Anti-"Bid Shopping" Bill Attempts to End Poor Management Practices
A new bill would prohibit bid shopping on construction contracts with the federal government and improve the government's construction management process. Rep. Paul Kanjorski (D-Pa.) introduced H.R. 1859, the Construction Quality Assurance Act of 2001, on May 16.
The bill would penalize contractors working on a federal contract for bid shopping. Bid shopping is defined in the bill as "the practice of a contractor asking, requiring, or otherwise pressuring a subcontractor to lower bids for subcontracts, or accepting lower bids from subcontractors, after submitting a bid without passing the savings from the lower bids back to the federal government."
According to American Subcontractors Association, which supports the bill, bid shopping entices subcontractors to lower their prices from what they proposed in their original bids to general contractors, resulting in higher profits for general contractors without increasing the quality of work that the government will ultimately receive. Some states prevent bid shopping by "bid listing," a system in which a general contractor must submit with its bid the names of the subcontractors it intends to use if awarded the contract.