Si Francis Slectric
• SINCE 194
975 Carden Street, San Leandro, CA 94577
(510) 639-0639 (Office) • (510) 639-4653 (Fax)
BID PROTEST
Date: 7/15/25
Re: Bid Protest -Fiber Optic Communication Redundancy Project - Phase I - Bid #26-001 To Whom it May Concern,
This letter serves as St. Francis Electric's (SFE) formal protest of the award to MP Nexlevel of California, Inc. (MP) for the Fiber Optic Communication Redundancy Project - Phase I with the City of Fremont. MP designated a subcontractor for use on the project whose registration with the Department of Industrial Relations (DIR) was and is Expired. Accordingly, the City of Fremont (City) should reject MP's bid because it contains non-waivable irregularities and SFE hereby requests that the City award the Project to SFE, the lowest responsive, responsible bidder.
Pursuant to statute and applicable case law, the City is required to award construction contracts to the lowest responsive and responsible bidder. (See Konica Business Machines v. University of California Regents, 206 Cal. App. 3d 449, 457(1988).) To put it simply, any bid that does not conform to the specifications is nonresponsive. (Southern Exchange v. County of San Diego, 5 Cal.App3d 81, 85 (1975); 14 Ops. Cal.Atty. Gen. 54, 55 (1949).)
In Konica, 206 Cal.App. 3d at 456-457, the court stated the importance of strictly following the rules for the competitive bidding process:
"Because of the potential for abuse arising from deviations from strict adherence to standards which promote these public benefits, the letting of public contracts universally receives close judicial scrutiny and contracts awarded without strict compliance with bidding requirements will be set aside. This preventative approach is applied even when it is certain that there was no corruption or adverse effect upon the bidding process, and deviations would save the entity money... The importance of maintaining integrity in Government and the ease with which policy goals underlying the requirement for open competitive bidding may be surreptitiously undercut, mandate strict compliance with bidding requirements." There is no question that MP's bid is nonresponsive. Contrary to California Law and the bid documents, MP designated "Heed, Inc." as a subcontractor on the project, but its DIR registration number (2000006393) was expired. However, to bid on, be listed in a bid proposal or engage in any public works contract, contractors and subcontractors must be registered with DIR. (See Cal. Labor Code 1725.5). Moreover, awarding bodies cannot accept contracts or subcontracts entered into without proof of current DIR registration and any such contract shall be subject to cancellation (ld. At 1771.1(a), (f).) From the desk of Ryan Dunham
The City has only Limited power to waive irregularities in a bid. In this instance, the City cannot waive the non-responsiveness in MP's bid because: (1) it is a statutory requirement that contractors and subcontractors working on a public project be registered with the DIR; (2) The City made the submission of each subcontractor's valid DIR registration numbers a mandatory part of the "Subcontractor List" sheet; and (3) because MP obtained an unfair advantage over other bidders in failing to fulfill this mandatory requirement.
Having a non-expired, valid DIR registration number is mandated by State Law (Id. At 1725.5) and listing a valid DIR registration number for any subcontractor is not only established in the bidding documents, but is also a requirement of Section 4104 of Public Contract Code where as "Who will perform work or labor or render services to the bidder in an amount in excess of one-half of one percent (0.05%) of the total bid" is a mandatory requirement.
This requirement, having been established by State Law, The Bidding Documents and Public Contract Code, the City is bound to follow it. In Pozar v. Department of Transportation, 145 Cal.App.3d 269 (1983), Caltrans failed to follow a rule set forth in its own bidding documents with respect to resolving a discrepancy between a bidder's unit price and the extension of the unit price. The aggrieved bidder sought a Writ of Mandate requiring Caltrans to follow its own rules for resolving this type of discrepancy. The Court of Appeals issued the Writ, Stating as follows:
"The court has no power to direct the award of a public contract to any individual. We can, however, direct an agency to follow its own rules when it has a ministerial duty to do so or when it has abused its discretion.
Here, we are concerned with a ministerial duty. Caltrans' own rules obligate it to accept the unit price in the absence of specified circumstances, none of which are here present." Similarly, MP was required to designate only those subcontractors with a valid DIR registration number.
Because Heed Inc's registration was expired, it renders MP's bid nonresponsive and the City cannot waive this irregularity.
Even if the City could somehow get around the legal impediment that its subcontractor must have a valid (ie.
