In Plain English
Quick Answer
A bid submitted in a sealed envelope that no one can see until all bids are opened at the same time.
Definition
Definition
A sealed bid is a bid submitted in a sealed envelope or secure electronic format that is not opened until the official bid opening, ensuring all bidders compete without knowledge of competitors' prices. Sealed bidding is required on most public construction projects to ensure fairness and transparency. Bids submitted after the deadline or in unsealed form may be rejected.
Context
Why It Matters in Bidding
Sealed bidding is the legal default on most public construction work because it enforces fairness — no bidder learns a competitor's price before the official opening, which prevents collusion and last-minute undercutting. For contractors this raises the stakes of bid-day timing and accuracy, since a bid that arrives late, unsealed, or improperly signed can be rejected outright as nonresponsive regardless of how competitive the price is. The public bid opening also creates a transparent record that competitors and the public can scrutinize.
Example
Example
All seven general contractors submitted sealed bids before the 2:00 p.m. deadline, and at the public bid opening the agency read each price aloud, revealing the apparent low bidder by just $12,000.
See Also
Related Terms
FAQ
Questions Contractors Ask
What happens at a sealed bid opening?
At the advertised date and time, an agency official publicly opens each sealed envelope or electronic submission and reads the bid amounts aloud, recording them on a bid tabulation. Bidders and the public may attend. The apparent low responsive, responsible bidder is identified, though award follows verification of bid bonds, math, and solicitation compliance.
Can a contractor change or withdraw a sealed bid after submitting it?
Before the deadline, a bidder may withdraw or resubmit freely. After opening, changes are generally barred to preserve fairness. A bidder can sometimes withdraw without penalty by promptly proving a genuine clerical or arithmetic mistake, but cannot simply revise a price that turned out too low, which is why bid-day math review is critical.
Why is sealed bidding required on public projects?
Public procurement laws mandate it to ensure transparency, equal treatment, and stewardship of taxpayer money. Keeping prices confidential until a simultaneous opening prevents bid-rigging and favoritism, while the public reading creates an auditable record. Private owners are not bound by these rules and may negotiate or use open bidding, but public agencies must follow it.
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