In a previous post, we recognized the issue of whether a local code had to mirror The South Carolina Consolidated Procurement Code (the State Code) in order to comply with state law. Although the 2008 case of Edward D. Sloan v. Greenville County, et al. touched on the issue, it did not directly decide it. Recently, however, the South Carolina Supreme Court decided a case that took the issue head on.
In Sloan v. Greenville Hospital System, Mr. Sloan brought three declaratory judgment actions against the Hospital challenging the Hospital’s procurement procedures for three constructions services. (http://sccourts.org/opinions/displayOpinion.cfm?caseNo=26827) After the circuit court ruled against Mr. Sloan on two of the services, he appealed, arguing the circuit court erred in finding the Hospital was not a governmental body subject to the State Code and, in the alternative, if the Hospital is a political subdivision, several of the Hospital’s policy provisions violate § 11-35-50’s mandate that political subdivisions enact ordinances or procedures embodying sound principles of appropriately competitive procurement.
Regarding Mr. Sloan’s first argument, the classification of the Hospital was important because, if the Hospital is a governmental body, it is subject to the requirements of the State Code. In contrast, if it is not a governmental body, the Hospital must follow the provisions of its own Hospital Policy that it adopted to govern the procurement of construction and design services. The court upheld the circuit court’s determination that the Hospital is not a state governmental entity subject to the procurement procedures detailed in the State Code. Rather, the court held that it is a special purpose district that is entitled to, and by law is required to, establish its own provisions embodying sound principles of appropriately competitive procurement as provided by § 11-35-50.
Mr. Sloan next argued that, even if the Hospital is a local political subdivision, the Hospital Policy does not embody sound principles of appropriately competitive procurement as required by § 11-35-50. In support, he pointed to the fact that the Hospital Policy does not mirror the terms of the State’s Code, the Model Procurement Ordinance, and other regional codes. However, the court agreed with the circuit court that this difference, standing alone, is not enough to deem the Hospital Policy in violation of the statute’s mandate to adopt “sound principles of appropriately competitive procurement.”
The court noted that § 11-35-50 does not specify any particular procedures that are considered to embody the appropriately competitive standard. Rather, the court held that the statute clearly was intended to afford local governments needed flexibility to determine what is appropriately competitive in light of the public business they must transact.
However, even though Mr. Sloan lost his above mentioned appeal on two services, there was a third service in which he emerged victorious at the circuit court level. In an order regarding the Parking Deck Case, the circuit court found the Hospital had improperly utilized the “Sole Source Procurement” method of selecting construction services under the Hospital’s own procurement policy and that the contract for that work was, therefore, invalid and void. In a separate consent order, Sloan was awarded costs and attorney’s fees of $ 21,789.95 in that matter and no appeal has been filed.

Bidder Responsibility

In this article we will begin by looking at the definition of responsibility and the difference between responsibility and responsiveness. One of the primary purposes of public bidding is to allow the people to receive their money’s worth of whatever they are contracting for. Awarding bids only to responsible bidders is one way to guard against default. There are others such as performance bonds and excellent contract administration which are beyond the scope of today’s blog.

The South Carolina Consolidated Procurement Code (Procurement Code) at 11-35-1410 provides the following definition:

(6) “Responsible bidder or offeror” means a person who has the capability in all respects to perform fully the contract requirements and the integrity and reliability which will assure good faith performance which may be substantiated by past performance.

The federal statutes give a lengthier definition that expressly touches on adequate financial resources, ability to comply with the schedule, prior performance record, integrity, organizational controls, skills and experience, adequate facilities, etc. See 41 USC 403(7). The Federal Acquisition Regulation is essentially the same.

Bidder Responsiveness Distinguished

Bidder responsibility and responsiveness are not the same thing. Where bidder responsibility concerns whether the bidder is capable of performing the job, bidder responsiveness refers to the terms of the bid offering to provide exactly what the owner wants to have performed. Sometimes the two concepts can seemingly apply to the same set of facts. For example if the solicitation requires site management by a person with ten years experience and the bid offers a person with five years experience, then the bid could be seen as no-responsive because the bid did not provide what the offeror sought but it could also be viewed as not responsible because the minimum amount of experience was not offered.