I told the Feds to take a hike today... (ME)

ScottMP

and well put. Unfourtunatly it wil fall on deaf ears. Well not all, it is heard here on the wall and as wew all know there are alot more here than post. Good chance some other contractor read it and may change the way he/she does business. Maybe ...

Scott

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[Deleted User]

GAO red tape rolls...

Right before I left for Germany last month, a local GC asked me to submit a bid for a snowmelt installation (difficult conditions) at a local Federal Government building here in Denver. I was required to use "Davis-Bacon" wage pricing to comply with the government requirements, which I obliged. It is about 1/3 more than I normally pay my guys, but I complied in any case.

When I got back, I had an email requesting a breakdown of materials, labor, profit and overhead. Seemed kind of ballsy to me, and I don't usually disclose that information to my potential customers, but I went ahead and broke it out for the GC anyway.

Yesterday, I get an e-mail from him telling me that the Feds had no problem with my overall number, but that they took exception to my overhead figures and profit margin...

My reply to him said that I found it quite ironic that a bunch of overpaid beauracrats who were basically 100% non profit OVERHEAD on the backs of the American tax payers felt that they could tell a legitimate business person how much the business person could charge! I told him that the day I would allow the federal government to tell me how much I should charge is the day I get out of business, and go onto the un-employment payroll, thereby becoming THEIR overhead.

I went on to explain to him that as a dilligent business person that we tracked our overhead costs on a regular basis and adjust our overhead charges accordingly, unlike the federal government who spends more than they bring in, and when they run out of money, create huge log jams of red tape. I explained that the overhead was recovered as a function of the labor factor because it was the only stable factor on any given job, and told him a partial list of those items which are attached to overhead, like indirect labor, EMPLOYMENT TAXES, UNEMPLOYMENT TAXES, WORKMANS COMPENSATION, etc..etc...

I explained to him that my alledged competiton had no idea what their overhead was and didn't charge enough to cover it and probably wouldn't be around long enough to service the warranty on the equipment. If that's the qualifications that they were looking for, then they were barking up the wrong tree.

I explained to the GC, that I had no problem working for him directly, but that if the Goverment agents expected me to lower my price for the privelidge of wrapping myself in their red tape that they were going to have to find another schill, because I was not interested in playing their games.

In closing, I explained that the price I charged included a meager 15% profit margin in it, and that if at the end of the year I saw single digit profits that I would be a happy camper, but my price is what my price is and if they wanted a quality installation guaranteed to outlast the concrete in which it was being poured that they would accept my bid without question.

I've not heard back from the GC, and I kind of hope I don't, but my gut tells me we'll probably get this job, like it or not...

This will undoubtedly be the LAST Federal Gubernmint job I will be bidding.

ME

Mark Hunt

Good for you!


Not to mention how long they want you to wait for your money.

Best of luck!

Mark H


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Christian Egli_2

Unless it's opposite day

Come April 15, the IRS will surely ask you to resubmit your return because they wouldn't want to be taxing you on too big an income. They'll surely be nice enough to slash it in half.

I think my fiscal rates are too high, let's renegotiate that while we look for the low bidders?!? Hello Liechtenstein, Monaco, Luxembourg, all places where the government is crystallized into one person, the quintessential anti-bureaucratic state.

Weezbo

thank you for your efforts.

my post timed out on my real reply.

you have done nothing to undermine the moral of the troops ,Here.

Good for you .

my statement to a recenty 'Opportunity" was, there is too much running around.....i have to get back to work.

fill in the blanks and think about the calls that come in "we have called everyone Else in town...." its like that ...

Unknown

Mark,,,,,,,,,,,

Thank your lucky stars your not in Canada, I can`t even afford a vacation!
Dave

Ragu_5

Well Done!

Mark, I am very impressed.

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Brad White_159

Bravo Mark!!

Every word. Had to be said.

The game they want you to play only underscores why we have The Big Dig here in Boston. Five times the orginal budget, a Yugo at Rolls Royce Prices.

You the MAN!

Brad White_159

Sure Dave

but you also have outstanding health ca...

Oh never mind!

mtfallsmikey

As someone who has had some experience in this field

This is done on the big contracts as well as the small ones. Your'e not the only one, my friend! Let Halliburton do the job!

[Deleted User]

Congrats Mark.

You made the correct decision. Unfortunately, your experience is one of many ways we, the taxpaying public, get scre_ed.

