Chapter 16 -Article 2 - Competitive Bidding on Public Contracts Generally
41-16-20 - Contracts for
which competitive bidding required; award to
preferred vendor
(a) With the exception of contracts for
public works whose competitive bidding
requirements are governed exclusively by Title
39, all contracts of whatever nature for labor,
services, work, or for the purchase or lease of
materials, equipment, supplies, other personal
property or other nonprofessional services,
involving fifteen thousand dollars ($15,000) or
more, made by or on behalf of any state
department, board, bureau, commission,
committee, institution, corporation, authority,
or office shall, except as otherwise provided in
this article, be let by free and open
competitive bidding, on sealed bids, to the
lowest responsible bidder.
(b) A "preferred vendor" shall be a person,
firm, or corporation which is granted preference
priority according to the following:
(1) PRIORITY #1. Produces or manufactures the
product within the state.
(2) PRIORITY #2. Has an assembly plant or
distribution facility for the product within the
state.
(3) PRIORITY #3. Is organized for business
under the applicable laws of the state as a
corporation, partnership, or professional
association and has maintained at least one
retail outlet or service center for the product
or service within the state for not less than
one year prior to the deadline date for the
competitive bid.
(c) In the event a bid is received for the
product or service from a person, firm, or
corporation deemed to be a responsible bidder
and a preferred vendor where any state higher
education institution, department, board,
bureau, commission, committee, institution,
corporation, authority, or office is the
awarding authority and the bid is no more than
five percent greater than the bid of the lowest
responsible bidder, the awarding authority may
award the contract to the preferred vendor.
41-16-21 Contracts for
which competitive bidding not required generally
(a) Competitive bids shall not be required
for utility services where no competition exists
or where rates are fixed by law or ordinance,
and the competitive bidding requirements of this
article shall not apply to: The purchase of
insurance by the state; contracts for the
securing of services of attorneys, physicians,
architects, teachers, artists, appraisers,
engineers, or other individuals possessing a
high degree of professional skill where the
personality of the individual plays a decisive
part; contracts of employment in the regular
civil service of the state; purchases of
alcoholic beverages only by the Alcoholic
Beverage Control Board; purchases and contracts
for repair of equipment used in the construction
and maintenance of highways by the State
Department of Transportation; purchases of
products made or manufactured by the blind or
visually handicapped under the direction or
supervision of the Alabama Institute for Deaf
and Blind in accordance with Sections 21-2-1
through 21-2-4; purchases of maps or photographs
purchased from any federal agency; contractual
services and purchases of personal property,
which by their very nature are impossible of
award by competitive bidding; barter
transactions by the Department of Corrections;
and purchases, contracts, or repairs by the
Alabama State Port Authority when it is deemed
by the Director of the Alabama State Port
Authority and the Secretary-Treasurer of the
Alabama State Port Authority that the purchases,
contracts, or repairs are impractical of award
by competitive bidding due to the exigencies of
time or interference with the flow of commerce.
The Director of the Alabama State Port Authority
and the Secretary-Treasurer of the Alabama State
Port Authority shall place a sworn statement in
writing in the permanent file or records setting
out the emergency or exigency relied upon and
the necessity for negotiation instead of
proceeding by competitive bidding in that
particular instance, and the sworn statement
shall be open to public inspection. A copy of
the sworn statement shall be furnished forthwith
to the Governor and Attorney General.
(b) All educational and eleemosynary
institutions governed by a board of trustees or
other similar governing body and the Alabama
State Port Authority shall be exempt from this
article which relate to the powers, duties,
authority, restrictions, and limitations
conferred or imposed upon the Department of
Finance, Division of Purchasing. The educational
and eleemosynary institutions, the Alabama State
Port Authority, and the other state agencies
exempted from this article shall let by free and
open competitive bidding on sealed bids to the
lowest responsible bidder all contracts of
whatever nature for labor, services or work or
for the purchase or lease of materials,
equipment, supplies, or other personal property
involving seven thousand five hundred dollars
($15,000) or more. The institutions, departments,
and agencies shall establish and maintain
purchasing facilities as may be necessary to
carry out the intent and purpose of this article
by complying with the requirements for
competitive bidding in the operation and
management of each institution, department, or
agency.
