Wednesday, September 5, 2012

When Does Bidder Responsibility Become an Issue of Bid Responsiveness?

While responsibility always relates to the bidder, and responsiveness relates to the bid, public agencies that require documentation of bidder responsibility be submitted with the bid unnecessarily complicate the bidding process.

3 Problems:  There are three problems associated with requiring that bidder responsibility documentation be submitted with the bid:
  • Non-Responsive bids:  If a bidder fails to submit the bidder responsibility documentation with the bid, the bid would be considered non-responsive.  Thus, the bidder's qualifications or responsibility would never even be evaluated because the bid would be non-responsive.
  • Required of all bidders:  Requiring that bidder responsibility documentation be submitted with the bid requires all bidders, not just the low bidder, to assemble and submit the documentation.  This is a lot of work for bidders, especially since the agency will only evaluate the responsibility documentation for the low bidder.
  • Reduces focus on developing a good bid price:  Public agencies should limit what must be submitted with the bid.  It is in the public agency's best interests to simplify the bidding process so that bidders can focus in the last frantic minutes before the bid deadline on submitting a competitive bid price, and not having to remember to submit additional extraneous materials.
What should be submitted with the bid?   I think it's best to limit what is required to be submitted with the bid to the Bid Form, a Bid Guaranty, and anything else legally required to be submitted.  I have talked with many public agencies who require a significant number of other items to be submitted with the bid.  Many of these items are not required by the terms of a grant of agency regulations, but are more a matter of practice, and can just as easily be submitted after the bid deadline by the low bidder. 

What are the risks?  The more items that must be submitted with the bid, the higher the risk there is for a public agency of non-responsive bids and/or bid  protests, both of which may delay the project schedule and/or cost the agency additional money in the form of a higher bid price or costs to defend a bid protest.

When bidder responsibility becomes responsiveness:  Bidder responsibility requirements become an issue of bid responsiveness when the low bidder fails to submit required responsibility documentation with the bid.

Evaluate:  Evaluate your agency's practices and what you require to be submitted with the bid.  Are there ways to limit these submittals?
Mike Purdy's Public Contracting Blog 
© 2012 by Michael E. Purdy Associates, LLC

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