19.202-3
Equal low bids
In the case of equal low bids, contracting officers must prioritize awards to small businesses in labor surplus areas, then to other small businesses.
Overview
FAR 19.202-3 addresses the procedure for awarding contracts when there are equal low bids, specifically prioritizing small business concerns. When two or more bids are tied at the lowest price, the regulation requires contracting officers to first award to small businesses that are also labor surplus area concerns. If no such business is available, the award should go to other small business concerns. This policy supports both small business participation and economic development in labor surplus areas, aligning with broader federal socioeconomic goals.
Key Rules
- Priority for Small Business/Labor Surplus Area Concerns
- When equal low bids occur, preference is given to small businesses located in labor surplus areas.
- Secondary Priority for Small Businesses
- If no small business/labor surplus area concern is available, the award goes to other small businesses.
Responsibilities
- Contracting Officers: Must determine if any equal low bidders are small business/labor surplus area concerns and apply the preference order when making awards.
- Contractors: Should identify and certify their status as small business and/or labor surplus area concerns to be eligible for preference.
- Agencies: Ensure compliance with preference order and maintain documentation of award decisions in cases of tie bids.
Practical Implications
- This regulation ensures that small businesses, especially those in economically disadvantaged areas, have a competitive advantage in tie situations.
- Contractors should be proactive in certifying their business status to benefit from these preferences.
- Failure to follow the required order of preference can result in protests or challenges to the award decision.