When a bidder fails to submit a required document with its bid, does that render the bid non-responsive, or may the omission of a required document be considered as an immaterial irregularity, and the contract awarded to them?
This is the question that the City of Scranton, Pennsylvania is wrestling with now. Under the City's blight removal program, an invitation to bid was developed for the demolition of 13 homes throughout the city.
Bid protest: After bids were received in February 2012, the City awarded a contract to the low bidder, Shea Demolition, for $121,375. The second low bidder, Scartelli Construction Services then filed a bid protest, alleging that Shea failed to submit its qualifications and a schedule for the work with its bid, as required in the bidding documents.
Internal City dispute: The City Controller ruled that Shea's bid was non-responsive and that the project needed to be re-bid. The City's Office of Economic and Community Development disagreed with the Controller, arguing that the qualifications were not necessary since they knew of Shea's reputation, and that the schedule wasn't critical since the City had provided six months for the work to be completed.
Responsive or non-responsive? Is the City Controller or the Office of Economic and Community Development correct? The Controller's attorney stated that "The law on bidding is clear. Whether the requirements contained in a bid invitation are met is not a discretionary matter." Is he right? It really all depends on the nature of the irregularity in the bid. In this particular situation, without having seen the bidding documents, it appears that the Controller's position is probably correct and that the failure of Shea to submit their qualifications and schedule with the bid is a material irregularity. Whether the Controller's position that the project must be re-bid is correct versus awarded to the second low bidder is a matter of the City's policy and the budget for the project.
What is a material irregularity? How should you make a determination whether an irregularity in a bid is material or immaterial? Generally, the test as to materiality is whether it gives a substantial advantage or benefit not enjoyed by other bidders. Since the City of Scranton required certain documents to be submitted with the bid, these became requirements. A bidder failing to submit them has an advantage or benefit that other bidders don't have. They have additional time because they don't have to prepare their qualifications and schedule. In addition, they have the theoretical advantage of deciding after bids are opened whether to take the project (arguing their bid is responsive) or not (arguing that the irregularity is material and their bid is non-responsive). This is a decision for public agencies only to make.
What should be required with the bid? In order to help decrease the risk of bid protests, and to provide bidders with as much time as possible to prepare and submit their bid, my practice has always been to only require a few documents to be submitted with the bid: the bid form, a bid guaranty, and anything else legally required to be submitted with the bid. Adding other requirements to the bid submission creates a risk of non-responsive bids.
More Information: For more information about the City of Scranton's situation, click here to read an article from thetimes-tribune.com.
Mike Purdy's Public Contracting Blog© 2012 by Michael E. Purdy Associates, LLChttp://PublicContracting.blogspot.com
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