STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

THE CONE CORPORATION )

)

Petitioner, )

)

1. ) CASE NO. 85-2828BID

   ) DEPARTMENT OF TRANSPORTATION, )

   )

   Respondent, )

   )

   and )

   ) GOLDEN TRIANGLE ASPHALT PAVING ) COMPANY, )

   )

   Intervenor. )

   )

   
   

   RECOMMENDED ORDER

   
   

   Pursuant to notice, an administrative hearing was held before Diane D. Tremor, Hearing Officer with the Division of Administrative Hearings, commencing on September 10, 1985, and continuing on October 8, 1985, in Tallahassee, Florida.

   
   

   ISSUE

   
   

   The issue for determination in this proceeding is whether a contract for highway construction work in Pinellas County should be awarded to the intervenor.

   
   

   APPPEARANCES

   
   

   For Petitioner: W. Crit Smith

   Cason, Henderson, Morrison and Prevatt

   320 First Florida Bank Building Post Office Box 1695 Tallahassee, Florida 32302

   
   

   For Respondent: Larry D. Scott

   Department of Transportation

   Haydon Burns Building, Mail Station 58 Tallahassee, Florida 32301

   For Intervenor: F. Alan Cummings and

   Harry R. Detwiler, Jr. Holland and Knight Post Office Drawer 810

   Tallahassee, Florida 32302 INTRODUCTION

   In support of its protest to the award of a contract to intervenor Golden Triangle Asphalt Paving Company (Golden Triangle) for highway construction work, the petitioner, The Cone Corporation, presented the testimony of five witnesses and its Exhibits 1 through 5 were received into evidence.

   Testifying for petitioner were Douglas Cone, President of The Cone Corporation; Michael R. Knox, the Chief Engineer for Oman Construction Company's Largo office; Jim Larisci, the Department of Transportation's (DOT) Resident Engineer for Pinellas County; John Collins, the DOT's Assistant District Construction Engineer in Bartow; and Thomas Drawdy, the Secretary of the DOT.

   
   

   The respondent DOT presented no witnesses and offered no exhibits at the hearing.

   
   

   The intervenor Golden Triangle presented the testimony of Mike Knox and Douglas Cone, and its Exhibits 1 and 2 were received into evidence.

   
   

   Subsequent to the hearing, each of the parties submitted proposed findings of fact and proposed conclusions of law. The parties' proposed factual findings have been carefully considered and, except as noted in the Appendix to this Recommended Order, have been accepted.

   
   

   FINDINGS OF FACT

   
   

   Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found:

   
   

   1. On or about April 29, 1985, the petitioner received notice that sealed bids would be received by the DOT on May 29, 1985, on State Project, Job No. 15070-6519, involving the widening and resurfacing of State Road 580 in Clearwater, Pinellas County. The petitioner requested the plans and specifications for the project and received these about a week and a half prior to the date the bids were to be received.

   2. The Plans for the project included one page entitled "Summary of Earthwork" which indicated that the project would involve 73,090 cubic yards of excess material. This amount is equivalent to approximately 5,000 dump truck loads of dirt. The plans specified that the excess earthwork was "to be disposed in areas, as directed by the engineer."

      
      

   3. The phrase "as directed by the engineer" is very common in the construction industry and is used throughout the DOT'S Standard Specifications for Road and Bridge Construction which are incorporated into construction contracts. The phrase is utilized to allow the DOT some flexibility and discretion when decisions are necessary to meet changed conditions or when it is impossible to finalize all directions and specifications at the time the plans are drafted. Generally, though not always, the phrase "as directed by the engineer" addresses situations where the directions pertain to job performances within the boundaries of the job site or within the job's right-of-way.

      
      

   4. It is common practice for a contractor to view the site of a potential job prior to the preparation and submittal of a bid. Petitioner did view this site and determined that it did not contain sufficient area upon which to deposit the excess material. Other than the phrase "as directed by the engineer," the plans for this project did not specifically indicate where the excess material was to be hauled or who would own the excess material after excavation.

      
      

   5. With regard to the disposal of excess materials, the Standard Specifications for Road and Bridge Construction provide that, unless otherwise provided by the plans or special provisions, any surplus materials shall become the property of the contractor to be disposed of by him, outside the right of way, to the satisfaction of the engineer.

