Managing Misplaced Bids

It was another routine bid opening.  The public agency opened and read in public the 8 bids it received.  An apparent low bidder was identified.  The bidders present went their way, one of them quite satisfied, and the others hoping for a better outcome next time.

Misplaced Bids:  And then, an hour later, staff from the public agency discovered two additional bids that had also been received and time stamped in prior to the bid submittal deadline, but that, for some reason hadn't made it to the bid opening room.  They had been misplaced.

Unfortunately, this is an all too common experience that I hear about from various public agencies.  How should the situation be handled? 

Strategies:  Here are a couple of thoughts to help you develop a strategy, in consultation with your attorney:

• Laws and Requirements:  Is there a state or local law or regulations that requires the public agency to open the bids on the date and time specified in the bidding documents?  We know that if there is such a requirement for opening and reading the bids on the date and time specified, it is there to promote the confidence in the contracting community into the integrity and transparency of the bidding process.

• Should the Public Suffer?  Even if there is a requirement for opening the bids on the date and time specified, consider whether an otherwise low bidder should be penalized because of an administrative snafu within the public agency.  And perhaps more importantly, consider whether the public should be forced to pay a higher price for the work because of such an error in handling the bids. 

• Contact the Bidders:  Before opening the misplaced bids, consider contacting the bidders who submitted the misplaced bids and ask them if their bid price would be lower than the previously identified low bid.  If their bid price would not be low, open their bids and record the amounts on the revised bid tabulation with a note explaining why it is being revised.

• Public Bid Opening:  If their bid price would be low, consider contacting all the bidders in writing, explaining the situation, and notifying them that you intend to publicly open the remaining two bids at a date, time, and place specified.  This helps make the process the most transparent for all of the bidders.

Do You Know Where Your Bids Are?  Establish clear procedures within your agency to ensure that this type of situation doesn't occur.  Know who is responsible for managing received bids and where they are safely stored.

Mike Purdy's Public Contracting Blog 

© 2011 by Michael E. Purdy Associates, LLC 

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