STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ANTHONY P. CAMINITE, )

)

Petitioner, )

)

vs. ) CASE NO. 82-3385BID

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

)

RECOMMENDED ORDER

This matter came on for hearing on March 22, 1983, in Tampa, Florida, before the Division of Administrative Hearings and its duly appointed Hearing Officer, R. T. Carpenter. The parties were represented by:

For Petitioner: John D. Pettigrew, Esquire

408 7th Street

Palmetto, Florida 33561

For Respondent: Janice Sorter, Esquire

Department of Health and Rehabilitative Services

4000 West Buffalo Avenue Tampa, Florida 33614

Petitioner was an unsuccessful bidder on a contract for an office building to be constructed and leased to Respondent in Manatee County. Petitioner protested the award of this contract to another bidder, giving rise to these proceedings. The parties submitted proposed findings of fact which are incorporated herein to the extent they are relevant and consistent with the evidence.

FINDINGS OF FACT

1. Respondent invited bid proposals for a "collocated service center" in Manatee County, providing approximately 25,500 square feet of office space. The invitation sought a "turnkey lease" for an initial period of 15 years and permitted the bidder a choice of providing "full services" (option 1) or "full services without electrical" (option 2).

   
   

2. Petitioner submitted his bid under option 2, while the successful bidder, Dr. Kenneth R. McGurn, selected option 1. Their bid proposals, along with others not relevant here, were forwarded to a bid review committee. Committee members were generally knowledgeable as to Respondent's operations and bid evaluation procedures, but were given no specific instructions on how to conduct their evaluations.

3. Each of the four committee members evaluated the bids and assigned points in 12 separate categories. The evaluation criteria to be utilized were set forth in the bid proposal (page 12, Joint Exhibits 3 and 4). The greatest weight was to be given in category number 1, "Rental rate including projected operating expenses to be paid by lessee."

   
   

4. The testimony of the bid evaluation committee members established that McGurn, rather than Petitioner, was the successful bidder primarily because his proposal included electrical service. The committee members did not individually or collectively seek assistance in projecting future electrical costs when making their determination as to the award of points in bid category number 1. Rather, they used their own judgment and experience to estimate possible costs and award rental and service expense points accordingly. Three of the four evaluators generally felt that known electrical costs were preferable to unknown costs for budget purposes even though Petitioners's proposal may ultimately have been less expensive.

   
   

5. Site characteristics were factors in several of the categories for which points were to be assigned. Committee members visited the proposed sites and rated Petitioner's site somewhat higher than McGurn's. Proper zoning of the site was not included in the bid criteria. 1/

   
   

6. Petitioner's site is properly zoned while McGurn's is not. McGurn's potential difficulties in obtaining a zoning change and with utility service to his site led him to inquire of Respondent whether he would be permitted to change sites if he received the contract award. Respondent advised him that he could do so if there was a persuasive reason for the change.

   
   

7. Petitioner obtained an option on the site he proposed to utilize and renewed it for 30 days when Respondent did not act on its bid within the announced period. 2/ This extension cost Petitioner the forfeiture of his

   $2,000 deposit but did not carry him through to the actual bid award date, November 4, 1982.

   
   

8. Respondent's memorandum (Petitioner's Exhibit 2) dated September 14, 1982, indicates that Respondent had already decided to award the contract to McGurn by that date. Had Petitioner been advised of this decision, he could have saved the $2,000 expended to extend his option.

   
   

9. During the period prior to the official announcement of bid award, McGurn became aware that he was the probable successful bidder and acquired Petitioner's site after the latter's renewal option expired. McGurn obtained this property for the purpose of substituting it for his proposed site after he received the contract. He has not yet requested site substitution.

   
   

   CONCLUSIONS OF LAW

   
   

10. Subsection 255.25(3)(a), Florida Statutes (1981), provides in part:

    
    

    No state agency shall enter into a lease as lessee for the use of 2,000 square feet or more of space in a privately owned building except on advertisement for and receipt of competitive bids and award to the lowest and best bidder. . .

11. The above provision required Respondent to follow the competitive bid procedure since over 2,000 square feet of space were involved. In carrying out its contract award responsibilities, Respondent is required to act in good faith and not in an arbitrary or capricious manner. Volume Services Division v. Canteen Corp., 369 So.2d 391 (Fla. 2nd DCA 1979).

    
    

12. Here, Respondent's procedural discrepancies have deprived Petitioner of fair treatment and, taken collectively, amount to bad faith. Therefore, Respondent should cancel its award and rebid the project as demanded by Petitioner.

    
    

13. The lack of comparability in bid options (for rental with and without electrical service costs included) worked to Petitioner's disadvantage. The omission of evaluation standards in the bid invitation, the lack of guidance to either bidders or bid evaluators, and the absence of professionally determined electrical cost data should be corrected upon reissue of the bid invitation.

    
    

14. Since points are awarded for the proposed site, the successful bidder should not be permitted to provide a substituted site after he has been awarded the contract. Rather, such a substantive change requires rebid.

    
    

15. No bidder should he given information that he will, or will probably, be awarded a contract unless this same information is given at the same time to all other bidders. Equality of treatment is essential to good-faith dealing and to the maintenance of an arm's length relationship with the bidder.

    
    

16. Finally, Respondent's delay in awarding this contract beyond its noticed date resulted in option difficulties costly to Petitioner. Where such delays are anticipated, bidders are entitled to be timely informed of the revised date.

RECOMMENDATION

Based on the foregoing, it is RECOMMENDED:

That the Respondent enter a Final Order setting aside the award of the subject contract and reissuing its bid proposal.

DONE and ENTERED this 12th day of May, 1983, in Tallahassee, Florida.

R. T. CARPENTER Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 12th day of May, 1983.

ENDNOTES

1/ Respondent considers zoning a problem for the bidder to resolve once he has been awarded the contract and is, therefore, justified in undertaking the often costly process of obtaining a zoning change.

2/ The bid award was to be made in 60 days of bid opening, on August 4, 1982, but was not officially announced until November 4, 1982, 92 days after said bids were opened.

COPIES FURNISHED:

John D. Pettigrew, Esquire

408 7th Street

Palmetto, Florida 33561

Janice Sorter, Esquire Dept. of HRS

4000 West Buffalo Avenue Tampa, Florida 33614

David H. Pingree, Secretary Department of Health and Rehabilitative Services 1323 Winewood Blvd.

Tallahassee, Florida 32301

Kenneth R. McGurn Post Office Box 12488

Gainesville, Florida 32604

Docket for Case No: 82-003385

Orders for Case No: 82-003385