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CityBiddingBookWashingtonStateDECEMBER2020December2020|CityBiddingBook:WashingtonStateICITYBIDDINGBOOK:WASHINGTONSTATECopyright2020bytheMunicipalResearchandServicesCenterofWashington(MRSC).
Allrightsreserved.
ExceptaspermittedundertheCopyrightActof1976,nopartofthispublicationmaybereproducedordistributedinanyformorbyanymeansorstoredinadatabaseorretrievalsystemwithoutthepriorwrittenpermissionofthepublisher;however,governmentalentitiesinthestateofWashingtonaregrantedpermissiontoreproduceanddistributethispublicationforofficialuse.
ACKNOWLEDGEMENTSThispublication,CityBiddingBook:WashingtonStateisdesignedtoassistcityofficialsindeterminingwhethercompetitivebidsarerequiredforpurchasesorwhencontractingforpublicworks.
SpecialrecognitionisgiventoMichaelPurdy,principalofthefirmMichaelE.
PurdyAssociates,forhisassistanceinthedevelopmentoftextandappendicesonalternativebiddingtechniques.
DISCLAIMERThecontentofthispublicationisforinformationalpurposesonlyandisnotintendedaslegaladvice,norasasubstituteforthelegaladviceofanattorney.
Youshouldcontactyourownlegalcounselifyouhaveaquestionregardingyourlegalrightsoranyotherlegalissue.
MRSCMISSIONTrustedguidanceandservicessupportinglocalgovernmentsuccess.
MRSC26014thAvenue,Suite800Seattle,WA98121-1280(206)625-1300(800)933-6772www.
MRSC.
orgDecember2020|CityBiddingBook:WashingtonStateIIRevisionHistoryMRSCdoesourbesttoupdatethispublicationasneededtoreflectnewlegislationorotherrelevantinformationimpactingcityandtownbiddingprocedures.
Belowisasummaryofsignificantrecentchanges.
Ifyouareawareofanyothersectionsthatyouthinkneedtobeupdatedorclarified,pleasecontactmrsc@mrsc.
org.
Tomakesureyouhavethemostrecentversion,pleasegotomrsc.
org/publications.
DATESUMMARYDecember2020EntireDocument:Completecontentreview;madeanumberofclarificationsandedits.
AddedhyperlinkstoRCWs,WACs,andotherresources.
TheFirstStepstoTake:PurchaseorProject:Preliminaryupdatetoreflectchangeddefinitionof"ordinarymaintenance"(WSR19-15-119).
BidLimitsThatDifferbyCityClass:FirstClassCities:Increaseddaylaborlimitsto$75,500(singlecraft)and$150,000(multiplecraft)(ESSB5418).
BidLimitsforSecondClassCities,Towns,andCodeCities:Increasedpublicworksbidlimitsto$75,500(singlecraft)and$116,155(multiplecraft)(ESSB5418).
TheBiddingProcess:TheBidDecision:Newprovisionsallowingcodecities,secondclasscities,andtownstoawardprojectstothesecond-lowestbidderifcertaincriteriaaremetandamendingthebidprotestprocedures(ESSB5418).
SmallWorksRoster:Updatedsmallworksrosterlimitto$350,000andlimitedpublicworksthresholdto$50,000.
Citiesmaywaiveretainageforrosterprojects.
Ifestimatedcostexceeds$250,000,citymustnotifyallcontractorsontherosterthatbidsarebeingsought(ESSB5418).
JobOrderContracting:Removed70,000populationthreshold;anycitymaynowusejobordercontracting(SHB1295).
WaterPollutionControlFacilities:RCW70.
150.
030etseq.
recodifiedasRCW70A.
140.
030etseq.
,butnochangesmadetostatutorytext(SHB2246§2049).
PollutionControlFacilities:Chapter70.
95ARCWnowrecodifiedaschapter70A.
210RCW,butnochangesmadetostatutorytext(SHB2246§2012).
December2020|CityBiddingBook:WashingtonStateIIIDATESUMMARYJuly2018TheBiddingProcess:Unit-Priced("On-Call")PublicWorksContracts:Newstatutoryauthoritytoenterintounit-pricedcontracts(ESSB6143).
TheBidDecision:Updatedlowestresponsiblebidderrequirementstoincludepublicworksandprevailingwagetraining/experiencerequirements(ESSHB1673).
July2017TheBiddingProcess:TheBidDecision:Updatedlowestresponsiblebidderrequirementstoincludeaswornstatementthatthebidderisnotawillfulviolatoroflaborlaws(SSB5301).
December2020|CityBiddingBook:WashingtonStateIVTableofContentsIntroduction1NavigatingthisPublication1TheFirstStepstoTake3PurchaseorProject3"PublicWork"or"OrdinaryMaintenance"3Materials,Supplies,andEquipmentNotUsedinConnectionwithaPublicWork;Services4CostofaPublicWorksProjectorPurchase4InclusionofRetailSalesandUseTax5BidLimitsThatDifferbyCityClass6FirstClassCities6PublicWorksBidLimits–TheTraditionalInterpretation6PublicWorksProjectsBiddingLimits6ReportingandNoticeRequirements7Women'sandMinorityBusinessEnterprise(WMBE)Requirements8MinorExceptions9Materials,SuppliesandEquipment9Services9BidLimitsforSecondClassCities,Towns,andCodeCities9PublicWorks9Materials,Supplies,andEquipment10PurchasesbyUseofVendorLists11LeasewithanOptiontoPurchase11Services12Unclassified,TerritorialCharterCity12ExceptionstotheBiddingLaws13BrandName,Monopolies,SoleSourceandSpecialMarketConditions13BrandNameBidding13MonopoliesandSoleSourceBidding14SpecialMarketConditions–WhatAreThey15Auctions15Emergencies15Neighborhood"Self-Help"Projects16StateorCountyConstructionorRepairofStreets16BidLawsThatApplytoAllCitiesandTowns18ArchitecturalandEngineeringServices18BidSplitting19BiddingLawsandPrivatePartyProjects20PurchasingfromOtherGovernmentsand"Piggybacking"22FederalGovernment22IntergovernmentalPurchasesandBidding22December2020|CityBiddingBook:WashingtonStateVTheBiddingProcess25AdvertisingforBids25SecondClassCities,Towns,andCodeCities25FirstClassCities25InformationtoIncludeintheAdvertisement26QuestionsAddressingOtherConsiderations27BidandPerformanceBonds29SecondClassCities,Towns,andCodeCities29FirstClassCities29PerformanceBondsforAllCitiesforAllPublicWorksContracts30TheBidDecision30DeterminingtheLowestResponsibleBidder31AcceptingorRejectingtheBid34ProtestofContractAward35BiddingIrregularities35ErrorsinBidProceduresorinComplyingwithSpecifications35BidAmountErrors36AlternativePublicWorksContractingProcesses38SmallWorksRoster38LimitedPublicWorksProcess40Unit-Priced("On-Call")PublicWorksContracts41BidAdvertisement42ContractDuration43PrevailingWages43ChangeOrders43SystemwideMaintenanceandRepairContracts43Performance-BasedContractsforEnergyEquipment44JobOrderContracting44DesignBuildProcedures45GeneralContractor/ConstructionManagerProcedures46WaterPollutionControlFacilities46PollutionControlFacilities47OtherBiddingIssues48ChangeOrders48ConflictofInterest50ResultsofViolationofBidStatutes50Appendicies52December2020|CityBiddingBook:WashingtonState1IntroductionThepurposeofcompetitivebiddingistoprovideafairforumforthoseinterestedinbiddingonpubliccontractsandtohelpensurethatpubliccontractsareperformedsatisfactorilyandefficientlyattheleastcosttothepublic,whileavoidingfraudandfavoritismintheiraward.
1Thispublicationisintendedtofamiliarizeofficialswith:(1)competitivebiddingrequirements;(2)therecommendedbiddingproceduresforthecontractingofpublicworksandimprovements;and(3)publicpur-chasingprocedures.
Publicpolicyfavorscompetitivebidding,andam-biguousstatutesaregenerallyconstruedinfavorofrequiringcompeti-tivebidding.
However,competitivebiddingproceduresdonothavetobefollowedunlesstheyarerequiredbystatute,localcharterprovision,orlocalruleorordinance.
Thispublicationdiscussesthestatestatutoryrequirementsand,insomeplaces,discusses"bestpractices"aswell.
NavigatingthisPublicationAlthoughrelativelyfew,thestatutesgoverningbiddingcanbequitecomplicated.
Therearedifferent"rules"forbiddingpublicworks;forpur-chasingmaterials,supplies,andequipmentnotusedinconnectionwithapublicwork;andforprocuringarchitecturalandengineeringservices.
Also,cityclassificationandpopulationdeterminewhattypesofproj-ectsmustbeputoutforbid,andthedollarthresholdatwhichbiddingisrequired.
Anumberofexceptionsandspecialsituationsexist,manyofwhichapplytoallcities,whilesomeapplyonlytocertainclassesofcities.
(Forsimplicity,wewilloftenreferjustto"cities.
"Unlessother-wisenoted,everythingsaidaboutcitiesalsoappliestotowns.
)Tousethispublication,wesuggestthatyoufollowthestepsbelow.
1.
ReadthesectiontitledPurchaseorProject.
Thiswillhelpyoudeter-minewhetheryouare:(a)dealingwithapublicworksproject;(b)purchasingmaterials,supplies,orequipmentunconnectedwithapublicworksproject;or(c)obtainingaservice.
Thisinitialdetermi-nationisimportant,becausetheamountacitycanspendwithoutgoingoutforbidvariesforthedifferentcategoriesofcontracts.
2.
Next,readthesectiononCostsofaPublicWorksProjectorPurchasesothatyouknowwhatcostsmustbeincludedifyourprojectorpurchasehastobebid.
1Gostovichv.
WestRichland,75Wn.
2d583,587(1969).
December2020|CityBiddingBook:WashingtonState23.
Thenrefertothesectionsonbidlimits.
Ifyourcityisafirstclasscity,gototheFirstClassCitiessection.
Forallothercitiesandtowns,seethesectionBidLimitsforSecondClassCities,Towns,andCodeCities.
4.
Reviewthetableofcontents.
Thereareadditionalbiddinglawsandexceptionstothoselawsthatapplytoallcities.
Onemightapplytoyourprojectorpurchase.
Specialrulesapplytopurchasingfromothergovernments.
5.
Foradiscussionofthebiddingprocess,includingpotentialpitfalls,seethesectionTheBiddingProcess.
December2020|CityBiddingBook:WashingtonState3TheFirstStepstoTakeFirst,determinewhatcategorytheprojectorpurchasefallsinto:publicwork;maintenance;purchaseofmaterials,equipment,orsuppliesunconnectedwithapublicwork;orservice.
Then,ifthecategoryisdeterminedtobeonewherebiddingmaybenecessary,thecostmustbeestimated.
PurchaseorProject"PublicWork"or"OrdinaryMaintenance"Publicworksprojectsmustbebidifthecostoftheprojectexceedsacertainamount.
RCW39.
04.
010definestheterm"publicwork"forbiddingpurposesasfollows:"Publicwork"meansallwork,construction,alteration,repair,orimprovementotherthanordinarymaintenance,executedatthecostofthestateorofanymunicipality,orwhichisbylawalienorchargeonanypropertytherein.
(Emphasisadded.
)Notethatthisdefinitionofpublicworkincludesconstructionandrepairbutexcludesordinarymaintenance.
Butwhatis"ordinarymain-tenance"Thepublicworksstatutedoesnotdefineit.
However,WAC296-127-010(7)(b)(ii),whichdefines"ordinarymaintenance"inthecontextofwhetherprevailingwageshavetobepaidaspartofthecon-tract,definesitasfollows:Ordinarymaintenanceisdefinedasmaintenanceworkper-formedbytheregularemployeesofthestateoranycounty,municipality,orpoliticalsubdivisioncreatedbyitslaws.
Ifyourcitydoesnotadopttheprevailingwagesdefinitionof"ordinarymaintenance"forpublicworks,itshouldstilldefinetheterminitscon-tractingordinancesorpolicies.
Thiswillhelpcontractingstaffdecidewhenacontracthastobebid.
Forexample,replacingadeterioratingbridgeorroofwouldamounttoarepair,orperhapsnewconstruction,butnotmaintenance.
Suchaprojectwouldbeapublicworkbothforbiddingandprevailingwagepurposes.
2Ontheotherhand,usingexistingcityemployeestorodorcleanasewerorcleanaroofwouldinvolvemaintenancenotperformed2AGO,December19,1923(Vol.
17.
p.
175).
December2020|CityBiddingBook:WashingtonState4bycontract.
Consequently,thisexpendituredoesnotneedtobebid,andprevailingwagesdonotapply.
However,ifinsteadofusingcityemployeestoperformthework,thecitycontractsoutfortherepair,therepairworkisclearlyapublicworkforprevailingwagepurposesandmayrequirebidding.
Obviously,iftheworkdoesnotqualifyas"ordinarymaintenance,"anditwillbeper-formedbycontract,bidsmayberequired,dependingupontheesti-matedcostofthework.
Materials,Supplies,andEquipmentNotUsedinConnectionwithaPublicWork;ServicesNormally,whetherpurchasesfallintothecategoryof"materials,supplies,andequipment"notusedinconnectionwithapublicworkprojectorimprovementisclear.
Stationery,rubberbands,firetrucks,andcopymachinescometomind.
And,servicesshouldalsobeeasytoidentify.
But,asthequestionsinthesidebarshow,sometimesthesituationisambiguous.
CostofaPublicWorksProjectorPurchaseDeterminingtheestimatedcostofaprojectorpurchaseisacrucialfirststep,sincethedeterminationwilldictatewhethertheprojectmustbebid.
Whileanexactcostestimatewouldclearlybepreferred,realisticallyexactnessisseldompossible.
Thepersonmakingtheestimateshoulddeterminethefairandreasonablevalueoftheworktobeperformed(orthepurchasetobemade),giventheparticularconditionsthatwillbefacedandtherequirementsoftheproposedprojectorpurchase.
Thecostestimateshouldreflecttheamountthecityconsidersfairandreasonableandthatitiswillingtopay.
Severalapproachescanbeusedtomakeanestimate.
Thecitycanconsidertheactualcostofperfor-mance,consideringthecurrentcostoflabor,equipment,andmateri-als.
Obviously,useofthisapproachrequirestheestimatorhaveagoodworkingknowledgeofconstructionmethods,equipment,andmarketconditions.
Asecondapproacharrivesatanestimatebyusinghistoricaldata.
Theestimatorreviewsrecently-awardedcontracts,makingadjust-mentsfortheproposedprojectandthecurrentmarketconditions.
Athirdapproachistocombinehistoricalbiddatawithactualcostdata.
33ThisdiscussiondrawsuponaninternetarticletitledGuidelinesonPreparingEngineer'sEstimate,BidReviewsandEvaluation,preparedbytheFederalHighwayAdministrationoftheU.
S.
DepartmentofTrans-portation(2004).
AskMRSCIsthepurchaseofcomputersoftwareapurchaseofsuppliesorapurchaseofservicesItdepends.
Ifthesoftwareis"off-the-shelf"(orpredominantlyso),thenitisapurchaseofsupplies.
Iftheprimaryorsolecostisforconsultantservicestocustomizetheprogramforthecity,itisapurchaseofservices.
IsanewtelephonesystemapublicworkoranequipmentpurchaseItdepends.
Iftheacquisitionofthetelephonesystemrequiresinstallationofcable,conduits,andotherdevices,itmayfallwithinthedefinitionofthetermpublicwork.
If,however,theacquisitionismerelyofhardware,suchastelephones,itwouldprobablybeconsideredthepurchaseofequipment.
December2020|CityBiddingBook:WashingtonState5Indeterminingthecostofapublicworksproject,allamountspaidformaterials,supplies,equipment,andlaborontheconstructionofthatprojectmustbeincluded.
SeeRCW35.
22.
620(5)and35.
22.
630forfirstclasscities,andRCW35.
23.
352(6)forsecondclasscities,towns,and(viaRCW35A.
40.
200)codecities.
InclusionofRetailSalesandUseTaxNormallysalestaxappliestoeverysaleoftangiblepersonalproperty(andsomeservices)toallpersons,includingcities.
4Soforbidlimitpurposes,thetaxshouldbeincludedwhendeterminingthecostofapublicwork,orwhencalculatingthecostofmaterials,supplies,andequipmentpurchasedseparatelyfromapublicwork.
However,therearesomesalesandusetaxexemptionsforcertainpublicworksprojects.
Theexemptionsinclude:1.
Laborandservicesrenderedforthebuilding,repairing,orimprov-ingofanystreet,place,road,highway,easement,right-of-way,masspublictransportationterminalorparkingfacility,bridge,tunnel,ortrestleownedbyacityortownwhichisusedprimarilyforpedestrianorvehicletraffic.
(RCW82.
04.
050(10);seealsoWAC458-20-171,nicknamed"Rule171.
")Materialsusedinconstructingtheseproj-ectsarenotexemptfromthesalesandusetax.
2.
Laborandservicesfortheprocessingandhandlingofsand,gravel,androcktakenfromcitypitsandquarrieswhenthematerialisforpublicly-ownedroadprojects.
(RCW82.
08.
0275andWAC458-20-171.
)Therearenosalesandusetaxexemptionsforanyothercitypurchases.
PracticeTip:Whendevelopingthebiddocuments,itmaybeusefultogroupthoseitemswhichareexemptfromthesalesandusetaxandthen,onthelinelabeled"salestax,"referencethatexcludedgroup,makingitclearthatallotheritemsaresubjecttothetax.
4ThebasicdefinitionsofitemsandtransactionssubjecttotheretailsalesandusetaxappearinRCW82.
04.
050.
AskMRSCIsthepurchaseofnewparkingmeterheadsanequipmentpurchaseorapublicworkIfthecityweremerelypurchasinganumberofparkingmeterheads,whichwillbestockpiledinawarehouseandusedoveraperiodoftimetoreplacedefectiveheads,itwouldbeanequipmentpurchase.
However,iftheheadsarebeingpurchasedinconnectionwithaspecificprojectandtheheadswouldbeinstalledwithinashortperiodoftime,suchasacitywideparkingmeterreplacement/upgrade,itisprobablyapublicwork.
Mustvolunteerlabor,material,orequipmentbeincludedinthecostestimateforapublicworksprojectNo.
Itisnotnecessarytoincludeanitemforwhichtherewillbenocharge,becausethereisnocosttothecity.
DoestheexemptionfromthesalesandusetaxforlaborandservicesonacitystreetprojectapplyifaprivatecontractordoestheworkYes.
