71st OREGON LEGISLATIVE ASSEMBLY--2001 Regular Session
Enrolled
House Bill 2052
Ordered printed by the Speaker pursuant to House Rule 12.00A (5).
Presession filed (at the request of House Interim Committee on
Agency Performance and Operations for Associated General
Contractors and National Electrical Contractors Association)
CHAPTER ................
AN ACT
Relating to public contracting; creating new provisions; and
amending ORS 279.027, 279.322 and 279.722.
Be It Enacted by the People of the State of Oregon:
SECTION 1. ORS 279.027 is amended to read:
279.027. (1) A public contracting agency preparing bid
documents for a public contract shall, at a minimum, include:
(a) A statement that, if the contract is for a public work
subject to ORS 279.348 to 279.380 or the Davis-Bacon Act (40
U.S.C. 276a), no bid will be received or considered by the public
contracting agency unless the bid contains a statement by the
bidder as a part of its bid that the provisions of ORS 279.350 or
40 U.S.C. 276a are to be complied with;
(b) The date and time after which bids will not be received,
which shall be not less than five days after the date of the last
publication of the advertisement;
(c) The date that prequalification applications must be filed
under ORS 279.039 (1) and the class or classes of work for which
bidders must be prequalified if prequalification is a
requirement;
(d) The character of the work to be done or the material or
things to be purchased;
(e) The office where the specifications for the work, material
or things may be reviewed;
(f) The name and title of the person designated for receipt of
bids;
(g) The date, time and place that the public contracting agency
will publicly open the bids;
(h) A statement that each bid must identify whether the bidder
is a resident bidder, as defined in ORS 279.029;
(i) A statement that the public contracting agency may reject
any bid not in compliance with all prescribed public bidding
procedures and requirements { - , - } and may reject for good
cause any or all bids upon a finding of the agency that it is in
the public interest to do so;
(j) Information addressing whether a contractor or
subcontractor must be licensed under ORS 468A.720; and
(k) A statement that no bid for a construction contract shall
be received or considered by the public contracting agency unless
the bidder is registered with the Construction Contractors Board
Enrolled House Bill 2052 (HB 2052-A) Page 1
or licensed by the State Landscape Contractors Board as required
by ORS 671.530.
(2) All bids made to the public contracting agency pursuant to
ORS 279.015 and 279.025 shall be:
(a) In writing.
(b) Filed with the person designated for receipt of bids by the
public contracting agency.
(c) Opened publicly by the public contracting agency at the
time designated in the advertisement.
{ - (3)(a) Within four working hours of the date and time of
the deadline when the bids were due to the public contracting
agency for a public improvement, a bidder shall submit to the
public contracting agency a disclosure of any first-tier
subcontractor that will be furnishing labor or materials in
connection with the public improvement and whose contract value
is equal to or greater than: - }
{ - (A) Five percent of the total project bid or $15,000,
whichever is larger; or - }
{ - (B) $500,000, regardless of the percentage of the total
project bid. - }
{ - (b) The disclosure of first-tier subcontractors shall
include: - }
{ - (A) The name and address of each subcontractor; - }
{ - (B) The registration number assigned to the subcontractor
by the Construction Contractors Board if the subcontractor is
required to have a certificate of registration issued by the
board; and - }
{ - (C) The amount of the contract of the subcontractor. - }
{ + (3)(a) Within four working hours after the date and time
of the deadline when the bids are due to the public contracting
agency for a public improvement, a bidder shall submit to the
public contracting agency a disclosure of the first-tier
subcontractors that:
(A) Will be furnishing labor or will be furnishing labor and
materials in connection with the public improvement; and
(B) Will have a contract value that is equal to or greater than
five percent of the total project bid or $15,000, whichever is
greater, or $350,000 regardless of the percentage of the total
project bid. + }
{ - (c) - } { + (b) + } For each contract to which this
subsection applies, the public contracting agency shall designate
a deadline for submission of bids that has a date and time that
is on Monday through Thursday or that is on Friday prior to 12
noon.
{ - (d) - } { + (c) + } This subsection shall apply only to
public improvements with a contract value of more than $75,000.
{ + (d) This subsection does not apply to public contracts
for public improvements that have been exempted from competitive
bidding requirements under ORS 279.015 (2).
