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The Advantages of a Bid Depository System

To the Owner and Bid Calling Authority

No fees to the Owner.
More Contractors.
Fosters confidence between Prime and Trade Contractor.
Promotes a harmonious relationship within the construction team which in turn serves the Owner.
When Bonding/Security is specified, receipt of these documents is verified.
Provides the Prime Contractors with time to prepare their bid.
Alerts Bid Calling Authority to problem areas.
Owner receives a copy of all documentation for information purposes.
Prevents added burden of last minute trade contractor questions.

To the Prime Contractor

When trades are not pre qualified, may solicit bids from their favorite trade contractors.
Will receive clear, unqualified bids in writing.
Bids are based on an understood and previously agreed scope of work, common to all bidders.
Affords time for adequate analysis of bids received.
Encourages every trade contractor to bid all Prime Contractors.
Incidence of misunderstanding and bidding errors is significantly lowered.

To the Trade Contractor

Able to bid Prime Contractors knowing the bid will not be "shopped".
Easy for all suppliers to verify who is bidding.
Mutual trust is promoted.
Better co-operation throughout the project.
Scope of work is known.
Easy to bid different amounts to different primes.

Why the need for a Bid Depository System?

The construction industry in Ontario believes that a uniform bidding system is necessary for building construction projects where the owner requires a lump sum bid based on plans a specifications and where a multitude of prime contractors, trade contractors and suppliers are involved in the bidding process.
A uniform system of bidding prevents:

Last minute bids
Qualified bids
Incomplete bids
"Shopping" of bids

The system decreases the risks to prime contractors, in turn protecting the owner's investment.
The construction industry, in consultation with the design professions, has developed the Ontario Bid Depository Standard Rules and Procedures which, when used, maintain an orderly system within our very complicated and diversified industry. These Rules and Procedures are evaluated and updated regularly.

What is the Bid Depository System and how did it originate?

It is a method of receiving sealed bids from trade contractors, thus assuring the sanctity of the bidding process. Those receiving bids obtain firm quotations in writing and have adequate time to compile their own bids completely and accurately, on an understood and previously agreed scope of work common to all bidders.

The Ontario System requires the trade contractor to submit his/her bid in accordance with the plans and specifications and encourages the submitting of unsolicited options and savings to be requested scope of work. Bonding is a requirement only if called for in the specifications. The sealed bid is delivered is delivered to the specified Bid Depository at a specified date and time and is deposited in a designated locked box.

The bid depository system was originally established in 1957. In 1972, the then Ontario Department of Public Works (now Ministry of Government Services), requested that a standard set of Rules and Procedures be established for the entire province. This resulted in the representatives from the

Electrical Contractors Association of Ontario (ECAO)
Mechanical Contractors Association of Ontario (MCAO)
Ontario Association of Architects (OAA)
Association of Professional Engineers of Ontario (APEO)
Ontario General Contractors Association (OGCA)

meeting over a period of two and one half years, and on September 15, 1974, the first edition of the Ontario Bid Depository Standard Rules and Procedures was published.

Since that time, certain amendments have been made to the Standard Rules and Procedures as a result of experience gained from using the system and through recommendations from the Restrictive Trade Practices Commission.

Today, all Ontario Bid Depositories and a majority of Sub-bid Depositories use the Ontario Standard Rules and Procedures.

Here is how the bidder uses the system

    1.    The trade contractor addresses copies of his/her Official Bid Form to Prime Contractors
           bidding the project.
    2.    The orange copy of this Official Bid Form is provided for the Bid Calling Authority or Owner.
    3.    The green copy is provided for the Bid Depository.
    4.    All the Official Bid Forms, Part One and Part Two, are enclosed in an official large white
           numbered envelope addressed to the Bid Depository. This envelope must be delivered by the
           specified Bid Closing time, time-stamped and receipted by the bid depository, then deposited
           by the contractor in a locked box.
           (a) Bid Forms: Trade Contractors shall submit "Part One" and "Part Two" of the bid forms as
                provided by the Bid Depository, for each Prime Contractor they intend to bid.
                i. "Part One" shall contain any bonding or security, and any separate and/or alternative
                    prices specified by the Bid Calling Authority. It also requires a signed commitment by
                    the Trade Contractor to adhere to the rules of the Bid Depository. Bid Calling
                    Authorities should not request unit or itemized prices or extensive lists of equipment or
                    material. If required, this information should be requested from and provided by the low
                    bidder only, following Prime Contractors' bid closing.

ii. "Part Two" shall contain the lump sum base bid price only.

