Construction bidding glossary
Plain-English definitions of the public-bidding terms contractors run into. Last updated 2026-06-28.
- Solicitation
- The umbrella term for any public notice inviting contractors to submit offers on a government project — includes IFBs, RFPs, and RFQs.
- IFB (Invitation for Bid)
- A solicitation where the government awards to the lowest responsive, responsible bidder on a fixed scope. Price is the deciding factor; common for straightforward construction work. Also called an ITB (Invitation to Bid).
- RFP (Request for Proposal)
- A solicitation that evaluates more than price — technical approach, qualifications, and experience are scored alongside cost. Used when the agency wants the best overall value, not just the cheapest bid.
- RFQ (Request for Qualifications or Quotation)
- Two meanings: (1) Request for Qualifications — agencies shortlist firms by experience before inviting proposals; (2) Request for Quotation — a request for pricing on a defined, usually smaller, scope.
- Bid bond
- A surety bond (commonly 5–10% of the bid) guaranteeing that if you win, you will sign the contract and provide the required performance/payment bonds. Protects the agency if a winning bidder backs out.
- Performance bond
- A surety bond, often 100% of the contract value, guaranteeing the contractor will complete the work per the contract. Required on most public construction projects.
- Payment bond
- A surety bond guaranteeing that subcontractors and suppliers get paid. Required on most federal and state public works under "Little Miller Act" statutes.
- Prequalification
- A process where the agency vets contractors (financials, bonding capacity, past performance) before they are allowed to bid. Common for state DOT and large projects.
- Addendum
- An official change or clarification to a solicitation issued before bids are due. Bidders must acknowledge every addendum; missing one can disqualify a bid.
- Prevailing wage / Davis-Bacon
- Legally required minimum wage rates for workers on public construction. The federal Davis-Bacon Act sets them for federal jobs; many states have their own prevailing-wage laws.
- SAM.gov UEI
- The Unique Entity ID assigned in SAM.gov (System for Award Management). It replaced the DUNS number in 2022 and is required to bid on or receive US federal contracts.
- NAICS code
- North American Industry Classification System code identifying the type of work in a solicitation (e.g., 237310 for highway/street construction). Agencies use it to categorize bids and size standards.
- Set-aside
- A contract reserved for a category of business — small business, 8(a), HUBZone, SDVOSB, WOSB — so only qualifying firms may bid.
- Bid tabulation (bid tab)
- The public record listing every bid received and its price after a bid opening. Lets contractors see who bid what and how close the competition was.
- Plan holders list
- The list of contractors who have obtained the plans/specs for a project. Useful for subcontractors to find which GCs are bidding so they can send quotes.
- Notice to Proceed (NTP)
- The agency’s formal authorization for the winning contractor to start work, which typically starts the contract clock.
- Public works
- Construction, alteration, or repair of public infrastructure or buildings funded by a government body — roads, bridges, water/sewer, schools, public facilities.
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