April 18, 1983

Mr. Al Arendt 
Dewey County State's Attorney 
Timber Lake, South Dakota 57656

Official Opinion No. 83-18

Bid Laws

Dear Mr. Arendt:

You have requested an official opinion from this office based on the following factual situation:

FACTS: 

During the course of its fiscal year, the County of Dewey has occasion to purchase various types and sizes of tires to be used on its motor vehicles and machinery.  Due to the nature of tire wear and failure, it is impossible to predict when a certain tire will have to be replaced.  As a result, the county does not keep an inventory of tires on hand.  Purchases of tires are made on an 'as needed' basis. 

The County of Dewey's annual tire purchases are estimated to be in the range of $3,000.00 to $4,000.00.  Therefore, if all the purchases for the county for the year were made at once, the total would probably exceed $3,500.00.  However, as explained above, we have no idea what type of tires will be needed during the year and cannot make said purchases.

Based on the above facts you have asked the following questions:

QUESTION: 

Is Dewey County required to advertise for bids to purchase its tires?

SDCL § 5-18-3 provides: 

If a contract of any public corporation, whether for the construction of a public improvement or for the purchase of materials, supplies or equipment which involves the expenditure of a sum equal to or in excess of three  thousand five hundred dollars, is to be entered into, the governing body of the public corporation shall cause advertisement of bids therefore to be printed in the official newspaper or newspapers of the contracting corporation published in the county wherein the public corporation is situated.  If the contracting corporation has no official newspaper the notice for bids is to be published in a legal newspaper with general circulation in the district, to be selected by the contracting corporation, for at least two consecutive weeks prior to the opening of the bids and in any other newspapers of the state as is advisable.  The first publication of the advertisement may not be less than two weeks prior to the date for opening of bids for new construction.  The advertisement must state the time and place where the bids will be opened and passed upon by the board.  In all notices the board shall reserve the right to reject any and all bids.

In view of the above statue and your stated fact that annual tire purchases would exceed $3,500.00, it is my opinion that Dewey County is required to advertise its tire purchases for bids.

In A.G.R. 76-100, my predecessor reasoned that 'bids are required where there is a recognized need for a product over a period of weeks and months.'  See Fonder v. City of South Sioux Falls, 71 N.W.2d 618 (1955); 1973-74 A.G.R. 238.  And as further stated in A.G.R. 76-100, '[p]ublic corporations cannot avoid planning for annual expenditures and therefore avoid the competitive bid  laws.'

It is, therefore, my opinion that when annual purchases of an item can be estimated and the estimate clearly exceeds $3,500.00, competitive bidding is required.

Any logistical problems of tire type and number of tires purchased can be adequately handled by bidding on a 'unit price' and an 'as needed' basis.

Respectfully submitted,

Mark V. Meierhenry
Attorney General