Across America, local units of government are adopting responsible contracting policies. Localities as diverse as Seattle, Washington and Portage, Indiana have included provisions to encourage contractors to use taxpayer dollars responsibly. The goal of the provisions is to balance the interests of business, labor, and taxpayers in a manner that creates broad-based prosperity and increases taxpayer value.

Responsible bidder ordinances (RBOs) are a kind of “insurance policy” for taxpayers. The local ordinances establish clear, objective standards that contractors must meet in order to win bids and construct projects funded using taxpayer dollars. The policies typically include common-sense items such as:

• Proof of required licenses;
• Certified payroll records to ensure that contractors only employ individuals who are eligible to work in the United States;
• Evidence of participation in certified training programs so that the workers are high-skilled, safe, and able to build quality schools, roads, parks, sewage systems, and public transit systems.

By mandating that local units of government accept the lowest responsible and responsive bidder, RBOs ensure that public works projects are completed efficiently, safely, on-time, and within budget– without the need for additional re-construction later on. All of these benefits accrue at no additional cost to the taxpayer.

RBOs also increase the likelihood that local contractors will win bids and local craftsmen will be employed on the job. By instituting local standards, RBOs prevent giving taxpayer dollars to cut-rate contractors racing to the bottom with wages, committing payroll fraud, or hiring less-trained workers. RBOs attract local contractors who care about their communities.

What happens in communities that do not have responsible contracting provisions? Folk singer Chicago Farmer– from Delavan, Illinois– indirectly helps describe the situation:

Woke up, jackhammers on Wednesday / Yeah, they’re tearin’ down my favorite store / To build up another new high rise / That no one on my block can afford.

And they brought in an out-of-state builder / He brought in his out-of-state help / Meanwhile, the poor local workers / Were drove out to find somethin’ else.

Illinois has about 90 responsible bidder ordinances because they ensure durable infrastructure and protect public bodies from shoddy work and cost overruns by unscrupulous contractors. With an RBO, taxpayers can be assured of safe, professional, and highly-skilled craftsmanship on every project– typically by local contractors who care about their communities. RBOs are a high-road economic development tool.

Chicago Farmer will play us out:

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Frank Manzo IV is the Policy Director of the Illinois Economic Policy Institute (ILEPI). Visit ILEPI at www.illinoisepi.org, like ILEPI on Facebook, and follow ILEPI on Twitter @IllinoisEPI.

One Year Later: Responsible Bidder Ordinances are Protection Plans for Taxpayers, Providing the Highest Value at the Lowest Cost