1-21 Section 102. Bid Submission, Award, and Execution o f Contract
102.01 Prequalification of Bidders
Unless otherwise provided, Bidders must be prequalified for the categories of work on which they submit a bid. A Bidder ’s net prequalification must be equal to or greater than that required for the proposed c ontract. When required in the proposal, the Bidder must designate other prequal ified Contractors to whom the Bidder will subcontract the categories of work for which the Bidder lacks prequalification.
102.02 Contents of Proposal
The plans, specifications, and other documents designated in the p roposal are considered part of the proposal whether attached or not .
102.03 Interpretation of Bid Items in the Proposal
The Department will use estimated quantities in the schedule of i tems to compare bids.
102.04 Examination of Plans, Proposal , and Work Site
Prior to submitting a bid, the Bidder must:
A.Examine the proposal, plans, and the work site to understand the local conditions affecting the work and the detailed requirements of construction.
B.Upon discovery of uncertainties, inconsistencies, errors, omissions, or conflicts during the examination of t he proposal, plans , and work site, notify the Department representative identified in the p roposal using Department -approved procedures.
C.Be familiar with all requirements of federal, state, and local laws, ordinances, and permits that may directly, or indi rectly, affect performance of the work. The Department considers the submission of a bid as prima facie evidence that the Bidder examined the proposal, plans, and the project site and understands the requirements of the proposal package and conditions at the project site. The Bidder must not take advantage of errors or omissions in the propos al that could make the bid mathematically or materially unbalanced. Failure to notify the Department of errors and omissions may MDOT Standard Specifications for Construction Section 102 1-22 result in the Department ’s rejection of the bid, reduction in or suspension of the Bidder ’s prequalification, or both.
102.05 Preparat ion of Bid
The bid must be prepared using current Department software and in accordance with current Department procedures. The Bidder must include, and will be deemed to have included, in its bid and contract price all applicable taxes that have been enacted into law as of the date the bid is submitted.
102.06 Irregular Bids
By submitting a bid, the Bidder agrees to the Department ’s procedures and standards for accepting and rejecting irregular bids. Unless the proposal modifies this subsection, the Department w ill take the following actions for irregular bids.
A.The Department will consider a b id irregular and will reject it for any of the following reasons:
1.The bid does not contain a unit price f or each pay item listed in the unit prices column or lump sum price in the bid amounts column, as applicable. While a blank space is unacceptable, the explicit quotation of zero constitutes a price and, if awarded the contract, the Bidder would be bound to perform that pay item for zero payment and to do so to the same ex tent as if a positive numeric price had been quoted.
2.All addenda issued for the contract are not acknowledged in the bid as submitted.
3.The bid is not electronically submitted by an authorized representative of the Bidder who has been designated in writing in accordance with current Department procedures.
4.The Bidder, except as otherwise provided in this subsection, is not prequalified or has insufficient prequalification for the specified category( ies) of work required for the purposes of submitting a bid.
5.The Department finds evidence of collusion.
B.The Department will consider a bid irregular and may reject it for any of the following reasons:
1.There is an unauthorized addition, deletion, or alteration to the bid.
2.There is an unauthorized alternate bi d or conditional bid.
3.There is an irregularity of any kind that make s the bid incomplete, indefinite, or ambiguous as to its meaning. MDOT Standard Specifications for Construction Section 102 1-23 4. The bid fails to comply with any other bid requirement.
5.Any provision is added to the bid reserving the right for the Bidder to accept or reject an award of the contract.
6.The bid is mathematically unbalanced. The Department will perform further analysis to determine whether the bid is also materially unbalanced. Decisions to accept or reject a materially unbalanced bid will be made in accordance with Department procedures and the Department ’s best interest.
7.Affiliated Bidders submit bids on the same contract .
C.The Department may waive irregularities in accordance with subsection 102.06.B and accept the lowest qualified bid whe never the considerations set forth in this subsection do not justify rejection of the bid. In determining whether to waive an irregularity and accept a bid, the Department will consider whether the nature or extent of the irregularity is such that acceptance of the bid might:
1.Confer on the Bidder an unfair advantage or possibility for bid manipulation;
2.Jeopardize funding for the contract ;
3.Impose unreasonable administrative burdens on the Department; or otherwise
4.Undermine the integrity of a fair, open, and honest competitive bidding process. If the irregularity will not result in any of the conditions listed under subsection 102.06.C, the Department may accept the bid and allow the Bidder to remedy the irregularity. In remedying the irregularity, the Bidder must not increase or decrease any unit price bid. Only a Bidder whose bid has been rejected pursuant to this subsection and who would otherwise be the lowest Bidder has an opportunity to appeal a proposed rejection in accordance wi th subsection 102.11 and subsection 102.12. Once all administrative appeals are exhausted under subsection 102.11 and subsection 102.12, the decision of the Department or the Commission is final and binding on all Bidders.
