Bidding Procedure for Public Works Projects in Washington State
Public works in Washington State that include public institutions like schools, hospitals, fire stations and many other facilities, have been and are slated to continue receiving funds from the Federal Stimulus Program. Contractors had not considered bidding for public works contracts earlier due to the influx of funding, but they can consider it now. Bidding on public works includes various mechanics and basic information on the formal bidding process for public works in Washington State– RCW 39.04 are mentioned below:
- Bid Invitation
A bid invitation is issued by a governmental entity. The invitation must be in writing and contain all specifications for the project, including information as bonding requirements and experience prerequisite for the subs to be employed on the project. These specifications must be detailed and complete to make sure that all bidders are on notice as to the requirements and can file a responsive bid. The governmental entity should publish the invitation in the county’s official newspaper at least 13 days prior to the date the bids are due. Bid conditions should also be posted at the clerk’s office and on the entity’s website.
The invitation must also state the time and place where bids will be opened. The statute needs that the bids be opened in the presence of the bidders or their agents, if they prefer to be present. At the time of the opening, the project is awarded to the lowest responsible bidder. At that the time of opening, bidders can scrutinize the bids and lodge a protest if a bidder thinks the project has not been awarded to the lowest responsible bidder.
- A responsible bidder:
The basic criteria for a responsible bidder are laid out by RCW 39.04.350. Responsible bidders:
- Should have a certificate of registration in compliance with chapter 18.27 RCW at the time of bid submittal
- Must have an existing state unified business identifier number
- Should have industrial insurance coverage for the bidder’s employees working in Washington as required in Title 51 RCW, an employment security department number as required in Title 50 RCW, and a state excise tax registration number as required in Title 82 RCW
- Must be qualified from bidding on any public works contract under RCW 39.06.010 or 39.12.065(3)
- If bidding on a public works project subject to the apprenticeship utilization requirements in RCW 39.04.320, not have been found out of compliance by the Washington state apprenticeship and training council for working apprentices out of ratio, without appropriate supervision, or outside their approved work processes as outlined in their standards of apprenticeship under chapter 49.04 RCW for the one-year period right away preceding the date of the bid solicitation.
Apart from this entities will also consider if the bidder and its subs have:
- the ability to meet the requirements set out in the bid invitation
- a reputation for integrity
- the required experience, and efficiency of the bidder
- the competence to meet deadlines
- performed well on previous contracts with the entity
- bidder’s compliance with laws applicable laws
- the ability to meet the contractual demands
Apart from these basic statutory requirements, any governmental entity can add requirements, which will be explained in the bid invitation.
- Pre-qualifying a responsible bidder:
Bidder must pre-qualify for projects initiated by the Washington State Department of Transportation. If the bidder does not satisfy the pre-qualification requirements, its bid will not be considered. Even though many entities do not require pre-qualification, it is a good idea for two reasons:
- A contract, unless there is an exception, must be awarded to lowest “responsible” bidder. Pre-qualification establishes one as a responsible bidder even before he submits the bid.
- If a bidder is not awarded the contract and bid protest follows, the bidder can be possibly awarded the contract as the next lowest responsible bidder.
- If the bid is accepted but the bidder is not pre-qualified, the qualification process will delay his ability to accept the bids of his subs and will delay the payment for his work.
There are occasions when bidder is determined to be not responsible, in such cases the agency is required to provide a written basis for this determination. This gives the bidder an opportunity to appeal the “not responsible” determination by presenting additional information. The agency should also consider the additional information before making a final determination regarding the responsibility of the bidder. If the agency makes a decision after considering the additional information that a the lowest bidder is not responsible, the entity cannot enter into a contract with any other bidder until two days after the not responsible bidder received notification of the final determination. It should also be noted that the subs must also meet the responsible bidder criteria.
- Knowing bidding:
A bid must be responsive to the specifications that are listed in the bid invitation. The bid should be developed on the basis of the materials and labour reasonably required to complete the contract. All forms in the bid packet must be completed filled out and included in the bid. Bids that do not contain all the required forms and do not list subs with the required credentials are non-responsive. Besides, bids that are significantly lower than the entity’s estimate of the cost or are significantly lower than the next highest bidder are also considered non-responsive.
- Bonding required:
Other than the bond required of registered contractors ($12,000 for generals and $6,000 for subs), Bid Bonds and Performance Bonds are generally required.
Bid bonds must be included with the responsive bid. By submitting a bid, bidder makes an offer to the entity. If the entity accepts, bidder is contractually bound to complete the contract. If for some reason he cannot enter into the contract after his bid is accepted, he is liable for breach of contract. The bid bond, which must be for 5% of the bid amount, acts as a remedy for the entity. The entity keeps the bonds amount and does not sue the defaulting bidder.
Performance Bonds are required, except for projects of $35,000 or less where entity can opt instead to retain 50% of the contract price for up to 30 days after the project is complete.
- Error on bid:
The bidder may be able to rescind or correct a bid if a clerical error is detected. If he has made an error in judgment, such as making an error as to cost of materials or labour, he will probably not be able to rescind his bid without forfeiting the amount of his bid bond.
In case of rescindable error, entity must be altered as soon as possible. He must communicate that he has made a mistake before his bid has been relied on. To be eligible to rescind or correct his bid the bidder should show that he has acted in good faith without gross negligence. The bidder requires informing that he gave reasonably prompt notice of the error and that he might suffer substantial damages if he is not allowed to rescind or correct the bid.