Alaska Construction Bidding Process

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What is the Bid Process in Construction?

The construction bidding process involves five steps: bid solicitation, bid submission, bid selection, contract formation, and project delivery. For a contractor in Alaska to achieve success in the construction bidding process, you need to plan and improve in each of these areas. 

If you’re a new contractor or are looking to secure more bids more often, follow our guide below. 

What Should a Construction Bid Include?

Successful construction bids generally contain the total cost of building the structure, including expenses for subcontractors, general contractors’ costs, overhead profit, and scope of work. A bid will also need to contain information such as company details, the date, a clear definition of the work, and a project name. Without all of these elements combined, you may not meet the necessary standards. 

How Do You Estimate a Construction Bid?

An accurate estimate is not only vital for winning a bid but it can also determine which Alaska Construction bonds you may need. A professional estimate will include: 

• Direct costs: This includes materials, labor, and equipment expenses tied directly to construction activities.
• Indirect costs: Consider costs that don’t involve direct construction work, like permits, utilities, security, quality control, administration, and legal fees.
• Labor hours: Wages paid to construction teams should be factored in, including potential overtime.
• Subcontractor expenses: Don’t forget to calculate costs associated with hiring subcontractors for specialized tasks like plumbing, electrical work, or HVAC installation.

What Are the Five Steps in the Process of Bidding?

1. Bid Solicitation: This is when the project owner or general contractor invites contractors to submit bids.
2. Bid Submission: Contractors prepare and submit their bids with all necessary details, such as pricing, scope of work, and deadlines.
3. Bid Selection: The owner of the project will look over bids, including the contractor’s costs, qualifications, and the scope of work suggested. Based on this information, they will choose a bid they believe is best. 
4. Contract Formation: Once the project owner chooses a bid, they will set up a contract with the winning contractor. 
5. Project Delivery: At this phase, the contractor will begin work on the project and secure any further surety bonds they may need. 

What Licenses and Bonds Do You Need for Alaska Construction Bidding?

In Alaska, contractors must generally hold a valid license issued by the Alaska Division of Corporations, Business and Professional Licensing in order to bid on and perform construction work on state-funded projects that meet or exceed certain contract thresholds. Federal projects located in Alaska also typically require compliance with state licensing laws unless a specific federal exemption applies. 

Moreover, most public projects in Alaska will require contractors to obtain surety bonds—such as bid bonds, performance bonds, and payment bonds—before work can commence. These bonding requirements help protect the public and ensure that contractors meet all contractual and legal obligations.

It’s imperative to work with a professional surety bond agency, like Surety Bond Professionals, that knows how to secure bonds successfully at the best price so you can submit a competitive bid. 

Common Mistakes Made While Bidding

Even a well-prepared contractor can be rejected for a bid. Some common reasons this might happen are:

• Incomplete documentation, such as proof of bonds and licenses.
• Inaccurate cost estimates, where your estimate is much higher or lower than average.
• Lack of experience – unproven track record.
• Simple mistakes, like not following the guidelines for the bid strictly or missing paperwork.
• Ambitious timelines, if your proposed timeline does not align with the average timelines submitted you may face rejection.

State vs. Federal Bids?

Understanding the difference between state and federal bids can help you stay compliant when you submit your bid. 

Topic	State	Federal
Procurement Laws and Regulations	State-specific procurement laws and regulations, varying by state.	Must comply with the Federal Acquisition Regulation, which is stricter and more rigorous.
Bonding Requirements	Often need state licensing and bonds like bid bonds and performance bonds.	Also needs bonds but is often required from a federally approved surety company.
Project Scope	Projects can range from small repairs to large public works in a specific area.	Contracts can be large-scale, spanning multiple states.
Set-Aside Programs	Some states have set-aside programs for small businesses, minority-owned, or veteran-owned businesses, but this varies.	The federal government has many set-aside programs for small businesses, veteran-owned, women-owned, and disadvantaged businesses through programs like 8(a) or HUBZone.
Competition	Often limited to nearby areas, reducing competition.	Open to contractors nationwide, increasing competition and opportunities.

