During the COVID-19 Pandemic, local governments and school districts are doing their best to conduct business while balancing the health, safety and welfare of employees and the general public. To the extent possible, business must continue and as a result local governments and school districts must continue to advertise bids. Governor Cuomo listened to concerns raised regarding competitive bidding requirements and on March 27, 2020, issued Executive Order (“EO”) 202.11. EO 202.11 permits the non-public opening of bids; provided, however, that where practical, local governments and school districts must record or live stream bid openings so that the public has the opportunity to view such bid openings.
Keane & Beane, P.C. has prepared this Legal Alert to provide guidance on frequently asked questions we have received concerning public bidding requirements under EO 202.11. Our firm also prepared Q&A Legal Alerts on Conducting Public Meetings During Governor Cuomo’s Stay at Home Order and Responding to Foil Requests During the Covid-19 Outbreak conducting public meetings in a virtual world. Access to all of Keane & Beane, P.C.’s Legal Alerts is available here.. Please send any questions to Stephanie Burns or Drew Victoria Gamils. We will be updating this Alert as necessary.
1. What are the standard bidding requirements under General Municipal Law § 103?
Generally, local governments and school districts are required to advertise for competitive bids when expenditures exceed certain dollar thresholds. All contracts for public work involving an expenditure of more than $35,000 and all purchase contracts involving an expenditure of more than $20,000 must typically be awarded to the lowest responsible bidder after advertisement for sealed bids.
As an alternative to awarding such contracts on the basis of lowest responsible bidder, local governments and school districts may elect to award purchase contracts on the basis of best value. The use of best value for awarding a purchase contract must be authorized by local law or, in the case of a district corporation, school district or board of cooperative educational services, by rule, regulation or resolution adopted at a public meeting. The best value standard may not be used for any contracts involving a public works project that is subject to Article 8 of the Labor Law.
An advertisement for bids and offers must be published in an official newspaper, if any, or otherwise in a newspaper designated for such purpose, and may be published in the procurement opportunities newsletter pursuant to Article 4-C of the Economic Development Law. The advertisement for bids must contain the date, time and location where the bids will be publicly opened and read.
In a pre-COVID-19 world, all bids received were required to be publicly opened and read at the time and place specified in the bid advertisement and the identity of all offerers is publicly disclosed.
2. How can local governments and school districts satisfy public bid opening requirements under EO 202.11?
Under EO 202.11, local governments and school districts are not required to hold in-person bid openings. The public entity may videotape the opening, utilize a videoconference service to provide live access to the bid opening, livestream the bid opening, or open the bids on public television. Where practicable, the public should be provided the opportunity to view the bid openings live.
The other requirements under General Municipal Law § 103 remain unchanged. Local governments and school districts must continue to advertise for and award competitive bids pursuant to the requirements of the law.
3. Can bidders participate in bid openings remotely?
Yes. Bidders should be permitted to participate remotely in a bid opening.
Under EO 202.10, non-essential gatherings of individuals of any size for any reason are canceled or postponed at this time. Local governments and school districts may not allow bidders to attend bid openings in person. Bidders should be invited to participate in a bid opening via videoconference or similar system.
4. What information is required in bid advertisements in light of EO 202.11?
Bid advertisements that were previously issued included a statement that all bids received would be publicly opened at a specified date, time and location. The local government or school district should post notices on their websites stating that in-person attendance at such bid openings will not be permitted. Such notices should include information about how the public can view the bid opening. Such notices should also be published in the official paper. In addition, a written addendum should be distributed to all prospective bidders to whom the bid was distributed providing information concerning how to view the bid opening from a remote location.
For bid advertisements that have not yet been issued, the required bid advertisement should include the date and time when all bids must be received, opened and read and note that it is anticipated that in-person attendance at the bid opening will not be permitted, and include information about how the opening of such bids can be viewed by the public if in-person attendance is not permitted. .