Itmakesnodifference,forthepurposesoftheexemption,whetherthecitydoestheworkorhasitdonebysomeoneelse.
December2020|CityBiddingBook:WashingtonState6BidLimitsThatDifferbyCityClassFirstClassCitiesPublicWorksBidLimits–TheTraditionalInterpretationNote:Thebasicbidstatuteapplicabletofirstclasscities(RCW35.
22.
620)isnotclear.
Thereisnohelpfulcourtdeci-sionorlegislativehistorytohelpdecipherwhatitmeans.
Thefollowinganalysisisa"bestguess"ofwhatthestatuteissupposedtomean,eventhoughtheseconclusionsarenotnecessarilyborneoutbythestatutorylanguage.
Analterna-tivereadingofthestatutesiscontainedinAppendixD:FirstClassCityBidLaws-AnAlternativeView.
Thestatuteonlyrequiresbiddingforpublicworksprojects.
Asmentionedpreviously,citiesneednotputservicecontractsoutforbid.
And,thestatutesdonotrequirefirstclasscitiestobidcontractsformaterials,supplies,orequipmentnotusedinconnectionwithapublicworksproject.
PublicWorksProjectsBiddingLimits1.
Infirstclasscities,competitivebidsarerequiredforallpublicworksprojectscostingover$150,000,ifmorethanasinglecraftortradeisinvolved.
Ifonlyasinglecraftortradeisinvolved,bidsarerequiredwhenthecostisover$75,500(RCW35.
22.
620(3)).
5However,additionalrestrictionsmayapply,asnotedinparagraph3below.
2.
Inanyannualorbiennialbudgetperiod,cityemployeesarelimitedintheamountofworktheycandoonpublicworksprojects.
Thislimitis10%ofthepublicworksconstructionbudget,includinganysupplementalamounts(RCW35.
22.
620(2)).
Thismeansanyproj-ectvaluedinexcessofthe10%limitrequirescompetitivebidding.
Remember,however,thatthisrulemustbecombinedwiththespecificdollarlimitsdiscussedinparagraph1.
Whenthosespecificdollarlim-itsarereached,biddingisrequired,evenifthe10%budgetlimitisnotexceeded.
Thedollarthresholdthatdetermineswhetherbidsarerequired5NeitherthestatebiddingstatutesnortheWashingtonAdministrativeCodedefinetheterms"craft"or"trade.
"Dictionariesdonotprovidedefinitionsthatareoperationalinthiscontext.
Forexample,TheAmericanHeri-tageDictionaryoftheEnglishLanguage,3rdedition(Boston:HoughtonMifflinCompany,1992)defines"craft"as"anoccupationortraderequiringmanualdexterity.
.
.
"and"trade"as"anoccupation,especiallyonerequiringskilledlabor;acraft.
"Abetter,workingdefinitionforbidlawpurposesmightbe:"Craft"or"trade"meansarecognizedconstructiontradeoroccupationforwhichprevailingwagecatego-riesareestablishedbytheDepartmentofLaborandIndustriesoftheStateofWashingtoninthelocalityofthecity'sprojectsorpurchases.
December2020|CityBiddingBook:WashingtonState7isthesmalleroftheamountsinparagraphs1or2.
Anexamplemaybehelpful.
Assumethatafirstclasscityhasa$6,000,000publicworksconstruc-tionbudget.
Itisplanningondoingamulti-tradeconstructionprojectthatwillcost$120,000.
Limitinparagraph1=$150,000Paragraph2limit:$600,000(10%ofpublicworksconstructionbudget)Theycandotheprojectin-housebecausethecostdoesnotexceedthesmallerofthetwoamounts.
However,ifthecityhasalreadydone$550,000ofin-housework,thenthe$120,000projectwouldputthecityoverits10%limitandthatprojectandallsuccessiveprojectsinthatbudgetperiodwouldhavetobebidthroughformalcompetitionorletthroughtheuseofthecity'ssmallpublicworksroster.
3.
Wheneverafirstclasscityhashadpublicworksperformedbycityemployeesinanybudgetperioduptothemaximumpermittedamountforthatbudgetperiod(the10%limit),allremainingpub-licworkswithinthatbudgetperiodmustbecontractedthroughacompetitiveprocess.
Penaltiesmaybeappliedifcitiesbreakthe10%limit.
Iftheemployeesofanyfirstclasscityperformpublicworksinexcessofthe10%limit,theamountinexcessof10%willbesubtractedfromtheamountofpublicworksotherwisepermittedtobeperformedbycityemployeesduringthenextbudgetperiod.
If,aftertwoyearsfromthedateoftheexcesswork,thecityhasfailedtoreducetheamountofpublicworksperformedbyitsemployees,thestatewillreducethemotorvehiclefueltaxdistributionstothecityby20%,retainingthewithhelddistributionuntilcomplianceisdemonstratedbythecitytothestateauditor.
ReportingandNoticeRequirementsFirstclasscitiesmay,butarenotrequiredto,reporttothestateaudi-toryearly,indicatingtheirtotalpublicworksconstructionbudget,supplementalpublicworksconstructionbudget,totalconstructioncostsofpublicworksperformedbypublicemployees,andtheamountofpublicworksperformedbypublicemployeesaboveorbelowthepermissible10%ofthetotalconstructionbudget(RCW35.
22.
620(4)).
Forcitiesoperatingonabiennialbudget,thereportmayreflectactivitywithinthebiennialperiod.
FirstclasscitieswithpopulationslessthanDecember2020|CityBiddingBook:WashingtonState8150,000mayreportallpublicworksinexcessof$5,000thatarenotletbycontract.
Everycitythatusesitsownforcesonprojectscostingmorethan$25,000mustpublishadescriptionandtheestimatedcostoftheprojectinitsofficialnewspaper15daysbeforebeginningtheproject(RCW39.
04.
020).
Women'sandMinorityBusinessEnterprise(WMBE)RequirementsPresumablyallcontractsenteredintobyafirstclasscityforanypublicworkorimprovementexceeding$10,000(or$15,000forwatermains)arerequiredtocontainthefollowingclause(RCW35.
22.
650):Contractoragreesthatthecontractorshallactivelysolicittheemploymentofminoritygroupmembers.
Contractorfurtheragreesthatthecontractorshallactivelysolicitbidsforthesubcontractingofgoodsorservicesfromqualifiedminoritybusinesses.
Contractorshallfurnishevidenceofthecontrac-tor'scompliancewiththeserequirementsofminorityemploy-mentandsolicitation.
Contractorfurtheragreestoconsiderthegrantofsubcontractstosaidminoritybiddersonthebasisofsubstantiallyequalproposalsinthelightmostfavorabletosaidminoritybusinesses.
Thecontractorshallberequiredtosubmitevidenceofcompliancewiththissectionaspartofthebid.
However,Initiative200(codifiedasRCW49.
60.
400(1))saysthat:Thestate[thestatutedefines"state"toincludecities,counties,andotherpoliticalsubdivisions]shallnotdiscriminateagainst,orgrantpreferentialtreatmentto,anyindividualorgroupontheba-sisofrace,sex,color,ethnicity,ornationaloriginintheoperationofpublicemployment,publiceducation,orpubliccontracting.
Theterm"preferentialtreatment"hasnotyetbeendefined.
There-quirementtograntsubcontractsmayrunafoulofthisprovision,buttherequirementtosolicitqualifiedminoritybusinessesmaynot.
Inaddition,sometransportationprojectsfundedinwholeorinpartbytheU.
S.
DepartmentofTransportationmayrequirethecitytoestab-lishadisadvantagedbusinessenterprise(DBE)programtoincreaseparticipationbyminoritybusinesses.
Formoreinformation,seetheWashingtonStateDepartmentofTransportation'sEqualOpportunity–DisadvantagedBusinessEnterprisewebpage.
December2020|CityBiddingBook:WashingtonState9MinorExceptionsThecostofwaterservicesandmeteringequipmentfurnishedbyanyfirstclasscityinthecourseofawaterserviceinstallation,fromtheutility-ownedmaintoandincludingthemeterboxassembly,isnotincludedindeterminingthecostofapublicworkorimprovement(RCW35.
22.
630).
RCW35.
22.
640relievesfirstclasscitiesfromthebiddingrequirementswhenthepublicworkrelatessolelytoelectricaldistributionandgenerat-ingsystemsonpublicrightsofwayoronmunicipally-ownedproperty.
6Materials,SuppliesandEquipmentUnlikeothercities,firstclasscitiesarenotrequiredtoseekcompetitivebidsforthepurchaseofmaterials,suppliesandequipmentnotassoci-atedwithapublicwork.
Firstclasscitiesmayadoptbiddingrequire-mentsintheircharter,localordinances,orpolicies.
ServicesBidsarenotrequiredbystatutefortheacquisitionofservices,exceptforobtainingarchitecturalorengineeringservices(seetheArchitecturalandEngineeringServicessection).
BidLimitsforSecondClassCities,Towns,andCodeCitiesDependingonthecost,thesecitiesandtownsmayhavetobidcon-tractsforpublicworks,aswellasforpurchasingmaterials,supplies,andequipmentnotusedinconnectionwithapublicwork.
Theonlyrequirementtobidforservicesistoselectanofficialnewspaper(RCW35.
23.
352(8)).
Obtainingarchitecturalandengineeringservicesre-quiresadherenceto"qualifications-basedselection"process(seetheArchitecturalandEngineeringServicessection).
Acitymayrequire,byordinanceorpolicy,thatbidsbesoughtforservices,anditmayadoptstricterprovisionsthanthosediscussedbelowforbiddingonpublicworkprojectsandpurchases.
PublicWorksRCW35.
23.
352providesthepublicworksbiddingrequirementsforsecondclasscities,towns,and(viaRCW35A.
40.
210)allcodecities.
Bidsarerequiredwheneverthecostofapublicwork,includingthe6Ifacity-ownedelectricutilitydirectlyassessesitscustomersaserviceinstallationchargefortemporary,permanent,orexpandedservice,acustomermay,withwrittenapprovaloftheutility,hireaqualified,licensedelectri-calcontractortodotheinstallationinsteadofusingcityworkers.
Iftheutilitydeniesthecustomer'srequest,itmustprovidethecustomerwithwrittenreasonsforthedenial.
Ifacustomeremploysaprivateelectricalcontractorforin-stallationwork,thecontractorissolelyresponsibleforanydamageresultingfromtheinstallationandthecity-ownedelectricalutilityhasnoliability.
RCW35.
22.
640.
December2020|CityBiddingBook:WashingtonState10costofmaterials,supplies,andequipment,willexceed$116,155,ifmorethanonecraftortradeisinvolved.
Ifonlyasinglecraftortradeisinvolved,oriftheprojectisoneofstreetsignalizationorstreetlighting,bidsarerequiredifthecostisgreaterthan$75,500.
Notethatthereisno"10%oftheconstructionbudget"limitontheto-talamountofworkthatcanbedonebycityworkersasthereisforfirstclasscities.
Ifeachproject'sestimatedcostislowerthanthebiddinglimits,thecitycouldhaveitsownworkersordaylaborersdoeveryproject.
However,secondclasscities,towns,andcodecitiesmustpro-videareporttothestateauditorofthecostsofallpublicworksgreaterthan$5,000thatarenotletbycontract.
Foranyprojectusingcityworkersthatcostsmorethan$25,000,acitymustpublishadescriptionoftheprojectanditsestimatedcostinitsofficialnewspaperatleast15daysbeforebeginningthework(RCW39.
04.
020).
Materials,Supplies,andEquipmentRCW35.
23.
352alsoprovidesthebiddingrequirementsforpurchasesforallsecondclasscities,alltowns,and(viaRCW35A.
40.
210)codecitiesunder20,000populationonly.
Anysecondclasscity,town,orcodecitywithapopulationunder20,000thatpurchasessupplies,materials,orequipmentcostingmorethan$7,500,whicharenottobeusedinconnectionwithanypublicworkorimprovement,mustcallforbids.
Purchasesbycodecitieswithapopulationof20,000ormoreare(viaRCW35A.
40.
210)governedbyRCW35.
22.
620,thefirstclasscitiesstatute,whichdoesnotspecifyanyprocessforthepurchaseofmateri-als,suppliesandequipment.
Becausetherearenostatutoryrequire-mentsforcodecitieswithapopulationof20,000ormore,thecity'sordinancesorcharterprovisionsgovernthosepurchases.
Whenpurchasingtelecommunicationsanddataprocessing(computer)equipmentorsoftwarecostingabovethebidlimit,municipalitiesmayfollowa"competitivenegotiation"processauthorizedbyRCW39.
04.
270requiring,ataminimum,thefollowingsteps:Arequestforproposals(RFP)mustbepublishedinanewspaperofgeneralcirculationatleast13daysbeforethelastdateonwhichtheproposalswillbereceived.
TheRFPmustidentifysignificantevaluationfactors,includingprice,andtheirrelativeimportance.
Themunicipalitymustprovidereasonableproceduresfortechnicalevaluationoftheproposals,identificationofqualifiedsources,andselectionforawardingthecontract.
AskMRSCWearedoingasidewalkprojectthatwillcost$110,000.
Mayweuseourstafftoperformabout$15,000oftheworkandbidtherestIngeneral,"no.
"Eventhoughthecitydoesnotintendtocircumventthebidlaw,itmustbidthewholeprojectsincethecostisoverthebidlimits.
However,theremaybesomecircumstancesinwhichacitymaymakeaminorcontribution.
Forexample,acitymightownapieceofequipmentthatthecontractordoesnotorprovidein-houseworkasamatchforagrant.
Thebidspecificationscouldnotethatthecitywould,uponrequest,leasetheequipmenttothecontractorataspecifiedrate,presumablylowerthanwouldbeavailableontheopenmarket.
December2020|CityBiddingBook:WashingtonState11Theawardmustbemadetothequalifiedbidderwhoseproposalis"mostadvantageous"tothecity.
Acitymayrejectallproposalsforgoodcauseandrequestnewproposals.
PurchasesbyUseofVendorListsAdvertisementandformalsealedbiddingmaybedispensedwithforpurchasesbetween$7,500and$15,000,ifthecitylegislativeauthor-ityauthorizes,byresolution,useoftheuniformproceduresetoutinRCW39.
04.
190(seeRCW35.
23.
352(9)).
7Thisstatuteprovidesthatavendorlistmaybeusedtosecuretelephoneorwrittenquotationsundercertainconditions:Thecitymustadvertiseatleasttwiceayearinanewspaperofgeneralcirculationthatavendorlist(orlists,ifcitieswanttokeepdifferentvendorlistsfordifferentproducts)existsanditmustsolicitnamesforthelist.
Ifpossible,citiesshouldgetatleastthreequotationstoensureacompetitiveprocessandshouldawardthecontracttothelowestresponsiblebidder.
(SeethesectionDeterminingtheLowestRe-sponsibleBidder.
)Immediatelyaftertheaward,thecitymustrecordallbidquota-tionsthatitreceivedandmakethemopentopublicinspection.
Thisinformationmustalsobeavailabletothosewhoinquirebytelephone.
Atleasteverytwomonths,acityusingthevendorlistprocessestablishedinRCW39.
04.
190toawardcontractsmustpostalistofthecontractsawarded(RCW39.
04.
200).
Thelistmustcon-tainthenameofthevendor,theamountofthecontract,abriefdescriptionofitemspurchased,andthedateoftheaward.
Thelistmustalsostatewherebidquotationsarelocatedandavailableforpublicinspection.
LeasewithanOptiontoPurchaseAleaseofpersonal(orreal)propertywithanoptiontopurchasemayrequirecompetitivebids,dependingonthetypeofpropertyinvolvedanditscost.
RCW35.
42.
220requiresacallforbidsinaccordancewithRCW35.
23.
352,ifthecostofthepropertytobeleasedexceedstheamountspecifiedinRCW35.
23.
352(currently$7,500).
Sincefirstclasscitiesandcodecitiesover20,000populationdonothavepurchasethresholdssetbystatute,thenecessitytocallforbidson7Forasamplevendorlist/rosterresolution,seetheMRSCRosterswebsiteunderthe"PublicAgencyMembership"tab.
AskMRSCWewanttopurchaseapieceofequipmentthatsellsforabout$8,000.
However,wewillgetatrade-inofover$1,000.
DoweneedtogooutforbidYes.
Thebidlimitisonthegrossprice,notthenetpriceafteratrade.
Ourcityhasnotreceivedmanyresponsesfromouradvertisementforfirmswishingtobeonourvendorlist.
MaywecontactfirmsdirectlyYes,acitymaydirectlycontactthefirmswithwhichitwishestodobusiness.
Thecitymightalsotryadvertisinginadifferentoradditionalnewspaper.
December2020|CityBiddingBook:WashingtonState12lease-purchaseswouldneedtobeevaluatedagainstthepurchasebid-dingthresholdsestablishedintheirpolicies.
Thecostisthetotalvalueoftheitemtobeleased,nottheyearlyleasepayment.
Fromapracticalstandpoint,thisprovisionprobablymeansthateveryleasewithanoptiontopurchasemustbebidbecausethelimitissolow.
Aleaseofpropertywithoutanoptiontopurchasedoesnotrequireacallforbids.
ServicesBidsareonlyrequiredwhenasecondclasscityortownselectsandcontractsfortheservicesofitsofficialnewspaper(RCW35.
23.
352(8)).
Althoughthestatutesarenotexplicit,codecitiesarenotrequiredtoseekbidsfortheselectionandcontractingforofficialnewspaperservices.
Obtainingtheservicesofanarchitect,landscapearchitect,engineer,orlandsurveyordoesnotrequirebidsbutdoesrequiretheuseofanegotiationprocess,discussedinthenextchapter(seethesectiononArchitecturalandEngineeringServices).
Specialproceduresaresetoutforacquiringsolidwasteservices(RCW35.
21.
156).
Theseprocedures,however,merelysetoutanalter-nativeapproachfortheselectionofasolidwasteserviceproviderandarenotmandatory.
Unclassified,TerritorialCharterCityOnlyoneWashingtoncity,Waitsburg,stilloperatesunderaterritorialcharter.
Therearerelativelyfewstatutesthatspecificallyregulateanunclassifiedcity,andnonerequirecompetitivebidsforpublicworksorpurchases.
Withoutspecificstatutorybiddingrequirements,thecityneednotseekcompetitivebids.
Ourstatesupremecourthasstated:Wehaveheretofore,incommonwiththeweightofauthority,recognizedthat,intheabsenceofconstitutional,statutoryorcharterrequirement,authorizedstateormunicipalcontractsneednotbeletundercompetitivebidding.
8Accordingly,unlesstheterritorialcharterrequirescompetitivebids,orthecityhasadoptedalocalpolicyrequiringthem,bidswouldnotberequiredforeitherpublicworksorpurchases.
