Ohio Bans eBay-Style Construction Bidding

Following the lobbying efforts of the Ohio Contractors Association, the Ohio legislature included in the latest version of the Ohio 2010-2011 state budget an express ban on certain forms of internet reverse auctions that have been used by government entities, most notably Portage County, to obtain bids and award construction work.

The provision defines these types of proposals as reverse auctions, which it defines as, a purchasing process in which offerors submit proposals in competing to sell services or supplies in an open environment via the internet. These auctions resemble an eBay auction, with the main difference here being that the lowest bidder is awarded the contract. A company called BidBridge appears to have assisted with auctions in Ohio.

The budget proposal disallows such reverse auctions if:

[T]he contract concerns the design, construction, alteration, repair, reconstruction, or demolition of a building, highway, road, street, alley, drainage system, water system, waterworks, ditch, sewer, sewage disposal plant, or any other structure or works of any kind.

This list encompasses much of the work that contractors in Ohio perform. The budget including this language is being finalized and, unless amended further, will be presented to the Governor shortly.

Am. Sub. H. B. No. 1, Secs. 9.314(A) and (B) (Lines 953-4, 970-4, 1008-13)

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