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Public Works Contracts

This page provides a brief overview of traditional public works contracting for local governments in Washington State, including links to a wide range of public works topics. It is part of MRSC’s series on Purchasing and Contracting.

For more detailed information on public works bidding and contracting, download MRSC’s City Bidding Book or County Bidding Book. Although these publications are geared toward cities and counties, much of the information is also applicable to special purpose districts.


Traditional Design-Bid-Build Contracting

These pages discuss only the “traditional” design-bid-build public works process, and not the alternative project delivery methods of Chapter 39.10 RCW.

In the traditional project delivery method, which all public agencies in the state are allowed or required to use, an engineer/architect designs the project, then the agency uses a competitive process to bid the project and make an award to a contractor, who constructs the project using plans and specifications prepared by the engineer/architect.


What is a Public Work?

RCW 39.04.010(4) defines "public work" as:

[A]ll work, construction, alteration, repair, or improvement other than ordinary maintenance, executed at the cost of the state or of any municipality, or which is by law a lien or charge on any property therein. … "Public work" does not include work, construction, alteration, repair, or improvement performed under contracts entered into under RCW 36.102.060(4) or under development agreements entered into under RCW 36.102.060(7) or leases entered into under RCW 36.102.060(8).

This applies to all municipalities as defined in RCW 39.04.010(3) – essentially all public agencies except the various types of diking, drainage, or irrigation districts, or any other district authorized for the reclamation or development of waste or undeveloped lands.

Examples of public works projects include road construction, roof repair, HVAC upgrades, building remodeling, or parking meter installation.


What is "Ordinary Maintenance"?

Prevailing wage regulation: Effective August 23, 2019, the definition of "ordinary maintenance" in WAC 296-127-010(7) has changed to "maintenance work performed by the regular employees of the state or any county, municipality, or political subdivision created by its laws," and the citation has changed from subsection 7(b)(iii) to 7(b)(ii).

This definition applies to the state prevailing wage law, chapter 39.12 RCW. But what about procurement of ordinary maintenance and chapter 39.04 RCW? The RCW 39.04.010(4) definition of "public work" specifically excludes "ordinary maintenance". Unfortunately, “ordinary maintenance” is not defined in this statute.

The exclusion of “ordinary maintenance” from the definition of “public work” in chapter 39.04 RCW can be read to exclude ordinary maintenance from the public works competitive procurement processes in that chapter.

Contracted maintenance requires prevailing wages. RCW 39.04.010(4) states: “All public works, including maintenance when performed by contract shall comply with chapter 39.12 RCW.” That means the prevailing wage requirements that would normally apply are still applicable even though the maintenance work might not be procured as a public work.

Some case law looked at whether prevailing wages applied to contracted maintenance or ordinary maintenance. In Spokane v. Department of Labor and Industries, 100 Wn. App. 805, 819-20 (2000), the state court of appeals concluded that maintenance, when performed by contract, is "public work" subject to prevailing wage law.

The prevailing wage law’s administrative rules use a broader definition of “public work” than the definition in RCW 39.04.010(4). See WAC 296-127-010(7). Arguably, the Spokane case was looking at that broader prevailing wage definition and not at the more limited definition in the procurement statute, chapter 39.04 RCW. So, the Spokane case is useful for whether prevailing wage law applies but arguably not instructive on whether the competitive procurement process in chapter 39.04 RCW is applicable.

So, must ordinary maintenance performed by contract conform to bid limits, contract bonds, and contract retainage?

Bid Limits

This will require studying your agency's various enabling statutes for competitive procurement requirements and applicable contract bid limits. If the contracted maintenance work is a purchased service, it is possible that the agency’s own procurement policy will control the process.

Agencies can review their statutory requirements at Find Your Contracting Requirements. A careful look at the wording of those statutes will be necessary to determine any applicable bid limits, and we recommend you discuss your process and procedures on this matter with your legal counsel.

Contract Bond

RCW 39.08.010 requires a contract bond on state or local government contracts with any person or corporation to perform any work. That is a broad requirement that applies to contracted ordinary maintenance. RCW 39.08.015 places liability on the public entity when the entity fails to obtain the required contract bond. RCW 39.08.010(3) provides a possible exception to requiring the contract bond:

On contracts of one hundred fifty thousand dollars or less, at the option of the contractor or the general contractor/construction manager as defined in RCW 39.10.210, the respective public entity may, in lieu of the bond, retain ten percent of the contract amount for a period of thirty days after date of final acceptance, or until receipt of all necessary releases from the department of revenue, the employment security department, and the department of labor and industries and settlement of any liens filed under chapter 60.28 RCW, whichever is later. The recovery of unpaid wages and benefits must be the first priority for any actions filed against retainage held by a state agency or authorized local government.

Contract Retainage

Chapter 60.28 RCW requires contract retainage on “public improvement contracts” unless the contract is for a federally funded transportation project. Often, contracted maintenance will not involve making any “public improvement.” If so, there is arguably no requirement for any contract retainage on a maintenance contract.


Competitive Bidding

Chapter 39.04 RCW requires competitive bidding for public works projects, although it does not establish bid limits or required competitive processes, and RCW 39.04.280 exempts municipalities from other competitive bidding including emergency public works projects.

The exact public works bidding requirements vary from agency to agency. Many local governments have their own unique bid limits, competitive processes, and even exemptions in their statutes, and many are able to use a small works roster process for projects under $350,000 (or $300,000 for port districts and irrigation districts).

Most public works projects require prevailing wages, retainage, and performance and payment bonds.

To see your agency's statutory competitive bidding requirements, use MRSC's Find Your Contracting Requirements tool.


Public Works Topics

For more information about public works contracting in Washington, see the topics below:


Last Modified: December 31, 2019