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Competitive Sealed Bidding (ITB)

What is Competitive Sealed Bidding?

Competitive Sealed Bidding is a method of procurement used to acquire products or services that exceed $250,000.  The intermediate procurement threshold as defined by ORS.279B.070.  Unless an agency is delegated the authority to conduct the procurement, DAS Procurement Services facilitates the Competitive Sealed Bidding process and coordinates with the agency throughout the process. In this section of the manual, the term “procuring agency” includes DAS Procurement Services or an agency that has been delegated authority to conduct a competitive sealed bidding procurement.

To initiate the Competitive Sealed Bidding process, a procuring agency issues an Invitation to Bid (ITB). Potential suppliers submit bids for the required products or services in response to the ITB. After evaluating bid responses, the procuring agency awards to the lowest responsive and responsible bidder. The Competitive Sealed Bidding method does not allow a procuring agency to negotiate with a bidder.

When to Use Competitive Sealed Bidding

Agencies must make their Buy Decision in the priority order specified in administrative rule. Before selecting an open market method, such as Competitive Sealed Bidding, an agency must first determine that the procurement need cannot be met through a higher priority. If an agency procures products or services that exceed $250,000 through an open market method, or services that exceed the intermediate procurement threshold as defined by ORS.279B.070 then it must use either the Competitive Sealed Bidding or Competitive Sealed Proposals method, unless otherwise covered by a statutory exception.

An agency should use the Competitive Sealed Bidding method when it is clear on “what” the product or service is and “how” the product or service must perform. An agency should use the Competitive Sealed Bidding method if there are no substantive differences among the products or services that meet specifications, and the only difference among responsive bids is price.

For formal procurements, refer to the following table that distinguishes the characteristics of Competitive Sealed Bidding versus Competitive Sealed Proposals.

Refer to Competitive Sealed Proposals (RFP) for more information on this formal procurement method.

Note: Prior to selecting any formal procurement method through the open market, an agency should refer to Procurement Planning for more information on conducting appropriate plan activities that facilitate the procurement process.

How to Process Competitive Sealed Bids

A procuring agency must use a process that comprises the following eights tasks to conduct a solicitation through the Competitive Sealed Bidding method:

​A procuring agency must include the following information in an ITB according to Oregon statutes and administrative rules.


  • Notice of any pre-offer conferences, including:
    • Time, date and location.
    • Whether attendance is mandatory.
    • Provision that statements made by the agency or DAS representatives at the conference are not binding unless confirmed by written addendum.
  • The form and instructions for bid submission including any other special information, for example, electronic means of submission.
  • The name and title of the person receiving bids.
  • The designated agency contact (if different).
  • A statement that the procuring agency may cancel the procurement or reject any or all bids.
  • Time, date and place of bid opening.
  • The location of the office where the solicitation document may be reviewed.
  • A statement that each bidder must identify whether the bidder is a resident bidder (refer to ORS 279A.120).
  • Methods of notifying bidders of addenda.

Definition of need

  • Description of the product or service.
  • Specification or scope of work for the needed product or service.
  • Requirement that contractors perform work according to the highest industry standards for their profession.
  • Delivery or performance schedule.
  • Inspection and acceptance requirements.
  • Contractor’s anticipated duties.
  • Expectations for the contractor’s performance.
  • A statement that the contractor must use recyclable products to the maximum extent economically feasible in the performance of the contract work.
  • Requirement for bidder to obtain subcontract labor, materials, or labor and materials from a supplier registered as an Emerging Small Business, if applicable.​

Bidding and evaluation process

  • The anticipated solicitation schedule, deadlines, protest process, and evaluation process.
  • Objective evaluation criteria (minimum acceptability and the criteria that will effect bid price or total cost of ownership).
  • If multiple awards, the factors used to determine the number of contracts to be awarded.
  • Applicable preferences that will be considered in evaluation.
  • Requirement for a contractor's certification of compliance with Oregon tax laws, if applicable (refer to ORS 305.385).
  • Bidder certification of non-discrimination in obtaining required subcontractors, if applicable.
  • Requirements for bid security, if reasonably necessary or prudent.
  • Contractual terms and conditions clearly specifying the consequences of a contractor’s failure to perform or meet established performance standards.
 Resources:​ Use the approved ITB Template and refer to the ITB Checklist.

The requesting agency must follow its internal and state-level procedures for review and approval of the ITB document prior to posting the public notice.

