When it comes to commercial construction projects, contractors and suppliers will bid on the job, and the property owner or developer will generally award the contract to the lowest responsible bidder. Bidding is different when the property owner or developer is a government agency compared to private contracts. It is important for the parties to construction contracts in Massachusetts to understand how the public bidding process compares to the private bidding process, so they can make informed decisions.
When it comes to bids on public contracts, there are many rules and regulations that must be adhered to. The process generally proceeds as thus. First, the government agency will publish an advertisement inviting others to bid on the contract. Qualified contractors will then obtain and look over procurement documents. Those interested in bidding on the contract will meet and look over the construction site. If the bidder is a contractor, it will obtain bids from the suppliers and subcontractors it will need to contract with to complete the project. Once the contractor knows how much it will cost to perform the work, it will submit a sealed bid. The bids are announced or read privately at a time that will be made publicly known. The lowest responsible bid will win the contract.
The bidding process for private contracts is more informal since there aren't as many rules and regulations that must be followed. The property owner or contractor can set the parameters through which it will request bids, and how the winning bid will be selected. However, there are still state and local laws regarding bids on private contracts, so it is important to understand what these are before proceeding.
As this shows, it is important for parties to a construction contract to understand how the bidding process for public contracts compares to the bidding process for private contracts. Commercial property owners or developers will want to ensure that the job is executed appropriately while contractors and subcontractors have a vested financial interest in being the winning bidder. So, all parties have a stake in the outcome of the bidding process. This is only a brief overview of this topic and cannot replace the advice of an attorney. Those who want more information on placing a bid for a private or public contract will want to seek legal assistance.