TheStateAuditor'sOffice,however,wouldanticipateseeinginternalcontrolsadequatetosafeguardpublicassetsandensurecompliancewiththelocalpolicies.
8Petschlv.
Century21Corp.
,61Wn.
2d276(1963);seealsoReiterv.
Chapman,177Wash.
392(1934),ShawDisposalInc.
v.
Auburn,15Wn.
App.
65(1976),andDaltonv.
Clarke,18Wn.
2d322(1943)).
December2020|CityBiddingBook:WashingtonState13ExceptionstotheBiddingLawsThestatutescontainexceptionstothepreviouslydiscussedbiddingrequirements:Citiesarenotrequiredtoadvertiseforbidsforpurchasesthatareclearlyandlegitimatelylimitedtoasinglesourceofsupply.
Bidsarenotnecessaryintheeventofanemergency.
Citiesmaynotberequiredtoseekbidsifthereare"specialfacilitiesormarketconditions.
"Pollutioncontrolfacilitiesandsomeneighborhood"self-help"proj-ectsmaybeexemptfrombiddingrequirements.
Citiesmayhirethecountytodoroadprojectswithoutgoingoutforbids.
Theseexceptionsarediscussedbelow.
Ifyouthinkyourprojectorpurchasefallsintooneoftheseexceptions:bereadytojustifyitwithspecificfactsandcheckwithyourauditor,financedepartment,and/orattorney.
BrandName,Monopolies,SoleSourceandSpecialMarketConditionsAlthoughtheissueofspecifyingabrandnameinabiddoesnotreallyfitinasectiontitled"Exceptions,"anydiscussionofbrandnamesover-lapswithsolesourcepurchasingwhich,inturn,overlapswithmonopo-liesandshadesinto"specialmarketconditions.
"BrandNameBiddingCitiesmayadvertiseforbidswithaparticularbrandnameinthespeci-ficationiftheresponsibleofficialshaveexercisedtheirjudgmentanddeterminedthatacertainbrandnameisofhigherqualityorisbettersuitedtothemunicipality'sneeds.
InSmithv.
CityofSeattle,192Wash.
64(1937),thecityadvertisedforbidsforincandescentlamps,specify-ingaparticularbrand.
Inasuitbroughtbyamakerofasimilarlamp,thecourtstatedthatiftheofficialsinvolvedexercisedtheirdiscretionindeterminingthataparticularbrandoflampswasmoredesirable,thecity'sprocedurewasproperintheabsenceofabuseofdiscretionorfraud.
Inthiscase,thefactthatthecityhadusedthespecifiedlampspreviouslyandtheyhadperformedsatisfactorilyprovidedarationalAskMRSCMayweadvertiseforaparticularmodelofaChevrolettruckMaybe,butyoumustdocumentverycarefullywhythisparticularmodelmeetsyourcity'sneedsbetterthanothermodels.
If,forexample,yousaythatyouwantaparticularChevrolettruckbecausetherestofyourfleetoftrucksareChevroletsandyouwillbeabletoexchangeparts,andifitthenturnsoutthatthemodelsaredifferentenoughthatmanypartsarenotinterchangeable,youwillprobablygetanauditfinding.
However,ifyougetbidsfromanumberofdifferentChevroletdealers,theauditormaybesatisfied.
December2020|CityBiddingBook:WashingtonState14basisforcityauthoritiestolimitthebidadvertisementtothatspecifiedbrandoflamps,andthecourtfoundnoabuseofdiscretion.
Thereisnorequirementthatbidspecificationsnamingaparticularbrandalsoincludeaphrasesuchas"oranequalbrand.
"9MonopoliesandSoleSourceBiddingButwhatifspecifyingaparticularbrandmeansthatonlyonebidwillbereceivedRCW39.
04.
280(1)(a)authorizessolesourcepro-curement.
10Tousethisprocess,thecitycouncilmusteitherapplyapreviously-adoptedwrittenpolicyorpassaresolutionthatstates"thepurchaseisclearlyandlegitimatelylimitedtoasinglesourceorsup-ply.
"Ifthecitycouncilwaivesthebidrequirementthroughapplicationofawrittenpolicy,itmust,immediatelyfollowingtheawardofthecontract,setoutthefactualbasisforthewaiver.
11OnecommentatorhasnotedthattheStateAuditor'sOfficewillprob-ablynoticeifyourcitymakestoomuchuseofsolesourcepurchas-ing.
Hegivessomeguidelinesforitsuse.
Ifthereisawaytodraftthespecificationssothatmorethanonerespondentcanreply,itisnotasolesourcesituation.
If,however,thecitycanmeetallofthefollowingrequirements,itisprobablyasolesourcepurchase:(a)thecitydepartmenthasconductedascreeningprocesswherebyitcanjustifypurchaseofaspecificproduct,(b)itcandraftlegitimatespecifications,towhichonlyonevendorcansuccessfullyrespond,(c)theproductisavailableonlythroughonemanufacturer(ordis-tributor,andthemanufacturersocertifies),whichisclearlydocu-mentedbythecity,and(d)thecitydocumentsitsreasonableeffortstoensureitisgettingthelowestprice.
129AGO61-62No.
24.
10ThissectionismadeapplicabletofirstclassbyRCW35.
22.
620(6)andtotowns,secondclasscitiesandcodecitiesbyRCW35.
23.
352(10);however,sincefirstclasscitiesarenotrequiredtoseekbidsforpurchases,theapplicabilityofthisstatutetoafirstclasscityisirrelevant.
11Caselawalsosupportstheuseofsolesourceprocurement.
SeeWashingtonFruit&ProduceCo.
v.
CityofYakima,3Wn.
2d152(1940).
12RichardN.
Little,Jr.
,"SelectedProblemAreasinPublicBidding,"LegalNotes,InformationBulletinNo.
488(MunicipalResearchandServicesCenter),October1994,p.
6-5.
AskMRSCMayacityspecify"American-made"inbidspecificationsAcitycouldprobablydraftspecificationsthatwouldmakeitdifficultforforeigngoodstoqualify.
However,restrictingabidto"American-made"productsmaybehardtojustify.
Thistypeofbidrestrictiondoesnotrelatetoanypracticaljustificationasabrandnamerestrictionmight.
In10McQuillin,MunicipalCorporations,§29.
49,itisstated:Anadvertisementmayormaynotbedeemedtoundulyrestrictcompetitivebiddingwhereitrequiredmaterialsandequipmentcoveredinittobemanufacturedinaparticularstateorcountry.
Inaddition,fromapracticalstandpoint,thisrestrictionmaybedifficulttomeasureandenforce.
ManyproductsproducedbyAmericanfirms(automobiles,forexample)haveanundeterminedamountofforeigncontent.
And,manyproductsproducedbyforeignfirmsmaybemade,atleastpartially,infactoriesintheUnitedStates.
December2020|CityBiddingBook:WashingtonState15SpecialMarketConditions–WhatAreTheyRCW39.
04.
280(1)(b)alsoprovidesa"specialmarketconditions"waiverfromthebiddingrequirementsforpurchasesofmaterials,sup-plies,orequipmentbysecondclasscities,towns,andcodecities.
Tousethisexemption,acitymustpassaresolutionstating"thefactualbasisfortheexception"(RCW39.
04.
280(2)).
WhatarespecialmarketconditionsNodefinitionisgiveninthestatutes.
Somehavesuggestedthatifsuppliesorusedequipmentareofferedataveryfavorablepriceandwillbesoldbeforeacitycancompletethebiddingprocess,thereisaspecialmarketcondition.
Thismightalsoapplytosituationswherethereisabusinessreasontouseaspecificitem,suchascompatibilityorconsistencyinoperations,main-tenance,orprocedures.
However,sincetherehavebeennocourtcasesorattorneygeneral'sopiniononthissubject,ifacitywishestoinvoke"specialmarketconditions"towaivethebiddingrequirements,thecityattorneyshouldbeconsulted.
AuctionsSometimesacitywillfindexactlywhatitneeds,atafavorableprice,atanauction.
Obviously,seekingbidsisimpossibleinanauctionsetting.
RCW39.
30.
045authorizesacitytoacquiresupplies,materials,andequipmentthroughanauctionconductedbytheUnitedStatesoranyagencythereof,anagencyofthestateofWashington,amunicipal-ityorothergovernmentagency,oranyprivateparty,withoutbids,iftheitemstobepurchasedcanbeobtainedatacompetitiveprice.
Thisauthorityallowsacitytomakeapurchaseonaninternet-basedauctionservice,suchaseBay,aswellasthroughmoretraditional,in-personauctionsaslongasitisnotafixed-pricemarketplace.
Formoreguidance,seeourCompetitiveBiddingExemptionspage.
EmergenciesRCW39.
04.
280(1)(c)specificallyauthorizesamunicipalitytowaivecompetitivebiddingrequirementsforpurchases"intheeventofanemergency.
"Theterm"emergency"isdefinedbystatutetomeanunforeseencircumstancesbeyondthecontrolofthemunicipalitythateither:(a)presentsareal,immediatethreattotheproperper-formanceofessentialfunctions;or(b)willlikelyresultinmateriallossordamagetoproperty,bodilyinjury,orlossoflife,ifimmediateactionisnottaken.
Thepersondesignatedbythegoverningbodytoactintheeventofanemergencymaydeclarethatanemergencysituationexists,waiveAskMRSCMayoursecondclasscitypurchaseself-containedbreathingapparatusforthefiredepartmentwithoutabidwhenthereisonlyonesupplierintheareawhoseproductmeetsthestandardsofthecountyfirechiefs'associationProbably.
Thecountyfirechiefswantallself-containedbreathingapparatustobestandardizedbecauseitwillbemoreefficientduringmutualaidconditionsandwillnotrequirenewequipmenttobepurchasedwhenfiredepartmentsmerge.
ThisseemstobeanappropriateapplicationofthesolesourcebiddingexceptioninRCW39.
04.
280.
Thecityshoulddocumentthefacts.
Thejurisdictionsinvolvedshouldestablishaninterlocalagreementforthepurchasesbecausetheymightgetabetterpriceforalargeorder.
Mayasecondclasscityspecifyinitsbiddocumentsthatitwantsonlyarearenginefiretruck,whenthisresultsinonlyoneresponsiblebidderIfthecityhasvalidreasonsforwantingarearenginetruckanddocumentsthem,itprobablycanwritethespecificationstoreflectthisdesire.
Infact,ifthecityiscertainthatitwillreceiveonlyonebid,itmaymakeuseoftheproceduresinRCW39.
04.
280(1)(a)anddispensewithbiddingbecausethesupplierisasolesource.
December2020|CityBiddingBook:WashingtonState16competitivebiddingrequirements,andawardallnecessarycontractsonbehalfofthecitytoaddresstheemergency.
Ifthecityhasnotdesig-natedapersontoactintheeventofanemergency,thecitycouncil,byresolutionormotion,woulddeclareanemergencyexists,waivethebiddingrequirements,andawardthecontract.
Ifacontractisawardedwithoutcompetitivebiddingduetoanemergency,writtenfindingsoftheexistenceofanemergencymustbemadebythegoverningbodyoritsdesigneeandenteredintoitsrecordnolaterthantwoweeksfollow-ingthecontract'saward.
Anotherstatute,RCW38.
52.
070(2),authorizespoliticalsubdivisionsinwhichmajordisastersoccur(asdefinedinRCW38.
52.
020andRCW38.
52.
010(9)oftheWashingtonEmergencyManagementAct)toforegostatutorycompetitivebiddingrequirements.
Severalfirstclasscitychartersalsoprovidethatthecitymayforegobiddingproceduresintheeventanemergencyexists.
13Neighborhood"Self-Help"ProjectsRCW35.
21.
278saysthatcitiesandtownsmaycontractwithcer-taingroupstodoneighborhoodimprovementprojectswithoutgo-ingouttobid.
Thesegroupsincludechambersofcommerce,serviceorganizations,community,youth,orathleticassociations,orothersimilarassociationslocatedinandprovidingservicetotheimmedi-ateneighborhood.
Thecontractingassociationmaymakeparkandrecreationimprovements,installequipmentandartwork,andprovidemaintenanceserviceswhilebeingreimbursedbythecityortownforitsexpenses.
Theconsiderationreceivedbythecity(theimprovements,artwork,etc.
)mustbeatleastequaltothreetimesthecityortown'spaymenttotheassociation.
Allpaymentsmadebyapublicentityun-dertheauthorityofthissectionforthesetypesofcontractsinanyoneyearshallnotexceed$25,000or$2perresidentwithintheboundariesofthepublicentity,whicheverisgreater.
StateorCountyConstructionorRepairofStreetsBypassingaresolution,acitycouncilmayauthorizethecountyinwhichitislocatedtoconstruct,repair,ormaintainacitystreet(RCW47.
24.
050).
Thecitypaysthe"actualcost"ofthework,withthepay-mentbeingdepositedinthecountyroadfund.
ThestateDepartmentofTransportationmayalsoprovideengineeringassistancetoacityonroadprojectsordotheactualconstruction.
Thestateisreimbursedfromthecity'sshareofthemotorvehicleexcisetaxinthemotor13YakimaCityCharter,Art.
VI,Sec.
6;AberdeenCityCharterSec.
46;TacomaCityCharter,Section7.
11.
AskMRSCArethefollowingsituationsconsideredemergenciesforthepurposesofcompetitivebiddingexemptionsOurcitywatertankhasbeenbadlydamagedandwaterpressureisthreatened.
Thisisnotanaturaldisaster,butitisaseriousproblemthatprobablyconstitutesanemergencythatwillallowthecitytoignorethebidlaws.
Ourpumpstationneedsrepairs.
Rawsewageisflowingintothelake.
Asinthepreviouscase,thisprobablycanbetreatedasanemergency,particularlywiththeemphasisthesedaysonprogramstoimprovewaterquality.
Thecitycouncilwantstogetnewstreetlightsinplacefortheholidayseason,andthereisnotenoughtimetogooutforbids.
Thisisnotanemergency.
Themoneyhasbeeninthebudgetformonths.
Thecouncilshouldhavemadethestreetdepartmentawarethatthiswasapriorityitemonitsworkprogram.
December2020|CityBiddingBook:WashingtonState17vehiclefund.
14Theseagreementswiththecountyorthestatedonotrequirecompetitivebids.
RCW35.
77.
020allowscitiestoenterintoagreementswiththecountyinwhichtheyarelocatedforalloraspecifiedpartoftheconstruction,repair,ormaintenanceofcitystreetsandbridges.
1514ThisstatutewillrequireamendmentsincethemotorvehicleexcisetaxstatuteswererepealedbythevotersasresultofthepassageofI-695inNovember1999.
Althoughtheinitiativewasfoundunconstitutional(Amal-gamatedTransitUnionLocal587v.
TheStateofWashington,142Wn.
2d183(2000)),theLegislaturerepealedthetaxprovisionsbylegislativeactiontakenin2000.
SeeChapter1,Lawsof2000,1stEx.
Sess.
Asresultoftheinitiativeand/orthe2000legislation,therearenomotorvehicleexcisemoniesavailabletocitiesandtowns.
15Anyworkperformedforafirstclasscitybythecountyunderthisstatutecountsagainstthelimitfortheamountofwork(10%oftheconstructionbudget)thatacitycanhavedonebyitsownforces.
RCW35.
22.
620(2).
WorkdoneunderRCW47.
24.
050doesnotappeartohavethisrestriction.
December2020|CityBiddingBook:WashingtonState18BidLawsThatApplytoAllCitiesandTownsThebidlawsthathavebeenpreviouslydiscussedareuniqueforthedif-ferentclassesofcities.
However,somebidlawsarethesameforallclassesofcities.
Allcitiesmustsecuretheservicesofarchitectsandengineersbyarequestforqualifications.
Nocitiesmaysplitbidstocircumventthebidlimits.
Incertainsituations,citiesmustcallforbidsevenwhenworkisperformedbyprivatedevelopers.
Eachofthesetopicsisdiscussedbelow.
ArchitecturalandEngineeringServicesCitiesmustfollowtheproceduressetoutinchapter39.
80RCWwhencontractingforarchitecturalandengineeringservices(includingland-scapearchitectureandlandsurveying).
Abriefsummaryfollows;formoreinformation,refertoMRSC'sContractingforServicespublication.
Chapter39.
80RCWrequiresthatacitypublishitsneedforarchitec-turalorengineeringservicesinadvance,conciselystatingthegeneralscopeandnatureoftheprojectorworkforwhichservicesarerequired(RCW39.
80.
030).
Thenoticemustalsoprovidetheaddressofarepre-sentativeofthecitywhocanprovideadditionaldetails.
Noticecanbeeither:(1)publishinganannouncementeachtimetheserviceisneeded,or(2)announcinggenerallytothepublicthecity'sprojectedrequire-mentsforanycategoryortypeofengineeringorarchitecturalservice.
Citiesmayadvertiseforarchitecturalandengineeringfirmstoannu-allysubmitastatementofqualificationsandperformancedata.
Thecitythenevaluatesthequalificationsandperformancedataithasonfilealongwiththeinformationsubmittedregardingaproposedproj-ect.
Followingtheevaluation,thecityinvitesoneormorefirmstomeetwithitsofficialstodiscusstheprojectandtherelativebenefitsofvariousmethodsofprovidingthedesiredservices.
Thecitythenselectsthefirm"mosthighlyqualified"toprovidetherequiredservicesfromamongthosefirms(RCW39.
80.
040).
Cityproceduresandguidelinesarerequiredtoincludeaplantoensurethatwomenandminority(WMBE)firmshavethemaximumopportunitytocompeteforthecontract.
Thepriceorcostoftheservicemaynotbeconsideredbythecitywhendeterminingwhichfirmisthemosthighlyqualified.
1616SeeAGO1988No.
4.
AskMRSCMustthecountydoallworkoncitystreetsifitdoesanyworkatallNo.
ThelanguageinRCW47.
24.
050statesthatthecityortownmayauthorizethecounty"toperformanysuchconstruction,repair,ormaintenance.
"Thislanguageisnot"allornothing.
"Thelegislaturecouldhavestated"allsuchconstruction,"butitchosenottodoso.
MaythecityhavethecountydostreetconstructionunderRCW47.
24.
050thatwillbepaidforbyaPublicWorksTrustFundloanProbablynot.
RCW43.
155.
060(3)requiresthatallworkfinancedbyPublicTrustFundloansbeputouttobid.
Thisseemstoruleouthavingthecountydothework.
