Monday, September 27, 2010

Bid Protest on Wisconsin City's Alternate Bid

The second low bidder on a City of Burlington, Wisconsin project to construct a parking garage downtown has filed a bid protest with the City, claiming the City should have awarded the project to them with an alternate bid price that was lower than the base bid price awarded to another firm.

Alternate Bid Lower Than Base Bid:  Metro Parking Structures, LLC submitted a bid for an alternate bid (using pre-existing materials versus new materials in the base bid) for $2.044 million.  The City chose not to exercise the alternate bid using pre-existing materials and thus awarded the project to Riley Construction for a base bid amount of $2.09 million.  Metro's bid for the base bid was $2.31 million.  Riley Construction has already begun work on the project.

City's Action:  The City Council met in closed session on September 21, 2010 but made no decision on the bid protest.  Based on the information I have on this project, it appears the City was well within their rights to award to Riley Construction as the low bidder on the base bid.

Practical Tip:  When awarding a contract based on a bid that includes alternate bids, a public agency should decide on the merits of the construction option whether it intends to exercise the alternate or only award the base bid.  The determination of the low bidder should be based on comparing the low base bid prices of all bidders, or the low bid alternate prices of all bidders, depending on which option is selected.  For a more detailed discussion of this issue, visit my blog posting for August 26, 2009.

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