(c) Contracts entered into in violation of
this article shall be void.
(d) Nothing in this section shall be
construed as repealing Sections 9-2-106 and
9-2-107.
41-16-21.1 Joint purchasing agreements
(a) In the event that utility services are no
longer exempt from competitive bidding under
this article, non-adjoining counties may not
purchase utility services by joint agreement
under authority granted by this section.
(b) The Division of Purchasing, Department of
Finance, is hereby authorized to enter into
joint purchasing agreements to purchase, lease,
or lease-purchase child support services,
materials, equipment, supplies, or other
personal property which have been let by
competitive bid or competitive solicitation
process by any group or consortium of
governmental entities within or without the
State of Alabama upon a finding by the
Purchasing Agent that such joint purchasing
agreements are in the best interests of the
State of Alabama. Joint purchasing agreements
entered into by the Division of Purchasing may
be utilized by any governmental entity subject
to the requirements of Title 41, Chapter 16,
Articles 2 or 3A. This subsection shall not
apply to the purchase, lease, or lease-purchase
of materials, equipment, supplies, or other
personal property which can only be utilized in
conjunction with a service or service contract,
whether subject to competitive bidding under
this article or not, for the materials,
equipment, supplies, or other personal property
that must remain in effect to utilize the
materials, equipment, supplies, or other
personal property.
Nothing in this subsection prohibits or
limits public four-year institutions from
entering into joint purchasing agreements to
purchase, lease, or lease-purchase materials,
equipment, supplies, other personal property and
services which have been let by competitive bid
or competitive solicitation process by any group
or consortium of governmental entities or
through a group purchasing organization within
or without the State of Alabama upon a finding
by the institution that such purchasing
agreements are in the best interests of the
institution; provided, however, this sentence
shall not permit agreements to purchase, lease,
or lease-purchase wireless communications
equipment or services through any group or
consortium of governmental entities or through
any group purchasing organization.
41-16-21.2 Exemptio of certain departments or
agencies whose principal business is honorariums
from competitive bid laws
All laws to the contrary notwithstanding, any
state department or agency whose principal
business is honorariums is hereby exempted from
the provisions of the state competitive bid laws
on purchases and contracts for services made by
such department or agency.
41-16-22 Comptetive bidding
not required on purchases from federal
government
The state may without advertisement or
receiving competitive bids purchase materials,
equipment, supplies or other personal property
from the United States government or any agency,
division or instrumentality thereof when such
purchase is deemed by the state Purchasing Agent
to be in the best interest of the State of
Alabama.
41-16-23. Letting of contracts without public
advertisement authorized in case of emergencies
affecting public health, safety, etc.
In case of emergency affecting public health,
safety or convenience, so declared in writing by
the head of the institution or state agency
involved, setting forth the nature of the danger
to public health, safety or convenience involved
in delay, contracts may be let to the extent
necessary to meet the emergency without public
advertisement. Such action and the reasons
therefor shall immediately be made public by the
awarding authority.
41-16-24. Advertisement for and solicitation
of bids; opening of bids; public inspection;
reverse auction procedures; certain partial
contracts void
(a) The Purchasing Agent shall advertise for
sealed bids on all purchases in excess of the
competitive bid limit as established in Section
41-16-20 by posting notice thereof on a bulletin
board maintained outside the office door or by
publication of notice thereof, one time, in a
newspaper published in Montgomery County,
Alabama, or in any other manner, for such
lengths of time as the Purchasing Agent may
determine. The Purchasing Agent shall also
solicit sealed bids or bids to be submitted by
reverse auction procedure by notifying all
Alabama persons, firms, or corporations who have
filed a request in writing that they be listed
for solicitation on bids for the particular
items set forth in the request and the other
persons, firms, or corporations the Purchasing
Agent deems necessary to insure competition. If
any person, firm, or corporation whose name is
listed fails to respond to any solicitation for
bids after the receipt of three solicitations,
the listing may be cancelled by the Purchasing
Agent.
