Public Bidding And The Level Playing Field

Recently I was asked, what rules govern competitive bidding? There are many different rules that govern public bidding in Pennsylvania, many of which can be found in the Commonwealth Procurement Code. Some govern the timing of bid awards and withdrawal of bids.

The primary “unwritten” rule of public bidding is the “level playing field” rule. This rule means that all bidders are treated the same, and are judged by a common standard that governs all bids that are received. A common standard implies universal specifications, freely accessible to all bidders, and not written in favor of a single bidder. The level playing field is violated where the public owner applies a different standard to the bids it receives, or awards a contract based upon unpublished or unadvertised standards, or otherwise deviates from the published bid instructions and bidding requirements. Read more

Posted on September 27, 2016 by Christopher I. McCabe, Esq. in Public Bidding 101 Comments Off

City Of Philadelphia Will Accept E-Bids Starting Fall 2016

Starting this fall, in a move to make bidding more efficient and competitive, the City of Philadelphia will begin to accept electronic bids and contract proposals. Philadelphia officials hope to make all aspects of City contracting electronic-based – from vendor registration to bids and even contract signatures. The change will affect contracts for public works, contracts for non-professional services, and contracts for goods and equipment. Contracts for professional services contracts are already subject to e-bidding. Contractors who wish to bid for City contracts must register for the new program.

The new PHLContracts website can be found here.

Contractors can find registration information here.

An FAQ on the new program can be found here.

An article in The Philadelphia Inquirer on the new program can be found here.

Posted on September 12, 2016 by Christopher I. McCabe, Esq. in City of Phila., Electronic Bidding Comments Off

Bad Faith Finding Does Not Mandate Award Of Attorney Fees And 1% Penalty

If a public owner breaches its payment obligations to a public contractor and acts in bad faith in doing so, is the public contractor automatically entitled to an award of its attorney’s fees and a 1% penalty under section 3935 of the Procurement Code?

In a recently published opinion, the Supreme Court of Pennsylvania has ruled that such an award is discretionary, not automatic, reversing a 2014 Commonwealth Court decision which had held that a bad faith finding entitled the contractor to recover its attorney’s fees and the 1% penalty. Read more

Posted on August 17, 2016 by Christopher I. McCabe, Esq. in Court Decisions, Procurement Code, Public Works Payment Rules Comments Off

Was Bid Non-Conforming Where Use Of PennBid Was Mandatory?

If a public owner mandates that all bidders use PennBid, an electronic bidding system used by public owners in Pennsylvania, for receipt and tabulation of their bid prices, but also inexplicably requires each bidder to write out its base bid price in words and numbers, what bid form controls? The PennBid tabulation, or the handwritten bid form?

Suppose the PennBid tabulated base bid price is $100,000, but the bidder writes out $100,001? Which is the controlling bid price? Why, for that matter, would any public owner require two forms of bid pricing which only invites confusion and the possibility of conflicting prices?

Posted on August 2, 2016 by Christopher I. McCabe, Esq. in Bid Protests, Bid Responsiveness, Electronic Bidding Comments Off

Commonwealth Court Affirms Dismissal Of Late-Filed Claim With The Board Of Claims

In a recent, unreported decision, the Commonwealth Court of Pennsylvania affirmed the dismissal by the Board of Claims (Board) of a late-filed contractor claim. Under the Board’s jurisdictional statute, 62 Pa. C.S. § 1712.1(e), a formal statement of claim must be filed with the Board, either within 15 days of the mailing date of a final determination denying a claim, or within 135 days of the filing of a claim, whichever occurs first. Read more

Posted on July 19, 2016 by Christopher I. McCabe, Esq. in Board of Claims, DGS Comments Off

Oral Promise To Pay Subcontractor Ruled Enforceable Against School District

In a departure from the usual rule, but not surprising given the facts of the case, the Commonwealth Court of Pennsylvania recently enforced a subcontractor’s claim for payment against a public owner.

In 2009, West Allegheny School District terminated Flaherty Mechanical Contractors, LLC, the prime contractor on a school alterations project, for failure to pay various subcontractors. After the termination, to prevent further delay, the school district asked F. Zacherl, Inc., the sheet metal subcontractor, to return to the project and complete the work remaining under its subcontract with Flaherty.

