§ 143-129. Procedure for letting of public contracts.
§ 143‑129. Procedurefor letting of public contracts.
(a) Bidding Required. No construction or repair work requiring the estimated expenditure of publicmoney in an amount equal to or more than five hundred thousand dollars($500,000) or purchase of apparatus, supplies, materials, or equipmentrequiring an estimated expenditure of public money in an amount equal to ormore than ninety thousand dollars ($90,000) may be performed, nor may anycontract be awarded therefor, by any board or governing body of the State, orof any institution of the State government, or of any political subdivision ofthe State, unless the provisions of this section are complied with; providedthat The University of North Carolina and its constituent institutions mayaward contracts for construction or repair work that requires an estimatedexpenditure of less than five hundred thousand dollars ($500,000) withoutcomplying with the provisions of this section.
For purchases of apparatus,supplies, materials, or equipment, the governing body of any politicalsubdivision of the State may, subject to any restriction as to dollar amount,or other conditions that the governing body elects to impose, delegate to themanager, school superintendent, chief purchasing official, or other employeethe authority to award contracts, reject bids, or readvertise to receive bidson behalf of the unit. Any person to whom authority is delegated under thissubsection shall comply with the requirements of this Article that wouldotherwise apply to the governing body.
(b) Advertisement andLetting of Contracts. Where the contract is to be let by a board or governingbody of the State government or of a State institution, proposals shall beinvited by advertisement in a newspaper having general circulation in the Stateof North Carolina. Where the contract is to be let by a political subdivisionof the State, proposals shall be invited by advertisement in a newspaper havinggeneral circulation in the political subdivision or by electronic means, orboth. A decision to advertise solely by electronic means, whether forparticular contracts or generally for all contracts that are subject to thisArticle, shall be approved by the governing board of the political subdivisionof the State at a regular meeting of the board.
The advertisements for biddersrequired by this section shall appear at a time where at least seven full daysshall lapse between the date on which the notice appears and the date of theopening of bids. The advertisement shall: (i) state the time and place whereplans and specifications of proposed work or a complete description of theapparatus, supplies, materials, or equipment may be had; (ii) state the timeand place for opening of the proposals; and (iii) reserve to the board orgoverning body the right to reject any or all proposals.
Proposals may be rejected forany reason determined by the board or governing body to be in the best interestof the unit. However, the proposal shall not be rejected for the purpose ofevading the provisions of this Article. No board or governing body of the Stateor political subdivision thereof may assume responsibility for construction orpurchase contracts, or guarantee the payments of labor or materials thereforexcept under provisions of this Article.
All proposals shall be openedin public and the board or governing body shall award the contract to thelowest responsible bidder or bidders, taking into consideration quality,performance and the time specified in the proposals for the performance of the contract.
In the event the lowestresponsible bids are in excess of the funds available for the project orpurchase, the responsible board or governing body is authorized to enter intonegotiations with the lowest responsible bidder above mentioned, making reasonablechanges in the plans and specifications as may be necessary to bring thecontract price within the funds available, and may award a contract to suchbidder upon recommendation of the Department of Administration in the case ofthe State government or of a State institution or agency, or uponrecommendation of the responsible commission, council or board in the case of asubdivision of the State, if such bidder will agree to perform the work orprovide the apparatus, supplies, materials, or equipment at the negotiatedprice within the funds available therefor. If a contract cannot be let underthe above conditions, the board or governing body is authorized to readvertise,as herein provided, after having made such changes in plans and specificationsas may be necessary to bring the cost of the project or purchase within thefunds available therefor. The procedure above specified may be repeated ifnecessary in order to secure an acceptable contract within the funds availabletherefor.
No proposal for constructionor repair work may be considered or accepted by said board or governing bodyunless at the time of its filing the same shall be accompanied by a depositwith said board or governing body of cash, or a cashier's check, or a certifiedcheck on some bank or trust company insured by the Federal Deposit InsuranceCorporation in an amount equal to not less than five percent (5%) of theproposal. In lieu of making the cash deposit as above provided, such bidder mayfile a bid bond executed by a corporate surety licensed under the laws of NorthCarolina to execute such bonds, conditioned that the surety will upon demandforthwith make payment to the obligee upon said bond if the bidder fails toexecute the contract in accordance with the bid bond. This deposit shall beretained if the successful bidder fails to execute the contract within 10 daysafter the award or fails to give satisfactory surety as required herein.
Bids shall be sealed and theopening of an envelope or package with knowledge that it contains a bid or thedisclosure or exhibition of the contents of any bid by anyone without thepermission of the bidder prior to the time set for opening in the invitation tobid shall constitute a Class 1 misdemeanor.
(c) Contract Executionand Security. All contracts to which this section applies shall be executedin writing. The board or governing body shall require the person to whom theaward of a contract for construction or repair work is made to furnish bond asrequired by Article 3 of Chapter 44A; or require a deposit of money, certifiedcheck or government securities for the full amount of said contract to securethe faithful performance of the terms of said contract and the payment of allsums due for labor and materials in a manner consistent with Article 3 ofChapter 44A; and the contract shall not be altered except by written agreementof the contractor and the board or governing body. The surety bond or depositrequired herein shall be deposited with the board or governing body for which thework is to be performed. When a deposit, other than a surety bond, is made withthe board or governing body, the board or governing body assumes all theliabilities, obligations and duties of a surety as provided in Article 3 ofChapter 44A to the extent of said deposit.
