Government Construction Contracts

May 9, 2023

Construction firms highly covet commercial government contracts, as public spending on construction projects exceeds hundreds of billions of dollars yearly, making them a lucrative opportunity. While most construction firms rely on government contracts as their sole source of revenue, others bid on various public and private jobs.

Public construction contracts are governed by lengthy laws, which vary based on the agency. However, there are some consistencies between requirements that all agencies abide by. Read on to learn more about bidding on government construction contracts. 

Construction Bonds
Contractors often need to guarantee bids, construction work, and payments to subcontractors or suppliers by government agencies. Moreover, the terms of the bid should be obeyed. Typically, three parties are involved: the obligee, the principal, and the surety. The three most common types of bonds required on construction projects are bid, performance, and payment. 

Pre-Bid Site Visit
To allow contractors to better understand the project at hand, owners will often allow site visits. Often, contractors can ask questions regarding the bid or network with relevant contractors. Sometimes, these meetings are mandatory, and failing to attend will result in bidding ineligibility.

Competitive Bidding
Budgets are top-of-mind for most public construction projects, and most often, contractors can bid on projects after an architect completes the full plans. Prior to the bid date, projects must be advertised in one way or another. The lowest responsive, responsible, and eligible bidder will be given the job. 

Special Programs
Women, minorities, and small-business owners should have an equal opportunity to bid on projects, so a number of state, local, and federal agencies have created programs to ensure they are awarded accordingly.

Davis-Bacon Act of 1931
This federal law forces contractors to be paid local wages based on earnings paid to the various classes of laborers working on other local construction projects. Varying from state to state, wages will differ based on location. 


At Construction Bonding Specialists, we work with new and experienced contractors to find the most satisfactory bond solutions. As a distinct surety-bond-only agency with decades of bonding experience, we work to discover surety solutions for all types of cases ranging from ordinary to challenging. Call us at 248-349-6227 to learn more.

Written by the digital marketing team at Creative Programs & Systems: https://www.cpsmi.com/