New Louisiana Laws Related to Bidding on Public Works Contracts

Following the 2008 Regular Session, Louisiana Governor Bobby Jindal signed House Bill No. 558 ("HB 558") into law. Prior to HB 558(Act No. 726), it was not infrequent that publicly bid contracts were not awarded because all bids exceeded the budgeted funds. Following the change in the law, La. R.S. 38:2212 now requires the designer to provide a cost estimate to the bidding entity prior to advertisement of the project, and states that in the event the designer's estimate for the project exceeds the funds budgeted by the public entity, the project shall not be advertised for bid.

Additionally, HB 558 also requires public entities which advertise bids for construction of public works projects to include an estimate of the allocated budget in the advertisement.

In related legislation, also signed into law by Gov. Jindal, House Bill No. 563 ("HB 563") the Division of Administration, Office of Facility Planning and Control, shall develop a bid form to be used by bidders on such public projects (Act No. 727). In a move that should help streamline the bid process and reduce continuing problems arising out of bid irregularities, the bid form shall only require the bidders to provide the information necessary to determine the lowest bidder. The form shall also request other enumerated information including but not limited to bond information, acknowledgment of addenda, base bids, and unit prices utilized (where applicable). Note that the new bid form legislation represented in HB 563 is not applicable to bid forms of the Department of Transportation and Development pursuant to Title 48 of the Louisiana Revised Statutes of 1950.

Both pieces of legislation appear to be attempts to not only streamline the bid process but also, to re-instill confidence in the contractors and general public in the bidding process as it relates to taxpayers' money invested into public works projects. Contractors, please be aware of these changes in the bidding process, and in the event that you plan to submit a bid for a contract, make sure the bid is being submitted on the correct form provided by the state.