I work in the land of Davis-Bacon (D. C.). Got entangled in one of those thru a former good customer, doing a gummint subsidized rehab. The paperwork was mindboggling. One of my guys had to take a pay cut, because the gummint did not have a classification for what he does. Had to list him as a laborer. Then, I was told the benefit package had to equal 41% of hourly wage, or pay the difference.

Our policy, since then, is no gummint work at all. Local, state (VA or MD), or Fed. Used to do quite a bit of sub work for a local plumber w/ a gummint contract. Gently told him no. I sleep a whole lot better at night.

jackchips_2

A little different side.

A majority of our work is "rated" because of the Davis/Bacon law and a project I am currently bidding will pay our licensed plumbers just over $ 63.00 per hour as the project winds down. Not bad.

The difference between us and Mark and some of you other smaller shops is we have people who handle the paper work as part of their regular work day and it is substantial.

Someone has to do the work, someone has to pay the "rate" and someone has to complete the paper involved, at least until the laws are changed.

I haven't heard one of our field workers complain but there sure can be a lot of it in the office.

Jack

Brent_2

Next time you need to find out what overhead and profit figures they are looking for. Just say they are looking for 10% and 10%. You adjust the labor and material price so that when you add the 10% and 10% you get your original bid.
Sometimes on commercial jobs the owner will want a change order broken out with labor, materials, overhead & profit. You can find out what overhead and profit they are looking for and adjust the labor and material price.

xwray

Would you please...

...move to Texas and run for congress?

xwray

Would you please

move to Texas and run for Congress?

xwray

would you please

move to Texas and run for Congress?

Gene_3

It seems

that everything in the country that starts out as a good thing gets screwed up

Davis Bacon was to put workers on a level playing field, for instance, if you had a real top notch crew, you wouldn;t want some scumbag coming in and out bidding you because he's running illegals at $4hr, right?

Problem is politicians, all they do us screw everything up.

Dave Yates (GrandPAH)_1

Congrats ME

We avoid prevailing-wage jobs, but for another reason. It sure isn't because of the lower rates for pay, which don't apply as our techs remain at their higher wage rates. The PW jobs disrupt an otherwise smooth flow in our business - mostly due to paperwork required.

A major loop-hole exists: if a sole propriator wishes to bid a job under a DB Act scenario, they are exempt from the wage rates and are welcome to bid at any rate they see fit.

Tain't fair, but that's the way it works. It's a sure fit for one-horse or strictly family employee shops as the competition takes themselves right out of the running because they are locked in at DB Act wage/benefit rates.

So, in spite of the fictional belief that DB levels the playing field for all, it left a wide opening for the smaller shops.

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Gene_3

yes it did

because it was not handled correctly when set up

like I said many things could work great in this country

WE JUST HAVE TO GET RID OF CAREER POLITICIANS

WHY KEEP VOTING THE SAME PIECES OF SLIME IN OVER AND OVER

IT AIN'T THE REPUBLICANS

IT AIN'T THE DEMOCRATS

IT'S THE INCUMBANTS

THE CAREER POLITICIAN

JEFFERSON WARNED US, HE SAID "god help the United States if Lawyers become career politicians"

for this country to get back on her feet and become something for the world to envy again we need to do 2 things

term limits 1 TERM

REMOVE ALL LOBBYISTS MAKE LOBBYING ILLEGAL

{oh yeah, a flat tax wouldn't hurt either, that would eliminate all the people that cheat on their taxes or use looopholes}

Chris_82

Mark

Why don't you just call this what it is, Union Bashing. And if you have a problem with what our elected officials are doing, which is following the voice of the people, try voting.

ScottMP

Chris ??

WHERE did you get Union bashing out of this ??

I see politician bashing ( always fair game ) but Union bashing ??

Come on back in from left field.

Scott



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jackchips_2

Hold on Dave.

Not like you to make such a blanket statement. Sure one man shops can pay themselves what they want but I'd like to see them do projects that require 16,000 man hours in a two year period.

They so much as put one other person on a site they have to play by the rules.

As for you paying your guys the "rate" congratulations. In this area our licensed formen are at around $ 35.00 per hour on private work but make from $ 42.00 to $ 57.00 per hour with it going to $ 60.00 soon for Davis/Bacon work.

