I Need Some Information About Bidding A Prevailing Wage Job - General Discussion - Contractor Talk

I Need Some Information About Bidding A Prevailing Wage Job

 
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Old 11-20-2008, 05:09 PM   #1
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I Need Some Information About Bidding A Prevailing Wage Job


I'm a paint contractor and have never done a PW job. This particular job is for the government, painting a Army Reserve's post. Reading through the specs, instructions, and just general job notes is beyond ridiculous.

For starters, they want to know exactly how much profit I project to make off of each phase of the job. How much in material etc. etc. Knowing how much profit I make is none of their business IMO, this seems way to personal for me. They also want me to show them every week's payroll, again this seems ridiculous too. I'm aware they want to make sure I'm paying the prevailing wage, which I certainly will, but these are red flags to me.

How much is it to get bonded, what's a surety bond etc.? These may be goofy questions but I need some answers from some of you guys out there that have been down this road before. I don't want to get in over my head, even though I've done commercial work in the past it hasn't been of the PW variety. Are these jobs worth the perceived hassle?

One more thing, I noticed on the files I downloaded that they had estimated 150 grand for painting. Now I can't find that page, it's like it's been deleted. Maybe I wasn't supposed to have access to it but I did.
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Old 11-20-2008, 06:04 PM   #2
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Re: I Need Some Information About Bidding A Prevailing Wage Job


Federal jobs are covered by the Davis Bacon Act, which require prevailing wages be paid to workers on projects over a certain dollar amount.

It looks daunting, but it's not that crazy. It is a lot of paperwork. Actually assembling a contract rate isn't hard if you already have a contract rate paid at open shop wages. That's the whole key, knowing your hourly rate breakdown (overhead, supervision, wages, taxes, etc). We do that calculation 4 times a year anyway, so we have our finger on that button. But PW work is relatively painless if you set your accounting up properly. If you try to buck it and let it get to you, it will frustrate you.

Prevailing wages should either be posted on the internet somewhere, or within your bid package.

For starters, breaking your bid down like that is normal for a PW contract. Labor, material, etc. They can ask for the profit markup. It doesn't mean you have to give it to them. We've always lumped the overhead and supervision higher and left the profit blank. Sometimes they'll even write something like "marking you material up over 5% may impact the success of your bid." That's horse hockey. We do it, and we get PW work.

But make sure you dot your i's and cross t's. Have your accountant help you. And make sure you pay the proper wage and bennie's.

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Old 11-21-2008, 12:56 AM   #3
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Re: I Need Some Information About Bidding A Prevailing Wage Job


I am repeating what my bookkeeper told me.

1.If you are the only person on the job, and are the owner, you are exempt from the prevailing wage, If you have one or more employees on the job, you have to pay employees prevailing wage
2. Your bookkeeper gets prevailing wage, as she has to keep track of the extra paper work.
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Old 11-21-2008, 10:26 AM   #4
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Re: I Need Some Information About Bidding A Prevailing Wage Job


We do a ton of goverment work and albeit it difficult to navigate at first is very rewarding as the contracts keep coming. Also if you are on tight finances understand getting paid is a timely process.
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Old 11-21-2008, 01:41 PM   #5
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Re: I Need Some Information About Bidding A Prevailing Wage Job


I was a contractor for the government for about thirteen years, working for the Army Corps of Engineers. The paperwork at first was a bummer but not that difficult. Once you are set up they make it worth your while, in fact you may even get a raise or two on government assignments. Keep your nose clean, dot your I's and cross all your T's and things will be just fine I think. I loved the arrangement totally.

The biggest hassle is waiting for your payment to be made but there's a secret to that hassle also. If you will discount your original quote when you invoice the work you can get paid in fifteen days as a part of the "Prompt Payment Act" passed by Congress years ago. If you don't discount, payment can drag out thirty sixty ninety days sometimes.

The government has an office (can't remember the name) that is set up to deal with you and any questions you have. Ask and you shall receive. Most of those people are very helpful and all the wage information you require is there for the asking.
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Old 11-21-2008, 03:33 PM   #6
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Re: I Need Some Information About Bidding A Prevailing Wage Job


Also, the Govt. jobs I have done, if your paper work is correct (in other words, it is not your fault) on your monthly bill, and do not pay within 30 days you charge them interest.
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Old 11-21-2008, 05:13 PM   #7
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Re: I Need Some Information About Bidding A Prevailing Wage Job


Thanks for the responses guys. It basically sounds like a lot of paperwork I have to deal with. That doesn't bother me to much, waiting on my money does bother me a little. I can handle thirty days, anything beyond that would break me.

Another question, if my regular rate per man hour is 45 dollars, should I raise it to 55-60 to cover the prevailing wages and make a small profit? I'm really confused as to what to charge, I certainly don't pay my men 30 bucks an hour on any job. But on these jobs that's about normal, what should I charge to make money off of my men and be profitable? I'm thinking 50-60 per man hour, thoughts?
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Old 11-21-2008, 08:05 PM   #8
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Re: I Need Some Information About Bidding A Prevailing Wage Job


hmmm never heard of that.. shes not on the job why would she get rate?


Quote:
Originally Posted by fireguy View Post
2. Your bookkeeper gets prevailing wage, as she has to keep track of the extra paper work.
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Old 11-21-2008, 08:33 PM   #9
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Re: I Need Some Information About Bidding A Prevailing Wage Job


Everything you need to do is in the bid packet. Just follow the instructions to a 'T".... We painted a couple of fire stations about 7 years ago & it was a prevailing wage job. This particular municipality paid us in 14 days, so I was happy. About three years later they needed to have one repainted after they had been through some remodeling. Same scope of work, just a price to re-paint. Now, having just painted it, I had my actual man hours & materials from the last time. My price was $7,100. Did'nt get it this time, the low bid was about $3,000! There is NO WAY he paid his guys prevailing wage without losing his shirt!
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Old 11-21-2008, 08:46 PM   #10
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Re: I Need Some Information About Bidding A Prevailing Wage Job


Dorman,
Yes, you need to raise what you normally charge to cover the increase in payroll expense you incur with prevailing wage. Just figure it as an increased expense, and adjust your hourly accordingly.
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Old 11-22-2008, 12:34 AM   #11
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Re: I Need Some Information About Bidding A Prevailing Wage Job


Quote:
Another question, if my regular rate per man hour is 45 dollars, should I raise it to 55-60 to cover the prevailing wages and make a small profit?
You can't get any big ideas and think you are going to get rich quick. You can't just raise your rates willy-nilly and think you are going to be awarded any contracts.

DO YOUR HOMEWORK! Get the information and the wage rates first. You should know what your markup is now. Use the prevailing wage stats then apply your same percentage markup you are using now. Add in your other operating costs and go for it. There is certainly a learning curve figuring out how to play the game.

I bid to paint some ironwork on a steel bridge to a water-gate at a reservoir/dam one time. My quote was $13,000.00. The job was awarded to another guy that had quoted $21,000.00. This was because my price wasn't high enough. It seems work that applies to dams and reservoirs carries a different (higher) prevailing wage rate than standard work away from dams. Go figure!!! I missed the wage rate and missed the required safety netting and bosun's chairs so my bid was thrown out.

The truth of the matter was...the job could have been done for about $7000.00 if it had been a non-government job and everyone would have minded their own business.

Keep in mind you have to provide copies of all your payroll records along with your invoices. Those records must include your employees names, addresses, SS#, and telephone numbers. They will randomly interview your workers.

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