2014 Louisiana Laws
Revised Statutes
TITLE 48 - Roads, Bridges and Ferries
RS 48:255 - Award of contract; time limitations and exceptions; bond of successful bidder; rejection of certain bidders

§255. Award of contract; time limitations and exceptions; bond of successful bidder; rejection of certain bidders

A. The department shall establish specific bidding requirements, in accordance with the provisions of this Part, provisions of the Federal Highway Administration, if applicable, and other provisions as necessary and will include these requirements in the project specifications and bid package issued to prospective bidders. Bids of prospective bidders shall conform to these requirements. Bids not submitted in accordance with this Subpart or such other specified requirements are irregular and must be rejected by the department.

B.(1) For all construction, maintenance, or improvement projects for department facilities or other public facility projects, advertised and let by the department, the department or the contracting agency may reject any and all bids for just cause but otherwise shall, with the concurrence of all funding sources, award the contract to the lowest responsible bidder within forty-five calendar days after receipt of bids or twenty calendar days after receipt by the department of concurrence in award from all project funding agencies, whichever occurs last, unless the department and the successful bidder mutually agree to extend the deadline. However, in cases where concurrence in award is required, the department shall award the contract no later than sixty calendar days after receipt of bids unless the department and the successful bidder mutually agree to extend the deadline.

(2) Should the successful low bidder not agree to extend the time period for award beyond the above described period the bid guaranty will be returned to the bidder and the department may, at its discretion, award to the next low bidder or may readvertise the project.

(3) If the department delays the award of the project in bad faith beyond the period specified herein for award such that the low bidder cannot perform at the prices bid and the project is awarded to a higher bidder, the unsuccessful low bidder shall receive the costs of preparation of his bid on the project from the department.

(4) If the contract is to be financed by bonds which are required to be sold after receipt of bids on the construction contract, or if the contract is to be financed in whole or in part by federal or other funds which will not be available at the time construction bids are received, or if the contract requires a poll of the legislature prior to the release of funds for the contract, the time limitation for the award of a contract herein stipulated in this Section may be modified and, if modified, shall be reflected in the specifications for the construction project and in the official advertisement for bids required in accordance with R.S. 48:252.

(5) For the purposes of this Section "just cause" means but is not limited to the following circumstances:

(a) The department's unavailability of funds sufficient for the construction of the proposed public work or the unavailability of funding participation in the project by anticipated funding sources.

(b) The failure of any bidder to submit a bid within an established threshold of the preconstruction estimate for the project by the department's engineers.

(c) A substantial change by the department prior to the award in the scope or design of the proposed public work.

(d) A determination by the department not to build the proposed public work within twelve months of the date for the public opening and presentation of bids.

(e) The disqualification or rejection by the department of all bidders.

(f) The discovery by the department prior to the award of the project of an error, defect, or ambiguity in the bidding documents that may have affected the integrity of the competitive bidding process or may lead to a potential advantage or disadvantage to one or more of the bidders.

(6) If two or more responsive bids from responsible bidders are received for exactly the same price and no preference or other method exists to determine the lowest bidder, the chief engineer shall notify the tied bidders of a time and place where the lowest bidder on the project will be chosen by flipping a coin or by lots, as appropriate in the determination of the chief engineer. The department may readvertise the projects in its discretion.

(7) Repealed by Acts 2007, No. 386, §2, eff. July 1, 2007.

C. Bids containing patently obvious mechanical, clerical, or mathematical errors may be withdrawn by the contractor if clear and convincing sworn, written evidence of such errors is furnished to the department within seventy-two hours of the bid opening, excluding Saturdays, Sundays, or other legal holidays. If the department determines that the error is a patently obvious mechanical, clerical, or mathematical error, it shall accept the withdrawal request and return the bid security to the contractor. A contractor who withdraws a bid under the provisions of this Section shall not be allowed to resubmit a bid on the project. If the bid withdrawn is the lowest bid, the next lowest bid may be accepted. If all bids are rejected, any contractor who had withdrawn a bid prior to rejection of all bids shall not be eligible to bid on the project unless the re-advertisement and opening of bids is at least one hundred eighty days after the date the bid was withdrawn.

D.(1) When the bid is accepted for the construction, maintenance, or improvement to a department facility, or public works project, a written contract shall be entered into by the successful bidder and the department or contracting agency, and, on projects exceeding fifty thousand dollars, the party to whom the contract is awarded shall furnish good and solvent bond in an amount equal to the contract bid cost for the faithful performance of his duties.

(2) Any surety bond written for a department project shall be written by a surety or insurance company currently on the U.S. Department of Treasury Financial Management Service list of approved bonding companies which is published annually in the Federal Register, or by a Louisiana-domiciled insurance company with at least an A- rating in the latest printing of the A.M. Best's Key Rating Guide.

(3) For any project advertised and let by the department, no surety or insurance company shall write a bond which is in excess of the amount indicated as approved for them by the United States Department of the Treasury Financial Management Service list of approved bonding companies as published annually in the Federal Register. For any project advertised and let by the department, a Louisiana-domiciled insurance company not on the U.S. Department of Treasury Financial Management Service list of approved bonding companies shall not write bonds exceeding ten percent of policyholder's surplus as shown in the A.M. Best's Key Rating Guide.

(4) In addition, any surety bond written for a project advertised and let by the department shall be written by a surety or insurance company that is licensed to do business in the state of Louisiana.

(5) The performance bond described by this Section shall inure solely to the benefit of the department and its successors or assigns, and no other person shall have any right of action based thereon.

E. The secretary shall reject any bid submitted by any firm, corporation, individual, or legal entity on any state funded project who, at the time or submission of bid, is prohibited from bidding or working on any federally funded project by the Federal Highway Administration.

F.(1) The contractor shall return the signed contracts along with good and solvent bond to the department or the contracting agency within fifteen calendar days following the transmittal of contracts for execution. After return of the surety bond and signed contracts from the contractor, the department or the contracting agency shall execute the contract documents within twenty calendar days.

(2) The department or contracting agency shall issue a work order to the successful contractor within sixty calendar days following execution of the contract. However, upon mutual written consent by all parties, the notice to proceed may be extended beyond the sixty days. Should the contractor not wish to extend the period from contract execution to work order beyond sixty days, the contractor may demand contract cancellation.

(3) Should the contract be canceled at the request of the contractor, the department may at its discretion award the contract to the next higher bidder if the next higher bidder so agrees, or the department, at its discretion, may readvertise and relet the contract. Should the contract be canceled at the request of the contractor, the contractor shall be compensated for the cost of procuring the bond or bonds required for the contract.

(4) If the contractor demands cancellation, but the department does not cancel the contract, the contractor shall be entitled to an escalation of his bid prices for the period between the lapse of the sixty-day period and the actual work order to the extent that the contractor can prove such escalation during that period, but in no event shall such escalation exceed the rate of inflation reflected by the United States Bureau of Labor Statistics Wholesale Price Index for the relevant period.

Acts 1990, No. 206, §1, eff. July 1, 1990; Acts 1997, No. 1112, §1, eff. July 14, 1997; Acts 1999, No. 652, §1; Acts 1999, No. 1284, §3; Acts 2001, No. 575, §1; Acts 2006, No. 14, §1, eff. May 4, 2006; Acts 2006, No. 324, §1, eff. June 13, 2006; Acts 2007, No. 386, §§1, 2, eff. July 1, 2007.