As I stated, someone has to do the work and quite frankly it does level the playing field. The big issue in our area now is Unions trying to close out open shops by having what are called Project Labor Agreements which limit an entire project to Union only. They are the ones who are having a problem playing on their own field.

Sorry to distract from ME's original point. I agree with his stance but also hope the government comes around and he gets the job.

Jack

bb_7

discount

1% 10 days net 30. The government has to take the discount! And you will have your check in about 14 days from invoice date. Delt w/ the Feds in a past life, and this worked great. It sure beats 90+ days! Adjust your pricing accordingly and you will do fine.

bb

Ragu_5

Doctor Eatherton.....

Just in case things get tough for you...

They may want to haul you in. I could be an excellent cell mate; we could do Heat Losses and other calculations together. We could also get visits from Hot Rod, and maybe a drop in visit from Mad Dog!

Think about it. I could use a vacation. You have my phone and Email. Jack



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Dave Yates (PAH)

well, if the blanket covers....

Actually, the whole fam damily can be on the job site & be exempt.

As for those larger slices of pie? First big DB Act job we bid saw the bid awarding/opening in our State Capitol's official chambers. We had the highest bid, but that's OK too as it was a project with six York Triathlon heat pumps. (I had added a bunch of warranty time, which, in hindsight, was spot-on. The Triathlon was yanked a year later as a failed product. The two we had installed elsewhere were so troublesome that York paid for replacement equipment - including labor - to be installed.) As one of just six firms trained and certified on that particular product, we had been invited to join the fray. Our bid was in the low 7-digits & included all of the PHVAC.

The low bidder submitted a number substantially below our bare-bones cost. Their estimator was seated behind me & I've known him most of my life. He leaned forward and whispered to me: "See me after this in the hallway. You obviously don't know how this system can be beat."

So, I had to ask him how it was possible for him to bid below the job costs. He's been an estimator for decades, so unless he screwed up - majorly - there had to be a reason.

"We're not doing the work. Everything will be subbed out to sole propriator shops, which are exempt from the DB Act! We routinely win PW jobs this way and have a list of individual PHVAC shops who will do the work for us. We'll take a cut off the top."

And that was my intro to this rather large loop-hole. Since then, we've bid a few, won a few and lost more than a few to small shops willing to work cheap. The last time, it was to a single-horse shop who was charging just $34.00 an hour for his time. I saw the work later because of a site pressure problem (not created by him) and his work was very nice. He just doesn't know what the term overhead means.

jim s_2

Try getting a clue

politicians screw everything up,which is why I don`t want them involved in health care.

jackchips_2

Yes sir,

makes sense to me. When we need 12 plumbers to install the fixtures in the last three weeks before school opens we sub out to 12 one man shops.

Let's see, anyone sitting around with nothing to do for the next three weeks?

Can not happen in Mass, Dave. The unions and the Attorney General would be all over it and justly so. But then, you are in the land of Oz and even the wizard is phoney.

Jack

The Boiler Dr.

OUTSTANDING HEALTH CARE !!!!!?????
Yeah RIGHT!!! Out standing in the cold for 4 months waiting to see a health care "aide"

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John Barba_2

Strange...

Mark --

Am I correct in saying they didn't balk at your price, just how you arrived at it? I can only imagine the tax dollars they wasted arriving at THAT conclusion.

Fight the good fight...

JMB

Christian Egli_2

Cold air does a body good, victorians loved it

There is secret plan to all this... See, if your knees don't get fixed, you can't either go kicking down the complaint department.

That's just cynical of me of course, and I hope you're doing just fine. And you know boilers, so at least you can keep warm

Best regards.

[Deleted User]

Chris...

> Why don't you just call this what it is, Union

> Bashing. And if you have a problem with what our

> elected officials are doing, which is following

> the voice of the people, try voting.



You're wrong, and I've not missed voting in an election in 37 years...

ME

[Deleted User]

Correct John...

They had no problem with my overall number, but took exception to my meager 15% profit margin and the overhead charges that I included as a part of my contractual proposal.

Some peoples kids...

ME

Maine Doug_51

I think

my answer would have been, "Thanks for pointing this out. I will correct that to reflect a 25% margin and standard industry overhead charges and resubmit the bid. You government guys are really sharp to catch this and I appreciate your making sure we small business owners stay healthy."


>>>They had no problem with my overall number, but took exception to my meager 15% profit margin and the overhead charges that I included as a part of my contractual proposal.
Some peoples kids...
ME<<<