December2020|CityBiddingBook:WashingtonState19Afterthemostqualifiedfirmhasbeenchosen,thecitynegotiatesacontractwiththatfirmfortheservicesatapricethatitdeterminesisfairandreasonable,consideringtheestimatedvalueoftheservicestoberendered,aswellasthescopeandcomplexityoftheproject(RCW39.
80.
050).
Ifasatisfactorycontractcannotbenegotiated,thecityformallyterminatesthenegotiationswiththatfirmandattemptstonegotiateacontractwiththenextmostqualifiedfirm.
Theprocesscon-tinuesuntilanagreementisreachedorthesearchisterminated.
Thisprocesscanbewaivedifthecityfindsthatanemergencyrequirestheimmediateexecutionoftheworkinvolved(RCW39.
80.
060).
Asanexceptiontochapter39.
80RCW,thereisaspecialprovisionforcontractingfor"buildingengineeringsystems"(RCW39.
04.
290).
17Acitymaycontractforthedesign,fabrication,andinstallationofbuild-ingengineeringsystemsbyusingacompetitivebiddingprocessorarequestforproposals.
Thosewhosubmitabidorproposalwilleitherprovidefinalspecificationsandabidpriceforthework,orwillprovidefinalspecificationsfortheworkaspartofalargerproject.
Ineithercase,thefinalspecificationsmustbeapprovedby"anappropriatede-sign,engineering,and/orpublicregulatorybody.
"Twoormorepublicagenciesmaycontractforjointutilizationofar-chitecturalandengineeringservices(RCW39.
34.
030(6)).
Theagencythatcontractsfortheservicesmustfollowthestatutoryrequirementsofchapter39.
80RCWandtheservicestobeprovidedtotheotheragencymustrelatetoandbewithinthescopeofservicesthefirmwasselectedtoperform.
Anagreementmustbeexecutedfortheworkde-tailedintheagreementbeforetheprocurementprocess.
BidSplittingMunicipalitiesmaynotbreakapublicworksprojectintoseparatephasesorpartstoavoidcompliancewithbiddingstatutes.
RCW35.
22.
620(3),re-latingtofirstclasscities,andRCW35.
23.
352(1),relatingtootherclassesofcitiesandtotowns,bothprohibitthedivisionofaprojectintounitsofworkorclassesofworktokeepcostsbelowthebiddingthreshold.
TheWashingtonCourtofAppealshasheldthatacitycannotbreakapublicworkintophasesforthepurposeofestimatingthecostofapublicworksproject,eventhoughthosephasesareperformedatdif-17Theterm"buildingengineeringsystems"isdefinedbythestatutetomean"thosesystemswherecontractsforthesystemscustomarilyhavebeenawardedwitharequirementthatthecontractorprovidefinalap-provedspecifications,includingfirealarmsystems,buildingsprinklersystems,pneumatictubesystems,extensionsofheating,ventilation,orairconditioningcontrolsystems,chlorinationandchemicalfeedsystems,emergencygeneratorsystems,buildingsignagesystems,pilefoundations,andcurtainwallsystems.
"AskMRSCMustacityfollowtheproceduresinchapter39.
80RCWwhenprocuringtheservicesofsurveyorsandlandscapearchitectsYes.
InRCW39.
80.
020(5),"architecturalandengineeringservices"isdefinedtomean"professionalservices.
.
.
withinthescopeofthegeneraldefinitionofprofessionalpracticeinchapters18.
08[architects],18.
43[engineersandlandsurveyors],or18.
96RCW[landscapearchitects.
]"(Materialinbracketsadded.
)SeealsoAGO1988No.
14.
Isatwo-yearretainerwithanengineerprohibitedItdepends.
Ifthecityishiringthispersontoactas"cityengineer"(butnotasacityemployee)toperformalltheengineeringworkinthecity,atwo-yearcontractisprobablynotallowed.
RCW39.
80.
040providesthatcitiesmustpublishtheirrequirementsforprofessionalservicesandencouragefirmstosubmitqualificationsandperformancedataannually.
However,thecityneednotchangeengineerseveryyear.
Thecitycancontinuetohirethesameengineerifthecityfindsthatpersontobethemostqualified.
Ifthecityhasaspecificprojectforwhichitwisheshireanengineer,andifthatprojectwilltaketwoyears,thecitymayhirethatpersonforthedurationoftheproject.
December2020|CityBiddingBook:WashingtonState20ferentintervalsoftime.
18Instead,acity,whilecompletingtheactualprojectinphases,musttotalthecostofallphasesofthepublicworkorpurchase.
Iftheaggregatecostexceedstheapplicablebidlimit,thecitymustbideachphaseoftheprojecteventhoughagivenphasemaycostlessthanthebidlimit.
Althoughthestatutesonlyrefertopublicworkswhenprohibitingbidsplitting,theStateAuditor'sOfficehasexpressedthatneitherprojectsnorpurchasesshouldbeartificiallysplitsothatthecostofeachcontractisbelowthebidthreshold.
TheSAOhasalsoindicatedthattheentityshouldnotdisaggregatepurchasessolelyforthepurposeofgettingtheindividualpurchasesbelowbiddingrequirements(bidsplitting).
BiddingLawsandPrivatePartyProjectsCitiessometimesgetinvolvedinprojectsthatinvolveaprivateparty,suchasadeveloperoraninsurancecompany.
Forexample,aspartofaprojectadevelopermaymakesomepublicimprovementssuchasstreet,sidewalk,water,orsewerimprovementsanddedicatethemtothecity.
Generally,iftheprojectisdonecompletelybythedeveloperandthendonatedtothecity,thebidlawsdonothavetobefollowedbecausethecityhasnotcontributedanycitymoneyandthedeveloperisnotact-ingasanagentofthecity.
But,ifthecostofaprojectinvolvesanycitymoney,thentypicallytheentireprojectissubjecttothebidlaws.
19AlsotobeconsideredisRCW39.
04.
260:Anywork,construction,alteration,repair,orimprovement,otherthanordinarymaintenance,thatthestateoramunicipal-itycausestobeperformedbyaprivatepartythroughacontracttorent,lease,orpurchaseatleastfiftypercentoftheprojectbyoneormorestateagenciesormunicipalitiesshallcomplywithchapter39.
12RCW[prevailingwages].
Citiesshouldconsiderthefollowingwhenreviewingwhetherbiddinglawsandprevailingwagesmayberequired:1)whoownstheland,2)whopaysfortheproject,and3)whoownstheprojectwhenitiscompleted.
18NationalElectricalContractorsAssociation,PugetSoundChapterv.
CityofBellevue,1Wn.
App.
81(1969).
19RCW35.
21.
275providesoneexception:acitymayassistapersonwhoownspropertyabuttingastreetinimprovingthestreetbyprovidingasphalt,concrete,orothersuppliesormaterials.
Thefurnishingofsuppliesormaterials,orthepaymentoftheircosttothepropertyownerandtheprovidingofmunicipalinspectorsandotherincidentalpersonneldoesnotrenderthestreetimprovementsapublicworkorimprovementsubjecttocompetitivebidding.
Thelegislativeauthoritymustapproveanysuchassistanceatapublicmeetingandmaintainapublicregistersettingforththevalue,nature,purpose,dateandlocationoftheassistanceandthenameofthebeneficiary.
AskMRSCIfadeveloperputsinwaterandsewerlinesatherexpenseandthendedicatesthemtothecity,mustshecallforbidsNo.
Assumingthatthereisnocitymoneyinthisprojectanditisbeingfundedentirelybythedeveloper,thenthebidslawsdonotneedtobefollowed.
Thefactthattheimprovementsmustbebuilttocityspecificationsdoesnotchangetheanswer.
Evenifalatecomeragreementisused,thebidlawsdonotneedtobefollowed.
December2020|CityBiddingBook:WashingtonState21Forexample,incaseswhereadeveloperinstallspublicimprovementsattheirowncostthroughthedevelopmentprocess,thedeveloperisnotrequiredtopayprevailingwages.
However,onceamunicipalityagreestocontributefundsorimpactfeerevenue,thereisacontractualelementwhichcouldtriggerRCW39.
04.
260.
Inanotherexample,somerepairstoacitybuildinglocatedinthecityparkareneeded.
Thisisapubliclyownedbuildinglocatedoncityland.
However,thereisaprivateassociationthatwillmaketherepairstothebuildingandtherewillbenodirectcostorexpensetothecity.
Oncetheprojectiscomplete,thebuildingwillbefullyownedbythecity.
ThisprojectwillnotbesubjecttocompetitivebiddingasthereisnocosttotheagencyasdefinedinthepublicworksdefinitionofRCW39.
04.
010.
Iftherearepaidcontractorsdoingworkontheproject,pre-vailingwageswillbenecessaryasitmeetsthepublicworksdefinitionoftheprevailingwagelawinchapter39.
12RCW–eventhoughtheywillnotbepaidbythecity.
AskMRSCIfaninsurancecompanyisgoingtospend$200,000torepairdamagetocityhall,mustthebidlawsbefollowedProbably.
Thereisnostatute,caselaw,attorneygeneralopinion,oradministrativerulethatdiscussesbidlawsandinsurancecompanies.
But,thereisarulethatdiscussesprevailingwagesandworkdonebyinsurancecompanies.
Indefiningtheterm"publicwork,"asitappliesinchapter39.
12RCW(theprevailingwagechapter),WAC296-127-010(7)(a)states,inpart:Theterm"publicwork"shallinclude:(I)Allwork,construction,alteration,enlargement,improvement,repair,and/ordemolition.
.
.
thatisexecutedatthecostofthestateofWashingtonorofanymunicipality.
Thesourceofthefundingshallnotdeterminetheapplicabilityofthestatute,andmayinclude.
.
.
suchsourcesasthosepaymentsmadethroughcontractswithinsurancecompaniesonbehalfoftheinsuredstateormunicipality.
(Emphasisadded).
ADepartmentofLaborandIndustriesmemorandum(fromSuzanneL.
Mayer,RulesOfficer,toPrevailingWageFile,p.
1),writtenatthetimetheaboverulewasamended,explainstherulechange:Thissubsectionalsoprovidesthatpaymentsmadebyaninsurancecompanyasagentfor,oronbehalfof,apublicagencyaretobetreatedcomparablytopaymentsmadedirectlybyapublicagency.
Ifinsurancecompanies,infundingrepairs,areconsideredtobeagentsofthecityforprevailingwagepurposes,theyprobablywouldalsobeconsideredagentsforbidlawpurposes,andcompliancewiththebiddingstatuteswouldberequired.
December2020|CityBiddingBook:WashingtonState22PurchasingfromOtherGovernmentsand"Piggybacking"FederalGovernmentTheauthorityforcitiestopurchasefromorthroughthefederalgov-ernmentisfoundinRCW39.
32.
070-090.
RCW39.
32.
070au-thorizescitiestopurchaseequipment,supplies,materials,andotherproperty,withoutadvertising,givingnotice,orinvitingbids.
RCW39.
32.
080suspendsanycharterprovisions,ordinances,orpoliciesthatrequirebiddingwhendealingwiththefederalgovernment.
RCW39.
32.
090requiresthatanordinanceorresolutionbepassedbeforeanyparticularpurchaseismadefromthefederalgovernmentorthroughafederalgovernmentcontract.
IntergovernmentalPurchasesandBiddingAsnotedonprecedingpages,RCW47.
24.
050andRCW35.
77.
020authorizecitiestoenterintoagreementswiththecountyinwhichtheyarelocatedforrepairorconstructionofanyorallofthecities'streetsorbridges.
Nobiddingrequirementsapplytosuchprojects.
RCW36.
75.
200providesthatacountymayexpendfundsfortherepair,maintenance,orconstructionofanybridgeswithinacityifthebridgeisessentialtocontinuationofthecountyroadsystem.
Acitymayacquiresurpluspropertyfromanothergovernmententitywithoutregardtobidlaws.
RCW39.
33.
010authorizessuchpurchases"onsuchtermsandconditionsasmaybemutuallyagreeduponbytheproperauthorities.
"RCW39.
34.
080,asectionoftheInterlocalCooperationAct,autho-rizesonepublicagencytocontractwithanotherpublicagencytoper-formanyfunctionwhicheachagencyisauthorizedbylawtoperform.
Underthisstatute,onepublicentity(e.
g.
,thestate,acity,acounty,aspecialdistrict,etc.
)couldactasagentorcontractorforoneormorepublicentities.
RCW39.
34.
030,anothersectionoftheInterlocalCooperationAct,authorizescooperativeaction,includingjointpurchases,bydifferentgovernmentalentities.
Anadvantagetousingthisprocessisthat,aslongastheleadagencyawardedthecontractfollowingitsownstatu-toryrequirements,apublicagencyhasanopportunitytopiggybackonthatprocessevenifitisdifferentfromtheirown.
AskMRSCIfacityleasesayet-to-beconstructedfacilityfromaprivateparty,mustthatprivatepartypayprevailingwagesfortheconstructionofthefacilityMaybe.
Ifthefacilityisbeingconstructedbytheprivatepartythroughacontractwiththecity,underwhichthecitywillrent,lease,orpurchasethefacilityafteritiscompleted,andthecity'susewillbeofatleast50%ofthefacility,thenprevailingwagesmustbepaid.
SeeRCW39.
04.
260.
Ifthecitydoespiggybackoffofanotherjurisdiction'scontract,mustitfiletheauthorizinginterlocalagreementwiththecountyauditorRCW39.
34.
040requiresthat,beforetheinterlocalagreementiseffective,itmusteitherbefiledwiththecountyauditororlistedbysubjectonthecity'swebsiteorotherelectronicallyretrievablepublicsource.
December2020|CityBiddingBook:WashingtonState23Mustaninterlocalagreementbeinplacebeforeacitymaypiggybackorbuyoffanotherjurisdiction'scontractBaseduponthelanguageoftheRCW39.
34.
030(5)(b),whichreferencespiggybackingoffcon-tractsthathavebeen"awarded,"inthepasttense,andlanguagefromaninformalAttorneyGeneralmemorandum,theanswerseemsclearthatacitycanpiggybackafterthefact.
BrianBuchholz,anAssistantAttorneyGeneral,wroteina2003memorandum:Ourcurrentinterpretationofthelawisthat,althoughsuchanagreementmaybeagoodbusinesspracticetoensurecompli-ancewithparticularbidlawrequirements,itisnotlegallynec-essarytohaveenteredaninterlocalagreementpriortoutilizinganotherentity'scontract.
20CitiesmayalsousetheauthoritygrantedinRCW39.
34.
030tomakepurchasesthroughstatecontracts.
21AcitydoesthisbysigningaMasterContractsUsageAgreement(MCUA)withtheDepartmentofEnterpriseServices(DES).
TheDESMasterContractsUsageAgree-mentwebpageprovidesinformationandinstructionsforenteringintoanMCUAwiththestateandformakingpurchaseswiththestatecontract;itexplains:TheMasterContractsUsageAgreement(MCUA)isaone-timeagreementnecessarytomeetstatutoryrequirementsallowingqualifyingorganizationstouseWashingtonStatemastercontracts.
Cooperativepurchasingthroughstatecon-tractsprovidesorganizationsthathaveagreedtotermsandconditionstheopportunitytosavemillionsofdollarsannuallybypoolingresourcestoleveragethemarketthroughvolumediscounts.
Authorizedorganizationsareprovidedaccesstoover1,500vendorssupplinggoodsandservicestomeetallthebusi-nessneedsoftheirorganizationatnocost.
Ifacitydecidestomakeapurchaseunderoneofthelistedcontracts,thecityidentifiesavendoronthecontractitwishestouse.
Thecitycontactsthevendorcitingthecontractnumberandnameandgivesthevendorthecity'sDEScustomernumber.
22Thecontractcontains20MemorandumdatedApril1,2003fromBrianBuchholz,AssistantAttorneyGeneral,toCorinePenning-ton,StateAuditor'sOfficeManager.
21SeealsoRCW39.
26.
050(1):Inadditiontothepowersanddutiesprovidedinchapter43.
19RCW,thedepartment[ofEnterpriseSer-vices]shallmakeavailablegoodsandservicestosupportstateagencies,andmayenterintoagreementswithanyotherlocalorfederalgovernmentalagencyorentityorapublicbenefitnonprofitorganization,incompliancewithRCW39.
34.
055,andanytribeslocatedinthestate,tofurnishsuchproductsandservicesasdeemedappropriatebybothparties.
22CitiesmayalsoreceivemoreinformationbycontactingDESat(360)407-2210orMCUA@des.
wa.
gov.
AskMRSCWe"piggybacked"onacountycontracttopurchaseagraderlastyear,havingenteredintoaninterlocalagreementforsuchapurposewiththecounty.
Thecountyisnowgoingtobuymoregradersfromthesamevendorwithoutgoingoutforbids.
CanwepiggybackonthispurchaseMaybe.
Ifthecity(andcounty)cansayingoodfaiththatlastyear'spurchasewasnotmeanttobeaone-timepurchase,itmightbeabletoarguethatthisyear'spurchaseiscoveredbylastyear'sarrangementwiththevendor.
However,acitymaynotutilizeapiggybackingarrangementasameanstocircumventthebidlaws.
Thesafestcoursehereistosolicitnewbids.
Doesacityhavetoenteranewinterlocalagreementeverytimeitmakesapurchaseonanothercity'scontractAseparateagreementmustbemadewitheachpublicagencywhosecontractthecitywishestopurchasefrom.
However,acitycanenteraninterlocalagreementwithanothercitytocoverpurchasesofmanydifferentitems.
Itdoesnotneedaseparateagreementforeachitem.
December2020|CityBiddingBook:WashingtonState24instructionsontheproceduresusedtomakepurchases.
Undermostcontracts,thecityortownmakesthepurchasedirectlyfromtheven-dor.
Insomecases,suchasthepurchaseofmotorvehicles,thedepart-mentrequiresthepurchasetobemadethroughitsoffice.
December2020|CityBiddingBook:WashingtonState25TheBiddingProcessWhenacitygoesoutforbids,itmustfollowcertainprocedures.
Itmustadvertiseandgivepropernotice.
Afterthebidsareopened,thelowestresponsiblebiddermustbeidentified.
Andthecityisgenerallyrequiredtocontractwiththatcompany.
Eachofthesestepswillbediscussedbelow,alongwithinformationonalternativeprocessesandquestionsconcerningirregularitiesinthebiddingprocess.
AdvertisingforBidsSecondClassCities,Towns,andCodeCitiesRCW35.
23.
352(1)setsouttheadvertisingrequirementsforthepublicworksbiddingprocessinsecondclasscities,towns,andcodecities.
Itrequires(inpart)that:Allsuchcontracts[thatrequirebids]shallbeletatpublicbid-dinguponpublicationofnoticecallingforsealedbidsuponthework.