(4) The disclosure of first-tier subcontractors under
subsection (3) of this section shall include:
(a) The name of each subcontractor; and
(b) The category of work that each subcontractor will be
performing.
(5) A public contracting agency shall accept the subcontractor
disclosure. The public contracting agency shall consider the bid
of any contractor that does not submit a subcontractor disclosure
to the public contracting agency to be a nonresponsive bid and
may not award the contract to the contractor. A public
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contracting agency is not required to determine the accuracy or
the completeness of the subcontractor disclosure. + }
{ - (4) - } { + (6) + } After having been opened { + , + }
the bids { + and the subcontractor disclosures + }shall be
filed for public inspection.
{ - (5) - } { + (7) + } A surety bond, irrevocable letter
of credit issued by an insured institution as defined in ORS
706.008, cashier's check or certified check of { - the - }
{ + each + } bidder shall be attached to all bids as bid
security unless the contract for which { - the - } { + a + }
bid is submitted has been exempted from this requirement pursuant
to ORS 279.033. Such security shall not exceed 10 percent of the
amount bid for the contract.
SECTION 2. ORS 279.322 is amended to read:
279.322. A prime contractor whose bid is accepted may
substitute a first-tier subcontractor that was not disclosed
under ORS 279.027 (3) { - (a) - } { + by submitting the name
of the new subcontractor and the reason for the substitution in
writing to the public contracting agency. A prime contractor may
substitute a first-tier subcontractor pursuant to this
section + } in the following circumstances:
(1) When the subcontractor disclosed under ORS 279.027 (3)
{ - (a) - } fails or refuses to execute a written contract
after having had a reasonable opportunity to do so after the
written contract { + , + } { - that is - } { + which must be
reasonably + } based upon the general terms, conditions, plans
and specifications for the public improvement project or the
terms of { - that - } { + the + } subcontractor's written
bid { + , + } is presented to the subcontractor by the prime
contractor.
(2) When the disclosed subcontractor becomes bankrupt or
insolvent.
(3) When the disclosed subcontractor fails or refuses to
perform the subcontract.
(4) When the disclosed subcontractor fails or refuses to meet
the bond requirements of the prime contractor that had been
identified prior to the bid submittal.
(5) When the prime contractor demonstrates to the public
contracting agency that the subcontractor was disclosed as the
result of an inadvertent clerical error.
(6) When the disclosed subcontractor does not hold a
certificate of registration from the Construction Contractors
Board and is required to be registered with the board.
(7) When the prime contractor determines that the work
performed by the disclosed subcontractor is substantially
unsatisfactory and not in substantial accordance with the plans
and specifications { - , - } or that the subcontractor is
substantially delaying or disrupting the progress of the work.
(8) When the disclosed subcontractor is ineligible to work on a
public improvement pursuant to the applicable statutory
provisions.
{ + (9) When the substitution is for good cause. The
Construction Contractors Board shall define 'good cause' by rule.
'Good cause' shall include, but not be limited to, the financial
instability of a subcontractor. The definition of 'good cause '
shall reflect the least cost policy for public improvements
established in ORS 279.023 (1).
(10) When the substitution is reasonably based on the contract
alternates chosen by the public contracting agency. + }
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SECTION 3. { + Section 4 of this 2001 Act is added to and made
a part of ORS 279.310 to 279.322. + }
SECTION 4. { + (1)(a) A subcontractor disclosed under ORS
279.027 may file a complaint based on the subcontractor
disclosure requirements under ORS 279.027 (3) with the
Construction Contractors Board about a contractor if the
contractor has substituted another subcontractor for the
complaining subcontractor.
(b) If more than one subcontractor files a complaint with the
board under paragraph (a) of this subsection relating to a single
subcontractor disclosure, the board shall consolidate the
complaints into one proceeding. If the board imposes a civil
penalty under this section against a contractor, the amount
collected by the board shall be divided evenly among all of the
complaining subcontractors.
(c) Each subcontractor filing a complaint under paragraph (a)
of this subsection shall post a deposit of $500 with the board
upon filing the complaint.
(d) If the board determines that a contractor's substitution
was not in compliance with ORS 279.322, the board shall return
the full amount of the deposit posted under paragraph (c) of this
subsection to the complaining subcontractor.
