OSFC Encourages Prime Contractor Self-Performance

Kegler Brown Construction Newsletter

Director Murray and others at the Ohio School Facilities Commission (“OSFC”) have been critical of contractors who, in their words, are a “pure broker of subcontracting services.” They are concerned that when a prime contractor acts as a “broker,” it might be in their self-interest, and not in OSFC’s interest, to “bid shop” subcontractors down to the lowest possible price.

In a May 28, 2010, meeting, the director of the OSFC recommended that any prime contract not involving masonry would require 25% self-performance, while any prime contract involving masonry would require 15% self-performance. Apparently, there will be a process in which certain contracts could be exempted from this requirement for “good cause shown.” Contractors may want to be particularly alert to these requirements showing up in future OSFC bid documents and may want to consider how they will handle future projects if they remain interested in doing OSFC work.