Municipal type contracts??

[RAW]

Has anyone here ever bid on and/or received a municipal contract (or something similar)?

I'm considering bidding on a Forest Service contract in the fall that would be for the next 3 years.

Curious to hear about others' experiences.

 

[Bird]

</font><font color="blue" class="small">( Has anyone here ever bid on and/or received a municipal contract )</font>

Nope, but I've been on the other end; working for the city and dealing with a lot of contracts and contractors. My experience has been that government agencies require sealed bids for nearly everything, and experienced bidders bid high so the government pays more for everything than you or I could go buy it for retail. Three reasons: (1) the contractor has to deal with, and satisfy, so many different people, (2) a tremendous amount of paperwork, and (3) slow pay. I can tell you for a fact that my City used to require, as a part of the bid, a 2% discount for payment within 30 days. They used to run 5 months behind on paying, but they still deducted their 2% discount. So, if I were going to bid on a municipal contract, I'd do just like the other bidders; bid at least twice what I'd charge anyone else. It's a sad fact, but never the less, a fact.

 

[Soundguy]

The GC I work for does about 50% of its work thru city/county/state contracts, and the rest are private (49% ) and an odd federal contract once in a blue moon.

What specifically are you wanting to know?

Soundguy

 

[GATC35]

I was approached by a local State run University about doing some landscaping work. The first question of of the guys mouth was how much damage bond insurance do you have ? Not how much do you charge like most people's first question. The next question was how much liability insirance do you have? The next question was how many empolyess do you have, and are they covered by workers compensation?

Get the picture ?

 

[Soundguy]

Seems like normal stuff to me. We won't even touch a sub that does not have wc for their employees.. or if a owner/operator corp.. he needs an exemption... Same with liability. In fact.. most small guys get limited use riders on their auto insurance for comercial liability in the 100,000$ range. Our insuranbce company usually requires 300k.. or more prefered.. 1mil... etc. I see most municipalities being the same way. might even ask about EEOC stuff.. and thusly.. certified payrolls.. etc. Safety program.. drug free workplace programs.. etc.. etc.. it's all about them limiting their liability exposure by making sure that subs they hire are insured.. that way when someone gets killed/hurt on the job.. -your- insurance 'hopefully' pays the brunt of it.. vs their liability insurance having to pay it all.

I've seen many cases where a general contractor was using unlicensed / uninsured subs.. the sub or subs workers get hurt.. then sue the GC.. and get workers comp benefits under the GC's policy. Insurance company hits the employer with something like 3x the policy premium.. treats it like an undocumented employee.. in many cases the carrier drops the gc after paying the claim.. not to mention the tax and legal ramifications / fines / penalties...

Soundguy

 

[RAW]

I was considering doing some Forest Service road maintenance. Talked to the guy on the phone. He forwarded me some documents (wow! there's a lot of stuff). I'd be looking to do grading maintenance, ditch clearing, mowing/brush-clearing.
I'm curious what all I need to have lined up to get the contract.
Clearly, I'd need to operate through an LLC, with good insurance. What else do I need to be thinking about to get my ducks in a row?
This contract would cover about 100 miles of road. There look to be 2 work periods (april-june and september-november). This contract is what would justify the purchase of the equipment I've got spec'd out. Then any other additional work would be gravy.

Speaking of which, for those of you making moolah with your equipment, how do you go about getting business? Word of mouth? Yellowpages? Show up at local businesses and neighborhoods hawking your wares? Do any of you do scheduled grading maintenance on people's driveways? What about bank mowing (long arm mowing)?

Thanks. Lookin' forward to more info.

 

[RonR]

One caution I would offer is some contracting agencies look at work history of your company. Most, I would think, would be reluctant to offer a contract to a startup without some track record.

Many check references, and if you can't provide any, doubt that you could win.

Most wouldn't want to contract with you, then have to break the contract, and re-bid it, because you couldn't get funding, labor, or broke down, etc.