(b) All bids, except as provided in
subsection (d), shall be sealed when received,
shall be opened in public at the hour stated in
the notice, and all original bids together with
all documents pertaining to the award of the
contract shall be retained in accordance with a
retention period established by the State
Records Commission and shall be open to public
inspection.
(c) If the purchase or contract will involve
an amount of the competitive bid limit as
established in Section 41-16-20 or less, the
Purchasing Agent may make the purchases or
contracts either upon the basis of sealed bids,
reverse auction procedure, or in the open
market.
(d) For purposes of this article, a reverse
auction procedure includes either of the
following:
(1) A real-time bidding process usually
lasting less than one hour and taking place at a
previously scheduled time and Internet location,
in which multiple anonymous suppliers submit
bids to provide the designated goods or
services.
(2) A bidding process usually lasting less
than two weeks and taking place during a
previously scheduled period and at a previously
scheduled Internet location, in which multiple
anonymous suppliers submit bids to provide the
designated goods or services.
(e) No purchase or contract involving an
amount in excess of the competitive bid limit as
established in Section 41-16-20 shall be divided
into parts involving amounts of the competitive
bid limit as established in Section 41-16-20 or
less for the purpose of avoiding the
requirements of this article. All such partial
contracts involving the competitive bid limit as
established in Section 41-16-20 or less shall be
void.
41-16-25. Effect of agreements or collusion
amoung bidders in restraint of competition;
sworn statements as to agreemetns to accompany
bids
Any agreement or collusion among bidders or
prospective bidders in restraint of freedom of
competition by agreement to bid at a fixed price
or to refrain from bidding or otherwise shall
render the bids of such bidders void. Each
bidder shall accompany his bid with a sworn
statement that he has not been a party to such
an agreement.
41-16-26. Effect of advance disclosure of
terms of bid
Any disclosure in advance of the terms of a
bid submitted in response to an advertisement
for bids shall render the proceedings void and
require advertisement and award anew.
41-16-27. Manner of awarding contracts; records;
exemptions
(a) When purchases are required to be made
through competitive bidding, award shall, except
as provided in subsection (f), be made to the
lowest responsible bidder taking into
consideration the qualities of the commodities
proposed to be supplied, their conformity with
specifications, the purposes for which required,
the terms of delivery, transportation charges
and the dates of delivery provided, that the
awarding authority may at any time within 30
days after the bids are opened negotiate and
award the contract to anyone, provided he
secures a price at least five percent under the
low acceptable bid. The award of such a
negotiated contract shall be subject to approval
by the Director of Finance and the Governor,
except in cases where the awarding authority is
a two-year or four-year college or university
governed by a board. The awarding authority or
requisitioning agency shall have the right to
reject any bid if the price is deemed excessive
or quality of product inferior. Awards are final
only after approval of the Purchasing Agent.
(b) The awarding authority may award multiple
purchase contracts resulting from a single
invitation-to-bid where the specifications of
the items of personal property intended to be
purchased by a requisitioning agency or agencies
are determined, in whole or in part, by
technical compatibility and operational
requirements. In order to make multiple awards
under this provision, the awarding authority
must include in the invitation-to-bid a notice
that multiple awards may be made and the
specific technical compatibility or operational
requirements necessitating multiple awards.
Multiple awards of purchase contracts with
unique technical compatibility or operational
specifications shall be made to the lowest
responsible bidder complying with the unique
technical compatibility or operational
specifications. The requisitioning agency shall
provide the awarding authority with the
information necessary for it to determine the
necessity for the award of multiple purchase
contracts under this provision.
This subsection (b) shall not apply to
contracts for the purchase of personal property
for which a service or service contract, whether
subject to competitive bidding under this
article or not, is necessary to utilize the
personal property throughout the period of
utilization of the personal property.
(c) Each bid, with the name of the bidder,
shall be entered on a record. Each record, with
the successful bid indicated thereon and with
the reasons for the award if not awarded to the
lowest bidder shall, after award of the order or
contract, be open to public inspection.
(d) The Purchasing Agent in the purchase of
or contract for personal property or contractual
services shall give preference, provided there
is no sacrifice or loss in price or quality, to
commodities produced in Alabama or sold by
Alabama persons, firms, or corporations.
