It is well known that that the lowest and best bid for a public contract wins the day. It also well known that if the public entity does not accept the lowest bid, they must state the reason for doing so. The Mississippi Court of Appeals, in J&A Excavation, Inc. v. City of Ellisville, emphasized the importance of the public entity’s minutes when the lowest bidder is not selected. Specifically, the Mississippi Court of Appeals held that the public entity’s minutes must also reflect the selected bidder’s and the next-lowest bidder’s qualifications, reputation, or capabilities.
In J&A Excavation, the City of Ellisville published an advertisement for bids for a National Resources Conservation Service (NRCS) watershed protection project located on various streets within the City. Out of four bids, the City’s Board of Aldermen voted unanimously to accept the next-to-lowest bidder. The Board’s minutes acknowledged that there was a lower bid, but only stated the lowest bidder’s job performance as the reason why they did not receive the contract. The minutes did not mention the other bidders at all.
The Court of Appeals found that there must be something in the record to show that the selected bidder was indeed the best bidder. The Court found that there is no evidence in the minutes that the selected bidder was the lowest and best bidder. As such, the decisions of the Board of Aldermen and the Board of Supervisors were not supported by substantial evidence and thus deemed arbitrary and capricious.
The Legal Lounge Conclusion
If a public entity does not accept the lowest bidder, then the public entity must describe why the next lowest bidder was the “best” bidder. The public entity should also clearly explain why it found that the lowest better was deficient. Stated simply, the minutes should clearly describe the rationale for the public entity’s decision. These detailed minutes are the required evidence for the board’s decisions. Without them, a court may deem the public entity’s decision as arbitrary and capricious. If your city, county, school district, or other public entity would like further guidance on this issue, contact Brown Legal Group today.