Does all public work have to go out to bid?

No. Every public body in Michigan runs tiered purchasing - a figure below which a department can buy directly, a band above it where a few written quotes are enough, and a point above that where a formal solicitation is required. The thresholds differ by agency and are amended over time, so the published figure on the day you ask is the one that governs.

When does a Michigan public job need a bond?

Michigan's public works bond act requires a performance bond and a payment bond before the award of any contract over $50,000 for the construction, alteration or repair of a public building or public work - covering the state, counties, cities, villages, townships, school districts, public educational institutions and public authorities. Each is set at no less than 25 percent of the contract amount. Below that figure the act does not require one.

What is the school competitive bidding threshold in Michigan?

Under the Revised School Code a district must seek competitive bids on construction, renovation, repair or remodeling only above a base figure reset every October against the Consumer Price Index. For the fiscal year running October 2025 to September 2026 that base is $31,321. A district's own internal policy can be stricter than the statute, and several are.

The Repair Work a Michigan Public Agency Can Buy Without a Bid

Q: Can a job be split into two invoices to stay under a purchasing limit?

No, and a contractor who offers to is a warning sign rather than a help. Breaking one project into pieces to avoid a procurement process is improper purchasing and the consequences land on the buyer whose name is on the requisition, not on the contractor who suggested it.

Two wrong assumptions, pointed at each other

Ask a small contractor in Michigan why they do no public work and you will usually get some version of the same answer: it all goes out to bid, the paperwork is brutal, and you need to be a much bigger company to get near it.

Ask a buildings director at a township, a district or a county why a small repair has been sitting on the list for two years and you will get the mirror image: nobody that size will engage with a public purchase order, the firms who will are geared for projects with another zero on the end, and it is not worth the chase for a door that will not latch.

Both of those beliefs are mostly wrong, and because they point at each other, nothing moves. The work sits on the list. This is an attempt to put the actual numbers in one place.

There is not one line. There are three, and then a fourth that matters more

Public purchasing is not a single gate marked "bid". Every public body in Michigan runs a tiered system, and the tiers are published:

A direct-purchase band. Below a stated figure, a department can simply buy the thing. One vendor, no competition, a purchase order.
An informal-quote band. Above that, the buyer has to collect a handful of written quotes — usually three — and document them. Still no sealed bid, no advertisement, no bond.
Formal solicitation. Above the second figure, the full process: published solicitation, sealed responses, a public opening, an award.

And then the fourth, which sits across all of them and is the one that actually stops small firms: bonding.

The figures, with the dates attached

Dollar thresholds move. Some are reset annually against inflation, some are amended by ordinance whenever a council decides to, and a figure quoted without the period it belongs to is worse than no figure at all. So, with dates:

City of Lansing. The city's purchasing rules allow informal direct purchasing by a department head below $3,000. From $3,000 to $24,999.99 the requirement is informal bidding, consisting of a minimum of three quotations wherever that is possible.

Michigan school districts. Under the Revised School Code, a district must seek competitive bids on construction, renovation, repair or remodeling only above a base figure that is reset every year against the Consumer Price Index. For the fiscal year running October 2025 to September 2026 that base is $31,321. Below it, a district can buy on quotes.

Federal purchases. These moved on 1 October 2025. The micro-purchase threshold went from $10,000 to $15,000, and the simplified acquisition threshold from $250,000 to $350,000. Under the micro-purchase figure a cardholder can buy without competing the purchase at all.

Bonding. Michigan's public works bond act requires a performance bond and a payment bond before the award of any contract over $50,000 for the construction, alteration or repair of a public building, public work or improvement — for the state, a county, a city, a village, a township, a school district, a public educational institution, another political subdivision, a public authority or a public agency. Each bond is set by the governmental unit at no less than 25 percent of the contract amount.

Every one of those is checkable, and every one of them will be different at some point. Ask the agency what its current figure is; the published number on the day you ask is the one that governs the purchase.

Why the bond line matters more than the license line

Contractors who look at public work usually fixate on licensing. It is the wrong thing to worry about first.

A bond is not insurance. Insurance you buy; a surety underwrites you, on your balance sheet, your working capital and your history of finishing jobs you started. It is a credit decision wearing a different hat, and a young company cannot acquire one in the two weeks before a solicitation closes. For a firm without a surety relationship, the $50,000 line is a wall — and it is a wall regardless of how good the crew is or how many certifications sit on the website.

Which is exactly why the band underneath it is interesting. Below $50,000 no bond is required by that act. A large amount of genuine public work lives there: interior repairs, doors and hardware, drywall and paint, handrails and accessibility corrections, gutters and roofline, floors, grounds work, the long tail of items that accumulate between budget years.

If you run public buildings

Three things make a small contractor far more likely to be useful to you, and all three cost you nothing:

Send the work order, not a summary of it. Your item numbering is the thing that lets a quote, a set of photographs, an invoice and a completion report all line up with each other. A contractor who re-describes your list in their own words has created a reconciliation problem for whoever closes the file.

Say whether a purchase order exists and what its ceiling is. A quote written against a known ceiling is a useful document. One written blind gets written twice.

Answer the prevailing wage question before the quote, not after. Michigan reinstated prevailing wage on state projects effective 13 February 2024. Where a project is sponsored or financed by the state — for schools, broadly those competitively bid under the School Code and paid for with State School Aid or qualified bond money — covered workers must be paid the locally prevailing rates and fringes, and certified payroll records have to go to the contracting agent, with online submission required from April 2026. It changes the labor line, sometimes a great deal. Your finance office can usually answer it in a sentence, and that sentence belongs in the request for quotes.

If you are the contractor

Register as a vendor with every agency in your area, even the ones that publish. Several bodies in this region do not advertise small work at all — they notify the vendors already on their list. For those, the registration is not a formality on top of the process; it is the process, and a contractor who is not on it never learns the work existed.

Then be unexciting about paperwork. A W-9 that arrives the day it is asked for, a certificate of insurance with the agency named exactly as their file requires, an invoice carrying the purchase order number, lien waivers at completion. None of that is skilled work, and all of it is the reason a buyer calls the same contractor again.

The one thing not to do

Sooner or later somebody will float the idea of splitting a job into two smaller invoices to keep it under a buying limit. It solves a real frustration and it is a serious mistake.

Breaking a single project into pieces to avoid a procurement process is improper purchasing, and the consequences land on the buyer — the person whose name is on the requisition — not on the contractor who suggested it. A contractor willing to propose it has told you exactly how they will behave when something goes wrong on site.

If the work is one project and it belongs above the line, it goes above the line. Either it gets bid properly, or it waits, or it goes to somebody bonded. Those are the three honest options and there is not a fourth.