High bid rejected for county property

Published 12:00 am Monday, July 14, 2003

WINTON – When is the highest bid not the highest bid? The answer lies in legal terms set forth by North Carolina’s General State Statutes.

During their meeting here last week, Hertford County’s Board of Commissioners learned they had to reject the high bid on a parcel of county property within the town limits of Ahoskie. Three bids were formally submitted for the Dean’s Deli property – a tract of real estate located at 201 East Main St., Ahoskie that was deeded to the county on Oct. 25, 2002 following tax foreclosure proceedings.

Ramona G. Herring of Cofield submitted the highest bid ($25,000) for the property. Also making offers were Quinton Turman of Winton ($23,000) and John Masters of Ahoskie ($20,100). Those bids, opened last week, were each accompanied by a required five percent deposit.

However, Herring’s deposit failed to meet the criteria set forth by State Statutes in regards to bid deposits, prompting Hertford County Board Attorney Chuck Revelle of Murfreesboro to declare her offering as, &uot;a nonresponsive bid based on our (newspaper) advertisement and the (state) statute and thus could not be accepted or considered as a bid.&uot;

According to State Statute 160A-268, a five percent bid deposit – in the form of cash, a cashiers or certified check or a bid bond executed by a corporate surety – is required to accompany the bid and will be retained if the successful bidder fails to close the transaction. Bid deposits will be returned to the unsuccessful bidder.

Herring’s bid deposit was in the form of a personal check, drawn on a money market account, while Turman and Masters each submitted bid deposits via certified checks.

At Monday’s meeting, Revelle was apologetic to Michael Herring, representing Ramona Herring, in regards to the bid deposit.

&uot;You indeed submitted the highest of the three bids we received on the property, but the state requires, as stated in our advertisement for sealed bids, that bid deposits be in the form of cash, a certified or cashiers check or a bid bond,&uot; stated Revelle. &uot;County government does not have the right to change the wording of the statute. This is out of our control.&uot;

The question was raised whether or not Herring, now informed of the correct procedure, could legally rescind the bid deposit made on a personal check and resubmit one that fulfilled the letter of the law.

Revelle referred the Commissioners to the wording of policy included in section 86 of the North Carolina Institute of Government. That policy read, &uot;The competitive bidding statute provides that no proposal shall be considered or accepted….unless at the time of its filing the same shall be accompanied by a bid deposit or bond. This language suggests that a bid deposit or bond in the right amount and the right form must accompany the bid no later than the time of the bid opening.&uot;

In other words, the letter of the law states that Herring could not change the way the bid deposit was submitted.

Revelle then informed the Commissioners of two options regarding the sale of the Dean’s Deli property – (1) award the bid to Turman as the second-highest bidder or, (2) reject all bids, a course of action the County has a right to pursue, and start over.

In a 5-0 vote, the Commissioners chose to award the bid to Turman for his offer of $23,000.

According to County Manager Don Craft, the majority of the money will be used to satisfy tax liens and legal fees associated with the foreclosure of the property. Taxes and legal fees owed to the County and the Town of Ahoskie totals nearly $10,000. Most of the remaining money, according to Craft, is owed to the State in back taxes.

Craft said he was not aware of what any of the bidders planned to do with the property. That information is not required for the bidding process.