Expert: Lee Kilcup - 12/5/2008

Question
Hi Lee, I am the city clerk for very small city in Minnesota. We have recently had steps and walkways put in (AGAIN--and that's a long and awful story) and we now need to have railings installed that will meet the handicapped accessible specs. We got three quotes-
1)Well experienced in this type of work, not from the area- $6,620;
2)Not a lot of experience with this particular type of railing, but a WELL known VERY WELL respected machine shop in the area - people come long distances to have them do work as their quality is exceptional-$5,190;
3)Local guy (IN TOWN)-NO experience with this type of work,  did not have a clue about drilling the concrete to install feet or flanges to anchor the railings-$2,850.
I cannot believe he can be putting in the same quality of railing for THAT MUCH less money. BUT of course the city council asked no questions, accepted this quote, and here is where we sit now:
I am drafting a contract for this job-he has no idea why the city needs this;
I asked him for an estimated time frame for completion- (this is going to be a liability issue soon if we don't have some railings with winter,ice, etc)- he has NO IDEA, as he is a one man show and will have to do other work at his shop if necessary;
I'm wondering what your thoughts are on his LOW price quote;

I'd like to know if the city would be able to back out of this as nothing has been signed, because of the time issue (I realize this might be a little different situation because of it being government); We sure don't need "Grandma" getting hurt @ the city building, and we don't need legal problems resulting from ANYONE being injured.

I'd also like to know how to put the top amount for payment by the city in this contract-is his quote what we pay, no matter what? Forgetting the other facts here for a minute-is the quote usually just a sort of "guesstimate"? (The city has NEVER put anything on paper when dealing with anyone before- they have also had HUGE amounts of problems which are coming back now to haunt them, and are costing the city a lot of money).  
Any input on any of these questions will be GREATLY appreciated, and if there is anything else you think of that would also be welcomed. I am sort of hands-tied here, as the clerk isn't supposed to have an opinion on things, but I have a bad feeling about this whole thing, and I am going to try to cover my OWN butt at least. And I really want this to be done soon, and also be done right.
Thank you!! Sorry for going on so long--I thought I should make a point of stating the details important to the story.

Answer
I would go back to the local guy (the one who is qualified) and ask him if the bid specification and details were clear and if not send out revised information in an addenda and get new bids.
If the plans and specs were clear find out from the local guy how much lineal ft of handrail was included and have the lowball bidder confirm his quantities.
If all of this checks out I would award to the low bidder but have him provide a performance and payment bond so that if he does not finish the work per plans and specs you can have insurance and replace him with someone else
The invitation to bid ideally would have the contract in it so you can rely on the bidders to sign the contract upon approval of their bid.
The contractors are always able to submit for extras if the conditions are changed on the job. If no changes the contract should stand as written (the "top amount"). The contract should also address the expected schedule and reference the plans and speciifications.
If you want standard forms of agreement you can get them from the AIA or the AGC. Good luck