ConstructionPro Week, Volume: 5 - Issue: 9 - 03/04/2016

Bidders Beware – Protest Rights Are Frequently Limited

By Bruce Jervis

 

Bidders on public construction contracts frequently have exaggerated impressions of their rights. Basically, a disappointed bidder has only the tools conferred by regulation and statute. And, those laws vary greatly among jurisdictions.

 

This was illustrated in the bidding on a fire station project in Missouri. The fire district bypassed the low bid without any determination that the bid was nonresponsive or the bidder was not responsible. Bid protest rights under Missouri state law are currently a topic of conflict and confusion, so the low bidder raised a constitutional challenge in the federal courts.

A federal appeals court ruled that the bidder was not entitled to due process of law in the administration of the procurement process. The fire district had reserved the right to reject any and all bids, so the bidder had no property interest in the contract.

 

In some forums, such as federal contracting, bid protest rights are extensive, formal and well established. In other jurisdictions, they are far more limited. With some local government contracting, protest rights appear nonexistent or informal at best. It is imperative for bidders to know their rights and utilize available remedies in a timely manner. What impediments have you encountered in dealing with questionable procurement practices? Your comments are welcomed.

 

COMMENTS

The limitation on the rights of bidders that you outline is certainly consistent with our practice over the years. Our RFPs consistently state that the Owner has the right to reject any and all bids without explanation. While we do primarily private work, this clause has been the a staple of the non-government side of the bidding process for many years.
Posted by: Michael Steiner, AIA - Friday, March 04, 2016 11:07 AM


My MPA master paper at Penn State, 2012 was on the problems of women and minority contractors not receiving contractors or subcontracts from the Commonwealth of Pennsylvania Department of General Services, which has a huge budget that includes state contracts in construction. What few contracts women and minority contractors received,if the prime contractors did not pay the state did not hold the prime contractors accountable, which caused a lot of small contractors to go bankrupt. The prime contractors were using subs because in this way that part of their projects the subs were responsible for the labor and materials.

As I looked into these matters, I found the local jurisdictions to not be accountable to state and federal monies that are filtered through state agencies.

In short, contracting with states and with federal monies when you are a subcontractor can be a real iffy thing if you get paid, or when you get paid, no matter what the rules say, because when primes don't pay they know this can be dragged out for long periods of time.

Though I as a contractor was state, federal, and PennDOT certified and registered, I did not feel confident to bid as a sub...not on my abilities, but would I get paid.

For most prime jobs I was too small, and for small ones or se

I did bid as a prime for s VA landscaping project for about $1.6 million amd did not get it, but I did not know in time that I could have protested and gotten more information. There were only four of us bidding, and the contractor they gave the project to was in their neighborhood.

I can only speak from my observations and those of other contractors whom I saw or learned of who were getting messed over by government contracting....it is as corrupt as anything I have ever seen.

When construction slowed down with the recession, things got worst. The prime contractors that did some work in house found it more profitable to mostly do away with their labor and instead manage projects, putting the expenses of labor and materials on subcontractors. Because of the scarcity of jobs, they low bid, which meant someone would not be paid...and it was not them.

I know there are supposed to be some checks and balances such as bonding, but I was not seeing the successes but the problems.

There is a lot more I could say but I will stop here.


Posted by: Donna Arthur - Friday, March 04, 2016 11:29 AM


Please tell me the citation for the Missouri case - have urgent requirement to know.

P Kraemer
Posted by: Peter Kraemer - Friday, March 04, 2016 2:35 PM


 









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