Not to rain on your parade, but I'd think about it.

ron

 

[Hib]

Several years ago I contracted with the state DOT to mow about 30 different small parcels. They ranged in size from .5 to 3 acres. The properties were spread about the county and my understanding was they thought it was a hassle to send their employees all around to deal with them. I had my tractor on a trailer and pulled into a cafe for lunch, just happened to sit next to a DOT official who asked me if I was interested in some work. I said sure! He gave me a list of the parcels and said check them out and send me a bid. His only concern was if I had personal insurance and enough equipment to do the 'job'. Mailed the bid and five days later I was mowing. I spent more time loading/unloading than mowing, but they payed me VERY well. As suggested, I bid what I thought was an extremely high bid (no experience there). As fast as I got the contract, I thought I should have bid much more. This put my name on their list which has led to more offers since.

 

[RAW]

Yes, I did notice the section about prior experience.
That was the thing that made me the most apprehensive about all of this. Well, that and the liability I'll be taking on. /forums/images/graemlins/shocked.gif

I'm looking at buying a new Unimog U500. It'll run the boom-mower, a snow plow, a salt spreader, a front-end loader, a rear-mount crane, a chipper, a tow-behind hydraulic grader, etc. etc. etc. It's a brilliant setup if you ask me. The truck runs its own hydraulics systems.

I'm in love with the idea of the truck, and I'm positive that you could make money with the thing. But I want to be sure that I DO make money with the setup, cuz it ain't cheap. So I'm trying to figure out my game plan before I commit to buying the equipment.

In addition to all of this, I'm a steel sculptor. And it would be lovely to use the Unimog for fetching steel supplies, loading and unloading sculpture for installation, getting to my remote house and shop in the snow, mowing my OWN driveway banks (about 1 mile of driveway), etc.

So, if I can pick up a few jobs with the Unimog that will pay for the equipment over 3-4 years . . . . I'd be happy. Once I've offset the purchase, any extra money coming in from the Unimog would be gravy.

Here's a picture to show an example of the boom-mower on the truck

And another that kinda shows the road-grader

Since I'm moving to the mountains of Western N.C., I also wonder about the possibility of running building supplies up rough roads for local builders. Or landscaping supplies. Or pulling mobile home trailers up rough inclines. I'm just not sure where to focus my time and effort. I'm going to call the owner of the company that built my driveway and see if he would be willing to send me driveway maintenance jobs.


Just trying to realize a dream.

 

[RonR]

Wow that is impressive equipment............... And also quite expensive I'm sure.

One thing about buying all new high dollar stuff, it will work great. But you also have to keep it running to pay the bills!

Specialty equipment like that can be marketed to fetch premium prices, such as "my equipment won't put ruts in the bank that can cause errosion and expensive to fix issues" .

With that amount of money to invest, I'd be cautious and see if I could do a rent to buy deal with the dealer or lease it for a year. That's just my conservative side.

I'm want to run this plan by my CPA, Insurance guy, and maybe personal lawyer just to be sure before I jumped in.

But overall, I think it could go!

Ron

 

[Soundguy]

Here in florida, we must have a business license, and depending on the work, a contractors license ( not for mowing or litter abatement.. etc.. ). We need a commercial insurance package with suitable limits for the contracting agency.. wc if applicable.. comercial auto .. general liability..etc.. Some require you to have a bonding company, and put up a bond to bid the jobs, ( bid bond ).. and then if you are awarded, you need a payment or performance bond.. again.. not all jobs are bonded.. etc. Local cities require us to have a comp card ( certificate of competence).. etc.

Have fun!

Soundguy

 

[RAW]

Yes, you're absolutely right. I've already talked to my financial advisor. I need to speak with a lawyer about how things would need to be set up.

Luckily though, I know of a used unit with very few hours on it and a practically brand new mower.

We'll see. I'm not sure if I have the balls to jump into this!
I wish I had some prior experience working for another grading company or something.

 

[RAW]

I've been thinking about this for a couple of months now.
But I think that I've decided not to pursue the endeavor any further. In the area I'm moving to, most of the entities that I would look to get work from already own their own equipment. Electric company, city, local ski resort/development, etc. all have their own equipment. And from what I can tell about this forest service contract, it now appears that the road-grading is more like road-building! So . . . unless I wanted to take on lots of small, individual jobs . . . it seems that it wouldn't be worth diverting my time and effort into this field.

Which puts me back in the market for some smaller/cheaper equipment to work my own property. /forums/images/graemlins/grin.gif

Thanks for the replies.