So lots of misinformation in this thread. First of the scope of the work is well defined fix bid contracts can only exceed the bid amount when there is a change in scope. Time and material work is always just an estimate and can exceed the quoted price.
Engineering code of ethics dictates that the engineer must select the lowest bid, as long as the contractor can meet the spec. If outside contractor as consistently beating local contractors in price. Local contractors will have to sharpen their pencil, acquire more efficient workers etc. or go out of business. We cannot spoon feed local businesses with work they have to be competitive.
If they close they close, those businesses will pop up again when it is profitable. Let the market do its work and don't continue to support bad businesses it hurts the economy because it enables monopolies that charge what they want when they want. That hasn't happened around here with a particular building contractor has it

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