SB290 Alabama 2023 Session

Summary

Primary Sponsor

Sam GivhanSenator

Republican

Session

Regular Session 2023

Title

Relating to public works contracts; to amend Sections 39-1-1, 39-2-1, 39-2-2, and 39-2-6, Code of Alabama 1975, to increase the threshold dollar amount for which competitive bidding is generally required; to further provide for certain notice procedures; to authorize the publication of notice by electronic means; to authorize the use of electronic sealed bids; to authorize certain statutory dollar amounts to be increased based on increases in the Consumer Price Index; 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

SB290 would raise the competitive bidding threshold for public works to $100,000 (with CPI increases), allow electronic notices and bids, strengthen bonding, and add life-cycle cost considerations to bid evaluation.

What This Bill Does

If enacted, most public works contracts would require competitive bids only above $100,000, with the amount adjustable for inflation. Notices and sealed bids could be published or submitted electronically. Contractors would face 100% performance bonds and 50% payment bonds, and bids could be evaluated on life-cycle costs rather than just upfront price. The bill also expands advertising rules (including certain DOT exceptions), requires final completion notices and a waiting period before final settlement, and introduces periodic cost indexing every five years; the act would take effect on the first day of the third month after passage.

Who It Affects

• Awarding authorities (state, counties, municipalities and their agencies) would need to follow new bidding thresholds, publish notices electronically, accept electronic sealed bids, post final completion notices, and apply CPI-based cost adjustments; DOT and certain educational institutions have specific exceptions.
• Contractors, bidders, and suppliers would be subject to higher bidding thresholds, mandatory electronic bidding, stronger bonding requirements (100% performance bond and 50% payment bond), potential life-cycle cost evaluation in bid selection, and stricter rules against bid splitting and collusion.

Key Provisions

• General bidding threshold increased from $50,000 to $100,000, with additional increases allowed based on the Consumer Price Index.
• Electronic publication of notices and electronic sealed bids is authorized.
• Bond requirements: performance bond equal to 100% of contract price and a payment bond of at least 50% of the contract price; payment/dispute procedures and related attorney fees.
• Final settlement rules: notice of completion must be published for at least four weeks, with a 30-day waiting period before final settlement and a sworn certification that all bills have been paid.
• Advertising rules: statewide and local advertising requirements, including DOT exceptions; three-newspaper ads for certain large contracts (over $500,000) and other publication options; protections against bid splitting to evade bidding.
• Life-cycle cost evaluation: bids may be evaluated on the lowest life-cycle cost, with criteria disclosed in the invitation to bid.
• Cost indexing: every five years beginning October 1, 2027, dollar amounts in this article may be adjusted based on CPI, with public notice of changes.
• Effective date: the act becomes law on the first day of the third month after passage and governor approval.

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