14.408-6 Equal low bids
Source: FAR 14.408-6 on acquisition.gov
When two or more low bids are tied, FAR 14.408-6 requires awards to follow a set priority favoring small and labor surplus area businesses, with ties ultimately broken by a witnessed drawing by lot and proper documentation.
Overview
FAR 14.408-6 outlines the procedures for awarding contracts when two or more low bids are equal in all respects under sealed bidding. The regulation establishes a clear order of priority for awarding such contracts, favoring small businesses and labor surplus area concerns, and provides a method for breaking ties if priorities do not resolve the tie. It also requires documentation and specific contract language to ensure compliance with the priority justification.
Key Rules
- Order of Award Priority
- Contracts must be awarded first to small business concerns that are also labor surplus area concerns, then to other small businesses, and finally to other business concerns if a tie remains.
- Drawing by Lot
- If a tie persists after applying the priority order, the award is made by a drawing by lot among the remaining bidders, with an opportunity for bidders to attend and at least three witnesses present.
- Documentation and Contract Language
- The contracting officer must document the drawing process and include a written agreement in the contract reflecting the circumstances justifying the priority or drawing by lot.
Responsibilities
- Contracting Officers: Must apply the priority order, conduct and document drawings by lot if needed, and ensure proper contract language is included.
- Contractors: Must be prepared to comply with the circumstances justifying their selection if awarded under these procedures.
- Agencies: Must oversee and ensure the integrity and documentation of the tie-breaking process.
Practical Implications
- This section ensures fairness and transparency in tie-breaking for sealed bids, with a preference for small and labor surplus area businesses. Contractors should understand their status and be prepared for possible drawings by lot. Proper documentation is critical to avoid disputes or challenges.
(a) Contracts shall be awarded in the following order of priority when two or more low bids are equal in all respects:
(1) Small business concerns that are also labor surplus area concerns.
(2) Other small business concerns.
(3) Other business concerns.
(b) If two or more bidders still remain equally eligible after application of paragraph (a) of this section, award shall be made by a drawing by lot limited to those bidders. If time permits, the bidders involved shall be given an opportunity to attend the drawing. The drawing shall be witnessed by at least three persons, and the contract file shall contain the names and addresses of the witnesses and the person supervising the drawing.
(c) When an award is to be made by using the priorities under this 14.408-6, the contracting officer shall include a written agreement in the contract that the contractor will perform, or cause to be performed, the contract in accordance with the circumstances justifying the priority used to break the tie or select bids for a drawing by lot.