "unit priced contract" 35
means a competitively bid contract in which public works are 36
anticipated on a recurring basis to meet the business or operational 37
needs of the city, under which the contractor agrees to a fixed 38
period indefinite quantity delivery of work, at a defined unit price 39
for each category of work. 40
p. 12 HB 1966
(c) Unit priced contracts must be executed for an initial 1
contract term not to exceed three years, with the city having the 2
option of extending or renewing the unit priced contract for one 3
additional year. 4
(d) Invitations for unit price bids shall include, for purposes 5
of the bid evaluation, estimated quantities of the anticipated types 6
of work or trades, and specify how the city will issue or release 7
work assignments, work orders, or task authorizations pursuant to a 8
unit priced contract for projects, tasks, or other work based on the 9
hourly rates or unit prices bid by the contractor. Contracts must be 10
awarded to the lowest responsible bidder as per RCW 39.04.010. 11
Whenever possible, the city must invite at least one proposal from a 12
certified minority or woman contractor who otherwise qualifies under 13
this section. 14
(e) Unit price contractors shall pay prevailing wages for all 15
work that would otherwise be subject to the requirements of chapter 16
39.12 RCW. Prevailing wages for all work performed pursuant to each 17
work order must be the prevailing wage rates in effect at the 18
beginning date for each contract year. Unit priced contracts must 19
have prevailing wage rates updated annually. Intents and affidavits 20
for prevailing wages paid must be submitted annually for all work 21
completed within the previous 12-month period of the unit priced 22
contract. 23
(12) For the purposes of this section((,)):24
(a) "((lowest)) Lowest responsible bidder" means a bid that meets 25
the criteria under RCW 39.04.350 and has the lowest bid; ((provided, 26
that if the city issues a written finding that the lowest bidder has 27
delivered a project to the city within the last three years which was 28
late, over budget, or did not meet specifications, and the city does 29
not find in writing that such bidder has shown how they would improve 30
performance to be likely to meet project specifications then the city 31
may choose the second lowest bidder whose bid is within five percent 32
of the lowest bid and meets the same criteria as the lowest bidder )) 33
and34
(b) "Exigent public works needs" means those situations that 35
arise as a result of unforeseen circumstances and that result in the 36
compromise of the proper performance of essential government 37
functions, a need for action to prevent or alleviate serious impacts, 38
financial or otherwise, and in which the use of a competitive 39
p. 13 HB 1966
procurement process would prevent the urgent action required to 1
address the situation. 2
Sec. 4. RCW 57.08.050 and 2023 c 395 s 33 and 2023 c 255 s 4 are 3
each reenacted and amended to read as follows: 4
(1) All work ordered, the estimated cost of which is in excess of 5
$150,000 if more than a single craft or trade is involved with the 6
public works project, or a public works project in excess of $75,500 7
if only a single craft or trade is involved with the public works 8
project, shall be let by contract and competitive bidding. Before 9
awarding any such contract the board of commissioners shall publish a 10
notice in a newspaper of general circulation where the district is 11
located at least once 13 days before the last date upon which bids 12
will be received, inviting sealed proposals for such work, plans and 13
specifications which must at the time of publication of such notice 14
be on file in the office of the board of commissioners subject to the 15
public inspection. The notice shall state generally the work to be 16
done and shall call for proposals for doing the same to be sealed and 17
filed with the board of commissioners on or before the day and hour 18
named therein. 19
Each bid shall be accompanied by a certified or cashier's check 20
or postal money order payable to the order of the county treasurer 21
for a sum not less than five percent of the amount of the bid, or 22
accompanied by a bid bond in an amount not less than five percent of 23
the bid with a corporate surety licensed to do business in the state, 24
conditioned that the bidder will pay the district as liquidated 25
damages the amount specified in the bond, unless the bidder enters 26
into a contract in accordance with the bidder's bid, and no bid shall 27
be considered unless accompanied by such check, cash or bid bond. At 28
the time and place named such bids shall be publicly opened and read 29
and the board of commissioners shall proceed to canvass the bids and 30
may let such contract to the lowest responsible bidder upon plans and 31
specifications on file or to the best bidder submitting the bidder's 32
own plans and specifications. The board of commissioners may reject 33
all bids for good cause and readvertise and in such case all checks, 34