The owning agency or theDepartment of Administration, in contracts involving a State agency, and theowning agency or the governing board, in contracts involving a politicalsubdivision of the State, may reject the bonds of any surety company againstwhich there is pending any unsettled claim or complaint made by a State agencyor the owning agency or governing board of any political subdivision of theState arising out of any contract under which State funds, in contracts withthe State, or funds of political subdivisions of the State, in contracts withsuch political subdivision, were expended, provided such claim or complaint hasbeen pending more than 180 days.
(d) Use of UnemploymentRelief Labor. Nothing in this section shall operate so as to require anypublic agency to enter into a contract which will prevent the use ofunemployment relief labor paid for in whole or in part by appropriations orfunds furnished by the State or federal government.
(e) Exceptions. Therequirements of this Article do not apply to:
(1) The purchase, lease,or other acquisition of any apparatus, supplies, materials, or equipment from:(i) the United States of America or any agency thereof; or (ii) any othergovernment unit or agency thereof within the United States. The Secretary ofAdministration or the governing board of any political subdivision of the Statemay designate any officer or employee of the State or political subdivision toenter a bid or bids in its behalf at any sale of apparatus, supplies,materials, equipment, or other property owned by: (i) the United States ofAmerica or any agency thereof; or (ii) any other governmental unit or agencythereof within the United States. The Secretary of Administration or thegoverning board of any political subdivision of the State may authorize theofficer or employee to make any partial or down payment or payment in full thatmay be required by regulations of the governmental unit or agency disposing ofthe property.
(2) Cases of specialemergency involving the health and safety of the people or their property.
(3) Purchases madethrough a competitive bidding group purchasing program, which is a formallyorganized program that offers competitively obtained purchasing services atdiscount prices to two or more public agencies.
(4) Construction orrepair work undertaken during the progress of a construction or repair projectinitially begun pursuant to this section.
(5) Purchase ofgasoline, diesel fuel, alcohol fuel, motor oil, fuel oil, or natural gas. Thesepurchases are subject to G.S. 143‑131.
(6) Purchases ofapparatus, supplies, materials, or equipment when: (i) performance or pricecompetition for a product are not available; (ii) a needed product is availablefrom only one source of supply; or (iii) standardization or compatibility isthe overriding consideration. Notwithstanding any other provision of thissection, the governing board of a political subdivision of the State shallapprove the purchases listed in the preceding sentence prior to the award ofthe contract.
Inthe case of purchases by hospitals, in addition to the other exceptions in thissubsection, the provisions of this Article shall not apply when: (i) aparticular medical item or prosthetic appliance is needed; (ii) a particular productis ordered by an attending physician for his patients; (iii) additionalproducts are needed to complete an ongoing job or task; (iv) products arepurchased for "over‑the‑counter" resale; (v) a particularproduct is needed or desired for experimental, developmental, or research work;or (vi) equipment is already installed, connected, and in service under a leaseor other agreement and the governing body of the hospital determines that theequipment should be purchased. The governing body of a hospital shall keep arecord of all purchases made pursuant to this subdivision. These records aresubject to public inspection.
(7) Purchases ofinformation technology through contracts established by the State Office ofInformation Technology Services as provided in G.S. 147‑33.82(b) and G.S.147‑33.92(b).
(8) Guaranteed energysavings contracts, which are governed by Article 3B of Chapter 143 of theGeneral Statutes.
(9) Purchases fromcontracts established by the State or any agency of the State, if the contractoris willing to extend to a political subdivision of the State the same or morefavorable prices, terms, and conditions as established in the State contract.
(9a) Purchases ofapparatus, supplies, materials, or equipment from contracts established by theUnited States of America or any federal agency, if the contractor is willing toextend to a political subdivision of the State the same or more favorableprices, terms, and conditions as established in the federal contract.
(10) Purchase of usedapparatus, supplies, materials, or equipment. For purposes of this subdivision,remanufactured, refabricated or demo apparatus, supplies, materials, orequipment are not included in the exception. A demo item is one that is usedfor demonstration and is sold by the manufacturer or retailer at a discount.
(11) Contracts by a publicentity with a construction manager at risk executed pursuant to G.S. 143‑128.1.
(12) (Repealedeffective July 1, 2011) Build‑to‑suit capital leases with aprivate developer under G.S. 115C‑532.
(f) Repealed bySession Laws 2001‑328, s. 1, effective August 2, 2001.
