If a Texas county advertises for bids and gets none, can it just buy directly or must it advertise again?

Texas AG Opinion DM-0004: A County Must Readvertise When a Bid Request Draws No Bids

Plain-English summary

Wood County advertised twice for bids on a dump truck for its Precinct 4 Road and Bridge Department, mailed the specifications to ten potential bidders, and held a bid opening. No bids came in. Because the truck cost more than $10,000, the purchase fell under the County Purchasing Act, and the county's criminal district attorney asked the Attorney General whether the county could now just negotiate directly with a vendor, or had to advertise again, and if so, how many times.

The Attorney General concluded the county had to readvertise. The County Purchasing Act (Local Government Code sections 262.022 through 262.035) required sealed competitive bidding for county purchases over $10,000 and laid out detailed notice, bid-opening, and award procedures. When bids are received, the commissioners court must either award the contract to the lowest and best responsible bidder or reject all bids and publish a new notice. The Act said nothing about what to do when no bids arrive, but the opinion read the structure to require a fresh round of bidding rather than direct negotiation. The clearest signal was section 262.027(a)(2): even when a court rejects all bids it cannot negotiate directly but must publish new notice, which restarts the bidding procedures. The opinion also applied the rule that when the legislature spells out specific exceptions to a statute, the statute applies in every case not expressly excepted, citing State v. Richards. Letting the county negotiate directly here would amount to inventing a new exception.

On the second question, the opinion found the Act set no limit on how many times a county might have to readvertise. It pointed out, though, that the Act's own exceptions could relieve the county in specific situations: a purchase to avert a genuine public calamity, to preserve public health or safety, to replace unforeseen damage to public property, or to buy personal property from another political subdivision, a state agency, or the federal government, none of which require competitive bidding.

Currency note

This opinion was issued in 1991. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. The County Purchasing Act has been amended since 1991, including the dollar thresholds and the list of bidding exceptions. Verify current law before relying on any specific rule mentioned here.

Common questions

If a county gets no bids, can it just buy the item directly?
No, according to this opinion. The County Purchasing Act required the commissioners court to publish a new notice and run competitive bidding again rather than negotiate directly with a vendor.

Where did the opinion find that rule, since the Act is silent on "no bids"?
It read the Act's structure, especially section 262.027(a)(2), which forbids direct negotiation even when a court rejects all the bids it does receive, and the rule that a statute applies in every case not expressly excepted (State v. Richards).

How many times must a county readvertise?
The opinion found no limit in the Act. A county could be required to readvertise repeatedly.

Are there any ways around bidding?
Yes, the statutory exceptions. The opinion listed purchases to meet a public calamity, to protect public health or safety, to replace unforeseen damage to public property, and purchases of personal property from another government, which the Act exempts from competitive bidding.

Background and statutory framework

The County Purchasing Act, Local Government Code sections 262.022 through 262.035, required a commissioners court to use competitive bidding or competitive proposal procedures before a county purchase exceeding $10,000 (section 262.023(a)), for contracts paid from current funds, bond funds, or time warrants (section 262.023(b)). The Act prescribed notice (section 262.025), bid opening, and award procedures (section 262.027). After opening bids, the court must award the contract to the lowest and best responsible bidder or reject all bids and publish new notice (section 262.027(a)). The Act made no provision for the case of no bids, which the opinion read against the backdrop of competitive proposal procedures generally limited to insurance and high-technology procurements (section 262.030) and to large counties (section 262.0295), and against the listed bidding exceptions in section 262.024 and the small-county provision in section 262.011(a). The opinion applied the canon from State v. Richards, 301 S.W.2d 597 (Tex. 1957), that a statute applies in all cases not expressly excepted, and contrasted a state purchasing regulation (1 T.A.C. § 113.6(c)(2)(D)) that did authorize negotiation when an advertisement drew no bids.

