Can a Public Authority Really Waive Competitive Bidding?
Kegler Brown Construction Newsletter September 1, 2015
The recent decision of the City of Columbus to dispense with competitive bidding after it had bid the $74 million City Office Building (apparently to try to render moot a sub bid listing controversy) has placed this issue of waiving competitive bidding squarely in the spotlight.
Most public authorities have the ability to waive competitive bidding in an emergency. For example, R.C. §152.18 allows any “Ohio Bidding authority” an exemption from competitive bidding for “real and present emergencies.” R.C. §306.43, dealing with “regional transit authorities” is one of the few statutes defining an emergency, and defines a “real and present emergency” as “an event that affects safety, welfare, or ability to deliver transportation services, arises out of an interruption of contracts essential to the daily provision of transport, or involves actual physical damage to structures.”
Some municipalities also have provisions that allow for the waiver of competitive bidding under more liberal circumstances, and cities often argue that under “home rule” their municipal ordinances prevail over state law.
While there would likely be little debate about whether a serious natural disaster allowed the waiver of competitive bidding, it is much more questionable whether a discrepancy or controversy in the bidding process constitutes a bona fide emergency. This would be particularly true when the public authority found the need to solicit bids in the first place.
Disgruntled bidders are often reluctant to challenge bidding decisions due to the legal cost involved and the law that says that public authorities unhappy with bidding decisions can rebid without any real consequences.