Covid-19 Creates Competitive Bidding

May 12, 2020
Doosan wheel loader.

While the coronavirus pandemic is causing declines in local sales tax revenue, it’s also caused some lowering of prices for city street projects.

Because of this, increased competitive bidding has resulted in at least $1.6 million when approved bids are compared to original estimates in three major projects, according to Keloland South Dakota.

Mark Cotter, director of public works in Sioux Falls, South Dakota, said one construction project was estimated to cost $2.07 million but the approved low bids was $1.7 million.

“We had five bidders and strong local interest,” said Cotter.

A 25-acre, 75-foot deep landfill cell in the city’s sanitary landfill was estimated to cost $3.84 million. The lowest bid was $3.15 million. An equipment purchase that usually draws four of five bidders drew nine this year, according to Cotter. That resulted in nearly $400,000 savings. 

The low bid was $2.15 million compared to the $2.5 million estimate. 

Contractors that do paving work, such as work on streets and highways, are generally “hungry” for work, said Toby Crow, the vp of the Association of General Contractors in South Dakota. Contractors who typically work in North Dakota, Montana, and Wyoming may start bidding on projects in northern or western South Dakota because energy work has stalled.