Bill Mandating Use of Competitive Bidding for School Construction Advancing Rapidly

This week, the Senate version —Senate Bill 236— of a bill that would impose significant new requirements for competitive bidding of public construction contracts by school districts surged through the legislative process.

Yesterday (Thursday, Oct 5), the Senate Committee on Economic Development, Commerce and Local Government voted along party lines to give a favorable recommendation to Senate Bill 236, which had received its only public hearing to date just two days earlier.  The bill now moves to the full state Senate for a vote.

[Editor’s Note:  An identical companion bill, Assembly Bill 307, authored by Rep. Rob Brooks (R- Saukville, pictured at right) is also moving through the process, although at a more deliberate pace.]

Currently, most local government units in Wisconsin other than schools are required to follow a state-mandated competitive bidding process for any public construction project that exceed $25,000 in anticipated costs.  Senate Bill 236 would raise the state-imposed bidding threshold for those public projects from $25,000 to $50,000.

Separately, Senate Bill 236 would subject school districts to the statutory bidding requirements.  Schools are currently one of the few government entities that are not required to advertise for sealed bids  and award contracts for construction and renovation projects to the lowest responsible bidder.  However, despite the fact that school districts are not statutorily required to use the competitive bidding process, many school boards have adopted board policies requiring their districts to follow a competitive bidding process for awarding construction project contracts.

Under Senate Bill 236, all public construction projects in excess of $50,000 would have to be awarded based upon the statutory competitive bidding requirements. This means school districts would be required to use a competitive bidding process for any construction projects that exceed $50,000 in estimated cost.  This would be a mandatory requirement for school districts whereas school districts currently have the discretion to decide whether or not to use a competitive bidding process.

Competitive bidding statutes follow the “design-bid-build” project delivery method, so schools would lose the option to utilize “design-build” or other alternative project delivery methods when awarding contracts.  As a result, districts that in the past have relied on long-standing relationships with local contractors would lose the option to negotiate directly with those contractors to ensure value and quality.

Proponents of requiring schools to use competitive sealed bids, such as state Sen. Duey Stroebel (R-Saukville, pictured at left), the lead author of Senate Bill 236, have told reporters one of the goals of the bill is to make school projects more transparent.   According to Sen. Stroebel, requiring competitive bidding allows the public to know who is winning construction contracts and why.

The WASB has opposed these bills because they would take away local control and the  flexibility to choose the project delivery method and the project contractor that best meet a school district’s needs.  (See WASB testimony.)

At one time the WASB had hoped that separate proposed legislation (e.g., Senate Bill 374 or Assembly Bill 456) authorizing counties and municipalities to utilize a host of alternative project delivery methods would be amended to offer school districts similar options as a way to restore some of the flexibility schools will lose if Senate Bill 236 becomes law.  It appears, however, that support for those two bills has fizzled and they are now stalled.

All signs point toward yet another state mandate on school boards.  Stay tuned.