(e)(1) Contracts for the purchase of personal
property or contractual services other than
personal services shall be let by competitive
bid for periods not greater than five years and
current contracts existing on February 28, 2006,
may be extended or renewed for an additional two
years with a 90-day notice of such extension or
renewal given to the Legislative Council,
however, any contract that generates funds or
will reduce annual costs by awarding the
contract for a longer term than a period of
three years which is let by or on behalf of a
state two-year or four-year college or
university may be let for periods not greater
than 10 years. Any contract awarded pursuant to
this section for terms of less than 10 years may
be extended for a period not to exceed 10 years
from the initial awarding of the contract
provided that the terms of the contract shall
not be altered or renegotiated during the period
for which the contract is extended.
(2) For purchases of personal property made
on or after January 1, 2010, in instances in
which the awarding authority determines that the
total cost of ownership over the expected life
of the item or items, including acquisition
costs plus sustaining costs, and including
specifically life cycle costs, can be reasonably
ascertained from industry recognized and
accepted sources, the lowest responsible bid may
be determined to be the bid offering the lowest
life cycle costs and otherwise meeting all of
the conditions and specifications contained in
the invitation to bid. To utilize this provision
to determine the lowest responsible bidder, the
awarding authority must include a notice in the
invitation to bid that the lowest responsible
bid may be determined by using life cycle costs
and identify the industry recognized and
accepted sources that will be applicable to such
an evaluation.
(3) Industry recognized and accepted sources
may be provided by rules adopted pursuant to the
Alabama Administrative Procedure Act by the
Green Fleets Review Committee if the review
committee is established and enacted at the 2009
Regular Session. If the Green Fleets Review
Committee is not enacted at the 2009 Regular
Session, the Permanent Joint Legislative
Committee on Energy Policy may adopt rules
providing industry recognized and accepted
sources, pursuant to the Alabama Administrative
Procedure Act.
(f) Contracts for the purchase of services
for receiving, processing, and paying claims for
services rendered recipients of the Alabama
Medicaid program authorized under Section 22-6-7
which are required to be competitively bid may
be awarded to the bidder whose proposal is most
advantageous to the state, taking into
consideration cost factors, program suitability
factors (technical factors) including
understanding of program requirements,
management plan, excellence of program design,
key personnel, corporate or company resources
and designated location, and other factors
including financial condition and capability of
the bidder, corporate experience and past
performance and priority of the business to
insure the contract awarded is the best for the
purposes required. Each of these criteria shall
be given relative weight value as designated in
the invitation to bid, with price retaining the
most significant weight. Responsiveness to the
bid shall be scored for each designated
criteria. If, for reasons cited above, the bid
selected is not from the lowest bidding
contractor, the Alabama Medicaid Agency shall
present its reasons for not recommending award
to the low bidder to the Medicaid Interim
Committee. The committee shall evaluate the
findings of the Alabama Medicaid Agency and
must, by resolution, approve the action of the
awarding authority before final awarding of any
such contract. The committee shall also hear any
valid appeals against the recommendation of the
Alabama Medicaid Agency from the low bid
contractor(s) whose bid was not selected.
(g) Notwithstanding the requirements under
Sections 41-16-20, 41-16-21, and this section,
contractual services and purchases of personal
property regarding the athletic department, food
services, and transit services negotiated on
behalf of two-year and four-year colleges and
universities may be awarded without competitive
bidding provided that no state revenues,
appropriations, or other state funds are
expended or committed and when it is deemed by
the respective board that financial benefits
will accrue to the institution, except that in
the cases where an Alabama business entity as
defined by this section is available to supply
the product or service they will have preference
unless the product or service supplied by a
foreign corporation is substantially different
or superior to the product or service supplied
by the Alabama business entity. However, the
terms and conditions of any of the services or
purchases which are contracted through
negotiation without being competitively bid and
the name and address of the recipient of such a
contract shall be advertised in a newspaper of
general circulation in the municipality in which
the college or university is located once a week
for two consecutive weeks commencing no later
than 10 days after the date of the contract. For
the purposes of this section, the term Alabama
business entity shall mean any sole
proprietorship, partnership, or corporation
organized in the State of Alabama.