Thenoticeshallbepublishedintheofficialnewspaper,oranewspaperofgeneralcirculationmostlikelytobringre-sponsivebids,atleastthirteendayspriortothelastdateuponwhichbidswillbereceived.
Purchasesofmaterials,equipment,andsuppliesnotusedinconnectionwithapublicworkbysecondclasscities,towns,andcodecitieswithapopulationunder20,000alsorequireadvertisementandsealedbids,ifthecostisover$7,500(or$15,000,ifavendorlistisused–seethePurchasesbyUseofVendorListssection).
Thestatutedoesnotspecifywhatnewspapermustbeused,butcit-iesshouldusethepaperorpapersthataremostlikelytobereadbypotentialbidders.
Thestatutealsodoesnotstatehowmanydaysmustbeallowedbetweenthetimetheadvertisementisplacedandthebidopening.
However,acitythatwishestoreceiveanumberofcompeti-tivebidsshouldallowfirmsareasonabletimetorespond,thelengthdependingonthecomplexityofthebid.
AdvertisingforsmallworksrostersisdiscussedintheSmallWorksRostersection.
FirstClassCitiesThefirstclasscitybidstatute,RCW35.
22.
620,doesnotcontainanydetailedrequirementsforpublicnotice.
MRSCrecommendsthatcitiesDecember2020|CityBiddingBook:WashingtonState26choosethenewspaperthatwillreachthemostcontractorsandallowenoughtimeforresponsivebidstobeprepared.
Firstclasscitiesarenotrequiredbystatutetoadvertiseorhavesealedbidsforpurchasesofequipment,materials,orsuppliesnotusedincon-nectionwithapublicwork,buttheymayberequiredtodosobytheirchartersormunicipalcodes.
InformationtoIncludeintheAdvertisementAdvertisementsforbidsshouldcontaindefinitespecificationsandpro-ceduresforbidderstouseinestimatingtheirbids.
23Werecommendthatthebidnoticeforapublicworkincludeatleastthefollowing:thetimeandplacewherebidswillbeopened;thetimeafterwhichbidswillnotbereceived;thecharacteroftheworktobeperformed;thematerialsandequipmenttobefurnished;andwherethespecificationsfortheprojectmaybeseen.
Althoughnotspecificallyrequiredbystatute,wealsorecommendthattheadvertisementcontainthefollowing:astatementthatabidbondmustaccompanythebid;andstatementsthatthecityretainstherighttorejectallbidsandtowaiveminorirregularitiesinthebiddingprocess.
Sinceprevailingwagesmustbepaidonallpublicworksperformedbycontract,24theadvertisementforbidsaswellasthespecificationsandthesubsequentcontractfortheprojectshouldindicatethatthesuccessfulbid-derwillberequiredtopayprevailingwagesfortheworktobeperformed.
Bidbondsarenotrequiredbystatuteforthepurchaseofmaterials,equipment,andsuppliesnotusedinconnectionwithapublicwork.
Yourcitymaydecidetorequireabidbond.
Thereisalsonostatutoryrequirementtoincludeareferencetocontractdocuments.
But,youmaywanttoincludeyourboilerplatecontracttoavoiddrawn-outdis-cussionsaboutcontractterms.
23SeePlattElectricSupplyInc.
v.
CityofSeattle,16Wn.
App.
265(1976).
24SeeRCW39.
12.
020andCityofSpokanev.
DepartmentofLaborandIndustries,100Wn.
App.
805(2000).
December2020|CityBiddingBook:WashingtonState27QuestionsAddressingOtherConsiderationsMayacityincludeapreferenceforlocalmerchantsinitsadvertisementNo,thereisnostatutoryauthoritytodoso.
InAGO61-62No.
41,theAttorneyGeneralconcludedthatentitiescouldnotestablishapolicygivinglocalbiddersapreferencebyreducingtheirbidsbysomespeci-fiedpercentageamountindeterminingthelowestresponsiblebidder.
Todosowould"beinthenatureofanarbitraryclassificationforthebenefitofaparticulargroupwithoutregardtothemeritsofanypar-ticularcase.
"MayacityrequirethatgeneralcontractorsonpublicworksprojectsbeunioncontractorsIngeneral,no.
ThereasoninginAGO61-62No.
41appliesherealso.
Thecontractshouldbeawardedwithoutregardtounionstatus.
Mayacityrequirethatallbiddersattendapre-bidmeetingNo,butacitymay"stronglyurge"allbidderstoattendsuchameet-ing.
Acitymayfeel,forexample,thatinordertomakearesponsiblebidthatmeetsallthespecifications,contractorsmustmakeafieldvisittothesite,inwhichcasethecitymightconsiderholdingmorethanonepre-bidmeetinginordertoaccommodatevariouscontractors'schedules.
Mayacitycallforbidswithadditivesand/ordeductiblestoallowforachangeintheprojectscopeYes,ifthebidspecificationsarewrittentospecificallyallowforthem.
Theyshouldstatethatbiddersaretosubmitanoverallbidfortheproj-ect,andthengivethecostofeachadditionordeductibleincasethecitydecidestorevisethesizeoftheproject.
Thespecificationsshouldclearlyindicatethatthecityreservestherighttoacceptbidsonthebaseprojectortorevisethesizeoftheprojectifitisnecessarytomakeitfitthebudget.
Theorderinwhichtheadditivesordeductibleswouldbeexercisedshouldalsobeidentifiedinthespecifications.
Thecitymaynotchooseacontractorandthennegotiatechanges.
SeeHansonExca-vatingCo.
v.
CowlitzCounty,28Wn.
App.
123(1981).
Mayacitystateinitsbidspecificationsthatit"reservestherighttomakesuchalterationsintheplansorinthequantitiesofworkasmaybeconsiderednecessary"incaseallbidsareoveritsbudgetNo,becausethecitywouldhavetonegotiatethechangeswithacon-tractortoseewhatthefirmwouldbewillingtodofortheamountofmoneythecityhastospend.
Citiesarenotallowedtonegotiatewithbidders.
Usingthedeductiblemethoddiscussedaboveisthewaytohandlebudgetconcerns.
December2020|CityBiddingBook:WashingtonState28MaythecitymodifythebidspecificationsafteradvertisingAcitymayuseaddendatomodifythebidspecifications.
Thecityshouldidentifyinthebidwhereandhowaddendawillbeavailabletobidders.
Ifthetimeperiodbeforethebidopeningisshortandanad-dendumissentouttooclosetotheopeningdate,thebidopeningmayneedtobedelayed.
Itiscommonpracticetohavethebiddersacknowl-edgereceiptofaddendaintheirproposals.
MayacityprequalifybiddersThereisnostatutoryauthorityforcitiestoprequalifybiddersexceptunderRCW39.
04.
155,relatingtothedevelopmentofsmallworksrosters.
However,firstclassandcodecities,withtheirbroadhomerulepowers,wouldnotneedsuchstatutoryauthorityunlessprequalificationwouldbeconsideredinconsistentwithstatutorycompetitivebiddingrequirements.
InMansonEngineering&ConstructionCo.
v.
State,24Wn.
App.
185(1979),thecourtofappealsruledthattheDepartmentofTransportationdidnothavetheauthoritytoaddadditionalprequalificationrequirements.
TheMansoncourt'sreasoningmaybeequallyapplicabletosecondclasscitiesandtotowns,toprohibitthemfromimposingprequalifi-cationrequirements.
Becauseofthis,wedonotthinkthatthe2020StandardSpecificationsforRoad,Bridge,andMunicipalConstruction,Section1-02.
1(includ-ingtheAPWASupplementprovision),whichauthorizesaprequalifica-tionprocedure,providessufficientauthorityforsecondclasscitiesandtowns,whenadoptingtheStandardSpecifications,toprequalifybidders.
MayacityreceiveabidelectronicallyRCW35.
23.
352(1)requiresthatsecondclasscities,towns,(andcodecities)receive"sealed"bids.
Unlessthecityhasestablishedasecuremeansof"sealing"electronicbids,typicallythroughanelectronicbid-dingsystemdevelopedbyanoutsidevendor,thenanelectronicbidwouldnotbeconsideredsealed.
Ofcourse,acontractorcouldsendthebidsbyemail,forexample,toanagentandhavetheagentsignandsealthedocumentsanddeliverthemtothecity.
Thestatutesdonotaddresstheissueofsealedbidsforfirstclasscit-ies.
However,unsealedbidsmightbeviewedbyinterestedpartiesinadvanceoftheclosingofthebidprocessandgiveundueadvantagetoanotherbidder.
Tobesafe,allcitiesshouldprobablyrequiresealedbidsforpublicworksprojects.
Faxedorelectronicallysubmittedbidsmightbeconsideredforequipment,supplies,orotherstandarditems.
December2020|CityBiddingBook:WashingtonState29Ifacontractistobeawardedthroughthesmallworksrosterproce-dures,thentelephone,writtenorelectronicquotationsarepermitted.
Oursocietyisinatransitionphaseconcerningacceptedmethodsfortransmittingdocuments.
Justassomecourtsnowallowthefilingoflegaldocumentstobedonebyfax,thereislittlereasontodoubtthatalternativemethodsfortransferringbiddocumentswillbecomelegallyacceptableinthefuture.
Untilelectronictransferofbiddocumentsisstatutorilypermittedorjudiciallyauthorized,itisadvisabletorequireameansoftransferthatdoesnotjeopardizetheprivacyofbiddocumentsorallowanydisputeconcerningtheauthenticityofbiddocuments.
BidandPerformanceBondsSecondClassCities,Towns,andCodeCitiesBidbondsarerequiredonpublicworksprojectstohelpensurethatthebidderwillenterintoacontractifhisorherbidisaccepted.
RCW35.
23.
352(1)providesthateachbidmustbeaccompaniedbyabidproposaldepositintheformofacashier'scheck,postalmoneyorder,orsuretybondtothecouncilforasumofnotlessthan5%ofthebidamount,includingsalestax.
Thestatuteaddsthat"nobidshallbecon-sideredunlessaccompaniedbysuchbidproposaldeposit.
"Bidbondsarenotrequiredwhensmallworksrosterproceduresareused,how-ever,asthoseproceduresare"inlieuof"theproceduressetbyRCW35.
23.
352,whichrequiresbidbonds.
Afterbidsareopenedandthecontractisawarded,thebidproposaldepositsorbidbondsarereturnedtotheunsuccessfulbidders.
Thesuc-cessfulbidder'sbidbondordepositiskeptuntilthebidderentersintoacontractwiththemunicipalityandfurnishesaperformancebondinthefullamountofthecontractprice.
Ifthesuccessfulbidderfailstoenterintoacontractwiththemunicipalityanddoesnotprovideaperfor-mancebondwithintendaysofbeingnotifiedofthebid'sacceptance,thebiddergenerallyisrequiredtoforfeitthebidbondordeposit.
25FirstClassCitiesThereisnosimilarstatutoryrequirementofbidbondsforfirstclasscitiesinRCW35.
22.
620,butseveralcharters,26aswellassomeor-dinances,requirebidbondsordeposits.
Eachcityshoulddeterminethosecontractsforwhichtheyitwillrequireadeposit.
25SeetheBidAmountErrorssectionforcircumstancesunderwhichabiddermaynothavetoforfeitthebidbond.
26Forexample,seeTacomaCityCharter,Art.
VII,Sec.
7.
11;SeattleCityCharter,Art.
VII,Sec.
2andSeattleMunicipalCodeSec.
20.
04.
220.
AskMRSCMayweconsiderabidsubmittedbyacontractorwhodoesnothaveaWashingtoncontractor'slicenseMaybe.
Ifacontractorregistersbeforeenteringintoacontract,theconditionsofRCW39.
06.
010thatrequirethatcontractsbeexecutedwithregisteredcontractorsaremet.
Note,howeverRCW18.
27.
020(2)providesthatitisagrossmisdemeanorforacontractortosubmitabidunlessregisteredwiththestate.
Additionally,RCW18.
27.
230providesfortheissuanceofaninfractionifthecontractorisnotlicensed.
RCW18.
27.
320statesthataninfractionwillbedismissedoncethecontractorregisters;dismissaloftheinfractionwouldnotaffectthemisdemeanor.
MaythebidopeningbedelayedYes,butthebiddersmustallbenotified.
Thecityshouldgiveallbidderstheopportunitytowithdrawtheirbids(thepostponementmightmakethisprojectinterferewithanothercontract)or,iftheywish,withdrawandresubmitthebid(thecostofsomeequipmentmighthavechanged)beforethenewbidopeningdateandtime.
Forlongdelays,thecityshouldprobablyjustreturnallbids.
Contractorswhowishtoresubmitmaydosobeforethenewdateandtime.
December2020|CityBiddingBook:WashingtonState30PerformanceBondsforAllCitiesforAllPublicWorksContractsRCW39.
08.
010requiresamunicipalitytohavecontractorspostaperformancebondwheneveritentersintoanypublicworkscontract,toensurethatthejobwillbecompletedandthatallworkers,subcontrac-tors,andsupplierswillbepaid.
Prevailingwageclaimshavepriorityiftherearemultipleclaimsonretainage.
Ifcityofficialsfailtoobtaintherequiredperformancebond,RCW39.
08.
015makesthecityliableforclaimsof"laborers,materialmen,subcontractors,andmechanics.
"Forcontractsof$150,000orless,RCW39.
08.
010allowsacity,attheoptionofthecontractor,toretain10%ofthecontractforaperiodof30daysafterthedateoffinalacceptanceinsteadofthecontractorprovidingaperformancebond.
Thisstatuteisintendedtohelpsmallcontractorswhomayhavetroublegettingabond.
However,bondsarerequiredonanyprojectfundedinwholeorinpartbyfederaltransportationfunds,asRCW60.
28.
011prohibitspublicagenciesfromwithholdingretainageonsuchprojects.
Thebondre-placestheprotectionsotherwiseprovidedthroughretainage.
TheBidDecisionDecidingwhomtoawardthebidtohasseveralcomponents.
Thebidsareopenedattheplace,date,andtimesetoutinthebidpackage.
Thecouncilmayhaveadoptedpoliciesandproceduresthatpermitstafftoawardsomebidsorthatauthorizestafftosummarizethebidsbeforepresentingthemtocouncil.
Thecitymustdeterminethelowestre-sponsiblebidder.
Somebidsmayinvolveerrors,omissions,orotherir-regularities.
Yourpurchasingcodeorpolicyshouldtellyouhowtodealwiththeseirregularities.
Theawarddecisionwillnotbesubjecttointerferencebythecourtsifitismadeingoodfaith,unlessitisarbitraryorthereisanindicationoffraud.
27Ifthecitycouncilawardsacontracttoabidderotherthanthelowestbidder,itshouldincludethereasonsforitsactioninthecouncilminutesorotherwisememorializethem.
Finally,thecitymustawardthebidtothelowestresponsiblebidderorrejectallbids.
Itmaynotnegotiatewithanyofthebidders.
Theseissuesandothersarediscussedinthequestionsandanswersinthefol-lowingparagraphs.
27SeeChandlerv.
Otto,103Wn.
2d.
268,275(1984).
AskMRSCMustthebidopeningoccuratacouncilmeetingNo.
Bidsmustbeopenedatthetimeandplacegivenintheadvertisement,buttheydonothavetobeopenedatacouncilmeetingandnocouncilmembersneedbepresentatthebidopening.
Itissuggestedthatbidsbeopenedinpublic.
December2020|CityBiddingBook:WashingtonState31DeterminingtheLowestResponsibleBidderForthoseprojectsandpurchasesrequiringcompetitivebidding,citiesmusttypicallyawardthecontracttothelowestresponsiblebidder.
28"Responsible"shouldnotbeconfusedwithbeing"responsive.
"Respon-sivenessisdeterminedattheoutsetofthebidreviewprocess.
HasthebiddersubmittedabidthatisconsistentwiththespecificationsandcallforbidsIfthebidisnotconsistent,itisnonresponsiveandshouldnotbeconsidered.
Aresponsivebid,however,maybemadebyapersonorfirmthatisnotresponsible,thatis,thebidderforavarietyofrea-sonsmaynotbeabletoperformasrequired.
RCW39.
04.
350establishesthebidderresponsibilityrequirementsthatabiddermustmeettobeconsideredaresponsiblebidderandbequalifiedtobeawardedapublicworksproject.
Beforeacitymayacceptthecontractor'sbid,thecontractormust:bearegisteredcontractoratthetimeofbidsubmittal(RCW18.
27.
020);haveacurrentUnifiedBusinessIdentifier(UBI)number;haveindustrialinsurance/workers'compcoverage;haveanEmploymentSecurityDepartmentnumber;haveastateexcisetaxregistrationnumber;notbedisqualifiedfrombiddingunderRCW39.
06.
010or39.
12.
065(3);nothaveanyapprenticeshipviolations,ifapplicable;certifythroughaswornstatementthattheyarenotawillfulviola-toroflaborlawsinreferencetoRCW49.
48.
082;andHavereceivedtraining,providedbytheDepartmentofLaborandIndustriesoraproviderwhosecurriculumhasbeenapprovedbyL&I,ontherequirementsrelatedtopublicworksandprevailingwages.
However,biddersthathavecompletedthreeormorepublicworksprojectsandmaintainedavalidbusinesslicenseinWashing-tonforatleastthreeyearsareexemptfromthisrequirement.
RCW39.
04.
350allowscitiestoadoptrelevantsupplementalbidderresponsibilitycriteriaforaparticularproject.
ThisstatutealsodirectsthestateCapitalProjectsAdvisoryReviewBoard(CPARB)todevelop28Somefirstclasscitiesmayuseslightlydifferentlanguageintheircharters,suchasthe"lowestandbest"bidder.
December2020|CityBiddingBook:WashingtonState32suggestedguidelinestoassistthestateandmunicipalitiesindevelopingsupplementalbidderresponsibilitycriteria.
SeetheBidderResponsibil-ityGuidelinesonCPARB'sBackgroundandReferencewebpage.
In2012thestatelegislatureadoptedlegislation(RCW39.
26.
160)settingoutcriteriafordeterminingresponsibilitybystateagencies:(a)Theability,capacity,andskillofthebiddertoperformthecon-tractorprovidetheservicerequired;(b)Thecharacter,integrity,reputation,judgment,experience,andefficiencyofthebidder;(c)Whetherthebiddercanperformthecontractwithinthetimespecified;(d)Thequalityofperformanceofpreviouscontractsorservices;(e)Thepreviousandexistingcompliancebythebidderwithlawsrelatingtothecontractorservices;and(f)Suchotherinformationasmaybesecuredhavingabearingonthedecisiontoawardthecontract.
Althoughcitiesarealreadyrequiredtogettheswornstatementin(f)aboveaspartofbidderresponsibilitycriteriainRCW39.
