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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 Idaho 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 Idaho 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?
- Bid Solicitation: This is when the project owner or general contractor invites contractors to submit bids.
- Bid Submission: Contractors prepare and submit their bids with all necessary details, such as pricing, scope of work, and deadlines.
- 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.
- Contract Formation: Once the project owner chooses a bid, they will set up a contract with the winning contractor.
- 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 Idaho Construction Bidding?
In Idaho, contractors bidding on public construction projects must adhere to specific licensing and bonding regulations as mandated by state law. Typically, contractors are required to hold an appropriate Idaho contractor’s license issued by the Idaho Division of Building Safety for the relevant classification of work. Additionally, they must obtain a general excise tax license from the Idaho State Tax Commission. Depending on the nature of the project, supplementary permits or professional registrations may also be necessary.
For most public works projects governed by Idaho’s procurement regulations, contractors must furnish a bid bond with their bid submission. This bond guarantees that they will fulfill the terms of their bid if awarded the contract. Upon selection, contractors are usually obligated to provide performance and payment bonds. These bonds serve to safeguard the government entity and ensure payment to subcontractors, suppliers, and laborers. These bonding requirements are implemented to uphold integrity, transparency, and responsible use of public funds in Idaho’s procurement procedures.
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 Idaho Construction Bidding Process
Understanding the difference between state and federal bids can help you stay compliant when you submit your bnique Aspects of the Idaho Construction Bidding Process
- In Idaho, most construction work requires an appropriate contractor’s license issued by the Idaho Division of Building Safety (DBS). Contractors must also obtain a sales tax permit from the Idaho State Tax Commission if their work involves taxable sales or services. Depending on the type of work—such as electrical, plumbing, or HVAC—additional licensure or specialized credentials may be required from applicable professional boards or regulatory agencies. Local counties or cities may also have their own permitting or registration requirements, so contractors should verify and comply with both state and local regulations before starting a project.
- Construction projects in Idaho must adhere to the Idaho State Building Codes, which generally adopt and amend versions of the International Building Code (IBC) and the International Residential Code (IRC). Local amendments may address region-specific conditions, such as seismic activity or extreme temperatures. For energy efficiency, Idaho adopts standards in line with the International Energy Conservation Code (IECC) or similar guidelines to promote sustainability and reduce energy consumption. Contractors should confirm the current codes and amendments for the specific jurisdiction in which they are working.
- Projects located near environmentally sensitive areas—such as wetlands, river corridors, or watersheds—may be subject to oversight by the Idaho Department of Environmental Quality (DEQ) or other relevant state agencies. Depending on the project’s scope and potential environmental impact, additional permits, environmental assessments, or inspections may be required. Federal agencies, such as the U.S. Army Corps of Engineers, also oversee activities that affect navigable waters and wetlands, so contractors must ensure compliance with federal regulations where applicable.
- Under Idaho law, employers with one or more employees are generally required to carry workers’ compensation insurance, with certain exemptions. While the state does not mandate general liability insurance for all contractors, it is strongly recommended and often required by project owners, lenders, or government entities. This coverage protects contractors against financial risks arising from accidents, property damage, or other liabilities and is typically required to secure project contracts.
- Idaho’s public contracting procedures are primarily governed by the Idaho Public Procurement Act (Idaho Code Title 67, Chapter 28), which sets competitive bidding requirements for publicly funded projects above certain monetary thresholds. This system ensures transparency and cost-effectiveness in awarding contracts funded by taxpayer dollars. Contractors bidding on state or local government projects must meet qualification standards, follow the prescribed bidding process, and secure any necessary bid, performance, and payment bonds. Typically, contracts are awarded to the lowest responsible bidder, though factors such as relevant experience, qualifications, and adherence to project specifications may also influence the award decision.
Idaho Bid Network
In Idaho, contractors and suppliers seeking bidding opportunities can use the Idaho State Procurement System (ISP) and other state-managed platforms. These official resources provide a centralized listing of public procurement solicitations, including bid advertisements, Requests for Proposals (RFPs), Requests for Qualifications (RFQs), and Requests for Information (RFIs), as well as details on recent awards and bid results. These platforms are designed to facilitate government-to-business (G2B) and business-to-business (B2B) interactions, in alignment with the Idaho Public Procurement Act (Idaho Code Title 67, Chapter 28) and other relevant legal requirements that ensure fair and competitive bidding processes.
Prospective bidders can monitor these portals for opportunities from state agencies, local governments, and other public entities seeking qualified vendors. Each solicitation typically includes detailed project descriptions, submission requirements, and legal guidelines, ensuring transparency, fairness, and compliance with Idaho’s public procurement regulations. As these platforms are specifically intended for G2B and B2B transactions, they do not accommodate business-to-consumer or consumer-to-consumer dealings.
Succeed in the Idaho Construction Bidding Process
To succeed in the Idaho 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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