52.214-10 Contract Award-Sealed Bidding
Source: FAR 52.214-10 on acquisition.gov
FAR 52.214-10 ensures sealed bidding awards are based on price and specified factors, while allowing the Government flexibility to reject, accept, or waive bids and to reject materially unbalanced bids.
Overview
FAR 52.214-10 outlines the procedures and criteria for awarding contracts under sealed bidding. This provision ensures that contract awards are made to the responsible bidder whose bid is most advantageous to the Government, considering only price and specified price-related factors. The Government reserves the right to reject any or all bids, accept bids other than the lowest, and waive minor irregularities. Bids may be accepted for any item or group of items, and awards can be made for quantities less than those offered unless otherwise specified. A binding contract is formed upon written award or acceptance within the specified time. The provision also addresses the rejection of materially unbalanced bids, which could pose a risk of higher overall costs or advance payments to the Government.
Key Rules
- Evaluation and Award Criteria
- Contracts are awarded based on price and price-related factors, without discussions, to the responsible bidder whose bid is most advantageous to the Government.
- Government Rights
- The Government may reject any or all bids, accept other than the lowest bid, and waive informalities or minor irregularities.
- Bid Acceptance Flexibility
- The Government can accept any item or group of items and may award for quantities less than those offered, unless the bidder limits their bid.
- Contract Formation
- A binding contract is created when the Government provides written award or acceptance within the bid acceptance period.
- Materially Unbalanced Bids
- Bids with significantly unbalanced pricing between line items may be rejected if they pose a risk of higher overall costs or advance payments.
Responsibilities
- Contracting Officers: Must evaluate bids per the provision, ensure awards are made to responsible bidders, and monitor for unbalanced bids.
- Contractors: Must submit responsive, balanced bids and specify any limitations on items or quantities.
- Agencies: Oversee compliance with sealed bidding procedures and ensure fair competition.
Practical Implications
- This provision ensures transparency and fairness in sealed bidding, emphasizing price as the primary factor.
- Contractors must carefully structure their bids to avoid unbalanced pricing and clearly state any limitations.
- Common pitfalls include submitting unbalanced bids or failing to specify bid limitations, which can lead to rejection.
As prescribed in 14.201-6(e), insert the following provision:
Contract Award-Sealed Bidding (July 1990)
(a) The Government will evaluate bids in response to this solicitation without discussions and will award a contract to the responsible bidder whose bid, conforming to the solicitation, will be most advantageous to the Government considering only price and the price-related factors specified elsewhere in the solicitation.
(b) The Government may-
(1) Reject any or all bids;
(2) Accept other than the lowest bid; and
(3) Waive informalities or minor irregularities in bids received.
(c) The Government may accept any item or group of items of a bid, unless the bidder qualifies the bid by specific limitations. Unless otherwise provided in the Schedule, bids may be submitted for quantities less than those specified. The Government reserves the right to make an award on any item for a quantity less than the quantity offered, at the unit prices offered, unless the bidder specifies otherwise in the bid.
(d) A written award or acceptance of a bid mailed or otherwise furnished to the successful bidder within the time for acceptance specified in the bid shall result in a binding contract without further action by either party.
(e) The Government may reject a bid as nonresponsive if the prices bid are materially unbalanced between line items or subline items. A bid is materially unbalanced when it is based on prices significantly less than cost for some work and prices which are significantly overstated in relation to cost for other work, and if there is a reasonable doubt that the bid will result in the lowest overall cost to the Government even though it may be the low evaluated bid, or if it is so unbalanced as to be tantamount to allowing an advance payment.
(End of provision)