​After the procuring agency obtains internal and state-level approvals, the agency must advertise the opportunity to potential bidders through a public notice posted on OregonBuys. This informs potential bidders of the procurement opportunity and strengthens competition.

To promote the procurement opportunity and foster competition, an agency may supplement the public notice through additional means. An agency may use mail, newspaper, Oregon Cooperative Procurement Program (ORCPP) or its website for this purpose, however, the information provided must be limited to directing potential bidders to the official notice on OregonBuys.

Note: Conducting a solicitation through OregonBuys satisfies an agency’s requirement to provide timely notice and information to the Governor’s Policy Advisor for Economic and Business Equity regarding bid solicitations and contract awards (refer to ORS 200.035).

All public notices must contain the following information:
  • Where, when, how, and for how long the ITB may be obtained.
  • A general description of the products or services to be acquired.
  • The date that suppliers must file applications for prequalification, if prequalification is a requirement, and the class of products or services for which suppliers must be prequalified.
  • The office where contract terms, conditions and specifications may be reviewed if unable to access the OregonBuys official notice.
  • The name, title and address of the individual authorized to receive bids.
  • The date the procuring agency will open bids.
  • Any other information deemed appropriate.
​Official notice of the ITB must appear on OregonBuys for a minimum of 14 days prior to bid opening. Additional notice may be given for any reasonable time period.

In certain circumstances, the procuring agency may determine that a shorter official notice period is in the public's interest and that the shortened period will not substantially effect competition. A posting period, however, must not be less than seven days. If the official posting period is reduced from 14 days, the procuring agency must document the specific reasons for the shorter time period in the procurement file.

​After the ITB is posted, the procuring agency must manage the solicitation until bid responses have been received. Solicitation management includes:
  • Facilitating the pre-bid conference (if provided through the solicitation).
  • Receiving and responding to potential bidders’ written inquiries regarding the solicitation.
  • Processing solicitation addenda, as required. 
The procuring agency may conduct a pre-bid conference to explain the procurement process to potential bidders and allow them to ask questions. Bidder questions and answers to those questions must be posted in OregonBuys and made available to all potential bidders. If an answer to a question results in a material change to the ITB, the procuring agency must issue an addendum to the ITB describing the change and post it in OregonBuys.

An addendum is used to communicate material changes to the ITB, correct minor defects, and provide information or clarification to potential bidders. If the procuring agency must amend the ITB, the agency should consider the impact to the potential bidders and determine if additional time should be given for submission of bids.

The procuring agency must post official notice of an addendum to the ITB through OregonBuys. Provided there is no extenuating public interest to retain the bid opening date, the procuring agency should not issue an addendum less than 72 hours before the bid opening unless the addendum also extends the bid opening date.

After the official public notice of the solicitation and before the award of a contract, any communication between the procuring agency and potential proposers must occur within the context of the solicitation only. This communication can only occur during the scheduled question and answer time frame allowed by the ITB as it relates to supplier inquiries related to terms and conditions, specifications, addenda or other related matters. During this time frame, telephone conversations and meetings with potential bidders must be documented in the procurement file.

If potential bidders submit written questions regarding a solicitation, the procuring agency should post the questions and answers on OregonBuys. A record of all material communications regarding the solicitation by potential bidders must be included as part of the procurement file.

The procuring agency must date and time stamp, but not open, any bid submitted prior to bid closing. Bids must be stored in a secure place until the time and date set for bid opening.
At the time, date and place designated in the ITB for bid opening, the procuring agency must publicly open all bids received. The names of the bidders and the amounts of their bids must be read aloud and made available to the persons present. This information should be recorded at the time of opening in a bid tabulation or bid abstract and should be posted in OregonBuys.
The procuring agency must inspect each bid to ensure that it is signed by the bidder, verify and secure any required bid bond and remove any documents designated by the bidder to be confidential. All other documents must be available for public inspection at the time of bid opening.
Any bids that arrive after the official due date and time are considered late and are retained by the state. The procuring agency may consider a late bidder’s request to return an unopened bid document at the bidder’s expense.