102.07 Delivery of Bid
The Bidder must s ubmit the bid using current Department software and before the deadline specified in the proposal. Only an authorized representative of the Bidder, with a digital identification , may submit a bid to the Department. An authorized representative of the MDOT Standard Specifications for Construction Section 102 1-24 Bidder is an individual identified on MDOT Form 1313 Confidential Construction Prequalification Application under “Person s Authorized to Execute Contracts. ” Complete and submit this form in accordance with the MDOT Bureau of Finance & Administration’ s Administrative Rules Governing the Prequalification of Construction Contractors .
102.08 Withdrawal or Revision of Bid
The Bidder may withdraw or revise a bid before the deadline for submission of bids. The Department will consider only the last bid submitted by a Bidder, identified by date and time.
102.09 Downloading of Bids
The Department will download the bids and display the total bid amount of each bid on the Department ’s website as “As Submitted” bid results. If a Bidder has a system -generated rece ipt of submission and the Department did not receive the bid, the Department may accept a bid after the deadline in accordance with Department procedures and pending an investigation. The Department will handle these situations on a case-by -case basis.
102.10 Bid Review
The Department will review bids for mathematical accuracy to determine the apparent low Bidder. The Department will review the bid of the apparent low Bidder to verify compliance with the bidding requirements. If the Department determines the appar ent low Bidder ’s bid is subject to rejection due to bidding irregularities, in accordance with subsection 102.06, the Department will repeat the verification process with the next apparent low Bidder until a bid meets the bidding requirements. The Department will refer bids of apparent low Bidders subject to rejection to the Bid Review Committee for review and decision. After the Department determines an acceptable low bid, it will publish the “As Checked ” bids.
102.11 Bid Rejection
If the Bid Review Committee rej ects a Bidder ’s bid, the Administrator of the Contract Services Division, or designee, will notify the Bidder of the following:
A.The rejection of its bid;
B.The reasons for the rejection;
C.The availability of an appeal to the Bid Appeal Committee; and
D.The appeal procedure. If circumstances warrant and allow, the Administrator of the Contract Services Division, or designee, may discuss with the Bidder the reasons for bid MDOT Standard Specifications for Construction Section 102 1-25 rejection and the Bidder ’s position. If the Bid Review Committee rejects an apparent low bid in accordance with subsection 102.06, the Bidder may file an appeal in accordance with subsection 102.12. If the Department makes successive rejections of low bids, each apparent low Bidder may file an appeal in accordance with subsection 102.12.
102.12 Bid Rejection Appeal
The Department will expedite the appeal process so as not to delay the award of a contract. The Department must receive a Bidder ’s written appeal of a bid rejection at the office of the Administrator of the Contract Services Division with in 5 calendar days after the Department notifies the Bidder of the decision to reject the bid. The Administrator of the Contract Services Division, or designee, may designate a shorter time period for the submission of an appeal. If the Department deems th at circumstances warrant a time period of less than 5 calendar days for filing the appeal, the Administrator of the Contract Services Division, or designee, will notify the Bidder of the shortened period with the notice of rejection of the bid. In the app eal, the Bidder must identify why it disputes the decision and supply pertinent information.
A.Bid Appeal Committee . The Administrator of the Contract Services Division, or designee, will assemble and submit all relevant information, including the decision of the Bid Review Committee, along with material and information submitted by the Bidder, to the Bid Appeal Committee. The Bid Appeal Committee will review the information provided by the Administrator of the Contract Services Division, or designee, conduc t any further inquiry, and make a decision. The Bid Appeal Committee usually makes a decision based on the written appeal, but the Bid Appeal Committee may request that the Bidder meet with the Committee to review the issue. The Administrator of the Contract Services Division , or designee, will notify the Bidder, and other relevant personnel, in writing of the Bid Appeal Committee’ s decision. If the Commission must approve the contract, the Department will also notify the Bidder of its right to file an appe al with the Commission. If the contract does not require the Commission’ s approval, the Bid Appeal Committee’ s decision is final and binding.
