Types of Contracts

• Under Act 4, there are two types of public contracts: Some contracts require bids by prospective suppliers and others do not; the government may enter into a contract without requiring a bid from the contractor. Most contracts worth more than $10,000 require suppliers to go through the bidding process (as of 2010).
  
  

Entering a Bid

• After a municipality advertises a biddable contract, bidding instructions will be disseminated. Bidding firms are required to follow the instructions and any deviation may void any bid by the contractor. If a municipality believes a bidding error was mistakenly made, they may waive the issue. A security bond may be required along with a bid to ensure the contractor intends to honor the agreement.
  
  

Withdrawing a Bid

• A contractor that withdraws its bid may forfeit its security bond, but Act 4 provides for a procedure in which a bidder who meets certain requirements may withdraw their bid from consideration after the bid opening without forfeiting the security.
  
  

Winning a Public Contract

• A public contract is binding from the date it is awarded. If a contractor fails to undertake the work, the municipality may proceed against the bond.