Bid mistakes

The procuring agency must protect the integrity of the competitive procurement process and assure fair treatment of bidders. To accomplish this, the procuring agency should carefully consider whether it will allow for waivers, corrections or withdrawals of bids for certain mistakes. Prior to bid closing, the procuring agency must not allow a bidder to correct or withdraw a bid for an error in judgment.
If mistakes are found in a bid after the bid opening, but before award of the contract, the procuring agency may take the following actions:
  • Waive, or permit a bidder to correct, a minor informality. A minor informality is a matter of form rather than substance that is evident on the face of the bid, or an insignificant mistake that can be waived or corrected without prejudice to other bidders. Examples include a bidder's failure to:
    • Return the correct number of signed bids or the correct number of other documents required by the ITB document.
    • Sign the bid in the designated block, provided a signature appears elsewhere in the bid, evidencing an intent to be bound.
    • Acknowledge receipt of an addendum to the ITB document, provided that it is clear on the face of the bid that the bidder received the addendum and intended to be bound by its terms; or the addendum involved did not affect price, quality or delivery.
  • Correct a clerical error if the error is evident on the face of the bid or other documents submitted with the bid, and the bidder confirms the procuring agency’s correction in writing. Examples include:
    • Typographical mistakes.
    • Errors in extending unit prices.
    • Transposition errors.
    • Arithmetical errors.
    • Instances in which the intended correct unit or amount is evident by simple arithmetic calculations. Note: Unit prices must prevail over extended prices in the event of a discrepancy between extended prices and unit prices.

Permit a bidder to withdraw a bid based on one or more clerical errors in the bid only if the bidder shows with objective proof and by clear and convincing evidence:
  • The nature of the error.
  • That the error is not a minor informality or an error in judgment.
  • That the error cannot be corrected or waived.That the bidder acted in good faith in submitting a bid and in communicating that the alleged error in the bid exists.
  • That the bidder acted without gross negligence in submitting a bid that contained the claimed error.
  • That the bidder will suffer substantial detriment if they are not granted the permission to withdraw the bid.
  • That the state will not face substantial hardship from withdrawal of the bid.
  • That the bidder promptly gave notice of the claimed error.

A procuring agency may allow for mistakes in bids to be corrected after bid opening, however, changes that are prejudicial to public interests or fair competition are not allowed. The procuring agency must reject any bid in which a mistake is evident on the face of the bid and the intended correct bid is not evident or cannot be substantiated from documents submitted with the bid.
A procuring agency may cancel awards or orders, or terminate a solicitation due to bid mistakes, but must support any of these actions with a written determination. Following award, a bidder is bound by its bid, and may withdraw its bid or rescind a contract only as allowed by applicable law.

A procuring agency must make its bid award to the lowest responsible and responsive bidder whose bid meets the ITB requirements and criteria. The results of the bid opening are limited to the apparent low bidder, which may or may not be awarded the contract.

After the opening, the procuring agency must evaluate each bid to determine whether it complies with all ITB requirements, specifications and ability of the bidder to perform the contract.
The procuring agency must consider all applicable preferences (refer to OAR 125-247-0600 and OAR 125-246-0300 through 0324), and then evaluate each bid to determine which one offers the lowest cost to the state according to the ITB.
If bids are received that are identical in price and meet all of the requirements established in the solicitation, then the procuring agency must use the following priority to resolve the tie bid:Award to the bidder who is offering products or services manufactured, produced or that will be performed in Oregon.Award through a random drawing if none or all of the tie bids are bidders offering products or services manufactured, produced or that will be performed in Oregon.

Responsive and responsible

As part of an evaluation process, the procuring agency must determine whether the bidder is responsive and responsible.
A responsive bid unequivocally commits to the requirements of the ITB. A responsive bidder is one whose bid substantially complies with the ITB and all prescribed procurement procedures and requirements and contains no material defects.
A material defect is one that affects price, quality, quantity, or delivery terms. Material deficiencies affecting responsiveness may not be corrected. Some examples of non-responsiveness are:
  • The bid does not meet the minimum specifications or requirements for the products, services or construction.
  • The bid document makes exception to terms and conditions in the solicitation.
  • The bid is submitted without pricing or with conditional pricing.
A responsible bidder has the capability and capacity to carry out all contractual responsibilities, and has:
  • Appropriate financial, material, equipment, facility, and personnel resources and expertise, or has the ability to obtain the resources and expertise, necessary to meet all contractual responsibilities.
  • Completed previous contracts of a similar nature with a satisfactory record of performance.
  • A satisfactory record of integrity.
  • The legal qualifications to contract with the agency.
  • Complied with the tax laws of the state.
  • A certification from DAS for training in pay equity provisions of state law.
  • Supplied all necessary information related to the determination of responsibility.
  • No record of being debarred by the state or agency.