Unique Aspects of the Alaska Construction Bidding Process

1. In Alaska, most construction work requires a valid contractor license (registration) issued through the State of Alaska Division of Corporations, Business, and Professional Licensing. Under Alaska Statutes (AS) 08.18, contractors must hold an active registration before offering, bidding on, or performing construction services. Specific trades—such as electrical, plumbing, or mechanical—may require additional specialized licenses or certificates. Local municipalities (e.g., Anchorage, Fairbanks, Juneau) can impose further permitting or registration requirements, so contractors should verify local rules and regulations prior to starting any project.
2. Construction in Alaska must comply with applicable building codes, often based on the International Building Code (IBC) and International Residential Code (IRC). However, many local jurisdictions modify these codes to address Alaska’s unique conditions, including severe weather, seismic activity, and permafrost. Coastal and tundra regions may impose additional requirements for wind resistance or foundation design. While there is no single, statewide energy code for all residential structures, various municipalities and agencies (such as the Alaska Housing Finance Corporation) may adopt or encourage specific energy-efficiency standards.
3. Projects near wetlands, waterways, floodplains, or coastal areas in Alaska may fall under the jurisdiction of the Alaska Department of Environmental Conservation (ADEC). Depending on the project’s scope and its potential impact on sensitive ecosystems or water quality, additional permits, studies, or inspections could be required. Federal agencies such as the U.S. Army Corps of Engineers may also have authority over certain activities that affect navigable waters or wetlands, necessitating compliance with federal regulations and permitting processes.
4. Under Alaska law, most employers are required to provide workers’ compensation insurance if they have one or more employees, subject to specific exemptions. While there is no universal state mandate for all contractors to carry general liability insurance, maintaining a robust policy is strongly recommended and often required by project owners or lenders. Adequate insurance coverage helps mitigate financial risks from accidents, property damage, or other liabilities and is frequently a prerequisite for obtaining contracts.
5. Alaska’s public contracting is primarily governed by the Alaska Procurement Code (AS 36.30) and related statutes, which set forth competitive bidding requirements for public projects exceeding certain monetary thresholds. This process promotes transparency and cost-effectiveness in the awarding of taxpayer-funded contracts. To bid on state or other publicly funded projects, contractors must meet qualification standards, follow prescribed bid procedures, and fulfill any bonding (such as performance, payment, or bid bonds) and insurance obligations. Typically, contracts are awarded to the lowest responsible and responsive bidder; however, an entity’s qualifications, experience, and compliance with project specifications may also factor into the final selection.

Alaska Bid Network

Alaska Bid Opportunities and Procurement Process
In Alaska, contractors and suppliers seeking bidding opportunities can explore the Alaska Online Public Notices System (OPNS) and the  State of Alaska Vendor Self Service portal. These official platforms provide a comprehensive list of public and private procurement solicitations—including bid advertisements, Requests for Proposals (RFPs), Requests for Qualifications (RFQs), and Requests for Information (RFIs)—along with recent awards and bid results. They operate primarily in a government-to-business (G2B) and business-to-business (B2B) capacity, aligning with the Alaska Procurement Code (AS 36.30) and other relevant state statutes that mandate competitive bidding.

Prospective bidders can use these sites to stay informed about projects from state agencies, municipalities, educational institutions, and certain private entities seeking qualified vendors. Each solicitation typically includes detailed project scopes, submission requirements, and legal guidelines, ensuring transparency, fairness, and compliance with Alaska’s public procurement regulations. Because these platforms focus exclusively on G2B and B2B engagements, they do not serve as venues for business-to-consumer or consumer-to-consumer transactions.

Succeed in the Alaska Construction Bidding Process

To succeed in the Alaska construction bidding process, you need accurate estimates and documentation as well as a solid grasp of the requirements and nuances of state vs federal bids.

However, one of the most important components of your bid is securing the right surety bonds, such as bid bonds, performance bonds, and payment bonds. When you choose a reliable surety bond agency, you can feel confident that your bond will meet all legal and regulatory requirements. At Surety Bond Professionals, we know the challenges you may face and are here to support you with all your bond needs.  Contact us today for a quote.

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