Opinion: Jones Library Bidders Beware

Despite objections from many quarters and documented failures by library and town officials to share information, the town put the Jones Library demolition/expansion project back out to bid on September 25, 2024. The rebidding has started even though contracts cannot be signed until a federally required review (Section 106) that could take months has been completed and which may require redesign. Cost escalation is not adequately reflected in the estimates suggested to bidders. The hoped for increase in the number of general contractor bidders with resultant lower bids has not materialized, with actually fewer potential bidders this time around..

Overly Optimistic Cost Estimate Provided to Bidders
The lone bid received on April 26, 2024 ($42.7 million) was ~$7 million more than the then estimate of $35.5 million in construction costs (soft costs add another ~23% for the total authorized project cost of $46.1 million). The current pricetag is now estimated to be about $500,000 higher ($36 million) than the first time despite efforts to cut costs via “value engineering” measures. Cost escalation was estimated by the design team (Finegold Alexander Associates, or FAA) at as much as $1.2 million. The much higher bid reflected the complex nature of the project (tight site in the middle of a downtown and adjacent to the fragile, historic Strong House, extensive work on an older building involving historic structures, etc). 

Bidding Documents Fail to Mention Contract Restrictions Pending Federal Reviews
Bids from subcontractors are listed as due October 17, 2024 and from General Contractors on October 31, 2024. However, a federally mandated Section 106 review that could cause changes to the project design to avoid, minimize, or mitigate adverse effects to the historic building is not expected to be completed until after those deadlines pass. According to Martha A. Curran from the office of Housing and Urban Development (HUD), “HUD’s position is that we discourage construction bids prior to the completion of the environmental review“ and “HUD suggests that the solicitation for bids explicitly state that no bid(s) will be awarded prior to completion of the environmental review record, which includes completion of the Section 106 review process, including a fully executed Memorandum of Agreement (MOA) with all relevant parties, if in fact an MOA is required.”

The publicly-available documents available to potential bidders do not contain any such notification. The Supplemental Instructions to Bidders only state that “The award of Contract to the lowest responsible and eligible Bidder will be made within sixty (60) days, Saturdays, Sundays and legal holidays excluded, after the opening of General Bids.” It does not forewarn bidders that no contract can be executed prior to the resolution of a review process that can take several months to complete and may very well require substantial changes to design. 

If a contract were to be signed prior to completion of the federal review and further design work or additional construction work is subsequently deemed necessary, currently-available information suggests that the contractors will not be able to be compensated for any impact on them.  “In the event that the Project is delayed for any reason, the Contractor shall not be eligible for any additional compensation or damages on account of such delay, and the sole remedy for the Contractor, and any subcontractor, for a delay not caused by the Contractor or its subcontractors shall be an extension of the Contract Time only.” 

Fewer Bidders Than Last Time
After the single bid came in ~$7 million over in April 2024, designers from FAA made the claim that a main reason for the high bid was that there weren’t enough general contractors (GC) bidding on the project to create a competitive market and generate a lower offer. In that round, there were 6 prequalified general contractor (GC) firms but only Fontaine Bros. of Springfield, MA submitted a bid. This time, 5 GC firms applied for prequalification but only 4 were approved (Fontaine Bros., Colantonio of Holliston, J&J Contractors of North Billerica, and CTA Construction Managers of Waltham). With fewer bidders this time around, and all the same issues of a challenging site and project, the theory of a bidding war resulting in low bids seems far-fetched.

Summary
The chances of a new bid coming in many million dollars lower, six months after a reputable GC’s initial assessment are vanishingly low. Add to that the very real possibility of additional costly design changes AFTER bids are due and you get an extraordinarily unrealistic situation that nobody seems willing to acknowledge. The only explanation that seems likely is that project proponents expect a high bid again and the plan will then be to try to bully Town Councilors into authorizing another $5 million, $10 million, $15 million – whatever it takes to push this project through and saddle the town with the fiscal fallout.