Challenge To Responsiveness Of Bid For Rocky Mount Project Falls Short — But Should It Have?

I just caught this article from the Rocky Mount Telegram regarding last Thursday’s decision by the Rocky Mount City Council to award the $6.1 million Downtown Streetscape project to the apparent low bidder, T.A. Loving Construction Co., despite an objection from the third-low bidder, PLT Construction, that T.A. Loving’s bid was non-responsive.

At issue was T.A. Loving’s inclusion in its bid of a light fixture that did not comply with the project specifications and for which T.A. Loving failed to obtain pre-bid approval as required by the bidding instructions.  Although the City Council initially considered re-bidding the project, it ultimately awarded the project to T.A. Loving, requiring in exchange that the contractor install spec-compliant light poles at the reduced price for the fixtures recited in its non-compliant bid.

The Telegram’s story suggests this arrangement will save the City of Rocky Mount $138,000 on the light fixture component of the project — i.e., more than 2% of the total value of the contract to be awarded.   Simply put, not a bad deal for the City.  But what about for the larger North Carolina contracting community?  I have my doubts.

N.C.G.S. § 143-128 establishes that public building contracts “shall be awarded to the lowest responsible, responsive bidder[.]”  The term “lowest” refers to price, and term “responsible” refers to the qualifications of the bidder itself.

What about “responsive?”  That term generally refers to whether the bid itself conforms to the requests for bid.  The leading North Carolina appellate decision fleshes out the definition of “responsive” as follows:

In the context of public contract bidding a “responsive” bid is one which conforms substantially with the terms of the request for bids.  Whether a bid conforms substantially with the request for bids or whether, instead, it contains a material variance depends on whether the bidder’s proposal gives him an advantage or benefit which is not enjoyed by other bidders.  However, where a contract can be let only to the lowest responsible bidder after advertising for bids, the specifications must be so framed as to secure fair competition upon equal terms to all bidders.

Professional Food Services Mgmt. v. N.C. Dept. of Admin., 109 N.C. App. 265, 268-69, 426 S.E.2d 447, 450 (1993) (internal quotes and citations omitted).

Under this standard, I find myself drawn to PLT Construction’s argument that T.A. Loving’s bid was non-responsive.  All parties involved agreed that the bid failed to comply strictly with the specifications and request for bids.  Was the deviation material?  Based on the facts as I understand them from the Telegram’s account, I think it may have been.  That’s because after the objection was raised, the City Council and T.A. Loving appear to have entered into a negotiated arrangement whereby the contractor, in exchange for the contract, agreed to install compliant light poles at the below-market price for same contained in its bid.  That negotiated arrangement strikes me as a second bite at the apple not enjoyed by the other bidders — and therefore an unfair advantage that undermined the level playing field the public bid statutes are intended to secure.

Because our state courts afford public agencies great deference in the awarding of public contracts let pursuant to the North Carolina bid statutes, judicial bid protests are generally very difficult to win in North Carolina.  So I don’t blame PLT Construction one iota for seeking to persuade the Rocky Mount City Council to reject all bids and re-bid the work, rather than seeking injunctive relief in a court of law.  All the same, judicial deference should have a limit, and I think a civil action for declaratory and injunctive relief on these facts would have given a superior court judge some serious heartburn.