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THE FALLACY OF
COMPETITIVE BIDDING
By
Eric Glazer, Esq.
Published June 1, 2015
Sometimes the exceptions to the rule swallow
the rule, rendering the rule virtually meaningless. Mandatory
competitive bidding is a fine example.
The Florida Condominium Act provides:
If
a contract for the purchase, lease, or renting of materials or
equipment, or for the provision of services, requires payment by
the association on behalf of any condominium operated by the
association in the aggregate that exceeds 5 percent of the total
annual budget of the association, including reserves, the
association shall obtain competitive bids for the materials,
equipment, or services.
In
an HOA, the competitive bidding requirement kicks in at 10% of
the budget.
So
far so good. But the next line of the statute reads:
Nothing contained herein shall be construed to require the
association to accept the lowest bid.
And here is where the rule basically goes out the window:
Notwithstanding the foregoing, contracts with employees of the
association, and contracts for attorney, accountant, architect,
community association manager, timeshare management firm,
engineering, and landscape architect services are not subject to
the provisions of this section.
If
competitive bidding is not required for the attorney,
accountant, architect, manager, management firm, engineer and
landscape architect services, then when exactly is competitive
bidding required?
For the pens and pencils in the office?
The concept of competitive bidding sounds nice. It makes it
appear as if the association has to vet numerous companies and
only after an exhaustive search, choose the company that makes
the most financial sense to the community. In reality, it is
only utilized for major renovation projects. That’s it. And, in
my experience, the association rarely chooses the contractor
with the lowest bid, because most associations know that you get
what you pay for. It also does not prevent someone’s friend or
son in law from ultimately getting the job.
For
all intents and purposes, it is a statute with no teeth
whatsoever.
I
just want to thank everyone who came to our Condo Craze Board
Certification Course, Day of Education and Live Radio Show at
The Seminole Hard Rock Hotel and Casino yesterday in Hollywood.
My entire staff and I were flattered by the wonderful turnout at
7:00 in the morning on a Sunday. It was an honor to spend the
day with all of you and I hope you enjoyed being there as much
as we did.
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About
HOA & Condo Blog
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Eric Glazer graduated from
the University of Miami School of Law in 1992 after
receiving a B.A. from NYU. He has practiced community
association law for more than 2
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decades and is the owner of Glazer
and Associates, P.A. a seven attorney law firm with offices in
Fort Lauderdale and Orlando and satellite offices in Naples,
Fort Myers and Tampa.
Since 2009, Eric has been the host
of Condo Craze and HOAs, a weekly one hour radio show that airs
at noon each Sunday on 850 WFTL.
See:
www.condocrazeandhoas.com.
He is the first attorney in the
State of Florida that designed a course that certifies
condominium residents as eligible to serve on a condominium
Board of Directors and has now certified more than 10,000
Floridians all across the state. He is certified as a Circuit
Court Mediator by The Florida Supreme Court and has mediated
dozens of disputes between associations and unit owners. Eric
also devotes significant time to advancing legislation in the
best interest of Florida community association members.
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