B.Appeal to the Commission . The Bidder must file a written appeal of the Bid Appeal Committee’ s decision on contracts that the Commission must approve no later than 5 calendar days after the Bid Appeal Committee renders its decision or by 3:00 p.m. on the day immediately preceding the MDOT Standard Specifications for Construction Section 102 1-26 date the Commission is scheduled to consider approval of the contract, whichever is sooner. If the Bidder receives verbal or written notice of the Bid Appeal Committee’ s decision less than 24 hours before the appeal submission deadline, the Bidder may file the written appeal no later than 9:00 a.m. on the day the Commi ssion is scheduled to consider approval of the contract. The Commission will review the information provided by the Department and the Bidder and make a decision. The Commission ’s decision is final and binding.
102.13 Consideration of Bids
To determine the low Bi dder, the Department will compare the bids based on the total bid amounts (the sum of lump sum amounts and the products of the estimated quantities and unit prices). For a discrepancy between the calculated total and the total shown in the bid, the Departm ent will use the unit prices entered in the bid and correct the errors found in the calculations. The Department may consider a Bidder eligible for award even though its total bid amount exceeds the Bidder ’s net prequalification if the Bidder was properly granted eligibility to bid and the Department determines the Bidder to be the low Bidder on only one contract . If the Department determines a Bidder to be the low Bidder on more than one contract and the total amount of the multiple low bid proposals excee ds the Bidder ’s net prequalification, the Department will award the contract(s) in the Department ’s best interest . The Department may reject bids , waive irregularities , advertise for new bids, or do the work in other ways in the Department ’s best interest. The decision by the Department to act in its best interest will not entitle Bidders to payment for preparing bids or anticipated profits.
102.14 Execution and Award of Contract
The Department will provide the contract and bond forms electronically to the determi ned l ow Bidder. The low Bidder will receive electronic notification of the documents ’ availability from MDOT -Awards@Michigan.gov at the e-mail address provided to the Department. The determined l ow Bidder will be responsible for the transmittal of documents to the Bidder’s surety and subcontractors, where appropriate, and the coordination of the electronically signed documents for return to the Department. Within 21 calendar days of transmittal, the Bidder must return, and the Department must receive, electronically executed contract, bond forms, and other documents required by the Department. The Department may grant an extension of that deadline if the extension would not impair the Department’s interests. If the Department executes a contract received after the deadline, an extension will be deemed to have been granted. MDOT Standard Specifications for Construction Section 102 1-27 Required contract and bond forms include:
1.A contract executed by the bidder’s authorized representative using an MDOT -approved digital -signature appliance;
2.A performance bond, lien bond, and endorsement executed by the bidder’s authorized representative and the surety’s attorney -in-fact using an MDOT -approved digital -signature appliance. The bond forms must contain the surety’s electronically applied seal;
3.A power -of-attorney authorization form. This authorization must contain either (1) the surety’s electronically applied seal; or (2) a mechanical and/or facsimile seal, provided that the form contains a statement that the suret y has authorized the use of such seals; and
4.Project -specific warranty or pass-through warranty documents, executed consistent with the subsections 1- 3 above. Scans, copies, and documents containing manual or non-approved digital signatures or seals will be rejected. The determined low bidder is responsible for ensuring that its authorized representatives and its powers of attorney are registered with MDOT’s digital signature appliance. If the determined low Bidder withdraws its bid submittal after opening and at any time prior to contract award , the Bidder may forfeit its bid guaranty subject to the provisions of subsection 102.16. The determined low Bidder ’s failure to submit its DBE documentation in the time frames required by subsection 102.17 may resul t in the Department ’s awarding the c ontract to the next low Bidder or otherwise exercise its discretion in accordance with subsection 102.13. If the Department does not receive the signed contract, bond forms, and other documents required within 21 c alendar days of transmittal to the Contactor , or within an extended deadline, the Department may award the contract to the next low Bidder or otherwise exercise its discretion in accordance with subsection 102.13. If the Department does not execute the contract within 35 calendar days after the transmittal of the contract to the Contractor (including Department - approved extensions) , the determined low Bidder may withdraw its bid without penalty. If the Department is responsible for the delay in award of the contract, the determined low Bidder may agree to extend the deadline for the execution of the contract for an agreed- upon time period. The Department considers the contract awarded and binding when signed by the determined low Bidder and executed by the De partment. MDOT Standard Specifications for Construction Section 102 1-28 102.15. Requirements of Contract Bonds The determined low Bidder must furnish performance and lien bonds each for not less than 100% of the total contract price. The bonds must be on the forms provided by the Department. The bonds must meet the requirements of Michigan law and of the Department and include other items such as the Powers of Attorney and Endorsement as specified by the Department. The same surety responsible for writing the performance bond must write the lien bond. It is the determined low bidder ’s responsibility to ensure that the lien bond conforms with the terms of MCL 570.101 et seq., supra, except the lien bond must give the time within the notice of lien claim as follows, and secure the payment of claims:
A.Lienable under the terms of M CL 570.101 et seq. ;
B.Notice of which is not given by subcontractors within the statutory period, but
1.Notice of which is given by subcontractors within 60 calendar days after notice of the payment of the final estimate or post -final estimate having been made by the Department; or
2.In the case of a supplier to the contractor or a subcontractor, within 120 calendar days after the materials are last furnished.
