Is it illegal for a company to ask me to match a bid of a competitor?

Depends on the bidding process and subsequent contract, but price movement of this type isn't illegal.
They clearly want you to do the job otherwise they wouldn't of given you the oppertunity to "re-bid" for the work.

They are asked to get three bids. There are no contracts with any vendors. I just wanted to know if it was ok for me to accept the "re-bid".

As long as you feel comfortable with it then yes.

Honestly, my soon to be ex-husband is threatening me saying that it is illegal and a felony and I could go to jail, lose my children and the employees there could lose their job.

"soon to be ex-husband"'s have a tendency of talking Bovine Excrement

It is illegal for the Federal Government to ask a vendor to "match a bid"

For private companies this is actually normal and standard business practice. The issue is often there is not another bid at that price, you may already be the lowest and they are just trying to get a cheaper price. The other come back is often they come back and just say you can get it for 10 percent.

You can either try to sell your company, ok we are a better company, so you know we are worth more money. Try to get a price slightly higher, They are not off the bid process to a negotiation. So talk to them and try to get more.

Next why are you letting your soon to be ex know what you are doing. You bid, and what you get paid by the contract is none of their business.

Hello v:

The law does not deal with the minutia of day to day business.. You CAN be certain that they have regulations and laws that prevent people from getting ripped off, and that's the way it should be... But, in your case, NOBODY is getting ripped off. That would be unless there was a CONTRACT with the bid wherein the buyer PROMISED that he would accept the lowest bid no matter what..

I seriously doubt the request for bid came with those conditions. This appears to be just ordinary negotiation between a buyer and a seller... Take the bid. Tell your ex, he's full of it.

excon