Contracts FAQ 14

May a municipality negotiate on the basis of changed plans with the low bidder?

This question usually arises when all bids received on a particular project are much higher than the municipality estimated the project would cost. In such situations, League attorneys are frequently asked whether the municipality can alter its plans and specifications and negotiate for a reduced price with the low bidder. We have consistently opined that the competitive bidding process prohibits a municipality from negotiating with either the lowest or low bidders on the basis of materially-altered plans and specifications. Contracts # 202, # 306 and # 339. If plans and specifications are to be changed, that change must affect all bidders and place each on an equal footing. A municipality should rebid a proposed public construction project when it proposes to substantially alter the plans and specifications by decreasing the work. A municipality may change the plans or specifications before receiving any bids by issuing an addendum to all potential bidders informing them of the modification.