Contractors in Maryland familiar with State and County procurement have likely experienced the heavy handed scrutiny of their Minority Business Enterprise (“MBE”) participation forms contained in their bid submissions. Quite often the procurement officer will reject bids for very minor irregularities in the MBE forms. For example, this law firm represented a contractor who submitted the low bid with the highest MBE participation but had its bid rejected because rather than putting an exact total percentage of MBE participation, the contractor indicated with a “>” sign that it had exceeded the governmental agency’s required MBE goal. Basic fifth grade level mathematical calculations would have allowed the procurement officials to determine the exact percentage. Unfortunately, the prevailing notion amongst State procurement officials is that the MBE certification forms should be strictly scrutinized and bids rejected for any irregularity no matter how minor. This position, however, is directly contrary to Maryland law, which states:
A bidder’s variation from specifications will not exclude him from consideration for the award of the contract unless it is so substantial as to give him a special advantage over the other bidders. In judging whether or not the omission or irregularity in a bid is so substantial as to invalidate it, the court must be careful not to thwart the purpose of competitive bidding by declaring the lowest bid invalid on account of variations that are not material.
To compound the problem arising out of the deviation between established Maryland law and the practice of State procurement officials, the Maryland Board of Contract Appeals (“MBCA”) had taken the position that it did not have authority to entertain appeals of bid protests related to MBE issues, citing to the Code of Maryland Regulations (“COMAR”). Thus, bidders were confined to having their protests heard by the same governmental agency that had already rejected their apparent low bid.
The Maryland Court of Special Appeals, however, has recently ruled that the COMAR regulation relied upon by the MCBA to abstain from review of MBE related protests is invalid because it conflicts with state procurement statutes enacted by the Maryland legislature. Consequently, aggrieved bidders will now be able to appeal unsuccessful bid protests rejected by governmental agencies for minor irregularities in their MBE forms to the MBCA; hopefully providing an avenue of relief from the heavy-handed scrutiny of state procurement officials.
For further information contact, Matt Hjortsberg at 410-583-2400 or at email@example.com.