Utility prequalification: what evaluators actually check
Prequalification under California Public Contract Code section 20101 is optional for a public entity and binding once adopted. The Labor Commissioner's March 2019 model questionnaire disqualifies a firm on any of thirteen essential answers, then scores twenty-one more on two factors. A weighted total above 35 points disqualifies. An investor-owned utility is bound by none of it.
In California the prequalification scoring sheet is published. The Labor Commissioner's model questionnaire, dated March 2019, is the form most cities, counties and special districts start from, and Public Contract Code section 20101 is why it exists. Thirteen of its questions disqualify outright. Twenty-one more are scored, and the passing number is printed on the worksheet.
Section 20101 is permissive, section 20111.6 is not
Section 20101(a) authorizes prequalification and stops short of requiring it.
Except as provided in Section 20111.5, a public entity subject to this part may require that each prospective bidder for a contract complete and submit to the entity a standardized questionnaire and financial statement in a form specified by the entity, including a complete statement of the prospective bidder's experience in performing public works.
"This part" is Part 3 of Division 2, Contracting by Local Agencies. Publicly owned utilities sit inside it. Municipal utility districts are picked up at section 20190, irrigation districts at section 20560. Once such an entity adopts a system, subdivision (b) obliges it to rate bidders on objective criteria and to decide from the answers both who may bid and on contracts of what type and size.
School districts run on a different section, and for them the word is shall. Section 20111.6 makes prequalification mandatory for a public project of $1,000,000 or more paid for with state general funds, Leroy F. Greene School Facilities Act money, or funds from any future state school bond. Districts under 2,500 average daily attendance are carved out at subdivision (l). Community college districts have their own authority at section 20651.5.
Where the school district route bites is the clock, not the content. Under subdivision (f), the district may not accept your proposal form at all unless the questionnaire arrived at least 10 business days before the public opening of sealed bids and you were prequalified at least 5 business days before that date.
Six answers must be yes, and seven must be no
Section C of the model, headed Essential Criteria Questions, is pass or fail. The instruction to awarding bodies is two lines long:
Contractor is immediately disqualified if: Any answer to questions 1 through 6 is "NO"; Any answer to questions 7 through 13 is "YES"
Questions 1 through 6 ask whether six things exist on the day you sign:
a valid and current California contractor's or other professional license as required by law for the project bid;
registration with DIR as a public works contractor for the current fiscal year;
liability insurance with a policy limit of at least $1,000,000 per occurrence and $2,000,000 aggregate;
workers' compensation insurance, or legal self-insurance under Labor Code section 3700;
reviewed or audited financial statements, attached, with notes and supplemental information;
a notarized bonding capacity statement from an admitted surety insurer, attached.
The last two carry printed traps. Question 6's note reads "Notarized statement must be from the surety company, not an agent or broker," so a letter on a broker's letterhead is a NO and the packet ends there. Question 5's note reads "Financial statements that are not either reviewed or audited are not acceptable," and it demotes a line of credit letter to supplemental information.
Question 1 is where the classification on your license has to match the work advertised, which is the ground the C-49 guide covers, and question 2 is where a registration that lapsed on June 30 shows up as a NO. That registration is dated by fiscal year, not by contract.
Questions 7 through 13 are the disqualifying histories, and two of them reach further than firms expect. Question 9 asks whether the firm or any of its officers, supervisors or managers is ineligible to bid under Labor Code section 1777.1 or 1777.7, or under any other debarment law. Question 13 asks about any currently delinquent liability for back wages, damages, interest, fines or penalties under a final judgment, order or determination. Neither question prints a dollar floor.
One ambiguity is worth raising before you decide to leave the financial statement out. Section 20101(e) waives it for a certified small business bidding no more than 25 percent of the qualifying amount in Government Code section 14837(d)(1).
The March 2019 model still prints that amount as "$10 million" as of January 1, 2001, making 25 percent of it $2.5 million. Government Code section 14837(d)(1)(B) has set the public works figure at $36,000,000 since January 1, 2019, and subparagraph (A) sets the general figure at $15,000,000. The footnote is a quarter of a century old. The awarding body writes the packet and applies the exemption, so the number to act on is the one it confirms in writing.
Twenty-one scored questions, and only a zero closes one
Section D is the scored half. Every answer other than "0" obliges the contractor to attach documents and obliges the evaluator to score two factors, each on a scale of 1 to 5.
Factor 1 is culpability: 1 for a clear good-faith mistake, 5 where the incident was "clearly an overtly willful action for which the Contractor is culpable." Factor 2 is count: 1 for a single incident, 5 for five or more of that kind. The two are added, then multiplied.
Fourteen of the twenty-one questions are multiplied by two. The model names them as questions 1 through 3, 5 through 6, 8, 10 through 12, 15 through 18, and 20. The seven left at single weight include questions 4, 19 and 21, and the pattern behind that is deliberate: a violation by a subcontractor you hired weighs half what the same violation by your own firm weighs. Questions 18 and 19 are the prevailing wage pair, questions 20 and 21 the apprenticeship pair, split on exactly that line.
