Government Contracting 101
What small subs actually need to know
You've done residential work. Now a developer or GC says you need SAM.gov, Davis-Bacon compliance, and a UEI. Here's what all of that means — in plain English — and how to get started.
What is SAM.gov?
The front door to federal contracts
SAM.gov stands for the System for Award Management. Think of it as the federal government's contractor database. If you want to work on any project that receives federal money — HUD-funded affordable housing, VA construction, federal highway projects, etc. — you need to be registered here.
- It's free to register. Takes 2–8 weeks to get fully active.
- You get a UEI (Unique Entity ID) — a 12-character number that identifies your business to the government.
- Being 'active' in SAM.gov means you can receive federal payments and show up in federal databases.
- Registration must be renewed every 365 days. Let it lapse and you can't bid or get paid.
Real talk: You do NOT need SAM.gov to work on purely private jobs. But almost every affordable housing development uses some federal funding (LIHTC, HUD, Section 8) — so developers and their GCs will ask for it.
What is the Davis-Bacon Act?
The prevailing wage rule
The Davis-Bacon Act is a federal law from 1931. It says that if a construction project receives federal funding, every worker on that project must be paid at least the "prevailing wage" for their trade in that geographic area. The Department of Labor sets these wage rates by county.
- Prevailing wage is often 30–60% higher than market residential rates.
- You must keep certified payroll records weekly and submit them to the developer or GC.
- Fringe benefits (health, pension, training) can count toward the wage requirement.
- Violations can lead to withheld payments, debarment from future work, or legal action.
Real talk: Many small subs accidentally underbid Davis-Bacon jobs because they quote residential rates. Always check the wage determination for the project county before you bid. Your state Department of Labor or the US DOL website has the current rates.
What is a UEI?
Your federal business ID
UEI stands for Unique Entity ID. As of 2022, the government replaced the old DUNS number with UEI. It's a 12-character identifier (like 123456789ABC) that SAM.gov assigns to your business when you register.
- You need it to bid on federal contracts and subcontracts.
- Developers and GCs will ask for it on prequalification forms.
- It's tied to your business name, address, and EIN — so everything must match.
- If you change your business name or address, update SAM.gov immediately.
Real talk: The UEI is free. Do not pay anyone to 'get you a UEI' — SAM.gov registration is completely free on the official government website.
Minority & Disadvantaged Business Certifications
MBE, WBE, DBE, 8(a), Section 3
Many affordable housing and public projects set aside a percentage of work for certified minority, women, or disadvantaged businesses. These certifications can help you win bids, but each has its own process and rules.
- MBE (Minority Business Enterprise) — certifies your business is at least 51% owned by minority individuals. Issued by state or local agencies.
- WBE (Women Business Enterprise) — same concept, 51% women-owned. Often required on projects with federal set-aside goals.
- DBE (Disadvantaged Business Enterprise) — federal DOT program for transportation projects, but often required on HUD-funded work too.
- 8(a) — a 9-year SBA program for small disadvantaged businesses. Gives preferential access to federal contracts.
- Section 3 — a HUD program that gives hiring preference to low-income residents and businesses in the project area.
Real talk: These certifications take months to obtain. Start the process early — before you need them for a bid. BuildersPass verification can confirm your certification status once issued.
Your First-Time Checklist
If you've never done government or affordable housing work, start here.
- 1
Get your EIN
If you don't have a Federal Employer Identification Number, apply free at irs.gov. You'll need it for SAM.gov and everything else.
- 2
Register at SAM.gov
Go to sam.gov, create an account, and complete entity registration. Use your legal business name exactly as it appears on your state filings. Expect 2–8 weeks.
- 3
Save your UEI
Once SAM.gov activates you, write down your 12-character UEI. You'll use it on every government prequalification form.
- 4
Get a contractor license
Every state requires a contractor license for the trades you perform. Some states license by trade (electrical, plumbing, HVAC); others have a general contractor license.
- 5
Buy insurance
At minimum: General Liability ($1M+), Workers Comp (if required in your state), and Auto liability if you use vehicles on site. Ask your broker about additional insured endorsements.
- 6
Apply for MBE/WBE/DBE if eligible
Contact your state's Department of Transportation or Office of Minority Business Development. These take 3–6 months.
- 7
Learn Davis-Bacon basics
Visit dol.gov/agencies/whd/government-contracts/construction. Bookmark the wage determination lookup for your county.
- 8
Join BuildersPass
List your verified credentials so developers and public agencies can find you pre-qualified and ready to bid.
Common First-Timer Mistakes
- Quoting residential labor rates on a Davis-Bacon job (you'll lose money)
- Letting SAM.gov registration expire (projects get held up, payments delayed)
- Using a different business name on SAM.gov vs. your state license
- Buying insurance without additional insured and waiver of subrogation endorsements
- Starting DBE/MBE certification AFTER a bid is due (takes months)
- Assuming 'affordable housing' means private — most use HUD, LIHTC, or tax credits