February 14, 1975
Senator Sheldon R. Songstad
Post Office Box 47
Sioux Falls, South Dakota
OFFICIAL OPINION NO. 75-29
Under what circumstances can SDCL 5-18 be circumvented, thus allowing state agencies to make direct purchases of items costing in excess of $1500 without calling for competitive bids?
Dear Senator Songstad:
You have requested an official opinion as to the legality of state and local government purchases of products without complying with SDCL 5-18 and 5-23 but instead accepting bids listed by the various suppliers for the federal government general services administration. SDCL 5-18-2 and 5-23-9 are relevant statutes applying to local government and state government in this regard:
5-18-2. All contracts of any public corporation, whether for the construction of public improvements or contracts for the purchase of materials, supplies or equipment, when such contracts involve an expenditure equal to or in excess of fifteen hundred dollars, must be let to the lowest responsible bidder. The governing body shall have the right to reject any and all bids and to readvertise for proposals if none of the bids are satisfactory, or if they believe any agreement has been entered into by the bidders to prevent competition.
5-23-9. The bureau of administration shall prepare blank schedules on which all bids shall be made, enumerating the number, kind, form, style, size, and quantity of the items, to be furnished, and when requested so to do, shall furnish any proposed bidder a copy of such blank schedules. Every bid shall be in accordance with the schedules and specifications. All bids shall be submitted in sealed envelopes and shall be publicly opened at such time and place as the bureau of administration may specify in the schedule.
Based on the above statutes I see no authority for the state or local governments to initially use GSA bids without first going through statutory competitive bid procedures. I am well aware of arguments as to the practical problems on occasional waste caused by competitive bid statutes, but the above laws on their face mandate the conclusion I here reach. Once the normal bidding procedure is followed or if the item would fit within such exclusions as found in SDCL 5-18-2 or 5-23-20, GSA bids may of course be utilized.
Respectfully submitted,
WILLIAM J. JANKLOW
ATTORNEY GENERAL
WJJ:DOC:rw