Non-expired) DIR registration number and that providing a valid number is a mandatory, nonwaivable requirement, the defect in MP's bid cannot be waived because it allowed MP the opportunity to back out of its bid, a benefit not available to SFE.
The bidding instructions only allow the City to waive "any informality or irregularity in bids received". This is consistent with California law, which provides that an irregularity in a bid can be waived only "if the variance cannot have affected the amount of the bid or given the bidder an unfair advantage or benefit not allowed other bidders" (Konica, 206 Cal.App.3d at 454.) Importantly, it has been well established in California that an irregularity is not waivable if it allows a bidder to withdraw its bid based on mistake. (See Valley Crest Landscape v. City of Davis, 41 Cal.App.4" 1432, 1442 (1996) because the irregularity gave the low bidder grounds to withdraw its bid pursuant to Public Contract Code section 5103, the irregularity created an unfair advantage over other bidders and, therefore, could not be waived.
The Court of Appeals decision in Valley Crest makes this point clear. In the Valley Crest case the Bidder's mistake was in stating the percentages of work to be performed by its listed subcontractors. The Court of Appeals stated:
From the desk of Ryan Dunham
"North Bay had an unfair advantage because it could have withdrawn its bid per public contract code 5101.
Misstating the correct percentage of work to be done by a subcontractor is in the nature of a typographical or arithmetical error. It makes the bid materially different and is a mistake in filling out the bid. As such, under Public Contract Code section 5103, North Bay could have sought relief by giving the city notice of the mistake within five days of the opening of the bid. That North Bay did not seek such relief is of no moment.
The Key point is that such relief was available. Thus, North Bay had a benefit not available to other bidders; Its mistake therefore could not be corrected by waiving an irregularity" Similarly, MP's mistake easily meets the requirements of Public Contract Code 5103 for seeking relief from bid. Specifically, because MP's subcontractor, Heed Inc, cannot be listed in a bid proposal or engage in work on the project and a new subcontractor would have to be used, the mistake obviously "made the bid materially different than [MP] intended it to be" (Pub. Cont. Code 5103(d).) This is exactly the type of advantage that was derided by the Court in the Valley Crest case.
Lastly, it is not relevant whether MP actually submitted a claim for mistake to the City. As stated by the court in the Valley Crest Case, the rule requiring rejection applies whether or not the bidder has, in fact, claimed mistake and sought relief. (Valley Crest, 41 Cal.App. 4* at 1442.) Rather, "the key point is that such relief was available." Thus, MP had "an advantage not available to other bidders; it could have backed out." If the City were to reject MP's Bid as nonresponsive, the City's decision will not be subject to viable legal challenge as the City is under no duty to accept a nonresponsive bid. (See MCM Constr., Inc. v. City and County of San Francisco, 66 Cal.App.4t* 359, 374 (1998).) By rejecting MP's Bid and awarding the project to SFE, the City will be awarding the Project to the lowest responsive, responsible bidder.
SFE requests that the City provide SFE with all responses to this letter and requests that the City notify SFE of any decisions with respect to award of this contract.
If you have any questions or need further clarifications, please do not hesitate to contact me.
Thank you,
Ryan Dunham
Vice President
St. Francis Electric
975 Carden Street
San Leandro, CA 94577
510-780-6793
From the desk of Ryan Dunham
Subcontractor List
registration number, and the percentage of the total Work to be performed by that Subcontractor, as a portion of the base bid price.
Bidders: Please print legibly. Illegible forms may be rejected.
DESCRIPTION SUBCONTRACTOR CALIFORNIA LOCATION DIR REG. PERCENT OF WORK NAME AND CONTRACTOR OF NO. OF WORK?
EMAIL ADDRESS LICENSE NO. BUSINESS
Fiber Splicing- Heed Inc, 1108139 852 West 11th 2000006393 [email protected] st #325 Tracy C/ 11%
Traffic Control Plans Testing 1000374689
NTS:[email protected] 787313 564 143rd Avenue .57%
San Leandro CA
END OF SUBCONTRACTOR LIST
'Note the Sur hintrator or Lin thine stren to Bie to any subcontract of 510,000 or more.
Fiber Optic Communication Redundancy Project - Phase I SUBCONTRACTOR LIST City Project No. PWC9115 (2021-1) Page 15
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