04.
350,ifcitieswantedtousetheotherlistedcriteria,theywouldneedtoadoptthemassupplementalcriteriaforaspecificproject.
Ifthecityadoptssupplementalcriteria,thebiddingdocumentsmustincludetheadoptedsupplementalcriteriaand:abasisforevaluation;adeadlineforbiddertosubmitresponsibilitydocumentation;andadeadlineforbiddertoappeala"notresponsible"determination.
Apotentialbiddermayrequestchangestothesupplementalcriteria,andthecitymustevaluatetherequest.
Ifitagreestochangethecrite-ria,itmustissueanaddendum.
Ifabidderfailstosupplyinformationrequestedconcerningresponsibilitywithinthetimeandmannerspecifiedinthebiddocuments,thecitymayDecember2020|CityBiddingBook:WashingtonState33baseitsdeterminationofresponsibilityonanyavailableinformationrelatedtothesupplementalcriteria,oritmayfindthebiddernotresponsible.
Ifthecitydeterminesabiddertobenotresponsible,itmustprovide,inwriting,thereasonsforthedetermination.
Abiddercanappealthedeterminationwithinthetimeperiodspecifiedinthebiddingdocu-mentsbypresentingadditionalinformationtothecity.
Thecitymustconsidertheadditionalinformationbeforeissuingitsfinaldetermina-tion.
Ifthefinaldeterminationaffirmsthatthebidderisnotrespon-sible,thecitymaynotexecuteacontractwithanyotherbidderuntiltwobusinessdaysafterthebidderdeterminedtobenotresponsiblehasreceivedthefinaldetermination.
Also,compliancewithRCW39.
30.
060,mayberequiredforabidtobeconsideredresponsive.
Thatstatutespecifiesthateverybidderforapublicworkscontractover$1,000,000mustsubmit,withthebidorwithinonehourofthepublishedbidsubmittaltime,thenamesofallthesubcontractorswithwhomthebidderwillsubcontractforheating,ventilationandairconditioning,plumbing,andelectricalwork.
Ifsuchalistisnotprovided,thebidisconsiderednonresponsiveandthereforevoid.
Ifthegeneralcontractordoesnotplantousecoveredsubcontrac-tors,itmustnameitselfforthework.
Todeterminethelowestresponsiblebidder,citiesmightfindithelp-fultoincludea"StatementofBidder'sQualifications"aspartofthebiddocuments.
Thisstatementnormallyrequestsinformationtoassistinverifyingthemandatoryresponsiblebiddercriteriaandpotentiallysomeofthesupplementalcriteriathatmayberequired.
Preferences.
RCW39.
30.
040allows(butdoesnotrequire)cities,indeterminingthelowestbid,toconsiderthetaxrevenuesthataregeneratedbyapurchaseofsupplies,materials,andequipment,includingthosefromalocalsalestaxorfromagrossreceiptsbusinessandoccupationtax.
Ifacityconsidersthesetaxrevenues,itmustconsiderthetaxesitwouldreceivefromsupplierslocatedbothwithinandwithoutitsboundaries.
Citiesmayawardacontracttothebiddersubmittingthelowestbidbeforetaxesareapplied,iftheyhavegivennoticeoftheintenttodosobeforebidsaresubmitted.
Sincemostcitiesthatlevybusinessandoccupationtaxesrequireallfirmsdoingbusinessinthecitytopaythetax,theonlytaxadvantagealocalfirmmighthavewillbesalestaxpaid.
Thebidawardmustbemadetothelowestresponsiblebidderafterthetaxrevenuehasbeenconsidered.
AskMRSCMayourcityacceptthesecondlowestbidforacomputercontractifthelowestbidderislocatedquitefarawayThecityisconcernedthatitwillnotreceiveasgoodservicefromthedistantcompany.
Thismayormaynotprovideabasisfornotacceptingthelowbid,dependinguponthespecificcircumstances.
Thecityshouldnotjustassumethatservicewouldbeaproblemsimplybecauseofthebidder'slocation.
However,ifthecityreasonablydetermines,andmakesappropriatefindings,thatthelowbidderwillnotbeabletoadequatelyprovidetherequiredservice,itmayrejectthelowbid.
Inaddition,thealternative,competitivenegotiationprocessprovidedbyRCW39.
04.
270forprocurementofcomputerequipmentandsoftwarebysecondclasscities,towns,andcodecitieswithapopulationofunder20,000providesthat"[t]heawardshallbemadetothequalifiedbidderwhoseproposalismostadvantageoustothemunicipalitywithpriceandotherfactorsconsidered.
"Abilitytoservicethepurchasedequipmentwouldprobablybeoneofthefactorsthatacitycouldconsiderwhenawardingacontractundertheprocedureauthorizedbythisstatute.
December2020|CityBiddingBook:WashingtonState34Citiesmayalsogivepreferencetoproductsmadeofrecycledma-terialsortoproductsthatmayberecycledorreused(seeRCW35.
22.
620(10),RCW35.
23.
352(12),andRCW39.
30.
040).
Ratherthaninvokethispreferenceinanarbitrarymanner,thecitycouncilshouldestablishapolicythatstateswhatpercentagepreferencewillbegivenforvariousproducts.
Ifeitherofthesepreferenceswillbeusedtodeterminethelowestbid-der,thatfactshouldbementionedinthebiddocuments.
Remember,other"localpreferences"favoringlocalbusinessesintheawardofacontractarenotallowed.
29However,ifduringanybiddingprocessforpublicworksinwhichabidisreceivedfromanonresidentcontractor,fromastatethatisidenti-fiedintheDepartmentofEnterpriseServicessurveyasprovidinganin-statecontractoradvantage(percentagebidpreference),thestateorlocalagencymustprovideacomparabledisadvantagetothebidofthatnonresidentcontractor.
Thisdoesnotapplyifthecontractorhasanof-ficelocatedinWashington(RCW39.
04.
380).
AcceptingorRejectingtheBidIftherearenobiddingirregularities(seenextsection),thecity,afteropeningthebids,mustawardthecontracttothelowestresponsiblebidderorrejectallbids.
Otherthantheexceptionnotedbelow,acitymaynotnegotiatewiththebiddersoncethebidshavebeensubmittedandopened.
Exception.
Secondclasscities,towns,andcodecitieswithapopula-tionunder20,000arereleasedfromtherequirementsofthebidlawsifnoresponsivebidsarereceived(RCW35.
23.
352(1)).
Theymaytalktocontractorsorsuppliersandnegotiatewiththemortheymayperformtheprojectusingcityemployees.
Althoughnosimilarstatutoryprovi-sionismadeforfirstclasscitiesorcodecitiesover20,000population,itislikelythattheywouldhavesuchauthoritybasedontheirbroadhomerulepowers.
Inaddition,effectiveJuly28,2019codecities,secondclasscities,andtownsmayawardprojectstothesecond-lowestbidderifbothofthefollowingconditionsaremet(RCW35.
23.
352(2)):Thecityissuesawrittenfindingthatthelowestbidderhasdeliv-eredaprojecttothecitywithinthelastthreeyearswhichwaslate,29SeeAGO61-62No.
41.
AskMRSCThelowestbidderisafirmthatdidnotfinishapreviouscontractwiththecityontime.
MaywechooseahigherbidderForcodecities,secondclasscities,andtowns:Yes,aslongasthepreviousincidentisrecordedandmanagedincompliancewithRCW35.
23.
352(2)and(14).
Forfirstclasscities,probably.
Aresponsiblecontractorfinishesprojectsinatimelymanner.
However,ifthereasonsthecontractorwaslatewerebeyonditscontrol,thecitymighthavetoawardtothelowbidder.
Theproblem,ofcourse,isthatthecityandcontractormayhavedifferingviewsonwhathappenedonthepreviouscontract.
Weputacontractforagaslawnmowerforourparksdepartmentouttobid.
Thelowbidwasforalawnmowerwithadieselengine,andwethinkthatwepreferthedieselengine.
MayweacceptthebidNo.
Thisbidisnotresponsivetothebidspecifications.
Ifthecitywantsalawnmowerwithadieselengine,itshouldrejectallbidsandre-advertise.
Allthebidswerehigherthanweexpected.
MaywenegotiatewiththelowestresponsiblebidderNo.
Thecitymustrejectallbids;negotiationwithbiddersisnotallowed.
Thecitymaywanttoreducethescopeoftheprojectandadvertiseagain.
December2020|CityBiddingBook:WashingtonState35overbudget,ordidnotmeetspecifications,andthecitydoesnotfindinwritingthatthebidderhasshownhowtheywouldimprovetheirperformancetobelikelytomeetprojectspecifications;andThesecond-lowestbidiswithin5%ofthelowestbidandmeetsthesamecriteriaasthelowestbidder.
Anycity/townthatawardsacontracttothesecond-lowestbidderunderthosecriteriamustmakeanannualreporttothestateDepart-mentofCommerceincludingthetotalnumberofbidsawardedtocertifiedminorityorwomencontractorsanddescribinghownoticewasprovidedtopotentialcertifiedminorityorwomencontractors(RCW35.
23.
352(14)).
ProtestofContractAwardCitiesshouldanticipatebidprotestsandhaveproceduresinplaceforhandlingthem.
Forallcompetitivelybidprojects,anewprovi-sioneffectiveJuly28,2019requiresthecity,withintwobusinessdaysofthebidopening,toprovidecopiesofthebidsitreceivedifrequestedbyabidder(RCW39.
04.
105).
Theagencymaynotawardthecontractduringthistwo-daywindow,andifbidcopiesarerequestedbyabidder,theagencymustwaitatleasttwofullbusinessdaysafterprovidingcopiesbeforeawardingthecontract.
(A"businessday"doesnotincludeintermediateSaturdays,Sundays,orlegalholidays.
)Ifawrittenprotestissubmittedwithin(a)twofullbusinessdaysfol-lowingthebidopening,or(b)twofullbusinessdaysfollowingwhenthemunicipalityprovidedcopiesofthebidstothosebiddersrequestingthem,theagencymaynotexecuteacontractfortheprojectwithanyoneotherthantheprotestingbidderwithoutfirstprovidingatleasttwofullbusi-nessdays'writtennoticeofitsintenttoexecuteacontractfortheproject.
BiddingIrregularitiesErrorsinBidProceduresorinComplyingwithSpecificationsAbidmustsubstantiallycomplywiththeapplicableproceduresorspecificationsifitistobeconsidered.
Ifitdoesnot,thebidmustbere-jected.
However,an"insubstantialvariance"fromcertainspecificationsorprocedureswillnotpreventacityfromconsideringabid.
Generally,animmaterialorinsubstantialvarianceisonethatdoesnotgiveabid-derasubstantialadvantageovertheotherbidders.
AskMRSCMustthecouncilmaketheawardofthecontractYes,unlessthecouncilhaspassedanordinanceallowingadministrativestafftoawardcontracts.
Manymunicipalcodeshaveprovisionsthatallowadministrativestafftomakeawardsforcertainkindsofprojectsundercertaindollarlimits.
December2020|CityBiddingBook:WashingtonState36Exampleofinsubstantialvariance:inRhine,Inc.
v.
Tacoma,13Wn.
App.
597(1975),thecourtconcludedthatthelatefilingofabidbondwasaninsubstantialvariancethatcouldbewaivedbythecitybecauseitdidnotgivethelatebidderanadvantageovertheothers.
30Exampleofsubstantialvariance:inAABElectricv.
StevensonPublicSchoolDistrict,5Wn.
App.
887(1971),thecourtheldthatthefail-uretosignabidwasasubstantialvariancethatjustifiedthecity'srejectingthelowbid.
Thecourtnotedthatthisdefectwouldgivethebidderwhofailedtosignthebidanadvantageovertheotherbidders.
Thisbiddercouldchoosenottoenterintoacontract,ifacceptedasthelowbidder,withouthavingtoforfeithisbidbondbecausehisbidwasunsigned.
Theotherbidders,whohadproperlysignedtheirbids,wouldforfeittheirbidbondsifanyoftheirbidswereacceptedandtheyfailedtoenterintoacontract.
31Inasimilarvein,thecourtinLandConstructionv.
SnohomishCounty,40Wn.
App.
480(1985),concludedthatasubstantialvari-anceexistedwhereabidderincluded,asasubcontractor,awomen'sbusinessenterprise(WBE)thatwasnotcertifiedasrequiredbythespecifications.
Thecourtsawinthiscircumstanceanadvantageoverotherbidders,becausethebidderwouldhavetosubstituteacerti-fiedWBEinorderforthecountytoacceptthebidandthebiddercouldthereforedecidenottoenterintothecontractifitthoughtthebidtoolow.
BidAmountErrorsBidamounterrorsareoftwotypes:(1)thosethatfavoracity,wherethebiddermakesamistakethatcausesthebidtobelowerthanitshouldbe,or(2)thosethatfavorabidder,wherethemistakecausesthebidtobehigherthanitshouldbe.
Abidderisboundbythebidamount.
Thecourtswillnotchangeacontractbecauseofanerror,evenanobviousone,intheamountbid.
Forexample,inJ.
J.
Welcome&SonsConstructionv.
State,6Wn.
App.
985(1972),thecourtrefusedtoreformacontractbasedonabidthatwas$10,000shortasaresultofamistakemadebyWesternUnionintransmittingatelegram,eventhoughthemistakewasnotnoticeduntilafterthebidswereopened.
30SeealsoGostovichv.
CityofWestRichland,75Wn.
2d583(1969);FarmerConstructionv.
State,98Wn.
2d600(1983).
31InFarmerConstructionv.
State,supra,however,thefailuretosignthebiddidnotinvalidatethebidwherethebidbond,whichmadereferencetothebid,wassigned(andthebiddocumentmadereferencetothebidbond).
SeealsoEastsideDisposalv.
MercerIsland,9Wn.
App.
667(1973).
December2020|CityBiddingBook:WashingtonState37Acityisnotnecessarilyboundbythebidamount.
InRed-SammMin-ingv.
PortofSeattle,8Wn.
App.
610(1973),thelowbiddersubmittedabidthattheportdeterminedwascalculatedincorrectlyandwasover$96,000lessthanthesubmittedtotal.
Theportrefusedtoawardthecontractatthehigheramountandthreatenedthebidderwithforfeitureofthebidbondifitdidnotacceptthebidawardattheloweramount.
Thebidderelectedtoacceptthecontractattheloweramount,butthensuedtheport,claimingthatitenteredintothecontractattheloweramountunderduress.
Thecourtrejectedthebidder'sclaim,becauseithaddecidedtoenterintothecontractratherthanrefusingtheawardatthelowerfigureandraisingequitabledefenses(duress),iftheporthadsoughtforfeitureofthebidbond.
DoestheRed-Sammcasemeanthatacity,whenconfrontedwithanobviouserrorthatfavorsthebidder,canforcethebiddertoacceptthecontractatthecorrectamountProbablythebestthatcanbesaidisthatitdependsuponthecircumstancesandhowacourtmightlookattheequitiesofthesituationandresolvetheapparentinconsistencybetweentheRed-SammandJ.
J.
Welcomecases.
32Thebidderwhosubmittedtheerroneouslowbidmaywithdrawthebid,attheriskofforfeitingthebidbond.
InPugetSoundPaintersv.
State,45Wn.
2d819(1954),thelowbiddersubmittedanerroneousbidasaresultofamistakemadeinestimatingthecostofperformingtheproposedcontract.
Afterthebidwasaccepted,thebidderim-mediatelyrealizedthemistakeandnotifiedthestate.
Thebidderwassuccessfulinasuittorecoveritsbidbond.
Thecourtstatedthatthefollowingfactorsshouldbeconsideredindeterminingifabiddercanberelievedofhiscontractualobligations(andnotforfeitthebidbond)aftersubmittinganerroneouslowbid:whetherthebidderactedingoodfaith,whetherthebidderactedwithoutgrossnegligence,whetherthebidderwasreasonablypromptingivingnoticeoftheerrorinthebid,32The2020StandardSpecificationsforRoad,Bridge,andMunicipalConstruction,atSection1-03.
1,providethatthecontractingagency"willcheck"bidproposals"forcorrectnessofextensionsofthepricesperunitandthetotalprice,"andthat"thetotalofextensions,correctedwherenecessary,willbeused…forawardpurposesandtofixtheamountofthecontractbond.
"Thissectionprovidesaprocedureforabiddertoclaimerror(presumablyotherthaninaddinguptheunitprices)afterthebidshavebeenopened,andforagencyreviewoftheclaimederror.
Ifthecontractingagencyconcursintheclaimoferror,thebidderisrelievedfromperformingthecontractwithoutforfeitofthebidbond.
NocourtcaseinvolvingaunitpriceerrorcorrectionunderthissectionoftheStandardSpecificationshasbeenre-ported.
Thecourtsmaynothaveaproblemwiththislimitederrorcorrectionmechanism,giventhatthespecificationsexpresslyprovideforit,thecorrectioninvolvesonlyaddinguptheunitprices,andtheprocedureappliesautomaticallytoallbidproposals.
AskMRSCThebiddersentherbidbyexpressmailanditarrivedatourpostofficebeforethebidopening.
However,throughsomeone'serror,itwasnotdeliveredtocityhalluntilafterthebidopening.
Thisbidwaslowerthantheothers.
MayweawardthecontracttoherThecitycanprobablywaivethisbiddingirregularity.
Thebiddertooktheappropriatestepstohaveherbidarriveintime,andthedelayinthecity'sreceiptofthebiddidnotgivethebidderanyadvantageovertheotherbidders.
MayacityacceptabidwhenthebidbondlanguageinthebidvariesfromtherequiredbidbondlanguageinthecallforbidsThelanguagethatthebidderusedwouldhaveallowedthebiddertoputupasmallerbidbondthanotherbiddersundersomecircumstances.
Thiscouldbeseenasanadvantagetothatbidderandthisirregularityshouldnotbewaived.
December2020|CityBiddingBook:WashingtonState38whetherthebidderwillsuffersubstantialdetrimentbyforfeiture,whethertheotherparty's(i.
e.
,thecity's)statushasnotgreatlychanged,andrelieffromforfeiturewillcausenosubstantialhardshiponthatparty.
Anylowbidderwhoclaimsanerrorandfailstoenterintoacontract(evenifthebidderisnotrequiredtoforfeititsbidbond)isprohibitedfrombiddingonthesameproject,ifasubsequentcallforbidsismade(seeRCW35.
22.
635,35.
23.
352,and39.
04.
107).
AlternativePublicWorksContractingProcessesWhilethetypicalbiddingprocessforpublicworksprojectsinvolvesthedevelopmentofspecifications,acallforbids,andacontractawardtothelowestresponsiblebidder,therearesomemorespecialized,alter-nativeproceduresthathavebeenstatutorilyaddedinrecentyears.