      
      

   6. The DOT never considered allowing the contractor to retain the excess earthwork from this project. Had the contractor been permitted to keep the dirt removed, the DOT would not have retained the authority to direct the location of its disposal.

      
      

   7. Excess earthwork from a project can be sold by a contractor, thus allowing it to reduce the amount of its bid.

      If The Cone Corporation had believed that it would have been permitted to retain the dirt removed from this project, it would have reduced the total amount of its bid by approximately

      $76,000. However, The Cone Corporation interpreted the Plans to

      mean that the DOT would retain ownership of the excess earthwork and bid the project as if the contractor would not own the dirt removed.

      
      

   8. Although The Cone Corporation has competitively bid on DOT projects for over twenty years, and has called the DOT in the past for clarifications on plans and specifications, it made no inquiry to the DOT concerning the plans for this project.

      The Cone Corporation also did not file any protests to the plans and specifications for this project prior to the bid letting.

      
      

   9. Agents of The Cone Corporation were concerned about how far away they would have to haul the excess earthwork from the project inasmuch as this factor would affect the amount of their bid. The Cone Corporation did contact Michael Knox, an engineer from one of their competitors, about this problem. Mr. Knox related that he had spoken to the DOT's Pinellas County. Resident Engineer, Jim Larisci, who was still uncertain as to the location for the placement of the excess dirt. Mr. Knox suggested to Mr. Larisci that an addendum to the plans be issued to clarify this item, and Larisci responded that he would check into the matter. Larisci informed Knox that he knew of one potential site some eight to twelve miles away from the project, but that he was attempting to find a site closer to the project. The DOT still has not determined where the excess earthwork for this project will be deposited.

      
      

   10. Knox related the substance of his conversations with Larisci to agents of The Cone Corporation. It was Mr. Knox's impression that the DOT would retain ownership of the excess earthwork for use on another project. Knox's bid on behalf of the Oman Construction Company took into consideration that the DOT would retain ownership of the excavated material and that it would need to be hauled some ten miles from the site. Likewise, The Cone Corporation's bid included some $60,000 for hauling the excess earthwork from the site.

       
       

   11. Prior to the bid letting, John Collins, the DOT's Assistant District Engineer in Bartow, received a telephone call from an agent with The Golden Triangle Asphalt Paving Company inquiring as to where the excess earthwork from the project would be stockpiled. Mr. Collins responded that, at that time, he did not know the location for depositing the excess dirt. He further informed the caller that a claim for additional work could be filed at a later time if the contractor discovered that it was required to move the material an unreasonable distance.

   12. It is common policy for the DOT to receive prebid calls and answer inquiries to clarify plans for a project. The DOT has no agency rule or policy of notifying all prospective bidders of a clarification it makes to one bidder.

       
       

   13. On May 29, 1985, the DOT received bids for the subject contract from six companies. The apparent low bidder was the intervenor Golden Triangle, who submitted a bid in the amount of

       $1,962,494.34. The Columbus Company submitted a bid of

       $2,059,357.14, and the petitioner's bid in the amount of

       $2,064,398.78 was the third lowest bid. The remaining bids were

       $2.199,431.58 (Oman Construction Company, Inc.); $2,291,909.75 (R.E. Purcell Construction Company); and $2,296,169.65 (J.W. Conner and Sons, Inc.).

       
       

   14. Golden Triangle's unit price bid for regular and lateral ditch excavation was, respectively, $2.25 and $1.75. For the same items, the petitioner's bid was $2.15 and $2.00. The petitioner included the $60,000 estimated for hauling the excess earthwork in the bid item designated as "clearing and grubbing." The amount bid for this item by the petitioner was

       $142,500, while Golden Triangle bid $62,500 for the same item. Bid prices on "clearing and grubbing" often vary greatly among contractors and, since this is an item for which contractors are paid early in the project, are often subject to inflation.

       
       

   15. As noted above, the six bids on the subject project were submitted on May 29, 1985. By letter dated June 5, 1985, The Cone Corporation advised the DOT of its intention to file a formal protest to the award of the contract "because of certain ambiguities in the plans making it impossible for us to submit a bid that was competitive." (Petitioner's Exhibit 4). The DOT's decision to award the contract was posted on July 8, 1985, and the petitioner's "Bid Protest" was filed with the DOT on July 9, 1985.