cash or bid bonds shall be returned to the bidders. If the contract 35
is let, then all checks, cash, or bid bonds shall be returned to the 36
bidders, except that of the successful bidder, which shall be 37
retained until a contract shall be entered into for doing the work, 38
and a bond to perform such work furnished with sureties satisfactory 39
p. 14 HB 1966
to the board of commissioners in the full amount of the contract 1
price between the bidder and the commission in accordance with the 2
bid. If the bidder fails to enter into the contract in accordance 3
with the bid and furnish the bond within 10 days from the date at 4
which the bidder is notified that the bidder is the successful 5
bidder, the check, cash, or bid bonds and the amount thereof shall be 6
forfeited to the district. If the bidder fails to enter into a 7
contract in accordance with the bidder's bid, and the board of 8
commissioners deems it necessary to take legal action to collect on 9
any bid bond required by this section, then the district shall be 10
entitled to collect from the bidder any legal expenses, including 11
reasonable attorneys' fees occasioned thereby. A low bidder who 12
claims error and fails to enter into a contract is prohibited from 13
bidding on the same project if a second or subsequent call for bids 14
is made for the project. 15
(2) As an alternative to requirements under subsection (1) of 16
this section, a water-sewer district may let contracts using the 17
small works roster process under RCW 39.04.151 through 39.04.154.18
(3) Any purchase of materials, supplies, or equipment, with an 19
estimated cost in excess of $40,000, shall be by contract. Any 20
purchase of materials, supplies, or equipment, with an estimated cost 21
of less than $50,000 shall be made using the process provided in RCW 22
39.04.190. Any purchase of materials, supplies, or equipment with an 23
estimated cost of $50,000 or more shall be made by competitive 24
bidding following the procedure for letting contracts for projects 25
under subsection (1) of this section. 26
(4) As an alternative to requirements under subsection (3) of 27
this section, a water-sewer district may let contracts for purchase 28
of materials, supplies, or equipment with the suppliers designated on 29
current state agency, county, city, or town purchasing rosters for 30
the materials, supplies, or equipment, when the roster has been 31
established in accordance with the competitive bidding law for 32
purchases applicable to the state agency, county, city, or town. The 33
price and terms for purchases shall be as described on the applicable 34
roster. 35
(5) The board may waive the competitive bidding requirements of 36
this section pursuant to RCW 39.04.280 if an exemption contained 37
within that section applies to the purchase or public work.38
(6)(a) A district may procure public works with a unit priced 39
contract under this section for the purpose of completing anticipated 40
p. 15 HB 1966
types of work based on hourly rates or unit pricing for one or more 1
categories of work or trades. 2
(b) For the purposes of this section, "unit priced contract" 3
means a competitively bid contract in which public works are 4
anticipated on a recurring basis to meet the business or operational 5
needs of the district, under which the contractor agrees to a fixed 6
period indefinite quantity delivery of work, at a defined unit price 7
for each category of work. 8
(c) Unit priced contracts must be executed for an initial 9
contract term not to exceed one year, with the district having the 10
option of extending or renewing the unit priced contract for one 11
additional year. 12
(d) Invitations for unit price bids must include, for purposes of 13
the bid evaluation, estimated quantities of the anticipated types of 14
work or trades, and specify how the district will issue or release 15
work assignments, work orders, or task authorizations pursuant to a 16
unit priced contract for projects, tasks, or other work based on the 17
hourly rates or unit prices bid by the contractor. Contracts must be 18
awarded to the lowest responsible bidder as per RCW 39.04.010. 19
Whenever possible, the district must invite at least one proposal 20
from a certified minority or woman contractor who otherwise qualifies 21
under this section. 22
(e) Unit price contractors shall pay prevailing wages for all 23
work that would otherwise be subject to the requirements of chapter 24
39.12 RCW. Prevailing wages for all work performed pursuant to each 25
work order must be the prevailing wage rates in effect at the 26
beginning date for each contract year. Unit priced contracts must 27
have prevailing wage rates updated annually. Intents and affidavits 28
for prevailing wages paid must be submitted annually for all work 29
completed within the previous 12-month period of the unit priced 30
contract. 31
(7)(a) A water-sewer district may ((have its own regularly 32
employed personnel perform work which is an accepted industry 33
