This bill amends existing law (RCW 39.04.152) to change procedures and dollar thresholds for the small works roster used by state agencies and authorized local governments. It sets tiered limits for small works roster contracts (excluding sales tax): $350,000 or less through Dec. 31, 2026; $530,000 from Jan. 1–June 30, 2027; $560,000 from July 1, 2027–June 30, 2028; $590,000 from July 1, 2028–June 30, 2029; $620,000 from July 1, 2029–June 30, 2030; and $650,000 beginning July 1, 2030. The amendment authorizes local governments to use the same direct contracting provisions as state agencies and requires agencies to adopt procedures to implement chapter 395, Laws of 2023, with the Department of Enterprise Services responsible for developing and publishing templates. The bill makes several procedural changes to how agencies solicit and award small public works contracts: agencies may obtain written or electronic quotations, award to the responsible bidder with the lowest responsive bid, and must notify all contractors on the applicable roster who indicated interest in the geographical area. For projects under $150,000, agencies are encouraged and may direct contract with small businesses as defined in chapter 395, Laws of 2023; when six or more qualifying small businesses are available, agencies must rotate direct contracts among them and avoid repeatedly favoring the same contractors. Agencies must notify small, minority, women, and veteran-owned businesses when direct contracting is used, establish a utilization plan for those businesses, record and make bid quotations publicly available after award, and publish annually the list of small works contracts awarded and contractors contacted for direct negotiation. If an agency chooses not to use small-business direct-contracting methods, it may not use direct contracting and must electronically notify all roster contractors. The amendment also changes bond and retainage procedures: contracts under $5,000 have no retainage or performance bond requirement; contracts over $5,000 remain subject to performance bond requirements in chapter 39.08 RCW and retainage requirements in chapter 60.28 RCW, but awarding agencies may reduce or waive retainage consistent with RCW 60.28.011(1)(a), subject to specified liabilities and recovery rights. The extract references definitions and other provisions in chapter 395, Laws of 2023 and uses terms (for example, small works roster, applicable geographical area, direct contracting, responsible bidder, responsive bid) that are not defined in the provided text. One provision mentions projects "with an estimated cost less than $350,000" while the section sets later effective threshold amounts; how those statements interrelate is not clear from the extract. The bill passed the House on February 12, 2026 (94-0) and the Senate on March 5, 2026 (48-0).

If enacted, the bill raises the dollar thresholds over several years so many more public construction jobs can be awarded through the faster small works roster and direct-contracting procedures instead of full formal bidding. State agencies and local governments authorized to use the roster will be able to directly award more contracts, will have to set and follow new procedures (with templates from the Department of Enterprise Services), notify and record quotations from roster contractors, publish annual lists of awards and contacts, and follow new small-business priority and rotation rules for projects under $150,000. For very small contracts under $5,000 there will be no retainage or performance bond requirement, and for contracts over $5,000 agencies may reduce or waive retainage subject to specified liabilities and recovery rights. The groups most affected are contractors on small works rosters—especially small, minority, women, and veteran-owned firms—which should see more opportunities and a required rotation that can spread work more evenly, though exact eligibility depends on definitions in chapter 395, Laws of 2023. Authorized local governments gain the same contracting options as state agencies. Agencies will face modest new administrative work and transparency duties and may change cash-flow risks for contractors by reducing retainage; key implementation details and timing are unclear from the provided text because several definitions and the interplay of an earlier $350,000 reference with the new tiered thresholds are not included.