102.16 Bid Guaranty Payment
The determined low Bidder ’s failure to sign the contract and submit satisfactory bonds and other required documents for the award of the contract within the 21-calendar day period provided, or within a Department -approved extension to that period, will result in the payment of the bid guaranty to the awarding authority. The determined low Bidder ’s failure to submit its DBE documentation in the time frames required by subsection 102.17 may result in the payment of the bid guaranty to the awarding authority if the Bid Appeal Committee denies the appeal as outlined in subsections 102.11 and 102.12. Each Bidder has a duty to carefully prepare and check the accuracy of its bid. The Department will return the bid guaranty only if the Bidder clearly demonstrates the following:
A.The Bidder made a substantial error , and signing the contract would impose a substantial and unjustified hardship on the Bidder, given the size and nature of the project; or
B.Extraordinary circumstances beyond the control of the Bidder exist in which signing the contract would impose a subst antial and unjustified hardship on the Bidder, given the size and nature of the project. MDOT Standard Specifications for Construction Section 102 1-29 A Bidder ’s mistake in judgment in preparing the bid will not warrant non-payment of the bid guaranty absent a compelling reason that enforcing payment of the guaranty would be unconscionable under all circumstances. The Bidder is responsible for clearly and convincingly satisfying the criteria for non-payment of the bid guaranty. The Bidder must request the return of the bid guaranty in writing to the Administrator of t he Contract Services Division or designee. The Bid Appeal Committee will consider and render a decision on the request for non-payment. The Bidder must file the written request with the Department within 15 calendar days after the Department mails notice t hat the Bidder must forfeit the bid guaranty. The Committee may require that the Bidder produce original bid documentation and submit other information to enable the Committee to decide if the Bidder is entitled to the return of the bid guaranty. The Commi ttee may also request that Department staff review the documentation and other information and make a recommendation to the Committee. When the Committee, in its sole determination, finds that the documentation and other information provide a partial justi fication, the Committee may make a correspondingly partial reduction of the bid guaranty. The Committee’ s decision is final and binding. If the Committee makes an adverse decision, or the Bidder fails to file a timely request for return or cancellation of the bid guaranty, the Bidder must make the bid guaranty payment within 20 calendar days after the Department mails a final demand for payment. If the Bidder does not make the payment within 20 calendar days, the Department will withhold the payment sum from money owed the Bidder, or it may become due and owing to the Bidder. Bidding practices, competitive considerations , and last -minute price changes commonly result in item prices that, in isolation, could be mischaracterized as bid errors. The Department i ntends payment of the bid guaranty to deter Bidders from manipulating the competitive process by mischaracterizing such item prices as bid errors to justify withdrawal of low bids after the downloading of all bids. Payment of the bid guaranty also constitutes liquidated damages for failure to sign the contract since it is difficult to determine the actual damages for the breach given that they are uncertain in nature and impossible to estimate with certainty. The damages include the various administrative c osts as well as other losses, damages, and costs resulting from the failure of the Bidder to sign the contract. A determined low Bidder who withdraws its bid prior to contract award cannot participate as a subcontractor, supplier, or trucker on the p roject. MDOT Standard Specifications for Construction Section 102 1-30 102.17. Subletting Contract Work to Disadvantaged Business Enterprises (DBEs) The DBE participation goal specified in the notice of advertisement must be made available to certified DBEs. Compliance with the designated DBE participation goal must be met by using DBEs to perform commercially useful functions as required by 49 CFR 26.55. All Bidders must provide the overall DBE percentage they have attained at time of b id within the DBE g oal folder of the b id file on all projects with a DBE goal designation. All Bidders must submit MDOT Form 2653 Contractor DBE Commitment within 5 calendar days of the bid letting. This form must be submitted whether Bidders have been able to meet the DBE participation goal or not. Submit this information via e-mail to MDOT -DBESheets@Michigan.gov . A Bidder who fails to meet the submittal requirements for DBE participation will be deemed ineligible for award of the contract. A Bidder who fails to meet the DBE participation goal will be deemed ineligible for a ward of the contract subject to the provisions of subsection
102.17 A.
A.Pre-Award Waivers or Modifications. If a low Bidder is unable to meet the DBE participation goal, additional information relating to MDOT Form 2653 Contractor DBE Commitment will be required. Submit the additional information in accordance with the current Department DBE Program Procedures . The contract will not be awarded until the Department makes a determination.