practice under prudent utility management without a contract. For 34
purposes of this section, "prudent utility management" means 35
performing work with regularly employed personnel utilizing material 36
of a worth not exceeding $300,000 in value without a contract. This 37
limit on the value of material being utilized in work being performed 38
by regularly employed personnel shall not include the value of 39
individual items of equipment. For the purposes of this section, the 40
p. 16 HB 1966
term "equipment" includes but is not limited to conductor, cabling, 1
wire, pipe, or lines used for electrical, water, fiber optic, or 2
telecommunications.)) address exigent public works needs through the 3
use of its own regularly employed in-house personnel up to a project 4
cost of $300,000. Project costs must include all labor, materials, 5
supplies, and equipment. A project may not be divided into units or 6
classes of work in order to avoid this restriction.7
(b) The amount of exigent public works needs addressed through 8
the use of the water-sewer's own regularly employed in-house 9
personnel is limited to a dollar value not exceeding 10 percent of 10
the public works construction budget over the district's budget 11
period. If a water-sewer district has public works performed by 12
public employees in any budget period that are in excess of this 10 13
percent limitation, the amount in excess of the permitted amount must 14
be reduced from the otherwise permitted amount of public works that 15
may be performed by public employees for that district in its next 16
budget period. The state auditor shall report to the state treasurer 17
any water-sewer district that exceeds this amount and the extent to 18
which the water-sewer district has or has not reduced the amount of 19
public works it has performed by public employees in subsequent 20
years.21
(c) In addition to the accounting and recordkeeping requirements 22
contained in RCW 39.04.070, every water-sewer district must annually 23
prepare a report subject to review by the state auditor indicating 24
the total public works construction budget and supplemental public 25
works construction budget for that year, the total construction costs 26
of public works performed by public employees for that year, and the 27
amount of public works that is performed by public employees above or 28
below 10 percent of the total construction budget. However, if a 29
water-sewer district budgets on a biennial basis, this annual report 30
may indicate the amount of public works that is performed by public 31
employees within the current biennial period that is above or below 32
10 percent of the total biennial construction budget.33
(d) Each water-sewer district shall use the form required by RCW 34
43.09.205 to account and record costs of public works in excess of 35
$5,000 that are not let by contract.36
(8) For the purposes of this section((,)):37
(a) "((lowest)) Lowest responsible bidder" means a bid that meets 38
the criteria under RCW 39.04.350 and has the lowest bid; ((provided, 39
that if the district issues a written finding that the lowest bidder 40
p. 17 HB 1966
has delivered a project to the district within the last three years 1
which was late, over budget, or did not meet specifications, and the 2
district does not find in writing that such bidder has shown how they 3
would improve performance to be likely to meet project specifications 4
then the district may choose the second lowest bidder whose bid is 5
within five percent of the lowest bid and meets the same criteria as 6
the lowest bidder)) and7
(b) "Exigent public works needs" means those situations that 8
arise as a result of unforeseen circumstances and that result in the 9
compromise of the proper performance of essential government 10
functions, a need for action to prevent or alleviate serious impacts, 11
financial or otherwise, and in which the use of a competitive 12
procurement process would prevent the urgent action required to 13
address the situation. 14
Sec. 5. RCW 52.14.110 and 2023 c 395 s 30 and 2023 c 255 s 5 are 15
each reenacted and amended to read as follows: 16
(1) Insofar as practicable, purchases and any public works by the 17
district shall be based on competitive bids. A formal sealed bid 18
procedure shall be used as standard procedure for purchases and 19
contracts for purchases executed by the board of commissioners. 20
Formal sealed bidding shall not be required for: 21
(a) The purchase of any materials, supplies, or equipment if the 22
cost will not exceed the sum of $75,500. However, whenever the 23
estimated cost does not exceed $150,000, the commissioners may by 24
resolution use the process provided in RCW 39.04.190 to award 25
contracts; 26
(b) Contracting for work to be done involving the construction or 27
improvement of a fire station or other buildings where the estimated 28
cost will not exceed the sum of $150,000 if more than a single craft 29
or trade is involved with the public works project, or a public works 30
project in excess of $75,500 if only a single craft or trade is 31
