So, here’s the idea. A small town wants to form a ‘shared services’ contract with a nearby town for some sort of municipal service, let’s say fire department services, because that’s what it is. This small town borders a few other towns who each have their own fire departments, and who each may bid for the opportunity to cover the small town’s homes.
Would it be legal for the bigger towns to discuss what their bids might be, or must it be a secret, competitive, bidding process? I know that collusion is generally illegal in the business world, but I don’t know if it applies to local or larger governments that may be submitting their own bids for things.
Think bids for a sports stadium or Amazon’s new headquarters, the cities might not want to discuss their bids, but are they legally forbidden from doing so?
A few things:
I do not believe under state sovereignty that this would fall under federal collusion laws so YMMV depending on the state.
I don’t think that what you are describing is collusion. I think it would fall under information gathering. It may fall under collusion if the town started sharing what other town were bidding, especially if there is a law that they must take the lowest bid. “Hey Davenport, its a real shame you can’t come in just below $1.6 million. Wink wink.” Collusion, I believe, would be more like towns getting together to make offers to an outside vendor like a private waste management firm that services multiple cities and so all of the towns in the area conspire to lowball them to save money knowing that the company can’t refuse the contracts and use their resources to work in towns for more money. Now is that illegal if the city governments do it as opposed to individuals? I don’t know.
Lastly, how would you distinguish that the town government is colluding vs. individuals? I would think there need to be an official policy passed that the government will take such action … but what government will go on record stating that?
Are these sorts of shared service arrangements even required to operate by means of bidding? They might , but there’s no reason that it has to be that way. About 10 years ago there was a story that attracted a fair amount of attention. A person lived in an area with no fire department. The neighboring city offered services to property outside the city limits for a $75 yearly fee. There is no reason I can think of why it would be impossible for Town A to decide to charge Town B $75 per property for firefighting services on a take it or leave it basis,
This is the general gist of it, but we have two towns bidding for the same property. If they discuss amongst themselves to charge $100, instead of competitively bidding at $75, is it illegal? It would certainly be illegal for two plumbers to discuss a customer’s job and agree to bid a set price.
I’m talking about no bidding process at all - if I want to hire a plumber to work on my house, there isn’t any bidding involved. I call a plumber and get a price. If I like his price, I hire him, if not I don’t. There isn’t any bidding process where all the plumbers know I want to hire a plumber and exactly what work I need done and they can get together and collude to fix a price. Since apparently this is a real situation, are you sure bidding is actually required?
I don’t know how it works in America, but when public services are contracted out in the UK, a “sealed bid” is the favoured method.
The need is advertised (maybe by sending a letter to potentially interested parties) and followed up by a detailed contract to bidders. They look at the contract and make an offer in a sealed envelope which gets opened at the same time as all the others. It is not a requirement to accept the lowest, or indeed, any bid.
It’s the situation we have going, at least. The current contract is up and the small town is asking it’s two neighboring towns what they would charge for fire services in a new contract.
It’s worth about $1million a year, so both towns are interested. It’s politically sketchy because the cost of $1m is less per capita for the little town then the larger towns pay themselves. It gives the appearance of a sweetheart deal for a wealthy enclave, but the argument is that it has to be that price to win the competitive bid.
I was musing that the two towns could cooperate rather than compete to get a better deal.
It depends on state law. In most states, cities - and I think that includes smaller entities like towns - are incorporated under a state charter. (Some places have unincorporated areas, but this doesn’t sound like one.) That binds them to a set of general rules, just as companies are bound by the rules of incorporation. (And why so many incorporate in Delaware, where the rules are much looser.)
Bidding is usually strictly controlled, mostly because it didn’t used to be and the corruption was rampant. You’d need to check state law to get an answer.
Generally speaking, however, two companies can work together and put in one bid. Two engineering firms can work jointly on a bridge construction project, e.g. In principal I’m not seeing a reason why two towns couldn’t put in a joint bid to share fulfillment of the contract.
But to get an answer in your particular reality, call Town Hall and talk to somebody. You could probably get an answer pretty quickly once they passed you to the right person.