B.Post -Award Waivers or Modifications. After award, the Contractor may request a waiver or modification of the DBE participation goal in accordance with current Department DBE Program Procedures. Prime Contractors may not terminate for conveni ence an approved DBE working on a federally assisted contract and then perform the work of the terminated DBE. The Contractor must notify the Department immediately of a DBE ’s inability to perform any or all of its work and the Contractor ’s intent to obtai n a substitute DBE by filling out MDOT Form 0196 DBE Removal/ Substitution Request .
C.Appeals. A Contractor receiving an adverse determination related to its request for waiver or modification of the DBE participation goal may appeal the determination in accordance with current Department DBE Program Procedures . The Department reserves the right to modify any requirement or shorten any time period whe n the need to place the project under contract is such that the public interest warrants such action and would be impaired by MDOT Standard Specifications for Construction Section 102 1-31 further delay. If the Department waives any of these requirements, except the length of a time period, it will en sure that no Bidder is given a material competitive advantage by these actions.
D.Reports. The Contractor is required to submit a statement of DBE subcontractor payments to the Engineer in accordance with the contract.
E.Penalties. Failure to fulfill the DBE subcontracting requirement may be considered a breach of contract and may result in the Department ’s exercising the rights and remedies available in accordance with the provisions of the contract. Remedies may also include suspension, reduction, or removal of the Contractor ’s prequalification as stated in the Administrative Rules Governing the Prequalification of Construction Contractors .
102.18 OJT Program
Contractors assigned OJT t rainees based on the past contract volume of federal -aid work performed with MDOT are required to fulfill all of the requirements of the OJT program at no additional cost to the Department in accordance with the current On -the-Job Training Program Manual .
102.19 Evaluation of Contra ctor Performance
The Engineer will evaluate the Contractor ’s and all subcontractors ’ performance on the contract in accordance with the Department ’s written Contractor performance evaluation procedures. An evaluation may be used as a basis for modifying the p requalification ratings of the Contractor and any tier subcontractor . An evaluation may be issued at any time during the course of the contract (interim) and will be issued at completion of the contract (final). The criteria used for the evaluation of Contractor performance are posted on the Department ’s website or may be requested from the Engineer. Any action to modify the Contractor ’s prequalification ratings will be taken in accordance with the duly promulgated administrative rules for prequalification. If a Contractor and or any tier subcontractor fails to honor a request by the Engineer to submit a performance improvement plan or to meet to discuss the plan, or if a Contractor or subcontractor at any tier fails to carry out an approved performance improvement plan, that failure may be used as a basis for modifying the p requalification ratings of the Contractor or subcontractor at any tier as applicable. Any action to modify the Contractor ’s prequalification ratings will be taken in accordance with the duly promulgated a dministrat ive rules for prequalification. MDOT Standard Specifications for Construction Section 102 1-32 102.20. Joint Two-Party Checks Parties desiring a joint/two-party check arrangement if one party is a DBE must submit MDOT Form 0183 Application to Use Joint Checks . An acceptable joint /two-party check arrangement must include the following:
A.Contractor/payor cannot require the subcontractor to use a specific supplier or the Contractor ’s negotiated price;
B.Subcontractor is more than an extra party in releasing the check to the material supplier;
C.Subcontractor negotiates the quantities, price, and delivery of materials;
D.Contractor/payor Contractor issuing the check acts solely as guarantor;
E.Subcontractor releases the check to the supplier;
F.Only a short -term arrangement (no more than two seasons) with the purpose being the establishment or increase of the subcontractor ’s credit line with the material supplier; and
G.Subcontractor is responsible to both furnish and install the material/ work item. Copies of cancelled joint checks issued from the payor/Contractor to a DBE and suppl ier must be submitted to the MDOT Office of Business Development upon request. Additional costs for issuing and/or processing j oint/two-party check arrangements will not be paid for separately but will be included in costs for other pay items .
Source: Michigan Standard Specifications for Construction, 2020 Edition. Pages 33–44 of 1,146.