PA Court OK’s Post-Bid Scope Change on Public Project
In Perrotto Builders, Ltd. v. Reading Sch. Dist. & Lobar, Inc., 108 A.3d 175, (Pa. Commw. 2015), the Pennsylvania Commonwealth Court found that a public owner’s revision of a project’s scope of work after public bids were received and opened was not improper when it was established that the change was done for budgetary reasons, applied to all bidders equally, and was specifically allowed by the terms of the bid documents.
Specifically, the Reading School District (the “Owner”) issued an invitation to bid for a school construction project that included the repair and renovation of several different school buildings. After the bids were opened, Perrotto Builders was the apparent low bidder but the bids exceeded the Owner’s budget. The Owner reduced the scope of the project by removing several school buildings and recalculated the base bids. On this basis Lobar, Inc. was now the apparent low bidder and the contract was awarded to Lobar, Inc. Perrotto Builders requested a preliminary injunction which was denied and Perrotto Builders appealed. Perrott Builders argued that the Owner could not remove schools from the project because the bid documents did not allow for it. However, the bid documents allowed for “alternates” which were specifically defined to include the removal of one or more school, which is exactly what the owner did.