Contract Management & Procurement Flashcards

What is the primary purpose of competitive bidding in public works procurement?

Answer: To promote fair competition and obtain best value for public funds

Competitive bidding promotes fair competition, transparency, and accountability to ensure taxpayer funds are spent wisely while obtaining the best value.

Which document formally invites contractors to submit bids for a defined public works project?

Answer: Invitation for Bid (IFB)

An Invitation for Bid (IFB) is used when project scope is well-defined and award will be made solely on price to the lowest responsive, responsible bidder.

What is a bid bond in public works contracting?

Answer: A surety guarantee that the bidder will enter into contract if awarded

A bid bond is a form of surety that guarantees the bidder will enter into a contract and furnish required performance and payment bonds if they are awarded the project.

Which procurement method is most appropriate when selecting based on qualifications rather than price alone?

Answer: Qualifications-Based Selection (QBS)

Qualifications-Based Selection (QBS) is used—particularly for professional design services—when the scope is complex and the provider's expertise is the primary selection criterion.

What is the purpose of a performance bond in a public works contract?

Answer: To ensure the contractor completes the project according to contract terms

A performance bond guarantees that the contractor will complete the project in accordance with the contract terms and specifications, protecting the public owner from contractor default.

What is the prevailing wage requirement in public works contracts?

Answer: The wage rate contractors must pay workers based on local union rates for the project trade

Prevailing wage laws (such as the Davis-Bacon Act) require contractors on public works projects to pay workers no less than the locally prevailing wage rates for the applicable trade.

Which contract type places the greatest financial risk on the contractor by fixing the total price regardless of actual costs?

Answer: Firm fixed-price (lump sum) contract

A firm fixed-price (lump sum) contract sets a single price for the entire scope of work, placing the risk of cost overruns entirely on the contractor.