Forexample,allcitiesmayusesmallworksrostersorlimitedpublicworksprojectprocedures.
Thesenewer,alternativeproceduresarediscussedinthefollowingparagraphs.
SmallWorksRosterWhenthecontractamountforapublicworksprojectis$350,000orless,acitymayfollowthesmallworksrosterprocessforconstructionofapublicworkorimprovementasanalternativetothegeneralcompetitivebiddingrequirements(RCW39.
04.
155,authorizedbyRCW35.
22.
620(7)and35.
23.
352(4)).
Iftheestimatecostexceeds$350,000,formalcompetitivebidsarerequired.
Asmallworksrosterlistscontractorswhohaverequestedplacementontherosterandwho,whererequired,areproperlylicensedorregisteredtoperformworkinthisstate.
RCW39.
04.
155(2)describestheproceduresthatacitymustfollowifitchoosestouseasmallworksroster.
33Acitymustpublishanoticeoftheexistenceofitsgeneralsmallworksrosterorrosters(ifthecitychoosestohavedifferentrostersfordifferentkindsofwork)inanewspaperofgeneralcirculation,atleastonceayear,andthecitymustsolicitnamesofcontractorsfortheroster(s).
Thecitycouncilmustestablishaprocedureforsecuringtelephone,electronic,orwrittenbidsfromthecontractorsontherosterwhohavethenecessaryqualificationstocompetentlycompletethepar-ticularproject.
33Forasamplesmallworksrosterresolution,seetheMRSCRosterswebsiteunderthe"PublicAgencyMembership"tab.
AskMRSCMaythelowbidderbeallowedtowithdrawabidifhemadeamistakeinhisbidcalculationInPugetSoundPaintersv.
State,thecourtheldthatthebiddercouldberelievedofhiscontractualobligationswithouthavingtoforfeithisbidbond,basedonthecourt'sconsiderationoffivefactors.
Fromapracticalstandpoint,itprobablymakessenseforthecitytobelenientwhenreviewingasituationwhereanhonesterrorhasbeenmadebecausethebidder,ifcompelledtoexecutehiscontract,maytryrecoupingitslossesinotherways,suchasthroughtheuseofchangeorders.
Abiddercalled,sayingthatshehadinadvertentlyleftoutthelightbarinherbidforapolicecar.
Thebidshavenotyetbeenopened.
MayweallowhertoamendherbidProbably.
Thetestiswhetherallowingtheamendmentwouldgivethisbidderanadvantageinthebiddingprocess.
Sinceshedoesnotknowwhatothersbid,shehasgainednoadvantage.
December2020|CityBiddingBook:WashingtonState39Invitationsforcontractorstosubmitbidsmustincludeanestimateofthescopeandnatureoftheworktobeperformedandalistofthematerialsandequipmenttobefurnished;detailedplansandspecificationsneednotbeincludedintheinvitation.
Quotationsmaybeinvitedfromallappropriatecontractorsontheappropriateroster.
Alternatively,quotationsmaybesoughtfromatleastfivecontrac-torsontheappropriaterosterwhohaveindicatedthecapabilityofperformingthekindofworkbeingsought.
34Wheneverpossible,thecitymustinviteatleastoneproposalfromacertifiedminorityorwomancontractorwhomustotherwisequalifyunderthissection.
35Afterthebidshavebeensubmitted,thecityortownmustawardthecontracttothecontractorsubmittingthelowestresponsiblebid(SeetheDeterminingtheLowestResponsibleBiddersection).
Immediatelyafteranawardismade,allbidquotationssubmittedmustberecordedandmadeavailabletothepublicforinspection,orthebidfiguresmustbesuppliedinresponsetotelephoneorelectronicinquiries.
Atleastonceeveryyear,thecitymustmakeavailablealistofthecontractsawarded.
Thelistsmustcontainthenameofthecontractor,theamountofthecontract,abriefdescriptionofthepublicwork,thedateoftheaward,andthelocationwherethebidquotationsforeachcontractisavailableforpublicinspection(RCW39.
04.
200).
Smallworksrosterproceduresare"inlieuofotherprocedures"toawardcontractsforsuchwork.
Therefore,specificrequirementssuchasthoserelatingtoadvertisingforbidsorregardingbiddeposits,requiredbyRCW35.
23.
352(1),arenotmandatoryforsmallworksrostercon-tracts.
PerformancebondsarerequiredbyRCW39.
08.
030,notRCW35.
23.
352(1)orRCW35.
22.
620;therefore,theyarerequiredonsmallworksrosterprojects,eventhoughbidbondsarenot.
Performancebondscanonlybewaivedforprojectsof$150,000orlessthroughthe34Ifthealternativeprocessisused,thecityshoulddistributetheinvitationsforquotationsinamannerthatwillequitablydistributetheopportunity,thatis,notfavoronecontractoroveranother.
Iftheestimatedcostoftheworkisfrom$250,000to$350,000andthecitychoosestosolicitbidsfromlessthanalltheappropriatecontractors,itmustnotifytheothercontractorsontherosterthatquotationsarebeingsought.
Noticemaybepublished,mailedout,orsentbyfacsimileorotherelectronicmeans.
Thereisnosimilarrequirementwhentheestimatedcostislessthan$250,000.
35InviewofthepassageofInitiative200in1998,itisnotclearthatthisrequirementisenforceable,asitcouldbeconstruedas"preferentialtreatment.
"AnissuepaperfromtheAttorneyGeneral'sofficedatedOctober16,1998,however,suggeststhatacourtmaydistinguishsuchanoutreachprogram,onewhichmerelyexpandsthepoolofqualifyingparticipants,fromtheuseofselectiongoals,onewhichmerelyexpandsthepoolofqualifyingpartici-pants,fromtheuseofselectiongoals,whichmorelikelyisaformofpreferentialtreatment.
AskMRSCOurtowncouncilmisreadabidanddidnotawardthebidtothelowestresponsiblebidder.
MaywewithdrawtheacceptanceandawardthebidtothelowestbidderSincethereisnolegitimatereasonforrejectingthelowestbidandacceptingahigherone(evenbymistake),theacceptanceofthebidisprobablyinvalidandshouldbewithdrawn.
Wecannotguarantee,however,thatthetownwillnotincurliabilityforwithdrawingtheaward.
But,ifonlyafewdayshavepassed,probablynodamageshavebeenincurredbythebidderthatwasmistakenlyawardedthebid.
Ananalogymaybedrawntothesituationwhereabiddermakesamistake(seePugetSoundPaintersv.
State)andisallowedtowithdrawthebidwithoutpenalty.
December2020|CityBiddingBook:WashingtonState40exceptionprovidedinRCW39.
08.
010(3).
Sincetheworkwillbeper-formedbycontract,therequirementtopayprevailingwagesremains.
Citiesmaychoosetorequirebidbondseventhoughtheyarenotrequiredwithasmallworksrosterprocess.
Thisconsiderationwouldcomefromariskanalysistoreviewthepotentialimpactofacontractorfailingtoexecutethecontractifoffered.
Inaddition,citiesmaywaiveretainageforsmallworksrosterprojects,therebyassumingliabilityforacontractor'snonpaymentof(1)laborers,mechanics,subcontractors,materialpersons,andsuppliers,and(2)tax-es,increases,andpenaltiesthatmaybedue.
However,thecityhastherightofrecoveryagainstthecontractor,andrecoveryofunpaidwagesandbenefitsarethefirstpriorityforactionsfiledagainstthecontract.
LimitedPublicWorksProcessThe"limitedpublicworksprocess"isatypeofsmallworksrosterpro-cessthatappliesonlytocontractsestimatedtocostlessthan$50,000.
ThisprocessisdescribedinRCW39.
04.
155(3)asfollows:Acitymustsolicitelectronicorwrittenquotationsfromamini-mumofthreecontractorsfromtheappropriatesmallworksroster.
Thecitymustequitablydistributeopportunitiesforlimitedpublicworksprojectsamongcontractorswillingtoperforminthegeo-graphicareaofthework.
Thecitymustawardthecontracttothelowestresponsivebidder,unlessthereisacompellingreasontorejectallbidsandcancelthesolicitation.
Quotationsmustbemadeavailabletopublicinspectiononcethecontractisawardedandmustbeavailablebyelectronicrequest.
Thecitymustmaintainalistofcontractsawardedandcontractorscontactedduringtheprevious24months,includingthenameofthecontractor,thecontractor'sregistrationnumber,theamountofthecontract,abriefdescriptionofthetypeofworkperformed,andthedatethecontractwasawarded.
Thecitymaywaivethepaymentandperformancebondrequirementsofchapter39.
08RCWandtheretainagerequirementsofchapter60.
28RCW.
However,thecityretainstherightofrecoveryagainstthecontractorforanypaymentsitmakesonthecontractor'sbehalf.
AskMRSCWhenweopenedthebidsforapublicworksproject,wenoticedthatthehighbidderhadmadeanarithmeticerrorand,aftercorrectingforthaterror,heisthelowbidder.
MaywereformhisbidandawardhimthecontractNo,thiswouldnotbefairtotheotherbidders.
Thecityshouldeitherignorethisbidandawardthecontracttothenextlowestbidderorrejectallbidsandstartover.
Caveat:IftheStandardSpecificationswereused,acorrectioninanyerrorinaddinguptheunitpricesmaybepermissible.
UnderthisStandardSpecificationsprocedure,allbidproposalsarecheckedforaccuracyinaddingupunitprices,priortothebidaward(seeStandardSpecificationsforRoad,Bridge,andMunicipalConstruction,Section1-03.
1).
Ourcityhasnotreceivedmanyresponsesfromouradvertisementforfirmswishingtobeonoursmallworksroster.
MaywecontactfirmsdirectlyYes,acitymaydirectlycontactthefirmsandencouragethemtosubmittheirnamesforplacementonthecity'ssmallworksroster.
December2020|CityBiddingBook:WashingtonState41Unit-Priced("On-Call")PublicWorksContractsAunit-pricedpublicworkscontract,sometimescalledan"on-call"publicworkscontract,isacontractforanunknownnumberofsmallpublicworksprojectsoverafixedperiodoftime("indefinitequantity,indefinitefrequency").
Statestatutedefinesaunit-pricedcontractas:"[A]competitivelybidcontractinwhichpublicworksareanticipatedonarecurringbasistomeetthebusinessoropera-tionalneedsofthe[agencytype],underwhichthecontractoragreestoafixedperiodindefinitequantitydeliveryofwork,atadefinedunitpriceforeachcategoryofwork.
"[Seeagency-specificstatutesbelow.
]Whiletraditionalpublicworkscontractsareawardedforspecificprojects/scopeswithaspecifictotaldollarvalue,unit-pricedcontractsarenotassociatedwithaparticularproject,donotguaranteeanyamountofwork,anddonotestablishatotaldollarvalue(althoughthecontractmaycapthedollarvalueatacertainleveloverthelifeofthecontract).
Instead,theagencyagreestopayadefined"unitprice"forcertaintypesofanticipated(butunplanned)workortradesoveracertaintimeperiod.
Thepricesfordifferenttasksmaybebasedupondifferentunits.
Com-monlyusedunitsinclude:Weight,suchastonsSurfacearea,suchassquarefeetoracresVolume,suchasgallonsorcubicyardsLength/depth,suchaslinearfeetorverticallinearfeetTime,suchashoursQuantityofitemsLumpsumpertaskWhenaspecificprojectisidentified,individualworkordersareautho-rizedbaseduponeithera"not-to-exceed"timeandmaterialsbasisoranegotiatedlumpsumamountusingthepreviouslyestablishedunitprices.
Unit-pricedcontractsallowpublicagenciestocontractformultipleorrecurringsmallpublicworksprojectsovertimewithouthavingtobidAskMRSCIsittruethatacitydoesnotneedtoaskforabidbondonsmallworksrosterprojectsYes.
But,whatthestatutesallowisnotalwaysgoodbusinesspractice.
Manycitiesrequirebidbondsonsmallworksrosterprojectstoprovidecompensationforcostsincurredintheeventthatthecontractorchosendoesnotsignacontract.
December2020|CityBiddingBook:WashingtonState42eachprojectseparately.
Thissavestheagencytimeandmoney,espe-ciallyforunanticipatedprojectsthatmayariseatthelastminute.
Unit-pricedcontractsareoftenusedforrepair,renovation,ormainte-nanceofpublicfacilities,allofwhichfallunder"publicwork"asde-finedinRCW39.
04.
010(4).
Unit-pricedcontractsaredifferentthanjobordercontractsunderRCW39.
10.
420etseq.
Jobordercontractsgenerallyhaveamuchwiderscopethanunit-pricedcontracts,encompassingallconceivablecon-structiontasks/projects,andhaveamorerigoroussolicitationprocess.
Jobordercontractsalsorequireatleast90%oftheworktobesubcon-tracted,makingthemlesssuitableforsmallpublicworksprojects.
Citieshavestatutoryauthoritytouseunit-pricedcontracts.
Hereisthestatutoryauthorityforeachcityclassification:Firstclasscities:RCW35.
22.
620(11)Allothercitiesandtowns:RCW35.
23.
352(13)(codecitiesviaRCW35A.
40.
210)BidAdvertisementTheenablingstatutesstatethataunit-pricedcontractisa"competi-tivelybidcontract"butdonotprovidemoreclaritythanthat.
MRSCinterpretsthislanguagetomeanthatcities,towns,andportdistrictsmustfollowtheircompetitivebiddingrequirements,andthatallunit-pricedcontractsshouldbebidusingacompetitiveprocessregardlessoftheestimatedcontractamount.
Forcontractscompetitivelysolicitedthroughthesmallworksroster,agencieswouldpresumablyneedtomonitorthestatusofsuchcon-tractstoensureanyworkorcontractextensionsdonotexceedthesmallworksrosterlimitof$350,000.
MRSCsuggestsconsultingwithyourattorneytoverifytheproceduresyouragencyshouldfollow.
Theinvitationforbidmustincludeestimatedquantitiesoftheantici-patedtypesofworkortradesandspecifyhowthecitywillissueorre-leaseworkassignments,workorders,ortaskauthorizations.
Wheneverpossible,theagencymustinviteatleastoneproposalfromaminorityorwomancontractor.
Liketraditionalpublicworkscontracts,unit-pricedcontractsmustbeawardedtothelowestresponsiblebidderunderRCW39.
04.
350.
December2020|CityBiddingBook:WashingtonState43ContractDurationTheinitialtermofaunit-pricedcontractmaynotexceedthreeyears,althoughcitiesandtownshavetheoptiontoextendorrenewthecon-tractforoneadditionalyear.
PrevailingWagesContractorsmustpayprevailingwagesforallworkthatwouldnor-mallybesubjecttoprevailingwagesunderchapter39.
12RCW.
Pre-vailingwageratesmustbeupdatedannually,usingtheratesineffectatthebeginningofeachcontractyear(notcalendaryear),andintentsandaffidavitsforprevailingwagespaidmustbesubmittedannuallyforallworkcompletedduringtheprevious12months.
ChangeOrdersDuringacontract,theremaybeoccasionswhentheoriginalunitpricesdonotaddressparticularworkitemsthatareneeded.
Inthosesituations,newlineitemsmaybeaddedbychangeorders,ortheworkmaybeaccomplishedunderatimeandmaterialsworkorder.
SystemwideMaintenanceandRepairContractsTherearealsosomesystemwidemaintenanceandrepaircontractsthataresometimesreferredtoas"on-callcontracts"butactuallyfallundertraditionalpublicworkscontractingaslongasthescopeisclearlyandproperlydefined.
Toqualifyasatraditionalpublicworkscontractinsteadofaunit-pricedcontract,asystemwidemaintenanceorrepaircontractmustcoverspecificactivitiesplannedinadvanceandbudgeted(asopposedtounit-pricedcontractswhichcoveractivitiesthatarenotspecificallyplannedandhavenosetbudget).
Examplesinclude:Sewerorstormdrain"jetting"(cleaning)uptoacertainbudgetamount,butnotanexactnumberoflinearfeetSidewalk/trailconstructionorreconstructioninrelationtoanagency'spedestrianmasterplan(notnecessarilyafixedquantity),uptoacertainbudgetamountStreetlightingandsignalmaintenanceandrepairinrelationtoanannual,systemwideworkplanAnnualcontractsforpavementcracksealing,chipseals,overlays,etc.
December2020|CityBiddingBook:WashingtonState44Thesecontractscanbestructuredsothattheyqualifyaspublicworksprojectswithreadilydeterminablequantitiesandcostsrelatedtoafixedscope.
Contractsareoftenawardedonanannualbasis,withop-tionalrenewals,butmulti-yearcontractsarealsocommon.
Systemwidemaintenanceandrepaircontractsshouldnotcoverunan-ticipatedprojectsoremergencyrepairs,whichwouldfallunderunit-pricedcontracting.
Performance-BasedContractsforEnergyEquipmentCitiesmayenterintoperformance-basedcontractswhencontractingforcertainwaterconservation,solidwastereduction,orenergyservicesandequipment.
A"performance-basedcontract"isacontractthatprovidesforpaymentonlyiftherearecostsavings,ifthepaymentobligationforeachcontractyeariseithersetasapercentageoftheannualcostsavingsattributableunderthecontractorguaranteedbytheotherpersonsorentitiestobelessthantheannualcostsavingsattributableunderthecontract(seeRCW39.
35A.
020(4)).
Toacquireequipment,services,orsupplies,thecityneednotfollowacompetitivebidprocess.
Instead,thecityannouncesitsrequirementsandseeksproposalstomeetthoserequirements.
Usingevaluationcriteriaithasestablished,thecitythennegotiateswiththepersonorfirmthathassubmittedthe"bestproposal"accordingtothecriteria(RCW39.
35A.
030).
Ifthecityisunabletodevelopasatisfactorycontractwiththatpersonorfirm,itmayselectthenextbestfirmandnegotiatewithituntilacontractcanbeagreedtoortheselectionprocessisterminated.
JobOrderContractingA"jobordercontract"isacontractbetweenacityandaregisteredorli-censedcontractorthroughwhichthecontractoragreestoprovideservicesofanindefinitequantityforworkanticipatedtoariseoverafixedperiodoftime,nottoexceedtwoyears,withanadditionalone-yearoption.
Jobordercontractingisaverydifferentprocessfromthetraditionaldesign-bid-buildmethodofperformingpublicworksprojects.
Jobordercontractingprovidesamethodofobtainingconstructionservicesforsmallerprojectsusinganindefinitequantitydeliveryordercontractoverafixedtimeperiod.