involved with the public works project; 32
(c) Contracts using the small works roster process under RCW 33
39.04.151 through 39.04.154; and 34
(d) Any contract for purchases or public work pursuant to RCW 35
39.04.280 if an exemption contained within that section applies to 36
the purchase or public work. 37
(2)(a) A fire protection district may ((have its own regularly 38
employed personnel perform work which is an accepted industry 39
p. 18 HB 1966
practice under prudent utility management without a contract. For 1
purposes of this section, "prudent utility management" means 2
performing work with regularly employed personnel utilizing material 3
of a worth not exceeding $300,000 in value without a contract. This 4
limit on the value of material being utilized in work being performed 5
by regularly employed personnel shall not include the value of 6
individual items of equipment. For the purposes of this section, the 7
term "equipment" includes but is not limited to conductor, cabling, 8
wire, pipe, or lines used for electrical, water, fiber optic, or 9
telecommunications.)) address exigent public works needs through the 10
use of its own regularly employed in-house personnel up to a project 11
cost of $300,000. Project costs must include all labor, materials, 12
supplies, and equipment. A project may not be divided into units or 13
classes of work in order to avoid this restriction. A declaration of 14
exigent public works circumstances may be established by an action of 15
the governing body of the district, or pursuant to written policies 16
and procedures adopted by the district. Whenever a fire protection 17
district determines there is an exigency, it must document the 18
factual basis for the decision, and must make this documentation open 19
to public inspection within two weeks of the beginning of the 20
project.21
(b) The amount of exigent public works needs addressed through 22
the use of the district's own regularly employed in-house personnel 23
is limited to a dollar value not exceeding 10 percent of the public 24
works construction budget over the district's annual or biannual 25
budget period, including any amount in a supplemental public works 26
construction budget. If a district city has public works performed by 27
public employees in any budget period that are in excess of this 10 28
percent limitation, the amount in excess of the permitted amount is 29
reduced from the otherwise permitted amount of public works that may 30
be performed by public employees for the district in its next budget 31
period. The state auditor shall report to the state treasurer any 32
district that exceeds this amount and the extent to which the 33
district has or has not reduced the amount of public works it has 34
performed by public employees in subsequent years.35
(c) In addition to the accounting and recordkeeping requirements 36
contained in RCW 39.04.070, every fire protection district must 37
annually prepare a report subject to review by the state auditor 38
indicating the total public works construction budget and 39
supplemental public works construction budget for that year, the 40
p. 19 HB 1966
total construction costs of public works performed by public 1
employees for that year, and the amount of public works that is 2
performed by public employees above or below 10 percent of the total 3
construction budget. However, if a district budgets on a biennial 4
basis, this annual report may indicate the amount of public works 5
that is performed by public employees within the current biennial 6
period that is above or below 10 percent of the total biennial 7
construction budget. 8
(d) Each fire protection district shall use the form required by 9
RCW 43.09.205 to account and record costs of public works in excess 10
of $5,000 that are not let by contract.11
(3) For the purposes of this section((,)):12
(a) "((lowest)) Lowest responsible bidder" means a bid that meets 13
the criteria under RCW 39.04.350 and has the lowest bid; ((provided, 14
that if the district issues a written finding that the lowest bidder 15
has delivered a project to the district within the last three years 16
which was late, over budget, or did not meet specifications, and the 17
district does not find in writing that such bidder has shown how they 18
would improve performance to be likely to meet project specifications 19
then the district may choose the second lowest bidder whose bid is 20
within five percent of the lowest bid and meets the same criteria as 21
the lowest bidder)) and22
(b) "Exigent public works needs" means those situations that 23
arise as a result of unforeseen circumstances and that result in the 24
compromise of the proper performance of essential government 25
functions, a need for action to prevent or alleviate serious impacts, 26
financial or otherwise, and in which the use of a competitive 27
procurement process would prevent the urgent action required to 28
address the situation. 29
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p. 20 HB 1966