Bipartisan Bill Would Ban Reverse Auctions for Federal Construction Contracts

House members introduced bipartisan legislation on Thursday to improve the procurement process for federally funded construction projects.

Reps. Ro Khanna, D-Calif., and Mark Meadows, R-N.C., introduced the “Construction Consensus Procurement Improvement Act” (H.R. 5644). If passed, it would ban federal agencies from using reverse auctions to award design and construction contracts. This procurement method often favors businesses offering the lowest price, rather than those that are most qualified, they said. The Senate passed its version of the bill in late December. 

Reverse auctions can “compromise quality, overlook small businesses, or even require a new bidding process down the road, eliminating any initial savings,” the lawmakers said in a press release. “Reverse auctions are ultimately inappropriate platforms for design-build contracts, which require design concepts, key personnel, and technical solutions to be incorporated into any successful final decision.”

If the bill is enacted, officials would be required to change the Federal Acquisition Regulation within 180 days. “Federal services should reflect the overwhelming technological and consumer advances of the 21st century economy,” Khanna said in the press release. “Taxpayers should see their hard-earned money going toward high-quality services around their communities.”

Meadows said the bill will “improve the effectiveness and efficiency of federal government construction contracts” and the change will not cost the government anything.

The lawmakers said the U.S. Army Corps of Engineers implemented a similar ban on reverse auctions for construction projects. Army Corps officials “found their use of reverse auctions did not reduce costs in practice and that they are ill-suited to the variability and unpredictability that comes with construction projects.”

Khanna and Meadows said they are proud to work together on this bipartisan legislation.