White House contracting proposal could have big impact on construction industry

“You shouldn’t have to show your entire business and run it the way you want me to run it to get a federal contract,” said Brian Worth, spokesman for Independent Electrical Contractors, a trade group for electricians. “If I have to pay all my employees High Road standards, unless I exclusively do federal work, it creates a massive headache. It almost makes me want to set up a federal contracting company. Otherwise, if I do one federal job I have to comply with these policies for all my employees.”

Republican lawmakers have also expressed concern that the proposed regulations would favor unionized companies bidding on federal contracts and may adversely impact small businesses, particularly in the construction industry. Sen. Susan Collins of Maine sent a letter to Office of Management and Budget chief Peter Orszag in early February requesting a briefing on the proposed changes; her office has yet to receive a response.

“I am very concerned that the High Road proposal would negatively impact small businesses. If, for example, small, non-union businesses ‘score poorly,’ then they could be ineligible to compete effectively in the acquisition process. This change could ‘shut the door’ for small businesses that are seeking to enter the federal marketplace,” Collins said in an e-mailed statement.

Sen. Bob Bennett of Utah, who also signed the request for a briefing, echoed Collins’s concerns.

“This would make it very difficult for a small business to take part in the federal market,” Bennett said last week. “In order to enforce that kind of thing you’ve got to have a hefty bureaucracy, a whole bunch of new regulations and a lot of new rules.”

The administration official countered that many of the recent reports are erroneous since no policy decision has been made, making the impact impossible to predict. They said one of the priorities for any contracting reform would be to keep costs as low as possible. The official also said the administration will try to accomplish as much of its procurement reform through administrative action as possible, adding weight to lawmakers’ fears that the White House may attempt to bypass them while implementing the new policies.

“It’s all couched in very attractive motherhood and apple pie kind of language,” said Bennett. “You get down below that language, ask what’s really going to happen in the marketplace and it appears, unless they can give me other information, that we want to unionize places that are not unionized and we want to punish shops that are not union contract shops.”