In Legal Terms - November/December 1999

Emergency Bid Situations Raise Frequent Questions
I have received several questions lately about the "exception to the bid law" in the event of an emergency. There is a lot of misunderstanding about how to let contracts in an emergency, so I thought it might be helpful to try to clear up some of the confusion.

First of all, there is no general exception to the requirements of the bid law in the event of an emergency. Code of Alabama 1975, § 41-16-53 provides that, "In case of emergency affecting public health, safety or convenience . . .contracts may be let to the extent necessary to meet the emergency without public advertisement." In other words, the law allows the awarding authority to proceed without formally advertising for bids. However, this limited exception does not allow the awarding authority to completely ignore Alabama's competitive bid law.

There has been very little interpretation of this Code section either by the courts or the attorney general's office. The attorney general has generally advised that the awarding authority should obtain as many informal bids as possible in the case of an emergency. See, e.g., Attorney General's Opinion # 96-113. Naturally, this will vary depending on the factual circumstances and the item to be bid. Nonetheless, I would recommend that the county commission take whatever steps are reasonable to obtain as many bids as possible - and I would advise that those steps be carefully documented.

Another common concern in determining how to apply § 41-16-53 is what constitutes an emergency. There is no definition in the statute, and again, there is no real guidance from other sources. In Union Springs Telephone Co. v. Rowell, 623 So.2d 732, 734 (Ala. 1993), the Supreme Court of Alabama noted that the determination of what constitutes an emergency is reviewable by the courts, but that, "The scope of review is limited, however, because a proclamation of a state agency is clothed with a presumption of correctness and may not be overturned unless it is shown to be unreasonable, arbitrary, or capricious." In other words, the courts will not generally interfere with the judgment of the awarding authority regarding whether an emergency exists. Even so, the section is not intended to serve as a regularly-employed loophole to avoid the competitive bid law. In fact, the Supreme Court noted that the decisions of the awarding authority were subject to review, because "if they were not, the Competitive Bid Law would become practically useless, because the State could declare an emergency anytime it wanted to and thus dispense with the bidding process." Union Springs Telephone Co. v. Rowell, supra.

There are a few other important factors to keep in mind when attempting to let a contract under emergency conditions. Section 41-16-53 requires that the awarding authority declare the emergency in writing, "setting forth the nature of the danger to public health, safety or convenience involved in delay" for public advertisement. Additionally, the fact that the contract has been let without public advertisement and the reasons for the action "shall immediately be made public by the awarding authority."

As I often say, when in doubt, ask. Therefore, if you have questions about whether you have a legitimate emergency or how to proceed under § 41-16-53, seek an opinion from your county attorney or contact the Attorney General's office or the Office of Examiners of Public Accounts. This section is a useful Code provision that can be a real lifesaver in the event of a real, declared emergency. However, this limited exception can also create a lot of problems for counties or other awarding authorities subject to the competitive bid law if it is abused, misused, or misunderstood.