INDOT’s decision to no longer publish a “plan holders list” has frustrated industry. ICI convinced INDOT to postpone this action in February, but INDOT subsequently decided to move forward with this policy change beginning with the March 11th letting. INDOT’s previously published “plan holder list” contained a list of contractors qualified to bid, others interested in the contract, and INDOT work type codes for each contract. This long-standing practice plays an important role in the transparent design-bid-build project delivery method contributing to an even playing field for bidders, subcontractors, and suppliers to participate in contracts all over the state and providing INDOT with the lowest bid based on the posted bid documents.
Industry feedback to INDOT and ICI has been abundant. Contractors and suppliers are reporting missed opportunities, lower quote submissions, and severe increase in manpower administration and frustration to try and find bidders and subcontractors to solicit quotes and to whom and where to send quotes. One specialty contractor stated, “At a time when the construction industry already faces a depleted trades workforce and a shortage of skilled labor, adding unnecessary administrative burdens only diverts limited resources away from building infrastructure and inevitably drives up project costs.” A prime contractor commented “There are many projects throughout the year that we receive sub quotes from companies we didn’t know existed, didn’t know they were interested in that work, and new companies entering the marketplace.” Another common concern was noted by a subcontractor “Without a traditional bidder’s list and using the solution INDOT rolled out, subcontractors will need to send quotes to every possible bidder for each contract they pursue. That may mean contacting three or up to even eight potential bidders on thirty to sixty contracts in a single letting resulting in hundreds of quotes to manage and track. For many smaller subcontracting firms, this represents an enormous administrative burden and an inefficient use of resources. Those unwilling or unable to absorb that burden may simply quote fewer projects, which will reduce competition and ultimately increase costs.”
At the February 3rd and 4th ICI/INDOT Central and Northern Joint Cooperative Committee meetings, INDOT’s Contracts Division Director Steve Duncan referred to a 2025 report, authored by the USDOT Office of Inspector General’s office, as the motivation to stop publishing a plan holders list. The USDOT-OIG report “Highlights” section states that their analysis found significant indications of potential complementary bidding on highway procurements.
The researchers used artificial intelligence to identify potential anti-competitive aspects of contracts awarded in six states from 2011 to 2019. The research flagged contracts as “anti-competitive”, “competitive”, or “other” based on criteria entered by the researchers. The researchers estimated overpayment associated with the contracts flagged as anti-competitive. The report, however, falls short in validating the findings. This omission is emphasized in the FHWA response memo enclosed with the report and referenced below. The researchers also failed to provide FHWA with a complete picture of the costs associated with all studied contracts. Highway construction bidding and contracts are greatly affected by market conditions and many other variable factors contributing to highway construction bidding risk that is not comparable to general procurement expectations.
As alluded to above, a memorandum authored by Kristin White, Acting Administrator, was enclosed within the report. Ms. White states the following in response to the “potential” findings:
FHWA has a strong interest in States’ efforts to identify and prevent anticompetitive bidding; however, the lack of real-world observations and limitations of the machine learning method—a branch of artificial intelligence that uses algorithms—used by OIG to conduct its review causes several concerns. OIG missed an opportunity to examine actual State policies, procedures, and methodologies used in bid reviews. For example, OIG referred to the importance of maintaining confidentiality of the engineer’s estimates prior to bidding. However, each State studied has relevant confidentiality procedures for engineers’ estimates.
OIG also acknowledges limitations in the machine learning method. This raises questions if the method has been sufficiently validated to justify the inference of “prevalent” anticompetitive behavior as a finding. In addition, given OIG’s repeated emphasis on the words “potential” and “potentially,” the OIG report does not offer any instances of actual anticompetitive behavior. Therefore, findings are being based on assumptions and not real-life observations or specific validated anti-competitive behavior. FHWA believes the machine learning method, or any other systematic approach, requires further vetting and validation against real-world data and comparison against other existing tools used by States to screen for anticompetitive behavior prior to FHWA issuing guidance to recommend nationwide implementation. Consequently, FHWA has concerns with the accuracy and magnitude of cost impact inferred by the analysis of the machine learning method under this audit.
INDOT has not presented ICI with evidence of anti-competitive bidding or bids of concern. ICI is committed to working with INDOT to address issues, study data, and generate mutually beneficial solutions.
ICI appreciates industry’s support and feedback in response to the issue. Please forward a copy of previously submitted feedback or subsequent feedback to dosborn@indianaconstructors.org.