Take one Cal/OSHA serious citation in the past five years. That is question 15, which is doubled. Read as a good-faith lapse with no prior history it scores (1 + 1) x 2, or 4 points. Read as willful with four prior incidents it scores (5 + 4) x 2, or 18, which is the model's own worked example.
A contractor pre-qualifies only if the overall score is 35 or less, and is disqualified if the overall score is greater than 35.
Two questions scored at the top of both factors total 40, and the packet is done. So does a longer tail: nine separate doubled questions, each scored as a single good-faith incident at 4 points, total 36. The threshold is reachable by pattern as well as by severity.
Two limits sit inside Section D and are easy to miss. Question 15 says a citation under appeal that the Occupational Safety and Health Appeals Board has not ruled on need not be reported at all, and question 16 says the same for EPA, air district and regional water board citations. Questions 13 and 14 cover disputes with project owners only, and let you omit every dispute under $50,000.
The reference interview scores in the other direction
Section E is unscored. It collects the firm's six most recently completed public works projects and its three largest private ones from the last three years, each with the owner's contact, the inspector of record, the original contractual completion deadline, the adjusted deadline and the actual completion date. Those five dates are the reason the section exists: an adjusted deadline that moved twice is a conversation the reference interview will have.
The model then supplies fourteen questions for the agency to ask those owners. Thirteen are unscored judgments about personnel, supervision, equipment and paperwork. One carries a number. Question 2 asks about stop notices, liens or claims still unresolved on contracts whose notices of completion were recorded more than 120 days ago, and prints "1 point for each is deducted from overall score; maximum amount to be deducted is 5 points."
On a worksheet where anything above 35 disqualifies, a deduction improves the contractor's position. That is unlikely to be the intent, and the model package does not resolve it. DIR is clear about who does:
Each public agency, however, is free to devise its own "uniform system of rating prospective bidders . . . based on objective criteria." For example, each public agency may determine its own scoring system and its own passing scores for different portions of the questionnaire and some may choose to implement a uniform rating system for the Project References interview questions.
The number that decides your packet belongs to the awarding body. Read it out of the published packet, and where the packet is silent, ask at the pre-bid meeting whether reference points add to the score or subtract from it.
Where the evaluator goes to check the answer
DIR expects the answers to be taken at face value in most cases. Its source list is for the case where a reviewer "has specific reason to believe that one or more answers should be verified." Those sources are public, and a contractor can run them on itself before submitting.
What the evaluator wants to confirm | Where the model package sends them |
Current license number, classifications and issue dates | Contractors State License Board |
Public works registration for the current fiscal year | |
Whether the firm or an officer is debarred | |
Whether the surety is admitted in California | California Department of Insurance |
Which carriers wrote the firm's workers' compensation | Workers' Compensation Insurance Rating Bureau, for a fee the package prints as $8 per year of information |
Officers, incorporation date and agent for service | California Secretary of State |
The package prefaces that list with a cautionary note. The answers are given under oath, and intentionally providing false information carries three consequences:
it is grounds for disqualification in itself;
it may result in disqualification from bidding on any public works project, and from registering as a public works contractor with DIR;
it may be grounds for terminating a public works contract.
The calendar decides as much as the answers
The single project track in the model runs on five deadlines, all counted back from the bid closing date.
Step | When the model sets it |
Completed questionnaire due | 35 days before bid closing |
Agency notifies qualification status | within 10 business days of a complete submission |
Contractor delivers notice of appeal | no later than 10 business days before bid closing |
Appeal hearing concluded | within 5 business days of the notice, and no later than 5 business days before bid closing |
Appeals panel renders its decision | within 1 day of the hearing |
The line that costs the most is one sentence: "There is no appeal from a refusal for an incomplete or late application, but re-application for a later project is permitted." The appeal right in section 20101(d) attaches to a rating. A packet missing the surety's notarized statement never receives a rating, so it never reaches a hearing.
The annual track runs differently. Four ten-day application windows open on January 1, April 1, July 1 and October 1, and status is mailed within 15 business days. Section 20101(c) then caps the result at one calendar year from the date of initial prequalification.
Inside that year the agency keeps the right to "adjust, increase, limit, suspend or rescind" a rating on subsequently learned information, after notice and a hearing. The model also lets the agency demand a fresh notarized surety statement at bid time whenever the questionnaire was submitted more than 60 days earlier.
The cover page is public, the rest of the file is not
Section 20101(a) draws the line:
The questionnaires and financial statements shall not be public records and shall not be open to public inspection; however, records of the names of contractors applying for pre-qualification status shall be public records subject to disclosure under Division 10 (commencing with Section 7920.000) of Title 1 of the Government Code.
DIR's package implements that by making the cover page of each questionnaire a public record and every other page confidential. The model request form then prints three exceptions: contents may go to third parties for verification, for investigation of substantial allegations, or in the appeal hearing. Signing the certification grants the agency permission to contact every person and entity named in the packet.