(e) If the board determines that a contractor has not
substituted a subcontractor or that the contractor's substitution
was in compliance with ORS 279.322, the board shall award the
contractor $250 of the deposit and shall retain the other $250,
which may be expended by the board.
(2) Upon receipt of a complaint under subsection (1) of this
section, the board shall investigate the complaint. If the board
determines that a contractor has substituted a subcontractor in a
manner not in compliance with ORS 279.322, the board may impose a
civil penalty against the contractor pursuant to subsections (3)
to (5) of this section. Civil penalties under this section shall
be imposed in the manner provided under ORS 183.090.
(3) If the board imposes a civil penalty under subsection (2)
of this section and it is the first time the board has imposed a
civil penalty under subsection (2) of this section against the
contractor during a three-year period, the board shall:
(a) Impose a civil penalty on the contractor of up to 10
percent of the amount of the subcontract bid submitted by the
complaining subcontractor to the contractor or $15,000, whichever
is less. Amounts collected by the board under this paragraph
shall be awarded to the complaining subcontractor or
subcontractors; and
(b) Impose a civil penalty on the contractor of up to $1,000.
Amounts collected by the board under this paragraph shall be
retained by the board and may be expended by the board.
(4) If the board imposes a civil penalty under subsection (2)
of this section and it is the second time the board has imposed a
civil penalty under subsection (2) of this section against the
contractor during a three-year period, the board may:
(a) Impose a civil penalty on the contractor of up to 10
percent of the amount of the subcontract bid submitted by the
complaining subcontractor to the contractor or $15,000, whichever
is less. Amounts collected by the board under this paragraph
shall be awarded to the complaining subcontractor or
subcontractors; and
(b) Impose a civil penalty on the contractor of up to $1,000
and shall place the contractor on the list established under ORS
701.227 for up to six months. Amounts collected by the board
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under this paragraph shall be retained by the board and may be
expended by the board.
(5) If the board imposes a civil penalty under subsection (2)
of this section and the board has imposed a civil penalty under
subsection (2) of this section against the contractor three or
more times during a three-year period, the board may:
(a) Impose a civil penalty on the contractor of up to 10
percent of the amount of the subcontract bid submitted by the
complaining subcontractor to the contractor or $15,000, whichever
is less. Amounts collected by the board under this paragraph
shall be awarded to the complaining subcontractor or
subcontractors; and
(b) Impose a civil penalty on the contractor of up to $1,000
and shall place the contractor on the list established under ORS
701.227 for up to one year. Amounts collected by the board under
this paragraph shall be retained by the board and may be expended
by the board.
(6) Within 10 working days after receiving a complaint under
subsection (1) of this section, the board shall notify, in
writing, any public contracting agency that is a party to the
contract for which the complaint has been filed that the
complaint has been filed under this section. + }
SECTION 5. ORS 279.722 is amended to read:
279.722. (1) In its discretion, the Oregon Department of
Administrative Services may require that bids be accompanied
either by a certified check, or by a bond in favor of the state
furnished by a surety company authorized to do business in this
state, in a sum not less than five percent of the total amount of
the bid, but not more than the amount specified by ORS 279.027
{ + (7) + }.
(2) Notwithstanding the provisions of ORS 293.265 or any other
provision of law, when bid security is in the form of a certified
check, the department shall deposit such a check in the Oregon
Department of Administrative Services Operating Fund, established
under ORS 283.076. However, the department shall return the
appropriate bid security held to an unsuccessful bidder in a
timely manner and pursuant to the provisions of ORS 279.031.
SECTION 6. { + Section 4 of this 2001 Act and the amendments
to ORS 279.027, 279.322 and 279.722 by sections 1, 2 and 5 of
this 2001 Act apply to public contracts first advertised on or
after January 1, 2002. + }
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Enrolled House Bill 2052 (HB 2052-A) Page 5
Passed by House May 3, 2001
...........................................................
Chief Clerk of House
...........................................................
Speaker of House
Passed by Senate June 5, 2001
...........................................................
President of Senate
Enrolled House Bill 2052 (HB 2052-A) Page 6
Received by Governor:
......M.,............., 2001
Approved:
......M.,............., 2001
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2001
...........................................................
Secretary of State
Enrolled House Bill 2052 (HB 2052-A) Page 7