CONCLUSIONS OF LAW

l6. The petitioner contends in this proceeding that the decision to award the contract to Golden Triangle, the low bidder, should be rescinded because the plans for the project with regard to the excess earthwork were unspecific and ambiguous and because at least two bidders, including Golden Triangle, had special knowledge or inside information as to where the excess earthwork was to be disposed. For these reasons, the petitioner demands that the contract be awarded to it or, in the alternative, that the project be re-let.

1. The DOT and Golden Triangle both contend that The Cone Corporation lacks standing to protest the award of the contract in this instance for two reasons. First, it is alleged that since petitioner was the third low bidder, it is not substantially affected by the award to Golden Triangle, the. apparent low bidder. The case of Preston Carroll Company v. Florida Keys Aqueduct Authority, 400 So. 2d 524 (Fla. 3rd DCA, 1981) is cited to support the contention that only a second low bidder would have standing to contest the award of a contract to the apparent low bidder. The Preston case is factually distinguishable from the instant case in two important respects. The challenger Preston maintained both that it produced the. second low bid and that, for some reason not apparent from the Court's opinion, it was entitled to the award of the contract. The Court affirmed the agency's determination that another contractor was the second low bidder and therefore held that Preston lacked standing to challenge the award to the successful bidder. In the instant proceeding, The Cone Corporation does not contend that it produced the lowest or the second lowest bid. Rather, it alleges that the apparent low bidder and others had inside or special information regarding an ambiguous item in the plans which affected the bid amounts. For this alleged reason, petitioner urges both that Golden Triangle's bid be rejected and either that petitioner be declared the successful low bidder or that all bids be rejected and the project be re- let. Such allegations, if proven and if timely made, establish petitioner's standing to challenge the award of the instant contract.

   
   

2. The second ground for attacking petitioner's standing to challenge the bid award to Golden Triangle is based upon the, timeliness of the protest. The DOT and the intervenor point to Florida Statutes, Section 120.53(5) and Florida Administrative Code, Rule 14-25.04(1), in support of their contention that petitioner's failure to file a notice of protest within 72 hours of its receipt of the plans and specifications for this project,, constituted ~ waiver of its right to challenge the award of this contract. Rule 14-25.04(1), Florida Administrative Code, requires that a notice of protest be filed "within 72 hours after receipt of the notice of bid solicitation or the notice of intent to award . . ." Section 120.53(5)(a)(b) and (c), Florida Statutes, requires a similar 72 hour filing of notices of protests from a bid solicitation or the posting of the bid tabulation and requires the agency to stop the bid solicitation process or the contract award process until the subject of the protest is resolved.

   
   

3. Here, the evidence is clear that petitioner received the plans and specifications at least seven to ten days prior to the May 29, i985, bid Letting and did not file its notice of, protest until after June 5, 1985. The DOT and the intervenor urge that since petitioner is challenging the plans and specifications, it was required to file its protest within 72 hours from receipt of those plans and specifications. The statute and the rule both utilize the words "bid solicitation." The DOT's and the intervenor's argument assumes that those words mean the "plans and specifications." The petitioner would interpret the phrase "bid solicitation" to mean the "notice to contractors" advising contractors that sealed bids will be received for certain construction contracts on a certain date. The former interpretation would appear to be the more logical one. It is difficult to imagine why any contractor would protest the DOT's notice of bid solicitation, as opposed to the actual plans and specifications for the job. On the other hand, it is reasonable and logical to require a potential bidder to challenge, what is alleged to be an ambiguity or confusion in the plans and specifications prior to the actual bid letting. Resolution of ambiguities in the plans and specifications should occur before contractors expend considerable time, money and risk in submitting a bid and in order to assure that all potential bidders are on equal footing in the bidding process. Thus, it is concluded that insofar as petitioner is attacking the ambiguity or vagueness of that portion of the plans which require that excess earthwork be disposed of as directed by the engineer, its challenge comes too late. Such a protest should have been filed within 72 hours from receipt of the plans, and failure to do so constitutes "a waiver of proceedings under Chapter 120." Section 120.53(5)(b), Florida Statutes.