Citations

Statutory provisions:

• TEX. LOCAL GOV'T CODE ANN. §§ 262.011, 262.022-262.035 (County Purchasing Act), including §§ 262.023, 262.024, 262.025, 262.027, 262.0295, 262.030

Cases:

• State v. Richards, 301 S.W.2d 597 (Tex. 1957)

Source

• Landing page: https://www.texasattorneygeneral.gov/opinions/dan-morales/dm-0004
• Original PDF: https://www.texasattorneygeneral.gov/sites/default/files/opinion-files/opinion/1991/dm0004.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain — the linked PDF is authoritative.

Office of the Attorney General
State of Texas

DAN MORALES
Attorney General

February 22, 1991

Honorable Marcus D. Taylor
Criminal District Attorney
Wood County
P. O. Box 689
Quitman, Texas 75783

Opinion No. DM-4

Re: Whether a county may make a purchase in excess of $10,000 without competitive bids if, after advertising, no bids are received (RQ-2187)

Dear Mr. Taylor:

You have requested our opinion on questions relating to the following set of facts:

On August 22 and August 29, 1990, Wood County commissioners advertised for bids for a dump truck for the Precinct 4 Road and Bridge Department. The specifications (which were identical to specifications previously used, where bids were obtained and trucks purchased) were mailed to ten potential bidders, as well as publicly advertised as required by law. On September 10, 1990, the date of the bid opening, no bids were received.

You state that the cost of the truck will exceed $10,000, thereby bringing the purchase within the County Purchasing Act, sections 262.022 through 262.035 of the Local Government Code. You also stipulate that none of the exceptions to competitive bidding provided in the act apply to the purchase of the dump truck.

You ask whether the county in these circumstances may negotiate directly with a vendor for the purchase of the dump truck or whether it must readvertise for bids. If it must readvertise, you also ask how many times it is required to do so. We conclude that the county must readvertise for contract bids in accordance with the terms of the County Purchasing Act. We further advise that the County Purchasing Act imposes no limit on the number of times that a county may be required to advertise for bids on a single contract.

The County Purchasing Act provides the following in pertinent part:

Before a county may purchase one or more items under a contract that will require an expenditure exceeding $10,000, the commissioners court of the county must comply with the competitive bidding or competitive proposal procedures prescribed by this subchapter. All bids or proposals must be sealed.[1]

Local Gov't Code § 262.023(a). Competitive bids or proposals are required only for contracts paid from current funds, with bond funds, or through the issuance of time warrants. Id. § 262.023(b).

The County Purchasing Act prescribes specific procedures governing the notice of competitive bidding for a particular contract, the opening of bids, and the awarding of contracts pursuant to competitive bidding. See id. §§ 262.025, 262.026, 262.027, 262.0275. Notice of a proposed purchase of $10,000 or more must either be published in a newspaper of general circulation in the county or, if there is no such publication in the county, posted in the courthouse in the manner specified in the act. Id. § 262.025(a). The notice must contain certain information, including specifications describing the item to be purchased (or a statement informing bidders where specifications may be obtained), the time and place for receiving and opening bids, the name and position of the person to whom bids must be sent, the method of payment, and the type of bond required of the bidder. Id. § 262.025(b).

Following the opening of bids, the commissioners court is required to

(1) award the contract to the responsible bidder who submits the lowest and best bid; or

(2) reject all bids and publish a new notice.

Id. § 262.027(a). The act makes special provision for the awarding of a contract when two responsible bidders submit the lowest and best bid, id. § 262.027(b), (c), but it does not provide alternative procedures when, as in this instance, no bids are submitted.[2] Compare 1 T.A.C. § 113.6(c)(2)(D) (regulation promulgated by State Purchasing & General Services Commission authorizing negotiations with vendors when advertisement results in submission of no bids).

Therefore, we believe the county is required in this instance to commence a new round of bidding by republishing notice of the purchase in accordance with the terms of the act. As noted, the purchasing act itself supplies no alternative procedures in this instance. Also, while the statute does not directly address the problem you describe, there is evidence to suggest that the legislature intends counties to readvertise for bids on a contract when the initial advertisement yields no bids.

