Bid Evaluation Dilemma

Question:  How should a public agency evaluate a low bid where the low bidder has proposed unit prices that are less than the applicable prevailing wages for the work?

The answer to this bid evaluation dilemma is not easy and is very much dependent on the facts of the situation.

Is the Bid Non-Responsive?  Since responsiveness relates to whether the bid responds to the requirements of the bidding documents, the answer to whether such a bid would be non-responsive depends on whether the bidding documents specifically required that any hourly rate bid must be at least the prevailing wage rate.  If the bidding documents did state this, then the bid might be considered non-responsive.  

If, on the other hand, the bidding documents simply requested bids for hourly rates and in a separate location in the bidding documents required payment of prevailing wages, then perhaps the bid should be considered responsive.

Questions to Ask:  In evaluating such a bid, it is very important to have a conversation with the bidder.  Here are some of the questions you might want to ask the bidder:

1. Is the bidder aware that prevailing wages apply to the project?
2. Does the bidder plan to pay prevailing wages?
3. How will the bidder be financially successful on the project if they are paying prevailing wages, but have bid less than the prevailing wage?
4. Is the bidder comfortable with their bid price even with less than prevailing wages bid for certain bid items?
5. Does the bidder want to submit a request to withdraw their bid?
6. Is the bidder aware that you may request your state prevailing wage enforcement agency to investigate whether the bidder actually pays their workers prevailing wages?

Again, the answer to the question of how to evaluate such a bid is very dependent on the specific facts and the language of the bidding documents.