3 contractors take MnDOT to court over $98 million bid award

Three major building contractors are crying foul over the handling of a nearly $100 million construction bid that was awarded for a 4½-mile project on Interstate 35E that includes adding the first MnPass lanes in the east metro.

In an unusual joint move, the contractors — C.S. McCrossan Construction Inc., and Lunda Construction Co. and its partner on the project, Shafer Contracting Co. — are asking the Minnesota Court of Appeals to review the Minnesota Department of Transportation's (MnDOT's) decision to award the $98.4 million contract to Ames Construction.

The contractors also have asked the court to delay the start of construction until the contractors and the agency can present their cases and a decision is made, a process that could take months, said Bob Huber, attorney for the three contractors.

The Ames bid is $11 million more than the lowest bid, submitted by McCrossan.

Under the state's "apparent best value" system, agencies aren't bound to accept lowest bids for public works projects, but the competitive bids can be evaluated based on other factors as well, such as technical merit or how quickly the project can be completed. Those factors are detailed in agency guidelines and state law, and if a low bid is not accepted, an agency has to demonstrate why it wasn't.

In this case, Huber said, MnDOT ignored both state law and its own instructions to the bidders on the project by allowing Ames to make several changes in the bid specifications without letting the other contractors know.

When the other three contractors went through an appeals process with MnDOT, an arbiter known as a "protest official" acknowledged that MnDOT made some technical errors and had inconsistencies in how it handled the bidding process, but concluded that it was not significant enough to reverse the award.

"They don't have to have rules, is really what they're saying," Huber said of MnDOT, adding that it could set a bad precedent for contractors on public projects and taxpayers who pay for them. "If you can both set the rules and enforce the rules, then decide later whether or not you're going to enforce the rules, then what good are the rules?"

Kent Barnard, MnDOT spokesman, declined to comment on the court petition.

But he said the long-awaited reconstruction of 35E between University Avenue and Little Canada Road, with its new MnPass lanes in both north and south directions, will go a long way toward easing congestion on a key traffic bottleneck into and out of downtown St. Paul.

The contract in dispute includes the construction of the MnPass lanes alongside the three lanes for general traffic, a concrete overlay of I-35E and the reconstruction of nine bridges along the corridor.

Like the MnPass lanes on Interstates 35W and 394 in the Twin Cities, the new lanes will be set aside for commuters willing to pay more for less-congested driving — a cost averaging about $1.25 a trip. The contract calls for construction to start in the spring, with most of the work to be done by the end of next year.

One of the deviations in specifications made by Ames was altering the width of a new Hwy. 36 bridge. Another involved how long the use of shoulders would be restricted along two stretches of the construction zone. The contract specified 120 days; Ames proposed 300 days.

Previously, McCrossan was the low bidder on a portion of the St. Croix bridge construction by $6 million, but did not prove to MnDOT's satisfaction that it would comply with requirements to use disadvantaged businesses. The company settled with MnDOT for about $300,000.