Bidding Requirements ACT 380

Objective Provide an overview of the bidding process, including documents included in the bidding requirements

Major Topics O The Bidding Process O Bidding Documents O Types of Bids O Bid Security O Bidder Qualification Data O Invitation to Bid O Instructions to Bidders O Elements of a Bid Form O Information Available to Bidders O Preliminary Schedules

The Bidding Process (TBP) O A basic principle of the process is that all bidders receive identical consideration and bid on an identical basis O Owner –”Who will do this work for the least cost?” O Contractor – “I will do the work for $xxxxx” O See pg 6.11; Section 6.4 covers Bidding

(TBP) Bids vary because: O Product costs vary among different suppliers O Labor costs & time estimates vary O Prices vary from the subcontractors O Labor rates vary with skill & experience O Overhead costs vary with composition of work force O Profit varies with bidder & other work available

(TBP) Subcontractor Bids O The subdivision of work will be accomplished by subcontractors which will submit their bids to the prime bidder O The prime bidder will select the subcontractors on a competitive basis

(TBP) Plan Rooms O Sets of documents for use by suppliers or subcontractors should be available in sufficient numbers and centrally located O Often these documents are available at the A/E office

(TBP) Submission of Bids O Time & date are set when the bids are invited O Bids are typically delivered in a sealed envelope to the A/E’s or owner’s office O Sometimes public project owner’s supply self-addressed, identical opaque envelopes that MUST be used for submitting the bid

(TBP) Time Limit for Bidding O The scope & complexity of the project influence the length of time given for preparing bids O A simple project may only allow 2 weeks O Other factors: O Time needed to collect subcontractor bids O Urgency dictated by owner O Time for settlement of questions & discrepancies

(TBP) Time for Acceptance O Bidder should be allowed to withdraw a bid before deadline to receive all bids – if after his/her bid is accepted then only if the owner consents may they withdraw the bid

(TBP) Bid Depository O Several states use this on publicly funded projects – may be voluntary or mandatory O Developed to improve the quality of bids & to reduce potential unethical bidding practices O Significant units of work bid by subcontractors are deposited and either compared to the bids submitted by the contractor bids or “deposited” for these contractors to use as a reference

Bidding Documents (BD) O These documents provide the necessary information that enable bidders to comply, understand, and follow stipulated requirements of the project O Bid solicitation O Instructions to bidders O Information available to bidders O Bid forms & supplements O Addenda O Contract forms O Conditions of the contract O Specifications O Contract drawings

(BD) Cross-Reference of Requirements O Basic principle of stating things only ONCE in construction documents applies here as well O e.g., Bid Security is referred to in the Bid Solicitation, but detailed requirements are found in Instructions to Bidders & Supplementary Instructions to Bidders O Correct way to document is “as indicated in the [location of primary reference]”

Types of Bids O Stipulated Sum – usually requested on architectural type of projects O Cost-Plus Fee O Guaranteed Maximum Price O Unit Price – usually used for civil type projects O Combined Bid – work divided into phases

Bid Security (BSec) O This guarantees if a bid is accepted, the bidder will enter into a formal agreement w/ the owner (typically days from opening of bids) O Selected bidder will furnish required construction performance & payment bonds – once done, they receive security back and are now considered the CONTRACTOR O Purpose of the security is to compensate the owner for damages incurred if selected bidder doesn’t accept contract award O If selected bidder accepts award, unsuccessful bidders receive their security back

BSec O Details should address: O Required amount of security (stipulated sum or %) O Form of security (cash, certified check, money order, bid bond) O Length of time security will be retained O Description of conditions under which security will be returned to unsuccessful bidders O Description of conditions under which bid security will be forfeited

Bidder’s Qualifications O Owners may require bidders to provide information related to their physical & financial ability to do the work O AIA Document A305 (Contractor’s Qualification Statement) may be used O Qualification information is CONFIDENTIAL

Bid Solicitation O Invitation to Bid – contain only pertinent data that will help bidders decide if they are qualified to submit a bid O See sample on page 5.8; fig 5.2-A O For public projects --- published as a legal notice in designated publications or newspapers O In private work the owner may send to a select few qualified bidders

Basic Information of Bid Invitation/Advertisement O Project Identification O Description of Work O Type of Bid O Time of Completion O Bid Opening O Examination and Procurement of Documents O Bid Security O Bidder’s Qualifications O Owner’s Right to Reject Bids O Laws & Regulations – nondiscrimination in employment/wages laws

Instruction to Bidders (ItB) O Provide more detail than the Invitation to Bid O Basic information includes: O Documents – where available, cost, return policy O Examination of Documents, Site & Local Conditions O Interpretations During Bidding –who to send inquiries to; how replies will be provided (formatted as Addenda); time limits

ItB O Substitutions of Products – list acceptable products or manufacturers O Type of Bid O Preparation of Bid – forms to use & the number of copies; required signatures O Bid Security Information O Performance & Payment Bond—in public projects it is typical that each are equal to 100 % of the contract sum

ItB O Subcontractor Listing O Identification & Submittal of Bid O Modification or Withdrawal of Bid O Disqualification of Bidders O Applicable Laws – list federal, state, & local O Licensing of contractors for special requirements O Permits for special construction O Exemption from sales tax, if applicable O Local labor agreements

ItB O Pre-bid Meeting – location, time, who can attend, if attendance is mandatory O Liquidated damages O Opening of Bids O Evaluation & Consideration of Bids – owner’s right to reject all bids O Execution of Contract

Bid Form (BF) O Prepared by bidder & submitted to the owner O Blank spaces are filled in by the bidder & he/she signs (if corporation—their seal included) O Bid form is bound into the project manual O See figure 5.2-C on pg 5.14 Note: this example does not include everything that could be included in a Bid Form

Elements of a Bid Form (EBF) O Project identification O Name/Address of party to whom bid is directed O Entity submitting bid O Acknowledgements –owner has right to reject bids; bidder will enter into agreement if accepted; bidder examined site & is familiar with laws

EBF O Amount of time for the bids to be held open O Identification of addenda O Prices O Alternatives O Allowances – cash & quantity O Combined bids O Completion date O Liquidated damages O Supplements (Attachments) non-collusion affidavit O Closing

Information Available to Bidders O When provided…not part of the contract documents O Often includes information related to subsurface, geotechnical reports, hazardous material reports, descriptions of the site or existing buildings, and property survey information

Preliminary Schedules O When provided, is included as advisory data only O Not part of the contract documents O Does not replace requirements for submission of a final schedule by the contractor