A provision in Delaware's capital improvements bill could reshape how construction projects at your facility get bid and staffed.
Most Delaware gym and fitness studio owners don't realize that a provision buried in HB500—the state's bond and capital improvements act—could affect how they hire contractors for renovation, expansion, or major maintenance work.
Here's what's happening: Delaware has enacted a Community Workforce Agreement (CWA) pilot program that changes the rules for construction bidding on certain large public works projects. While the pilot targets state-funded projects, understanding it matters because it signals a shift in how the state views labor compliance on construction work—and because some fitness facilities may eventually pursue state-backed financing or grants for capital improvements.
Under Section 28 of HB500 (found on page 23), the state is piloting a requirement that small construction businesses bidding on up to four large Office of Management and Budget (OMB) public works contracts must meet a union-labor threshold. Specifically, contractors must either:
• Hold a Collective Bargaining Agreement (CBA) with a union,
• Subcontract to a union-affiliated firm, or
• Hire union workers to meet a mandated percentage of the workforce.
Traditionally, public construction contracts go to the lowest qualified bidder. This pilot suspends that standard low-bid rule (waiving 29 Del. C. § 6962(d)(13)a.4.) and instead conditions contract eligibility on union-labor compliance.
If your gym or studio is planning a significant capital project—a new wing, equipment overhaul, or structural renovation—and you're exploring public financing, grants, or partnerships with state entities, you need to know that union-labor requirements could affect your contractor options and project costs.
The pilot doesn't yet apply to all public construction. It's limited to up to four large OMB projects. But the existence of the pilot signals state policy direction. If your facility receives state funding or operates on state property, or if you're bidding against competitors who do, this creates a competitive landscape you should monitor.
The provision became effective upon enactment of HB500 (Section 173). The state will issue annual pilot reports due January 1 each year, which will track how the CWA requirement affects bidding, costs, and labor outcomes. These reports are public and worth reviewing if you're planning construction work.
If you're considering a capital project in the next 12 to 24 months, ask your contractor and your accountant whether state funding or tax incentives might apply—and if so, whether union-labor requirements would kick in. Get clarity on how that would affect your bid pool and timeline. If you work with a trade association, ask them to track the January 1 pilot reports; they'll show whether the requirement expands beyond the initial four projects.
The bottom line: HB500's CWA pilot is real, it's active, and it could influence your construction decisions if state money is involved. Stay informed as the pilot develops.
Source: Delaware HB500, A Bond And Capital Improvements Act, Section 28, effective upon enactment; annual pilot reporting due January 1.