The Minnesota legislature is requiring new regulatory changes for government contractors. The law will go into effect on January 1 of next year. From that point, contractors and subcontractors soliciting construction contracts for, or working on projects exceeding $50,000 from public entities in Minnesota must now qualify as “responsible contractors.”
Attorneys for Dorsey & Whitney spelled out the details in a recent alert – “In order to qualify as a “responsible contractor”, a bidder must meet minimum criteria under lowest responsible bidder or best value selection methods. The new statute applies to construction contracts let by state agencies, the Metropolitan Council, the Metropolitan Airports Commission, Minnesota State Colleges and Universities, the University of Minnesota and municipalities.”
In order to achieve this designation, contractors will have to be in compliance with workers’ compensation and unemployment insurance requirements, and appropriately registered with state agencies. They will also have to be in compliance with federal and state labor laws, and has not had a certificate of compliance for public contracts revoked or suspended more than twice during the three year period prior to submission of the verification of compliance.
Additionally, contractors may not have received a monetary sanction from the Minnesota Department of Administration or Transportation for failure to meet targeted business goals more than once during the three-year period prior to submission of the verification of compliance.
These requirements also extend to subcontractors added to the project. Failure to comply or being fraudulent in compliance will result in the loss of an award.
“Contractors and subcontractors vying for public construction awards should seek counsel before submitting solicitation documents to ensure compliance with the specific statutory “responsible contractor” criteria,” the attorneys note. “Further, even after winning an award, contractors must be diligent in ensuring any subcontractors hired for the project also meet the “responsible contractor” criteria and timely submit supplemental verification.”