Indiana 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 Indiana 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 Indiana 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 Indiana Construction Bidding?

Indiana does not issue a single, statewide general contractor license. Instead, contractors must hold any trade-specific licenses that the state regulates, such as plumbing, roofing, fire-sprinkler installation, or asbestos abatement, and register their business with the Indiana Secretary of State. Firms formed in other states must also obtain a Certificate of Authority before operating in Indiana.

Before a bid will be accepted, most state construction agencies require contractors to be prequalified for financial capacity, safety record, and work experience. The most common prequalifying bodies include:

Indiana Department of Administration’s Public Works Certification Board – for vertical construction projects over $150,000.
Indiana Department of Transportation (INDOT) – for transportation and roadwork projects, including those managed by local agencies.

At the bidding stage, authorities may require a bid bond or certified check (typically up to 10% of the bid amount) to demonstrate financial responsibility. Once a contract is awarded, Indiana law mandates a 100% performance bond for state-managed public works projects valued at $200,000 or more. Agencies may also impose this requirement on smaller contracts.

A combined performance and payment bond (usually submitted on the standard IDOA DAPW-15 form) is customary. This ensures that the contractor completes the project and pays all subcontractors, suppliers, and laborers.

Together, Indiana’s licensing, prequalification, and bonding rules are designed to protect public funds, promote transparency, and ensure that qualified, responsible contractors are entrusted with taxpayer-funded construction.

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 Indiana Construction Bidding Process

Indiana does not issue a single statewide “general contractor” license. Instead, a firm must hold any trade-specific credentials that the state regulates—such as a plumbing contractor license from the Indiana Plumbing Commission—and register for a Registered Retail Merchant Certificate (RRMC) with the Department of Revenue to satisfy sales and use tax requirements. A company formed outside Indiana must also secure a Certificate of Authority from the Secretary of State before transacting business. Because contractor licensing is largely handled at the municipal level, bidders must verify and obtain any local registrations or building permits required by the city or county where the project is located.
Indiana maintains statewide construction standards through the rules of the Fire Prevention and Building Safety Commission. The Indiana Building Code (based on the 2012 IBC with state amendments), the 2020 Indiana Residential Code, and the 2010 Indiana Energy Conservation Code apply uniformly to all jurisdictions unless the Commission approves local variances. Contractors should review the current editions and amendments of these statewide codes and any Commission-approved local modifications before preparing plans or specifications.
Work that could affect wetlands, streams, floodplains, or other sensitive resources may trigger environmental permits from multiple agencies. Disturbance of waters in the United States requires a Section 401 Water Quality Certification from the Indiana Department of Environmental Management, and construction in a regulated floodway generally needs a Flood Control Act permit from the Indiana Department of Natural Resources; many projects also require a corresponding Section 404 authorization from the U.S. Army Corps of Engineers. Contractors should confirm all IDEM, IDNR, and federal clearances before any land-disturbing activity begins.
Under the Indiana Workers’ Compensation Act, every employer with even one employee must carry workers’ compensation insurance, subject only to narrow statutory exemptions. Although Indiana law does not impose a blanket requirement for commercial general liability coverage, project owners, lenders, and public agencies commonly make such insurance a contractual condition for award or for local contractor registration.
State-funded construction is governed chiefly by Indiana Code 413.6 and related public works statutes. When the estimated cost of a state public works project is $150,000 or more, the Indiana Department of Administration must advertise and award the contract through sealed competitive bidding; similar dollar thresholds apply to political subdivisions under IC 36112. Prime contractors and major subcontractors on vertical state projects must be prequalified by the Public Works Certification Board, while road and bridge work require active prequalification with the Indiana Department of Transportation before bids are accepted.
Indiana’s “Little Miller Act” and related statutes require bid security and final bonds on most public works procurements. Awarding authorities may demand a bid bond or certified check of up to 10 percent of the bid price with each proposal, and contractors awarded state or local public works contracts of $200,000 or more must furnish a 100 percent performance bond that also serves as a payment bond to protect subcontractors, suppliers, and laborers. These bonding measures safeguard public funds, ensure contract completion, and guarantee that everyone working on the project is paid.

Indiana Bid Network

In Indiana, contractors and suppliers locate public-sector bidding opportunities chiefly through the Indiana Department of Administration (IDOA) Supplier Portal, the State’s central e-procurement platform. The portal publishes all competitive solicitations—Invitations for Bids, Requests for Proposals, Requests for Qualifications, and Requests for Information—together with addenda, bid-tab results, and award notices, and it is structured to support government-to-business (G2B) and business-to-business (B2B) transactions in line with the Indiana Public Purchasing Statute (Indiana Code 522), which requires open, fair, and competitive procurement procedures.

Vendors can monitor the Supplier Portal for solicitations issued by state agencies, public universities, and the IDOA Public Works Division, while transportation and highway contracts are advertised and led electronically through the Indiana Department of Transportation’s Bid Express system. Each posting provides a detailed scope of work, submission instructions, statutory references, and evaluation criteria, thereby ensuring transparency and equal access to contracting opportunities while maintaining a public record of past awards.

Because the Supplier Portal, Bid Express, and related state procurement sites are intended solely for G2B and B2B engagement, they do not accommodate business-consumer or consumer-to-consumer transactions.

Succeed in the Indiana Construction Bidding Process

To succeed in the Indiana construction bidding process, you need accurate estimates and documentation and 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.