A new state law quietly reshapes how small construction companies can bid on certain large public works projects in Delaware.
Most Delaware construction and trades owners haven't heard about a significant change buried in HB500, the state's bond and capital improvements bill. But if your firm bids on large public works contracts, it directly affects your eligibility and how you'll need to structure your labor force.
HB500, effective upon enactment, includes a Community Workforce Agreement pilot program that mandates union labor on up to four large OMB (Office of Management and Budget) public works projects. This isn't optional guidance—it's a contract condition.
Here's the practical requirement: to bid on these designated projects, small construction businesses must do one of three things:
If you don't meet one of these conditions, you're ineligible to bid—regardless of your price or qualifications.
Traditionally, Delaware public works contracts have been awarded under a low-bid system. HB500 suspends that rule for these pilot projects. The law specifically waives 29 Del. C. § 6962(d)(13)a.4., the statute governing standard bid procedures. This means the lowest bidder doesn't automatically win if they can't demonstrate union labor compliance.
For non-union shops, the impact is clear: you'll either need to partner with union subcontractors, negotiate union labor arrangements, or sit out these contracts entirely. For union-affiliated firms, it creates a competitive advantage on these specific projects.
The pilot applies to "up to four large OMB public works contracts." The law doesn't specify which projects will be designated, so firms should monitor announcements from the state about which contracts fall under this requirement. This is a pilot program, meaning it's being tested before potential expansion.
The provision is found in Section 28, Page 23 of HB500. Pilot reporting is due January 1 annually, which suggests the state will track outcomes—labor participation, bid patterns, project costs—to decide whether to expand the program statewide.
That annual reporting deadline is important: it signals when policymakers will evaluate whether this approach is working and whether it should apply to more projects.
If your firm regularly bids public works contracts, review upcoming project announcements carefully to identify which ones fall under the pilot. If you're non-union, start conversations with union contractors about potential subcontracting relationships. If you're union-affiliated, understand that this creates new bidding opportunities on these specific projects.
This is a significant structural change to how Delaware awards certain public contracts. It's worth understanding now, before you encounter it on a bid deadline.
Source: HB500—A Bond And Capital Improvements Act Of The State Of Delaware, Section 28, effective upon enactment.