ConstructionGovernment Contracts
Federal construction contracting covers new building construction, renovation, infrastructure, and military facility projects across all government agencies. The Army Corps of Engineers and Naval Facilities Engineering Systems Command are the two largest federal construction buyers, together managing tens of billions in annual construction spending.
Definition
Construction government contracts are federal procurement opportunities for building, renovating, and maintaining government facilities and infrastructure. These contracts cover military construction (MILCON), civilian buildings, roads, bridges, and specialized facilities, typically awarded through sealed bidding or best-value source selection.
Key Takeaways
- The Army Corps of Engineers (USACE) and Naval Facilities (NAVFAC) are the two largest federal construction buyers.
- Davis-Bacon Act prevailing wage requirements apply to all federal construction contracts over $2,000.
- Bonding capacity (bid, performance, and payment bonds) is a critical barrier to entry for construction contractors.
- Small business set-asides are common in construction, with many projects reserved for 8(a) and SDVOSB firms.
- MILCON projects often require security clearances and specialized certifications for work on military installations.
Market Snapshot
Average Contract Size
$500K - $25M
Competition Level
MediumGrowth Trend
StableTop NAICS Codes for Construction
| NAICS Code | Description | Search |
|---|---|---|
| 236220 | Commercial and Institutional Building Construction | View |
| 237310 | Highway, Street, and Bridge Construction | View |
| 238210 | Electrical Contractors and Other Wiring Installation | View |
| 237990 | Other Heavy and Civil Engineering Construction | View |
| 238220 | Plumbing, Heating, and Air-Conditioning Contractors | View |
Search contracts by NAICS code to find opportunities matching your construction capabilities.
Key Federal Agencies
These agencies are the largest buyers of construction services and products in the federal market.
Relevant Certifications & Set-Asides
These certifications and set-aside programs can give your construction business a competitive advantage in federal contracting.
Tips for Winning Construction Contracts
Build bonding capacity progressively by starting with smaller projects and establishing a track record with your surety company.
Register in the USACE Procurement Integrated Enterprise Environment (PIEE) and SAM.gov, and set up alerts for USACE and NAVFAC solicitations.
Ensure Davis-Bacon compliance from day one - wage violations can result in contract termination and debarment.
Develop relationships with USACE district offices and NAVFAC regional commands, as most construction is procured regionally.
Pursue mentor-protege agreements with established prime contractors to access larger projects and build past performance.
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Frequently Asked Questions
What bonding is required for federal construction contracts?
The Miller Act requires bid bonds, performance bonds, and payment bonds for federal construction contracts over $150,000. Performance and payment bonds must each be 100% of the contract value. Building bonding capacity is one of the biggest challenges for small construction firms entering the federal market.
What is the Davis-Bacon Act and how does it affect construction contractors?
The Davis-Bacon Act requires contractors on federal construction projects over $2,000 to pay workers prevailing wages as determined by the Department of Labor for that geographic area. Prevailing wages are typically higher than market rates and must be tracked carefully. Non-compliance can result in contract termination, debarment, and back-pay liability.
How do I find federal construction opportunities?
Federal construction opportunities are posted on SAM.gov. The largest sources are USACE (posted through ProjNet and SAM.gov), NAVFAC, GSA, and the VA. Many are posted as Sources Sought notices before formal solicitation, giving contractors time to prepare. GCFinder indexes all federal construction solicitations with NAICS code filtering.
Can small businesses compete for large federal construction projects?
Yes. Many federal construction projects under $4 million are set aside for small businesses. The 8(a) sole-source threshold for construction is $8 million, allowing agencies to award directly to 8(a) firms. Joint ventures and mentor-protege arrangements also enable small businesses to pursue larger projects.
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