In an effort to curb the desire of subcontractors to lower their prices from what they proposed in their original bids to general contractors, the American Subcontractors Association (ASA) is pursuing the Construction Quality Assurance Act of 2001, which would prohibit bid shopping on construction contracts with the federal government. 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.
The proposed legislation would give the government the power to prohibit bid shopping in the contract bidding process and provide government contracting officers with the ability to investigate incidents of bid shopping. If ratified, the bill would also impose penalties for noncompliance, including treble damages, cancellation of the contract, and in some cases, debarment.
The Construction Quality Assurance Act of 2001 has been referred to the House Committee on Government Reform’s Subcommittee on Technology and Procurement Policy for further discussion.