Tuesday, September 23, 2014

Strategies for Dealing with Bid Protests

Some bid protests have merit, while others are frivolous. Regardless of how valid a bid protest is or isn't, it can wreck havoc on a project's schedule, and cause significant delays and added costs, especially if it moves to court. 

Recognize the high stakes:   It's important to remember that emotions can run high when award of a contract is involved.  A bid protester desperately wants the project, while the low bidder believes they are entitled to the award.

Listen carefully:  I think the best practice with bid protests is to invite the protester and the firm whose bid is being protested in for a meeting to discuss the protest.  While this isn't a formal hearing, it should be conducted with some basic ground rules.
  • Listen to the protester:  Give the protester the opportunity to verbally state the reasons why they believe their protest is valid and why they should be awarded the contract and not their competitor.
  • Ask questions:  Ask the protester the hard questions about their protest
  • Understand protester's position:  Communicate clearly that you have understood the protester's positions, whether you agree with them or not.
  • Listen to the other side:  Provide the low bidder (whose bid is being protested) with the opportunity to state why the bid protest is without merit, and why they should be awarded the contract.
  • Ask more questions:  Ask the low bidder the hard questions about points of the protest that may have merit.
  • Communicate understanding:  Communicate clearly that you have understood the low bidder's positions, whether you agree with them or not.
  • Keep an open mind:  Bring all of the issues related to the protest into the open and keep an open mind.
Avoiding court:  By treating both parties to a bid protest with respect, fairness, and dignity as you pursue the facts, it can help prevent parties from escalating the issue into a lawsuit.  If both the low bidder and protester feel that they have been treated fairly, regardless of whether your decision favors them or the other party, you can significantly reduce the likelihood that one of the parties will take the issue to court. 

Protest policies:  
  • Does your agency have clear protest policies that are fair and in compliance with any state requirements?  
  • Do you communicate your protest policies in your bid documents?
Involve your attorney:  It's a good idea to involve your attorney if you receive a bid protest, especially if the bid protest letter has come from the protester's attorney.

Mike Purdy's Public Contracting Blog
© 2014 by Michael E. Purdy Associates, LLC

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