SB108 Alabama 2023 Session

Summary

Primary Sponsor

Linda Coleman-MadisonSenator

Democrat

Session

Regular Session 2023

Title

Relating to public contracts; to amend Sections 41-16-50, 41-16-51, 41-16-52, 41-16-53, 41-16-54, and 41-16-55, Code of Alabama 1975, to increase the threshold dollar amount for which competitive bidding is generally required for certain state and local public awarding authorities, with exceptions; to provide a legislative method for the increase of the threshold dollar amount; and in connection therewith would have as its purpose or effect the requirement of a new or increased expenditure of local funds within the meaning of Section 111.05 of the Constitution of Alabama of 2022.

Summary

SB108 raises and indexes the bidding thresholds for public contracts, expands local purchase options and joint procurement, and preserves a broad set of bidding exemptions for Alabama state and local governments.

What This Bill Does

It increases the general bidding threshold for non-public-work procurements from $15,000 to $30,000 (and for certain leases) and allows future increases tied to the Consumer Price Index. Beginning in 2027 and every three years after, those amounts can be adjusted by a CPI-based cost adjustment. It creates local preference zones to give some bid advantages to locally located or resident bidders, enables joint purchasing agreements among agencies, and sets out advertising, bid, and reverse auction requirements, while maintaining numerous exemptions from bidding and establishing penalties for bid collusion, plus an emergency procurement mechanism. The bill also specifies that certain purchases and contracts remain outside the bidding requirements and outlines how expenditure quantities must be managed to avoid evading thresholds.

Who It Affects

• State and local awarding authorities (state agencies, counties, municipalities, and their instrumentalities) would face higher bidding thresholds, new CPI-adjustment rules, local preference options, and opportunities for joint procurement.
• Vendors, bidders, and local businesses (including resident and locally owned firms) who compete for public contracts would be impacted by local preference zones, potential price advantages for in-zone bidders, and new bidding and advertising rules, as well as existing or new compliance and reporting requirements.

Key Provisions

• Raises the competitive bidding threshold from $15,000 to $30,000 (and applies to leases) for expenditures by public awarding authorities, with exceptions for public works and certain other categories.
• Introduces a cost adjustment mechanism: starting October 1, 2027 and every three years thereafter, dollar amounts in the article may be adjusted based on CPI and approved by the Legislative Council.
• Creates local preference zones defined by awarding authority boundaries, county boundaries, or Core Based Statistical Area, allowing a resident bidder within the zone to win if their bid is within 5% of the lowest bid among non-resident bidders.
• Authorizes joint agreements among multiple contracting agencies for purchasing or bidding, with shared procedures and costs, and may designate a joint purchasing or bidding agent.
• Maintains and clarifies bidding methods (sealed bids, reverse auctions, or open market) and adds requirements for bid bonds where applicable; requires posting notices for purchases over thresholds and allows reverse auctions.
• Keeps numerous exemptions from competitive bidding (e.g., insurance purchases, election materials, certain professional services, employment in civil service, certain complex or specialized contracts, and various local government categories).
• Allows emergency procurements to address health, safety, or convenience concerns with documented price quotations and a formal resolution, and requires public disclosure of reasons.
• Prohibits splitting purchases to evade thresholds and imposes penalties for bid collusion, including Class A misdemeanor for smaller-scale collusion and Class C felony for larger-scale collusion.
• Notices that the bill is exempt from Section 111.05 of the 2022 Alabama Constitution due to defining a new crime or amending crime definitions.
• Effective date is the first day of the third month after passage, following gubernatorial approval.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.