(h)(1) For purchases of motor vehicles by the
state made on or after January 1, 2010, the
lowest responsible bid may be determined to be a
bid offering the lowest life cycle costs, if it
is determined that the total cost of ownership
over the expected life of a motor vehicle,
including acquisition costs plus maintenance
costs, including specifically life cycle costs,
can be reasonably ascertained from industry
recognized and accepted sources. The lowest
responsible bid shall otherwise meet all of the
conditions and specifications contained in the
invitation to bid. To utilize this provision to
determine the lowest responsible bidder, the
state must include a notice in the invitation to
bid that the lowest responsible bid may be
determined by using life cycle costs and
identify the industry recognized and accepted
sources that will be applicable to such an
evaluation.
(2) Industry recognized and accepted sources
may be provided by rules adopted pursuant to the
Alabama Administrative Procedure Act by the
Green Fleets Review Committee if the review
committee is established and enacted at the 2009
Regular Session. If the Green Fleets Review
Committee is not enacted at the 2009 Regular
Session, the Permanent Joint Legislative
Committee on Energy Policy may adopt rules
providing industry recognized and accepted
sources pursuant to the Alabama Administrative
Procedure Act.
(i) When a single invitation-to-bid specifies
a set of deliverables that would be capable of
division into separate, independent contracts,
the awarding authority, at its discretion, may
award a secondary contract for any subset of
such deliverables, not to exceed 20 percent of
the original contract value, to any Alabama
business certified under the Federal HUBZone
program whose properly submitted responsible bid
does not exceed five percent of the lowest
responsible bid. In order to make a secondary
award under this provision, the awarding
authority shall include in the invitation-to-bid
a notice that a secondary award may be made.
41-16-28. Bond for faithful performance of
contract to be required
Bond in a responsible sum for faithful
performance of the contract, with adequate
surety, shall be required in an amount specified
in the advertisement for bids.
41-16-29. Assignment of contracts
No contract awarded to the lowest responsible
bidder shall be assignable by the successful
bidder without written consent of the awarding
authority and requisitioning agency, and in no
event shall a contract be assigned to an
unsuccessful bidder whose bid was rejected
because he was not a responsible bidder.
41-16-30. Conflicts of interest of purchasing
agents, assistants, etc., generally; making of
purchases or awarding of contracts in violation
of article
Neither the Purchasing Agent nor any
assistant or employee of his shall be
financially interested or have any personal
beneficial interest, either directly or
indirectly, in the purchase of or contract for
any personal property or contractual service,
nor in any firm, partnership, association or
corporation furnishing any such personal
property or contractual services to the state
government or to any of its departments,
agencies or institutions. Neither the Purchasing
Agent nor any assistant or employee of his shall
accept or receive, directly or indirectly, from
any person, firm, association or corporation to
whom any contract may be awarded, by rebate,
gifts or otherwise, any money or thing of value
whatsoever or any promise, obligation or
contract for future reward or compensation, nor
shall any person willfully make any purchase or
award any contract in violation of the
provisions of this article.
Any violation of this section shall be deemed
a misdemeanor, and any person who violates this
section shall, upon conviction, be imprisoned
for not more than 12 months or fined not more
than $500.00 or both. Upon conviction thereof,
any such Purchasing Agent, assistant or employee
of his or any person who willfully makes any
purchase or awards any contract in violation of
the provisions of this article shall be removed
from office.
41-16-31. Institution of actions to enjoin
execution of contracts entered into in violation
of article
Any taxpayer of the area within the
jurisdiction of the awarding authority and any
bona fide unsuccessful bidder on a particular
contract shall be empowered to bring a civil
action in the appropriate court to enjoin
execution of any contract entered into in
violation of the provisions of this article.
41-16-32. Provisions of article cumulative;
repeal of other provisions of law
This article shall be cumulative in its
nature.
All conflicting provisions of law are hereby
expressly repealed; however, this article shall
in no manner repeal any of the provisions of
Chapter 36 of Title 16 of this code or Chapters
2 and 5 of Title 39 of this code or Article 5 of
Chapter 4 of this title.
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