Zacherl orally agreed with school district, provided it was paid its then outstanding invoices. These invoices were paid, and Zacherl completed its work, but the school district made no further payments for either the work Zacherl had performed for Flaherty or the work Zacherl performed for the school district. Zacherl sued Flaherty’s surety and the school district for payment. The trial found in favor of Zacherl, with the surety liable for payment for Zacherl’s work for Flaherty, and the school district liable for Zacherl’s work for the school district. The school district appealed. Read more

Posted on July 7, 2016 by Christopher I. McCabe, Esq. in Court Decisions, Public School Code Comments Off

No-Bid Busing Contracts Cost School Districts An Extra $53.7 Million Over State Reimbursement

According to recent audits conducted by the Pa. Department of the Auditor General, Pennsylvania school districts spent at least $53.7 million in excess of the state’s transportation reimbursement formula through the use of no-bid busing contracts.

The conclusion of the Auditor General was based on audits of about 450 of the state’s 500 public school districts. As a result, Auditor General Eugene DePasquale called on the Pa. General Assembly to mandate competitive bidding for such transportation services, saying:

To get the best possible price and ensure transparency for taxpayers, student transportation contracts should be re-bid every time they are up for renewal. I’m calling on the General Assembly to enact legislation to ensure school districts are getting the best possible price by requiring them to seek competitive bids for transportation services. Amending the Public School Code to require schools to competitively bid transportation services will improve transparency and could put more money in our classrooms.

The Auditor General press release issued on May 12, 2016, can be found here. A PennLive story on the Auditor General’s findings can be found here.

Posted on June 21, 2016 by Christopher I. McCabe, Esq. in Com. of Pa., Public School Code Comments Off

Executive Order Prohibits Discrimination On The Basis Of Sexual Orientation Or Gender Identity Or Expression By Contractors Doing Business With State

On April 7, 2016, Pa. Governor Tom Wolf signed a new Executive Order establishing that future Commonwealth of Pennsylvania contracts must ensure that contractors doing business with the state will not discriminate in the award of subcontracts or supply contracts, or in hiring, promotion, or other labor matters, on the basis of sexual orientation, or gender identity or expression. The Executive Order also mandates that contractors receiving state funds must have, as a condition of payment, a written sexual harassment policy and that employees of the contractor are aware of the policy. Read more

Posted on June 7, 2016 by Christopher I. McCabe, Esq. in Com. of Pa., DGS Comments Off

Procurement Code Protest Allowed Where Late Filing Was Due To Extraordinary Circumstances

Under the Pa. Procurement Code, a protest must be filed within seven days after the protestant knew or should have known of the facts giving rise to the protest. If the protest is untimely, it will be rejected. Recently, in a published opinion and in a departure from the usual rule, the Commonwealth Court decided that equitable principles would allow a late-filed protest to be considered.

The case concerned Pa. Department of Transportation (PennDOT) inspection contracts on which Bureau Veritas (BV), the protestant, had submitted a statement of interest. PennDOT ranked BV fifth in its statement of rankings. BV learned of the rankings on November 13, 2014. Seven days later, on November 20, 2014, BV filed a protest, but the email of its protest was rejected by PennDOT’s computer server due to improper formatting of the file attachment. On November 21, 2014, BV learned of the email rejection and promptly re-sent the email with the proper formatting of the file attachment, eight days after the publication of the rankings. PennDOT rejected BV’s protest as untimely and on the merits. BV then argued that it should be allowed to file its protest nunc pro tunc (literally, “now for then”). PennDOT issued a final determination rejecting the protest, as well as the request that the protest be considered nunc pro tunc. BV appealed to the Commonwealth Court. Read more

Posted on June 2, 2016 by Christopher I. McCabe, Esq. in Bid Protests, Court Decisions, PennDOT, Procurement Code Comments Off

Minimum Wage Increased For Employees Of Certain State Contractors

On March 7, 2016, Governor Tom Wolf signed an Executive Order that raises the minimum wage to $10.15 an hour for employees of certain state contractors.

The employees covered the Executive Order include:

Employees who: (1) directly perform services or construction; or (2) directly perform services for the Commonwealth and are employed by a lessor of property to the Commonwealth; or (3) spend at least 20 percent of their working time in a given work week performing an ancillary service called for in a new lease of property or contract for services or construction exceeding the applicable small purchase threshold entered into with a Commonwealth agency under the jurisdiction of the Governor, including bilateral modifications to existing such leases or contracts, after the effective date of this Executive Order.

According to a 6ABC Action News report:

[The Executive Order] also will affect a narrow set of state contracts – potentially 109 vendors that provide janitorial, landscaping, delivery and food preparation services – that does not include hospitals, nursing care or state universities, administration officials said. The overall cost to the state and its contractors was projected at just above $4 million.

Executive Order No. 2016-02, which takes effect on July 1, 2016, for employees of state contractors, can be found here.