Have you ever bid on a local government contract?
1. Prevailing Wage
Requirements:
•Must be registered with the California Department of Industrial Relations (DIR)
•Pay prevailing wage rates (not your normal crew rates)
•Submit Certified Payroll Reports (CPRs) weekly
•Maintain:
•Worker classifications (carpenter, laborer, operator, etc.)
•Apprenticeship ratios
Reality:
👉 Labor cost can jump 20–40% vs private jobs
👉 Paperwork is constant and audited
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📊 2. Certified Payroll Reporting
•Weekly submission (often through LCPtracker or similar systems)
•Includes:
•Worker name, classification, hours, wage rate
•Subject to audit at any time
👉 Mistakes = penalties back pay
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🌱 3. Local Hire Requirements (SF-specific)
San Francisco has strict local hire rules through the:
•San Francisco Office of Economic and Workforce Development (OEWD)
Typical requirements:
•% of hours must be worked by SF residents
•Additional targets for:
•Disadvantaged workers
•Apprentices
👉 If you miss targets:
•You pay penalties OR make up hours
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🏗️ 4. LBE / DBE / Small Business Participation
City contracts often require:
•LBE (Local Business Enterprise) participation (SF-based firms)
•Or DBE / MBE / WBE participation depending on funding
You may need to:
•Subcontract a % (e.g., 10–25%) to certified firms
👉 This can affect:
•Your subs list
•Your pricing
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🌿 5. Environmental Requirements
Especially in SF:
a. Clean Construction / Green Diesel
•Use Tier 4 equipment or retrofitted engines
•Low-emission diesel (or electric where required)
b. Dust Control
•Watering / dust suppression plan required
•Air Quality Management compliance
c. Stormwater Pollution Prevention (SWPPP)
•Erosion control
•Runoff containment
•Inspections logs
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🪶 6. “Indigenous / Community / Equity” Requirements
This varies by project, but you’ll often see:
•Community benefits requirements
•Outreach to:
•Minority-owned businesses
•Local workforce programs
Sometimes includes:
•First Source Hiring
•Good faith efforts documentation
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🛠️ 7. Tooling & Safety Requirements
•Cal/OSHA compliance (strictly enforced)
•Site-specific safety plan required
•Sometimes:
•Electric tools (noise/emissions rules)
•Idling limits on equipment
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📑 8. Insurance & Bonding
Much heavier than private work:
•General liability: often $2M–$5M
•Performance bond: 100% of contract
•Payment bond: 100%
👉 This can cap how big a job you can bid
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💰 9. Retention & Payment Terms
•Retention: typically 5–10%
•Slow payment cycles vs private work
•Change orders = bureaucratic
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🧠 10. Administrative Burden (Underrated Cost)
You’ll need:
•Someone managing:
•Payroll compliance
•Subcontractor compliance
•Reporting
👉 This is why a lot of good builders avoid public work