Here is what happens after the Bid Depository Closing Time

Bid Opening

Immediately after the Bid Depository closing time, the large white envelopes shall be removed from the deposit box. Any specified Bonding/Surety attached to the large white envelope shall be scrutinized for disqualification. The large white envelope will be opened and all Part One Bid Forms scrutinized for signature. If disqualification's do not occur, all Part One Bid Forms are released to the named Prime Contractors.

The colored envelopes, containing the Part Two Bid Forms are held until twenty five (25) hours prior to the Prime Contractors closing time and are dealt with as follows:
Green Envelopes are opened and the Part Two Bid Forms are checked for disqualification's. If the contents of the green envelopes are formal, the Orange andPink Envelopes are sorted. The Pink envelopes are distributed to the Prime Contractors twenty four (24) hours prior to their closing time.

Questions and Answers

Q.    When you use the term 'Prime Contractor', to whom do you refer?
A.    A Prime Contractor is one who receives bids e.g. A General Contractor is Prime when
        receiving bids from Trade Contractors; similarly, a Trade Contractor would be Prime when
        receiving bids from his Sub-trades.

Q. If I specify an "Invited bidders" list, can I use the Bid Depository?
A. Certainly!

Q. As a Prime Contractor, is it mandatory that I carry the lowest bid submitted through the Bid
Depository?

How do I specify the use of the Bid Depository System?

Procedures to be followed by the Bid Calling Authorities.

(a)    Notification by Bid Calling Authority: When specifying the use of the Bid Depository, Bid
        Calling Authorities should notify the appropriate Bid Depository in writing. It is
        recommended that the instructions to bidders be worded as follows:
        i)    Sealed Bids for the (named) Trades shall be deposited in the (named) Bid Depository,
              in official envelopes, no later than 3:00 p.m. on (month, day, and year), two working
             days prior to the Prime Contractor's bid closing.
        ii)   Bids received at the Bid Depository after the prescribed time shall be deemed invalid.
        iii) The Ontario Bid Depository Standard Rules and Procedures shall apply to all bidders
              and receivers of bids, and shall be fully supported by the Bid Calling Authority.
(b)    Bid Acceptance: The Depository will accept Bids for any project where the Bid Calling
        Authority has specified the use of the Bid Depository.
(c)    Addenda: Upon receipt, the Bid Depository shall record the time and date of all addenda.
        To ensure that bidders have sufficient time to include any addenda in their bids, addenda
        shall be received and recorded by the Bid Depository at least forty-eight hours prior to Bid
        Depository Closing (Saturdays, Sundays and statutory holidays excluded).
(d)    Bid Recalls: As specified in CCDC Document 23 and CCA Document 29

ONTARIO BID DEPOSITORY

STANDARD RULES & PROCEDURES

Ninth Edition
January 1, 1998 Rev.1

1. NAME
For purposes of this document, the particular member local Bid Depository, being used for the receipt of sealed bids, shall be referred to as the "Bid Depository".

2.    DEFINITIONS AND PURPOSE
(A)    The Bid Depository receives sealed bids from Trade Contractors, ensures that the bidding process is
          followed and that bidders obtain firm quotations in writing.
(B)    Where they appear in the specifications, contract documents and these rules and procedures, the terms
         "tender (s)", "tenderer (s)", "bid (s)", and "bidder(s)" are synonymous
(C)    The Bid Depository is not intended to provide audit or itemized prices, or extensive lists of equipment and
          material. If required, this information should be requested from and provided by the low bidder only,
          following the Prime Contractor bid closing. Separate and alternative prices, if specified, should be
          minimal. A separate price is for work to be added to the lump sum base bid price, and an alternative price
          is for substituted item or section of work , which is an addition to or deduction from the lump sum
         base bid price.
(D)    In specifying the use of the Bid Depository, the Bid Calling Authority endorses and agrees to abide by
          the rules and procedures governing its use.

3.    ONTARIO BID DEPOSITORY COUNCIL
(A)    Amendments: The authority to amend these rules and procedures rests solely with the Ontario Bid
          Depository Council (OBDC).
(B)    Representation: The OBDC is comprised of one representative from each of the following: Member
         Local Bid Depository, CEO, CSC, ECAO, MCAO, and OAA, as well as a non-voting chairperson
         appointed in accordance with the OBDC constitution.