The clearest indicator of this intent is section 262.027(a)(2), quoted above, which describes the county's options when it is determined that all bids are inadequate or unresponsive. In these circumstances, the commissioners court is authorized to reject all bids, but it is not free to enter into direct negotiations with vendors for the purchase of an item. Instead, it must publish new notice, which in turn triggers the other competitive bidding procedures of the act. See also Local Gov't Code § 262.024(d) (procedures for the purchase of food items otherwise exempted from competitive bidding).

In addition, the legislature has specified those occasions on which a departure from competitive bidding is permitted. See Local Gov't Code § 262.011(a) (in counties of less than 20,000 population without a purchasing agent, commissioners court may dispense with competitive bidding for contracts exceeding $15,000 when it publicly finds such "to be in the public interest"); 262.024 (exceptions to competitive bidding); 262.0295 (alternative multistep competitive proposal procedures for counties with population of 125,000 or more); 262.030 (competitive proposal procedure for insurance and high technology items). It is well established that when the legislature has enacted exceptions to a statute, the statute will be held to apply in all cases not expressly excepted. See State v. Richards, 301 S.W.2d 597 (Tex. 1957). To permit the county in this instance to avoid its obligation to award contracts on the basis of sealed competitive bids would be to effectively create a new exception to the purchasing act. Accordingly, in answer to your first question we conclude that a county must readvertise for bids on a contract subject to competitive bidding under the County Purchasing Act when the initial advertisement results in the submission of no bids for the contract.

You next ask the number of times the county must readvertise for bids on a contract for which no bids are received. Again, the purchasing act neither anticipates nor offers alternatives for this contingency, and the county thus has no recourse but to comply with the terms of the act.

Moreover, the statute provides for exceptions to the competitive bidding process in certain circumstances. For example, if the dump truck is needed to avert the consequences of a genuine public calamity, the county may purchase the truck without resort to competitive bidding. Id. § 262.024(a)(1). The same will hold true if the purchase is necessary to preserve the public health or safety of county residents, or if it is required because of unforeseen damage to public property. Id. § 262.024(a)(2), (3). Such outcomes will, of course, depend on the facts of the case and the exercise of sound discretion by the commissioners court. Finally, it should be noted that the county may also purchase items of personal property from a political subdivision of this state, a state agency, or an entity of the federal government without resort to competitive bidding. Id. § 262.024(a)(8)(C).

SUMMARY

A county must readvertise for bids on a contract subject to the County Purchasing Act, Local Government Code sections 262.022 through 262.035, when the initial advertisement results in the submission of no bids for the contract. The County Purchasing Act imposes no limit on the number of times a county may be required to advertise for bids in such instances.

DAN MORALES
Attorney General of Texas

WILL PRYOR
First Assistant Attorney General

MARY KELLER
Executive Assistant Attorney General

JUDGE ZOLLIE STEAKLEY (Ret.)
Special Assistant Attorney General

RENEA HICKS
Special Assistant Attorney General

SUSAN GARRISON
Acting Chairman, Opinion Committee

Prepared by Steve Aragon
Assistant Attorney General

[1] Competitive proposal procedures, which authorize a county to negotiate with vendors after the opening of proposals submitted at the county's request, are generally available only for insurance and high technology procurements. See Local Gov't Code § 262.030. The legislature recently amended the County Purchasing Act to allow a county with a population of more than 125,000 to employ competitive proposal procedures if "the county official who makes purchases for the county determines that it is impractical to prepare detailed specifications for an item to support the award of a purchase contract," and the commissioners court concurs in this determination by making a similar finding. Id. § 262.0295. According to 1980 census figures (the most recent available), Wood County has a population of just under 25,000 persons.

[2] For that matter, the County Purchasing Act does not expressly address the submission of identical low bids by more than two responsible bidders.