Usingthismethod,acityselectsacontractorbasedontheevaluationfactorsestablishedintherequestforpropos-December2020|CityBiddingBook:WashingtonState45als(RFP),whichmustincludepriceandtheabilityoftheproposertoperformthejobordercontract.
Thecontractor'sbidisknownasthecontractor'scoefficientandisapercentagemarkupormarkdownofthepricesincludedintheidentifiedpricebookthecityintendstouse.
Theprimaryadvantagetojobordercontractingisitsspeed.
Acityisabletocompletesmallerprojectsmorequicklythanthroughthetra-ditionalmethodofcontracting.
Completeplansandspecificationsarenotalwaysrequired,althoughtheymustbesufficientlyclearsothatacontractorunderstandstheprojectclearlyenoughsothatheorshecanpriceit.
Somecriticizejobordercontractingasbeingmoreexpensivethanwouldbepossibleundercompetitivebidding.
Unlessextendedthroughlegislativeaction,thejoborderprocessisscheduledforrepealonJune30,2021(seeRCW43.
131.
407-.
408).
36AdditionalinformationregardingjobordercontractingissetoutinAppendixC.
Design-BuildProceduresCitiesmayusedesign-buildprocedurestocontractforpublicworks(RCW39.
10.
300).
Thedesign-reviewprocessallowsacitytocontractforboththedesignandconstructionof(a)afacilityvaluedover$2million,(b)aparkinggarage,regardlessofcost,and(c)constructionorerectionofportablefacilities,preengineeredmetalbuildings,ornotmorethan10prefabricatedmodularbuildingsperinstallationsite,regardlessofcost.
Thecontractisawardedthroughacompetitiveprocessstartingwiththepublicsolicitationofqualificationsfordesign-buildservices.
Therequestforqualificationsmustcontainageneraldescriptionoftheproject,thereasonsforthedesign-buildprocedure,adescriptionofthequalificationsrequired,adescriptionoftheprocessforevaluationofqualificationsandproposals,andanyotherrelevantinformationtotheproject(RCW39.
10.
330).
Uptofivefinalistswillbeaskedtosubmitproposals,tobeevaluatedbyacommitteethatmayeitherawardthecontractfromthesepropos-alsorrejectallproposals.
Thefirmselectedisthenrequiredtosubmitaperformanceandpaymentbond,whiletheotherfinalistsarepaidanhonorariuminanamount"sufficienttogeneratemeaningfulcompeti-tionamongpotentialproposers.
"36Forjobordercontracting,oneofthestatuteslistsanexpirationdateofJune30,2021whiletheotherlistsadateofJune30,2022.
Weareusingthe2021dateuntilthisdiscrepancyisclarified.
December2020|CityBiddingBook:WashingtonState46Unlessextendedthroughlegislativeaction,thedesign-buildprocessisscheduledforrepealonJune30,2021(seeRCW43.
131.
407-.
408).
37Additionalinformationregardingthedesign-buildproceduresissetoutinAppendixC.
GeneralContractor/ConstructionManagerProceduresAgeneralcontractor/constructionmanagerisafirmthecityselectsandwithwhomitnegotiatesamaximumallowableconstructioncost,guaranteedbythefirm,selectedafteradvertisementandcompetitivebids.
Unlessthisprocessisextendedthroughfurtherlegislativeaction,itwillceasetobeavailableJune30,2021(seeRCW43.
131.
407-.
408).
38Thefirmthatisselectedprovidesservicesduringthedesignphaseandactsastheconstructionmanagerandgeneralcontractorthroughtheconstructionphase(RCW39.
10.
210(7)).
Theprocessusedforselec-tionofafirmissimilartothatusedtoselectadesign-buildcontractor,discussedinthesectionabove(RCW39.
10.
350).
Thecontractorisselectedpartiallyonqualifications,asprovidedinresponsetoarequestforproposals,andonthebidthecontractorprovides;thecitymayaddaninterviewprocess.
Themaximumallowableconstructioncostisnegotiatedbythecityandthefirmselectedafterthescopeoftheprojectisdetermined.
Thatcostisusedtosettheguaranteedcontractcost.
Subcontractworkrequirescompetitivebids.
Thecontractawardmayincludeanincentiveclause,nottoexceed5%ofthemaximumconstructioncost,tobeawardedforsavingsofeithertimeorcostorboth.
Additionalinformationregardingthecontractor/constructionmanagerproceduresissetoutinAppendixC.
WaterPollutionControlFacilitiesRCW70A.
140.
030-.
070(formerlyRCW70.
150.
030-.
070)pro-videsanalternativeandadditionalmeansbywhichacitycanobtainservicestodesign,finance,construct,own,operate,ormaintainwaterpollutioncontrolfacilities.
37Fordesign-buildcontracting,oneofthestatuteslistsanexpirationdateofJune30,2021whiletheotherlistsadateofJune30,2022.
Weareusingthe2021dateuntilthisdiscrepancyisclarified.
38Forgeneralcontractor/constructionmanagercontracting,oneofthestatuteslistsanexpirationdateofJune30,2021whiletheotherlistsadateofJune30,2022.
Weareusingthe2021dateuntilthisdiscrepancyisclarified.
AskMRSCOursecondclasscityawardedacontractforasingle-craftpublicworkwithoutgoingoutforbidsbecausetheestimatedcostwas$72,000,underthe$75,500thresholdforbids.
Nowthecontractrequiresachangeorderthatwillpushthecostover$75,500.
DoesthiscreateabiddingissueAslongasthecityestimatedthecostoftheprojectingoodfaith,thechangeorderwillnotbeaffectedbythebiddingstatutes.
Thecityshouldfollowitsnormalproceduresforachangeorder.
December2020|CityBiddingBook:WashingtonState47PollutionControlFacilitiesChapter70A.
210RCW(formerlychapter70.
95ARCW),relatingtopollutioncontrolfacilities,mayofferanimportantexceptiontobiddingrequirements.
Althoughtheprimaryemphasisofthechapterrelatestofinancingpollutioncontrolfacilities,onesectionmayexemptcertainprojectsfrombiddingrequirementsthatmightotherwiseapply.
RCW70A.
210.
110statesinpart:The[pollutioncontrol]facilitiesshallbeconstructed,recon-structed,andimproved…inthemannerdeterminedbythegoverningbodyinitssolediscretionandanyrequirementofcompetitivebidding,leaseperformancebondsorotherrestric-tionimposedontheprocedurefortheawardofcontractsforsuchpurpose…isnotapplicabletoanyactiontakenunderauthorityofthischapter.
DefinitionsareprovidedinRCW70A.
210.
020.
Theterm"facility"isdefinedtomean"anyland,building,structure,machinery,system,fixture,appurtenance,equipmentoranycombinationthereof…whichisusedortobeused…infurtheranceofthepurposeofabating,control-ling,orpreventingpollution.
""Pollution"isdefinedbroadlytoincludewaterpollution,landpollution,solidwastedisposal,thermalpollution,radiationcontamination,ornoisepollution.
Althoughtherehavenotbeenanyrelevantappellatecourtdecisionsorattorneygeneralopinionsonthestatute,itsplainlanguageseemstowaivebiddingrequirementswheneveracityortownconstructsorreconstructsabuildingorstructureoracquiresfixturesorequipmentwhichwillbeusedforpollutioncontrol.
Giventhebroadscopeofthestatute,thisexceptiontothebidlawscouldbefar-reaching.
Citiesmaybeabletobuildasewagelagoon,aeratealake,orpurchasealandfillscale,allwithoutgoingoutforbids.
However,inviewofthelackofappellateorotherauthorityregard-ingthechapter'suse,citiesshouldusecautionindecidingtomakeuseofitsprovisions.
AskingtheDepartmentofEcologytocertifythattheprojectisdesignedtoabate,control,and/orpreventpollutionwouldbeajudicioussteptotakebeforeignoringthebidlaws.
(RCW70A.
210.
120describestheprocedure.
)AskMRSCMayourcityutilizethebidlawexceptioninchapter70A.
210RCWtoconstructanaeratorsystemtoreducetheformationofalgaeinacitylakeThisprojectappearstofallwithintheintentofthischapter.
TheDepartmentofEcologyhasinthepastacceptedtheaerationprojectaseligibleunderRCW70A.
210.
120(formerlyRCW70.
95A.
100)andprovidedaloantoallowthecitytoconstructthisprojectwithoutgoingoutforbids.
Mayacityusethebidlawexceptioninchapter70A.
210RCWtopurchasewaterfiltrationequipmentforaswimmingpoolThedefinitionsectioninRCW70A.
210.
020isverybroad,butprobablynotenoughtoincludethispoolequipment.
Theintentofthisstatutoryprovisionwastoprovidebidlawexceptionsformajorpollutioncontroldevicestohelpreduceoreliminatewater,air,andotherresourcepollution.
Thispurchasedoesnotappeartofallwithinthatintent.
December2020|CityBiddingBook:WashingtonState48OtherBiddingIssuesChangeOrdersAnyalterationtoaprojectduringconstructionthatisnotspecificallyrequiredbythebidspecificationsuponwhichthecontractwasaward-edisa"changeorder.
"If,forexample,duringconstructionofabuildingfoundationadditionalexcavationworkisrequiredtoavoidunstablesoilconditions,theadditionalexcavationisaresultofachangeincondi-tions,andtheaddedcosttothecontractormaybecoveredbyachangeorder.
Ifmachineryanchorsmustberelocatedtoaccommodateapieceofmachinerythathasbeenordered,therelocationisachangeorder.
If,duringconstruction,abuildingmustberedesignedtomeetnewfederalorstatestandards,suchasforaccessforthehandicapped,theredesignandadditionalworkisachangeorder.
Conversely,reductionsinworkmayresultinachangeorderthatwillprovideacredittothecity.
WhendoestheadditionalworkrequiredbyachangeorderrequirecompetitivebidsThereisnoWashingtonauthorityonthisissue,andtheauthorityfromotherjurisdictionsappearstobesplitastotheneedforcompetitivebids.
However,accordingtoonelegalcommentator,the"bettercases"favorthepositionthatbidsarenotrequiredwhenunforeseenextraworkbecomesnecessaryunderavalidpreexistingcontract.
39InHomeOwnersConstructionsv.
GlenRock,34NJ305,169A.
2d129,134(1961),thecourtstated:Inthecourseofaconstructioncontract,bonafideemergenciesmaywellariseandincidentalalterationsmaywellberequired.
Whentheresultingadditionalexpendituresarereasonableandareconscientiouslyviewedasbeinginfulfillmentoftheorigi-nalundertakingratherthanasdepartingtherefrom,itwouldclearlybecontrarytothepublicinteresttohalttheundertak-ingandcallforbiddingwithrespecttotheadditionalworkentailedbytheemergencyorincidentalalteration.
Citingtheabovecase,Antieaucomments:Bidrequirementsshouldnotbeconstruedsostrictlyastodivestalocalgovernmentofthepowertoletextraworkre-quiredbyunanticipateddevelopmentsintheperformanceofaconstructioncontract,ortomakeminorchangesandadditionsafteracontracthasbeenawarded.
Ifthelocalgovernmenthas391AAntieau,MunicipalCorporationLaw,§10.
34atp.
10-96;seealsoMcQuillin,MunicipalCorporations,§29.
119.
10December2020|CityBiddingBook:WashingtonState49nolatitudewhateverinauthorizingchangesinmaterialsorsmalladditionswhennecessaryordesirable,thepublicinterestmaywellbejeopardized.
(Citationsomitted.
)40Antieau,however,doesrecognizethattheremustbesomelimitationsplacedonchangeordersnotrequiringbids:Thegenerallyacceptedruleisthatwhereastatuterequiresthatacontractforpublicworkshallbelettothelowestresponsiblebidder,amunicipalcorporationcannotevadethelawbymakingsubstantialchangesinthecontractafterithasbeenawardedpursuanttothelaw.
Anysubstantialandmaterialdeparturefromthespecifications,benefi-cialtothesuccessfulbidder,inthecontractenteredintowillrenderitvoid.
.
.
.
ThegeneralprinciplehasbeenstatedbytheMarylandcourt:[D]eviationsfromacontract…mustbebaseduponhon-est,reasonableandintelligentjudgmentandmustnotvarysosubstantiallyfromtheoriginalplanastoconstituteanewundertaking,wherefairnesscouldbesecuredonlybycompeti-tivebidding.
41Generally,achangeordershouldnotbeusedtoremedydefectivework;competitivebiddingshouldbeusedinsuchcases.
42However,iftheworktoremedythedefectiveworkisunderawarranty,itprobablycouldbetreatedasachangeorder.
Eachchangeorder,accordingly,mustbereviewedseparatelytode-terminewhethertheproposedworkisasubstantialchangefromthatcontemplatedinthebiddingprocess.
DoestheworkconstituteanewundertakingorisitconsistentwiththescopeoftheoriginalworkDoestheworkrequireexperienceorexpertisebeyondthatrequiredintheoriginalcontractIsthechangeordertheresultofdefectiveworkWithoutbetter(orany)directionfromtheWashingtoncourts,eachquestionablechangeordershouldbesubmittedtothecityattorneyforreview.
Additionally,theStateAuditor'sOfficehascreatedaBestPracticesforChangeOrdersdocument.
40Id.
atpage10-97.
411AAntieau,MunicipalCorporationLaw,§10.
34,atp.
10-98,citingHannv.
BoardofEducationofWic-omicoCounty,200Md.
49,87A.
2d846,849(1952).
42McQuillin,MunicipalCorporations,§29.
40.
December2020|CityBiddingBook:WashingtonState50ConflictofInterestMunicipalcontractsthatmaybenefitamunicipalofficerareseverelyrestricted.
RCW42.
23.
030provides,inpart:Nomunicipalofficershallbebeneficiallyinterested,directlyorindirectly,inanycontractwhichmaybemadeby,throughorunderthesupervisionofsuchofficer,inwholeorinpart,orwhichmaybemadeforthebenefitofhisoffice,oraccept,directlyorindirectly,anycompensation,gratuityorrewardinconnectionwithsuchcontractfromanyotherpersonbenefi-ciallyinterestedtherein.
"Municipalofficer"isdefinedinRCW42.
23.
020(2)as:[A]llelectedandappointedofficersofamunicipality,togetherwithalldeputiesandassistantsofsuchanofficer,andallper-sonsexercisingorundertakingtoexerciseanyofthepowersorfunctionsofamunicipalofficer.
Washingtoncourtshavelookedattheterm"beneficialinterest"overtheyears.
Theyhaveheldthatacitycouldnotcontractwithacom-panythatsuppliedrock,whentheownerwasthecity'spublicworkscommissioner.
43Ontheotherhand,theyhaveheldthatacitycouncilmemberwhowasanunpaidboardmemberofanonprofitagencydidnothaveabeneficialinterestintheagencyandcouldvoteoncityfundingofthatagency.
44Thereareexceptionstotherule.
And,thestatutedefinesremoteintereststhatmustbedisclosedbutthatdonotpreventthecityfromcontracting.
Eachofthesedependsonthesizeofyourcityortownandotherspecificfacts.
So,youshouldalwayscheckwithyourattorneytoseewhetherthoseexceptionsapply.
AnycontractmadeinviolationofRCW42.
23.
030isvoid,andanyofficerwhoviolatesthatstatuteissubjecttoacivilpenaltyof$500andhisorherofficemaybesubjecttoforfeiture(RCW42.
23.
050).
ResultsofViolationofBidStatutesAviolationofstatutorybiddingrequirementsmayhaveseveralcon-sequences.
First,acontractmadeinviolationofsuchrequirements,or43CityofRaymondv.
Runyon,93Wn.
App.
127(1998).
44Barryv.
Johns,92Wn.
App.
865,920P.
2d222(1996).
December2020|CityBiddingBook:WashingtonState51thoseofacitycharterorordinance,isillegalandvoid.
45Nevertheless,acitymayhavetopayforthereasonablevalueofapartiallyperformedcontractthatisvoidedforviolationofbidlaw,wherethereisnobadfaithorfraud.
46Second,aviolationofbidlawhasconsequencesforthemunicipalof-ficerunderwhomorunderwhosesupervisionthecontractwasmade.
RCW39.
30.
020providesthattheofficerisliableforapenaltyofnotlessthan$300iftheviolationofbidlawwas"willfulandintentional,"andthat,further,theofficermaybeheldliablefortheconsequentialdamagestothecityresultingfromtheviolation.
And,RCW42.
23.
050requiresapersonwhoviolateschapter42.
23RCWtopaya$500finetothecityinadditiontoothercivilorcriminalpenalties.
Iftheofficer,inacriminalactionagainsthimorher,isfoundtohaveintentionallyviolatedbidlaw,heorsheimmediatelyforfeitshisorheroffice(seeRCW39.
30.
020andRCW42.
23.
050).
45PlattElectricSupplyv.
Seattle,16Wn.
App.
265(1976).
Pleasenote,ifthelowbidistobechallenged,thechallengemustbebroughtbeforethecontractissigned.
BBGGroupv.
Monroe,96Wn.
App.
517(1999).
Afterthecontractissigned,thechallengingpartynolongerhasstandingtochallengethebidaward.
46Edwardsv.
CityofRenton,67Wn.
2d598(1965).
December2020|CityBiddingBook:WashingtonState52AppendicesTheresourceslinkedbelow,providefurtherinformationandreadingrelatedtocitybiddingprocesses.
Clickonthedocumenttitlestoviewtheseresources.
A.
MRSCBidThresholdsforPublicWorksProjectsThismatrixshowsthebidthresholds,smallworksrosterthresholds,andlimitsforworkbyagencyemployeesforallclassesofcitiesandtowns,aswellasmanyotherlocalgovernmentsinWashington.
B.
MRSCBidThresholdsforPurchasesThismatrixshowsthethresholdsforquotes,vendorlists,andformalcompetitivebidsforallclassesofcitiesandtowns,aswellasmanyotherlocalgovernmentsinWashington.
C.
Non-TraditionalPublicWorksContractsThisdocument,preparedbyMikePurdy,providesabriefintroductiontothethreealternativepublicworksprojectdeliverymethodsauthorizedinWashington:(1)jobordercontracting,(2)design-buildcontracting,and(3)generalcontractor/constructionmanager(GC/GM)contracting.
D.
FirstClassCityBidLaws–AnAlternativeViewThisdocumentbrieflyaddressestheambiguitywithinthefirstclasscitybiddingstatute,RCW35.
22.
620,aswellasthehistoryofthecurrentlaw.
1.
800.
933.
6772MRSC@MRSC.
orgMRSC.
orgfacebook.
com/MRSCWA@MRSC_WA2601FourthAvenue,Suite800Seattle,WA98121-1280PUB-19-0009