Obtaining Government Contracting Work
Almost $140 billion of the $787 billion allocated in the American Recovery and Reinvestment Act of 2009 is targeted toward federal construction projects. For contractors dealing with the nationwide slowdown in commercial and residential construction, federal construction work can be a source of steady, lucrative projects. If you are interested in pursuing government construction work, the following brief overview of the process may help you in your efforts.
Identifying Likely Federal Prospects
Your goal is to identify federal construction projects that mesh with your company's level of expertise and your plans for growth. In addition, you want to be sure that the cost of acquiring federal business is low enough that you can maintain acceptable profit margins.
You can begin the search process by reviewing the websites of various federal agencies since the law requires every agency to post information about their contracts. You can do the research yourself, or you can use a government market intelligence service to provide specifics on federal contracting opportunities.
Once you've identified potential opportunities, you'll have to decide on whether you're prepared to make hard money bids or if answering requests for qualifications (RFQs) or requests for proposals (RFPs) will be more effective.
Bids
Hard money bids can be disadvantageous since price is the only distinguishing factor separating your company from others. You'll have to be very sure that your estimates are rock solid. Underestimate your costs and you could win the bid but lose money on the project.
Request for Qualifications
Various agencies put out RFQs to build a list of qualified contractors. If you opt for this approach, you will have to supply the agency with a list of former clients, background information on your company's past projects and business approaches, company resources data, and your financials. Once you are accepted onto an agency's qualified contractor list, you are essentially prequalified to bid on appropriate projects as they come up.
Request for Proposals
An RFP allows you to differentiate your bid beyond price; however, this design-oriented process tends to favor firms with architecture and engineering capabilities. The RFP's specific requirements should guide the content and format of your response. Structure your proposal toward detailing how your company's strengths can bring the best value to the agency. Be sure you completely address all the requested information. If any requirements are unclear, ask for an explanation.
Your proposal might include:
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• A recap of the general requirements
• Details regarding how you will meet each requirement, including your business' credentials -- experience, equipment, resources, staffing, skills, technology, etc.
• The schedule you propose
• The costs, including as necessary, labor, materials, and equipment, plus your payment terms
• If requested, details regarding the staff who will oversee and manage the project and their backgrounds
• Supplementary information, such as descriptions of similar projects you have completed
Obtaining information about and applying for government construction work can be a time consuming process. In the right situation, however, government projects can be well worth pursuing.
Standard Contract for Federal Projects
The complex rules for federal government projects can be intimidating and can prevent contractors from attempting to bid on potentially rewarding jobs. However, a coalition of construction industry associations, ConsensusDOCS, has created and published a standard agreement that specifically addresses the complexities of federal subcontracting.
The document, known as the ConsensusDOCS 752–Subcontract for Federal Government Construction Projects, is intended to simplify and streamline the often cumbersome federal contract application process by addressing the many terms and conditions that contractors must meet in order to comply with the terms of the Federal Acquisition Regulation (FAR). The American Recovery and Reinvestment Act of 2009 requires that all federal projects that are administered directly by federal agencies be governed by FAR. However, FAR does not apply to federal-aid projects such as highway and bridge construction and clean water projects.
The agreement addresses the new employment eligibility and verification regulations, compliance with business and ethics rules, federal Prompt Pay Act requirements, stop work orders, and other items.