   
   

4. One issue remains. The petitioner contends in its Bid Protest that Golden Triangle had an "unfair competitive edge": since it had "special knowledge improperly received as to where the excess earthwork was to be disposed." It is further alleged that petitioner had no special knowledge as to where the excess earthwork should be disposed. It is concluded that these allegations were timely raised. However, the petitioner bears the burden of proof in this proceeding, and the evidence totally fails to prove these allegations. Instead, the evidence clearly demonstrates that Golden Triangle was given no information regarding the site for disposition of the excess earthwork except that the DOT had not yet made that determination.

   Indeed, the evidence demonstrates that the petitioner, through the agent of the Oman Construction Company, had more detailed

   information concerning a potential site than did the intervenor. The only other information provided the intervenor was that it could submit a claim for additional compensation should the site for deposit of the excess dirt prove to be an unreasonable distance from the project site. Such a right to submit a claim is expressly provided in the DOT's Standard Specifications which are incorporated into each contract. The oral reminder hardly constitutes "special knowledge, inside information or knowledge improperly received."

   
   

5. Two final matters bear mention. Though not raised in the Bid Protest, petitioner contended at the hearing that the plans were unclear as to whether the DOT or the contractor would own the excess earthwork to be removed from the site. This alleged ambiguity, too, should have been raised by a notice of protest filed within 72 hours from petitioner's receipt of the plans. Even if timely raised, the evidence clearly demonstrates that neither the petitioner nor the other bidders who presented testimony placed their bid with the understanding that they, not the DOT, would own the excess material. This leads to the second matter. Petitioner presented evidence that it added some

   $60,000 to its bid amount to cover the estimated cost of hauling the excess dirt to an unknown site. No evidence was submitted as to whether Golden Triangle did or did not include an amount for hauling. Thus, even if the S60,000 amount were subtracted from the total amount bid by the petitioner, Golden Triangle's bid was still lower than the petitioner's bid by almost $42,000.

   
   

6. The petitioner bore the burden of proof in this proceeding to establish its standing to protest the award of the contract to Golden Triangle and to establish the allegations contained in the protest. It has failed to establish that it timely protested the plans and specifications or that the competitive bidding process was otherwise impaired or contaminated. As such, its bid protest must fail.

RECOMMENDATION

Based upon the findings of fact and conclusions of law recited herein it is RECOMMENDED that the contract for State Project No. 15070-6519 be awarded to the Golden Triangle Asphalt Paving Company and that the bid protest filed by The Cone Corporation be DISMISSED.

Respectfully submitted and entered this 3rd day of December, 1985, in Tallahassee, Florida.

DIANE D. TREMOR

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 3rd day of December, 1985.

COPIES FURNISHED:

W. Crit Smith, Esquire Cason, Henderson, Morrison

and Prevatt

320 First Florida Bank Building Post Office Box 1695 Tallahassee, Florida 32302

Larry D. Scott, Esqulre Department of Transportation Haydon Burns Building, MS-58 Tallahassee, Florida 32301

F. Alan Cummings and

Harry R. Detwiler, Jr., Esquires Holland and Knight

Post Office Drawer 810 Tallahassee, Florida 32302

Thomas Drawdy Secretary

Department of Transportation Haydon Burns Building Tallahassee, Florida 32301

APPENDIX

The proposed findings of fact submitted by the parties have been accepted and/or incorporated in this Recommended Order , except as noted below:

The Cone Corporation

1. Rejected legal conclusion as opposed to factual-finding.

   
   

2. Rejected in part. See Finding of Fact, paragraph 3

1. Rejected not supported by the evidence.

   
   

2. Rejected in part not supported by the evidence.

13. Rejected in part; partially legal conclusions and partially irrelevant. See Finding of Fact, paragraphs 6; and 7.

15. Rejected, irrelevant due to conflicting testimony.

17. Rejected; legal conclusion as opposed to factual finding.

Golden Triangle

1. Rejected; no evidence of record to support such a finding and irrelevant to the issues in dispute.

11. Last sentence rejected: legal conclusion as :- ~ ~ opposed to factual finding.

19. Rejected; speculative.

Docket for Case No: 85-002828BID

Orders for Case No: 85-002828BID