(g) Waiver of Biddingfor Previously Bid Contracts. When the governing board of any politicalsubdivision of the State, or the person to whom authority has been delegatedunder subsection (a) of this section, determines that it is in the bestinterest of the unit, the requirements of this section may be waived for thepurchase of apparatus, supplies, materials, or equipment from any person orentity that has, within the previous 12 months, after having completed apublic, formal bid process substantially similar to that required by thisArticle, contracted to furnish the apparatus, supplies, materials, or equipmentto:
(1) The United States ofAmerica or any federal agency;
(2) The State of NorthCarolina or any agency or political subdivision of the State; or
(3) Any other state orany agency or political subdivision of that state, if the person or entity iswilling to furnish the items at the same or more favorable prices, terms, andconditions as those provided under the contract with the other unit or agency.Notwithstanding any other provision of this section, any purchase made underthis subsection shall be approved by the governing body of the purchasingpolitical subdivision of the State at a regularly scheduled meeting of thegoverning body no fewer than 10 days after publication of notice that a waiverof the bid procedure will be considered in order to contract with a qualifiedsupplier pursuant to this section. Notice may be published in a newspaperhaving general circulation in the political subdivision or by electronic means,or both. A decision to publish notice solely by electronic means for aparticular contract or for all contracts under this subsection shall be approvedby the governing board of the political subdivision. Rules issued by theSecretary of Administration pursuant to G.S. 143‑49(6) shall apply withrespect to participation in State term contracts.
(h) TransportationAuthority Purchases. Notwithstanding any other provision of this section, anyboard or governing body of any regional public transportation authority,hereafter referred to as a "RPTA," created pursuant to Article 26 ofChapter 160A of the General Statutes, or a regional transportation authority,hereafter referred to as a "RTA," created pursuant to Article 27 ofChapter 160A of the General Statutes, may approve the entering into of anycontract for the purchase, lease, or other acquisition of any apparatus,supplies, materials, or equipment without competitive bidding and withoutmeeting the requirements of subsection (b) of this section if the followingprocurement by competitive proposal (Request for Proposal) method is followed.
The competitive proposalmethod of procurement is normally conducted with more than one sourcesubmitting an offer or proposal. Either a fixed price or cost reimbursementtype contract is awarded. This method of procurement is generally used whenconditions are not appropriate for the use of sealed bids. If this procurementmethod is used, all of the following requirements apply:
(1) Requests forproposals shall be publicized. All evaluation factors shall be identified alongwith their relative importance.
(2) Proposals shall besolicited from an adequate number of qualified sources.
(3) RPTAs or RTAs shallhave a method in place for conducting technical evaluations of proposalsreceived and selecting awardees, with the goal of promoting fairness andcompetition without requiring strict adherence to specifications or price indetermining the most advantageous proposal.
(4) The award may bebased upon initial proposals without further discussion or negotiation or, inthe discretion of the evaluators, discussions or negotiations may be conductedeither with all offerors or with those offerors determined to be within thecompetitive range, and one or more revised proposals or a best and final offermay be requested of all remaining offerors. The details and deficiencies of anofferor's proposal may not be disclosed to other offerors during any period ofnegotiation or discussion.
(5) The award shall bemade to the responsible firm whose proposal is most advantageous to the RPTA'sor the RTA's program with price and other factors considered.
The contents of the proposalsshall not be public records until 14 days before the award of the contract.
The board or governing body ofthe RPTA or the RTA shall, at the regularly scheduled meeting, by formal motionmake findings of fact that the procurement by competitive proposal (Request forProposals) method of procuring the particular apparatus, supplies, materials,or equipment is the most appropriate acquisition method prior to the issuanceof the requests for proposals and shall by formal motion certify that therequirements of this subsection have been followed before approving thecontract.
Nothing in this subsectionsubjects a procurement by competitive proposal under this subsection to G.S.143‑49, 143‑52, or 143‑53.
RPTAs and RTAs may adoptregulations to implement this subsection. (1931, c. 338, s. 1; 1933, c. 50; c. 400, s. 1; 1937,c. 355; 1945, c. 144; 1949, c. 257; 1951, c. 1104, ss. 1, 2; 1953, c. 1268;1955, c. 1049; 1957, c. 269, s. 3; c. 391; c. 862, ss. 1‑4; 1959, c. 392,s. 1; c. 910, s. 1; 1961, c. 1226; 1965, c. 841, s. 2; 1967, c. 860; 1971, c.847; 1973, c. 1194, s. 2; 1975, c. 879, s. 46; 1977, c. 619, ss. 1, 2; 1979, c.182, s. 1; 1979, 2nd Sess., c. 1081; 1981, c. 346, s. 1; c. 754, s. 1; 1985, c.145, ss. 1, 2; 1987, c. 590; 1987 (Reg. Sess., 1988), c. 1108, ss. 7, 8; 1989,c. 350; 1993, c. 539, s. 1007; 1994, Ex. Sess., c. 24, s. 14(c); 1995, c. 367,s. 6; 1997‑174, ss. 1‑4; 1998‑185, s. 1; 1998‑217, s.16; 2001‑328, s. 1; 2001‑487, s. 88; 2001‑496, ss. 4, 5; 2005‑227,s. 1; 2006‑232, s. 2; 2007‑94, s. 1; 2007‑322, s. 4; 2007‑446,s. 6.)