Life cycle costing

An agency must consider the use of life cycle costing as an evaluation method to quantify the total cost of ownership. This method calculates the cost to acquire, operate, support and dispose of a product over its useful life.
The procuring agency may use this method to include any additional costs that relate to adverse impacts of a product, for example, impacts to the environment or public health. Using this method, award of a contract is not based solely on the lowest price, and a low bid would include life cycle costing.
If an agency elects to use life cycle costing for evaluation, the ITB must:
  • Describe how life cycle costing will be considered and applied in the evaluation process and award decision.
  • Provide relevant information for the evaluation of the bid, for example, projected product usage, operating environment, and operating period.
  • Describe any information that a bidder must provide in their bid, including relevant life cycle costs and supporting information.

Successive rounds of bidding

The procuring agency has the ability to perform successive rounds of bidding to gain the best offer if the initial ITB documents provide for this option. In this instance, a bid’s specifications, terms and conditions, or pricing structure may be revised and reissued for bidding. Bidders must be allowed adequate time to revise and resubmit their bids in response to the requirements in the newly revised ITB.

At each successive round, scoring of prior bids may be disregarded and new scoring may be performed based on the new bids. After each round, the procuring agency may disqualify bidders if the bids did not meet requirements, or if the bids did not meet a minimum evaluation score. A disqualified bidder may be reinstated in a later round if the procuring agency determines that reason for rejection is no longer applicable based on changes to the ITB. 

Multi-step Competitive Sealed Bidding

The multi-step Competitive Sealed Bidding method is a combination of the Competitive Sealed Proposals process (Phase one) and the Competitive Sealed Bidding process (Phase two). This method is preferred under circumstances where an award to the lowest responsive, responsible bidder is desired, but impractical as the solicitation does not define the product or services requirements in a manner that permits an award based on price.

The multi-step Competitive Sealed Bidding method allows the procuring agency to: 
​Phase one
    • Evaluate technical proposals.
    • Rank bidders.
    • Perform discussions.
    • Allow revised priced proposals, if necessary.

​Phase two

    • ​Identify the lowest, responsive and responsible bidder.

In this process, the procuring agency may instruct bidders to submit their bid pricing in a separately sealed envelope along with the technical proposals. Alternatively, the procuring agency may instruct bidders to submit their bid pricing after technical proposals have been submitted and evaluated and after completing discussions on the technical proposals. Regardless of the approach, the priced bids are only considered in step two and only for those bidders whose unpriced technical proposals are found acceptable in step one.
Unless the procuring agency instructed bid pricing to be submitted during Phase one, notification of the due date and time for bid pricing should be issued only to bidders deemed acceptable in Phase one.
If a separate submission of the bid pricing is required in Phase two, the procuring agency must provide all bidders whose unpriced technical proposals are found acceptable in Phase one an opportunity to submit their bid pricing.

Once the procuring agency determines the lowest responsive and responsible bidder, the agency must document the award determination and file it in the procurement file. At a minimum, documentation of an award determination for an ITB must include:
  • Bid responses.
  • ​Completed bid tabulation sheet.
  • Written justification for any rejection of lower bids.
In addition to these required elements, the procuring agency should also document any other relevant information used in its award decision. Examples may include any bids rejected, discussions held with a bidder, or clarification received from bidders.

After documenting the award determination, and seven days prior to awarding a contract, the procuring agency agency must notify all bidders in writing about the notice of intent to award. The agency must also post the notice of intent to award in OregonBuys for at least seven days prior to awarding a contract.

The procuring agency may determine that circumstances justify prompt execution of a contract, in which case a shorter award notice period may be provided. If a shorter award notice period is used, the procuring agency must document the specific reasons for the shorter notice period in the procurement file.

After the notice of intent to award, the procurement files must be made available according to applicable law, except where applicable law requires the procuring agency to make information contained in the procurement files available before any notice of intent to award (refer to the Public Records Law).

After the intent to award notice period, and as required by the ITB, the procuring agency must provide the successful bidder a contract, signed purchase order, price agreement, or other contract documents, as applicable.
The successful bidder must promptly execute the provided contract and complete any actions necessary to complete the contract, including posting performance security, submitting proof of insurance when the invitation to bid requires the submission and agreeing to perform the scope of work and meet the performance standards described in the ITB.
Unless delegated procurement authority to conduct Competitive Sealed Bidding, a requesting agency must submit a purchase request through OregonBuys or email a Contract  Services Request to DAS Procurement Services and must provide a concept document, statement of work, specifications, and other checklist items.

Amendments and Protests

Read the full sections on each of these subjects to learn more about requirements and how to process: