If you’re in the construction industry, you have likely heard and probably know a great deal about the Louisiana Public Bid Law. You may, however, have some important questions, such as whether this law applies to you? And what contracts does it cover? At Smiley Law, we always want our clients to be well-informed and updated on local law and legislation.
Here are some important facts to keep in mind about the Louisiana Public Bid Law:
Whom does it apply to?
The Louisiana Public Bid Law applies to:
- The State of Louisiana and all of its agencies, colleges and universities, only as related to public works
- Parishes, municipalities, and all other political subdivisions of the state
- The Louisiana Legislature
- The Louisiana Judiciary
- Locally elected public officials (e.g., sheriffs, assessors, court clerks, coroner etc.)
- You may not divide or separate any procurement of a public works project into smaller projects where such division or separation would effectively avoid the public bid process.
- Design-build contracts are generally prohibited for public work contracts.
- Construction managers are prohibited from managing the project as a general manager or acting as a general contractor.
- All public works contracts must provide for change orders within the scope of the contract.
- Unlicensed contractors and subcontractors are not allowed to bid on public works.
This list covers pretty much any arm of the government that is not the United States Federal Government.
What contracts does it apply to?
The Louisiana Public Bid Law applies to contracts for public works, such as those related to construction, remodeling, drainage structures, utilities and improvements. It may also apply to demolition and removal of a structure. Keep in mind that the law only becomes applicable when the total cost of a project (including labor and materials), exceeds a certain amount of money. You should also note that any public work projects over $50,000 require the use of state licensed contractors or subcontractors.
What materials/supplies are covered?
The Louisiana Public Bid Law also applies to “purchases of materials and supplies.” This may include equipment, vehicles and all other movable property. It does not apply to services, professional or otherwise, pure leases of movables (unless there is an opportunity to obtain title), contracts for insurance, and leases/purchases of real estate. There are strict notice requirements for material suppliers and equipment lessors on public projects in order for payment rights to remain protected.
The Louisiana Public Bid Law imposes several restrictions that go beyond the scope of this article. We recommend contacting local counsel to help you navigate the law and its various applications. You should keep in mind, however, a few important prohibitions:
For more information about the Public Bid Law, contact the attorneys at Smiley Law today.