5. Can local governments and school districts accept bids in electronic format?
Yes. Bids and offers submitted in connection with purchase contracts, including contracts for service work, but excluding any purchase contracts necessary for the completion of a public works contract pursuant to Article 8 of the Labor Law, may be accepted in electronic format. The governing board of the political subdivision or district must first adopt a resolution to authorize the receipt of bids and offers in electronic format.
Accepting bids or offers electronically can increase competition, as well as convenience, especially during the COVID-19 pandemic. The advertisement for bids or offers must designate how the electronic bid or offer will be received, such as designating the website or email address where the bid or offer should be sent.
With the exception of technology contracts, the submission of bids or offers in electronic format may not be required as the sole method, and paper bids or offers must still be accepted. All other minimum requirements of the competitive bidding or competitive offering process remain the same (e.g., advertising in the official newspaper). Any method used to receive electronic bids or offers must, at a minimum:
- Document the time and date of receipt of the bids or offers received electronically;
- Authenticate the identity of the sender;
- Ensure the security of the information transmitted; and
- Ensure the confidentiality of the bid or offer until the time and date established for the opening of bids or offers. Electronic submissions should be marked confidential. Care should be taken to ensure that such bids are not released before the bid opening date.
The authorization for electronic bids or offers is scheduled to sunset and expires on June 1, 2023.
6. What are the procedures for emergency procurements?
Pursuant to General Municipal Law § 103(4), certain emergency purchases arising out of an accident or other unforeseen occurrence or condition affecting public buildings, public property or the life, health, safety or property of the inhabitants of a political subdivision or district do not require competitive bidding. Under this provision, contracts for public work or the purchase of supplies, material or equipment may be let by the appropriate officer, board or agency of the political subdivision or district without the issuance of an advertisement for sealed bids. While emergency purchases do not require competitive bidding, it is nevertheless in the public interest that such purchases be made at the lowest cost to the local government or school district.
In order for a situation to constitute an emergency within the meaning of General Municipal Law § 103(4), there must be some imminent danger to public property or the life, health, safety and property of a local government’s or school district’s residents which makes any delay in action untenable. The declaration of a public emergency for competitive bidding purposes is a matter of local determination to be made by the governing board in light of the existing factual circumstances and the requirements of § 103(4). In a true emergency situation, prompt performance of the required services is required. An emergency situation does not exist if the work could be postponed for a period of time equivalent to the time required to advertise for bids.
7. Did the Governor order any other emergency actions that impact public bidding requirements?
Yes. EO 202, issued March 7, 2020 suspends the requirements of General Municipal Law §§ 103 and 104-b to the extent necessary to permit schools to procure and use cleaning maintenance products without the usual advertising for bids and offers and compliance with existing procurement policies and procedures.
8. Can the scheduled bid opening be postponed?
Yes. The public entity may in its discretion postpone or extend a bid opening. Any delay should be made public and a written addendum should be distributed to all prospective bidders to whom the bid was distributed. Such notices should also be circulated in the official paper.
9. Should pre-bid conferences and/or site visits be held?
Given the limitation on gatherings pursuant to EO 202.10, the implementation of social distancing requirements, and the limited staff available, pre-bid conferences or site visits should be canceled, unless considered essential. Local governments and school districts should consider, where possible, conducting pre-bid conferences and site visits remotely via videoconference. Any modification of a pre-bid conference or site visit should be made by written addendum to the advertisement for bids and should be advertised in the official paper.
10. Does EO 202.11 impact local procurement policies?
No. The EO only affects public bid openings covered by General Municipal Law § 103. Local governments and school districts should be sure to review their local procurement policies to determine if any temporary changes need to be made to address concerns related to COVID-19.
Consult Counsel Regarding Specific Questions
Given the fluidity of this rapidly developing situation, we encourage you to reach out to a member of the Keane & Beane Municipal Law or Education Practice Group with questions regarding specific situations. Because of the frequent developments, you should consult counsel regarding specific questions. For questions on General Municipal Law § 103 and bid openings using virtual technology, or any other inquiries regarding municipal issues please contact Stephanie Burns or Drew Victoria Gamils or any other attorney in our Municipal Law or Education Law Practice Group.