The signature block is stricter than most bid forms. A corporation's questionnaire needs two signatures, the first from the chairman of the board, president or a vice president, the second from the secretary, assistant secretary, chief financial officer or assistant treasurer. Both signers must be authorized to bind the corporation, and the model requires that "satisfactory evidence of the authority of each officer signing on behalf of a corporation shall be furnished." The declaration underneath is made under penalty of perjury under the laws of California.
Prequalified is a different finding from responsible
A rating settles who may hand in a bid. It does not settle who gets the award. The community college statute says so in the statute itself, at section 20651.5(b):
The prequalification of a prospective bidder shall neither limit nor preclude a district's subsequent consideration of a prequalified bidder's responsibility on factors other than the prospective bidder's financial qualifications.
The model request form says the same thing for everyone else, and in more detail:
neither the fact of pre-qualification, nor any pre-qualification rating, will preclude [Public Entity] from a post-bid consideration and determination of whether a bidder has the quality, fitness, capacity and experience to satisfactorily perform the proposed work, and has demonstrated the requisite trustworthiness.
Subcontractors are judged on their own account. Section 20101(f) lets an awarding agency prequalify or disqualify a subcontractor, and provides that disqualifying one "does not disqualify an otherwise prequalified contractor." The model's closing notice gives the agency four routes to choose from: prequalify all subcontractors, prequalify subcontractors in certain crafts, qualify named crafts after the bid is accepted but before award, or review after bid. A prime bidding line clearance work should read which box the packet checked before listing anyone.
None of this reaches an investor-owned utility
Public Contract Code section 1100 defines the term the whole scheme turns on:
"Public entity," as used in this part, means the state, county, city, city and county, district, public authority, public agency, municipal corporation, or any other political subdivision or public corporation in the state.
Pacific Gas and Electric Company, Southern California Edison and San Diego Gas and Electric are corporations regulated by the CPUC, and none of them is on that list. Section 20101 does not reach them. Their prequalification is a term of the contract instead, assembled from a safety platform grade, a risk matrix and an insurance schedule, and what that looks like at PG&E is the subject of the ISNetworld guide.
The difference shows up in three places a bidder can feel. A contractual prequalification carries no statutory appeal, no one calendar year floor on a rating, and no statutory confidentiality for what gets uploaded. A publicly owned utility buying the same line clearance work sits on the other side of that line, with section 20101 supplying all three.
So the practical rule for a bid team is to sort the buyer first. A municipal utility district, an irrigation district, a city or a county is running a statute with published deadlines and a hearing in it. An investor-owned utility is running its own program, and the packet it publishes is the only place the rules are written down.
Further reading
ISNetworld grades and what an A actually means: The contractual prequalification an investor-owned utility runs instead, and the grade it turns on.
Public works contractor registration: The DIR registration that Section C question 2 asks about, and the fiscal year it expires on.
The C-49 classification and its scope: The license Section A asks you to list and Section C question 1 asks you to hold.
Frequently asked questions
Does a vegetation management contract have to be prequalified?
That depends on the buyer, not the work. Public Contract Code section 20101 is permissive: a public entity subject to Part 3 of Division 2 may require a questionnaire, and many never do. Publicly owned utilities sit inside that part, municipal utility districts at section 20190 and irrigation districts at section 20560, so either may adopt a system. School districts are the exception that runs the other way. Section 20111.6 makes prequalification mandatory for a public project of $1,000,000 or more funded by state general funds, Leroy F. Greene Act money or any future state school bond, unless average daily attendance is under 2,500.
Can a Cal/OSHA citation still under appeal be held against a bidder?
The model questionnaire says it need not even be reported. The note printed under Section D question 15 reads: 'If you have filed an appeal of a citation, and the Occupational Safety and Health Appeals Board has not yet ruled on your appeal, you need not include information about it.' The same relief appears under question 16 for EPA, Air Quality Management District and Regional Water Quality Control Board citations. Once the Appeals Board rules, the citation is reportable and question 15 is one of the fourteen doubled questions.
How long does a prequalification rating last?
One calendar year, under Public Contract Code section 20101(c), running from the date of initial prequalification. The rating is not frozen for that year. The model announcement reserves the agency's right to 'adjust, increase, limit, suspend or rescind the pre-qualification ratings based on subsequently learned information,' after notice and a hearing. The model also lets the agency request a fresh notarized surety statement at bid time when the questionnaire was submitted more than 60 days earlier.
What happens when a packet arrives late or with a document missing?
It is refused, and there is no hearing. The model request form is explicit: 'There is no appeal from a refusal for an incomplete or late application, but re-application for a later project is permitted.' The appeal right in section 20101(d) attaches to a rating, not to a refusal. A broker's letter where the surety's notarized statement belongs is an incomplete application, so it reaches the same end as a late one and by a route with no rebuttal in it.
Is the completed questionnaire a public record?
The cover page is; the rest is not. Section 20101(a) provides that questionnaires and financial statements 'shall not be public records and shall not be open to public inspection,' while records of the names of contractors applying for prequalification status are disclosable. DIR's package states that the cover page of each questionnaire is a public record and all other pages are not. The model request form then prints three exceptions: contents may be disclosed to third parties for verification, for investigation of substantial allegations, or in the appeal hearing.