4. LOCAL BID DEPOSITORY MANAGEMENT

A local operating committee, including representatives from user groups and from the professions, is responsible for managing and administering the Bid Depository.

5. BID DEPOSITORY CLOSING TIME

The bid closing time specified by the Bid Depository is 3:00 p.m., two days prior to the Prime Contractors' closing, or as specified by the Bid Calling authority (Saturdays, Sundays and statutory holidays excluded).

6. ELIGIBILITY

All owners, Prime and Trade Contractors submitting and/or receiving bids for projects utilizing the Bid Depository shall have access to its facilities, provided they observe these rules and procedures and all applicable federal and provincial legislation

7. PROCEDURES FOR BID CALLING AUTHORITIES

(A)    Notification be Bid Calling Authority: When specifying the use of the Bid Depository, Bid Calling
          Authorities should notify the appropriate Bid Depository in writing. It is recommended that the
          instructions to bidders be worded as follows:
          i)    Sealed Bids for the (named) Trades shall be deposited in the (named) Bid Depository, in official
                envelopes, no later than 3:00 p.m. on (month, day and year), two working days prior to the Prime
                Contractors' bid closing.
        ii)    Bids received at the Bid Depository after the prescribed time shall be deemed invalid.
        iii)   The Prime Contractor shall name the Trade Contractors whose bids, submitted to him/her through the
                Bid Depository, have been incorporated into his/her bid.
      iv) The Ontario Bid Depository Standard Rules and Procedures shall apply to all bidders
            and receivers of bids, and shall be fully supported by the Bid Calling Authority.

(B)    Addenda: Upon receipt, the Bid Depository shall record the time and date of all addenda to ensure
         that bidders have sufficient time to include any addenda in their bids, addenda shall be received and
         recorded by the Bid Depository at least forty-eight hours prior to Bid Depository closing (Saturdays,
         Sundays and statutory holidays excluded).
(C)    Bid Recalls: As specified in CCDC Document 23 and CCA Document 29.
(D)    Bid Depository Location: Only one Bid Depository should be specified for each project.
(E)     Bid Forms: Trade Contractors shall submit "Part One" and "Part Two" of the bid forms as
          provided by the Bid Depository, for each Prime Contractor they intend to bid.
          i) "Part One" shall contain any bonding or security, and any separate and/or alternative prices specified
               by the Bid Calling Authority. It also requires a signed committment by the Trade Contractor to adhere
               to the rules of the Bid Depository. Bid Calling Authorities should not request unit or itemized prices
               or extensive lists of equipment or material. If required, this information should be requested from and
               provided by the low bidder, following Prime Contractors' bid closing.
        ii) "Part Two" shll contain the lump sum base bid price only.
(F)    Closing: Each Trade Contractor shall submit "Part One" and "Part Two" of the bid forms by the specified
        Bid Depository closing time. "Part One" shall be released to the Prime Contractors immediately following
        the closing; "Part Two" shall be held until twenty four hours prior to Prime Contractors' bid closing, and
        then released to the Prime Contractors.
(G)   Bonding or Security: It is recommended that where the Bid Calling Authority has specified that the Prime
        Contractor provide performance bonding or security, similar bonding or security should be specified by
        the Bid Calling Authority for Trade Contractors.

8. VOLUNTARY BID DEPOSITORY

(A)    Applicability: Where the respective majority of each of the Prime, Mechanical and Electrical trade
          contractor bidders favour the use of the Bid Depository, but it is not specified by the Bid Calling
          Authority, a voluntary Bid Depository shall be proclaimedthrough the Local Bid Depository, when so
          requested.
(B)    Notification: Prime and Trade contractors bidding a project shall be notified of the voluntary Bid
         Depository in writing at least three (3) days (Suturdays, Sundays and statutory holidays excluded), prior
         to the closing of the named Bid Depository.
(C)    Rules: The rules and procedures of the Bid Depository shall apply to the Voluntary Bid Depository.

9. PROCEDURES FOR PREPARING BIDS

(A)    Scope: To permit Prime Contractors to compare bids, Trade Bids must comply strictly with drawings
          and specifications, including instructions to bidders, general conditions and any addende, as received
          and recorded by the Bid Depository forty eight (48) hours prior to the Bid Depository closing (Saturdays,
          Sundays and statutory holdiays excluded).