STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

VARIAN INSTRUMENT GROUP, )

)

Petitioner, )

)

vs. ) CASE NO. 89-5058BID

) SOUTHWEST FLORIDA WATER ) MANAGEMENT DISTRICT, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice this cause came on for formal hearing, before P. Michael Ruff, duly-designated Hearing Officer, of the Division of Administrative Hearings in Brooksville, Florida, on October 29, 1989. The appearances were as follows:

APPEARANCES

For Petitioner: Mickey McAllister

Varian Instrument Group

505 Julie Rivers Road, Suite 150 Sugar Land, Texas 7747

For Respondent: A. Wayne Alfieri, Esquire and

Edward B. Helvenston, Esquire Assistant General Counsel Southwest Florida Water Management District

2379 Broad Street

Brooksville, Florida 34609-6899 STATEMENT OF THE ISSUES

The issue involved in this proceeding concerns whether the Respondent Southwest Florida Water Management District (District, Respondent) should award a bid for certain equipment to the Petitioner Varian Instrument Group based upon the evidence presented in this proceeding and facts found therefrom, or should its intended action of awarding the bid to Perkin-Elmer Corporation (Perkin- Elmer) be accomplished.

PRELIMINARY STATEMENT

This matter arose upon the filing of a formal protest by Varian, pursuant to Section 120.57(1), Florida Statutes, challenging the District's initial notice of award, to Perkin-Elmer, of a bid authorizing provision of an "atomic absorption spectrophotometer." This is an instrument used to measure the existence of atomic elements in a solution ,and is used in laboratory analysis projects in the District's laboratory.

The matter was duly referred to the Division of Administrative Hearings and a formal hearing was held in Brooksville, Florida pursuant to notice.

The District called two witnesses at hearing, District employees Albert Carter, the Director of Purchasing for the District and Marc Rials, the Laboratory Supervisor who was the author of the specifications for the instrument in question and who evaluated the bids received. The Petitioner called the same two persons as witnesses, as well as adducing the testimony of Mickey McAllister, who represented Varian. Joint Exhibit 1 was received into evidence and Varian's Exhibit 1 was denied admittance on account of its hearsay nature and its lack of a corroborative link to otherwise competent, admitted testimony or evidence. Varian's Exhibit 2 was not admitted because of its incomplete nature. The District's Exhibit 2 was received into evidence.

At the conclusion of proceeding the parties elected to have it transcribed and avail themselves of the opportunity to file proposed recommended orders containing proposed findings of fact and conclusions of law. In conjunction with obtaining an extended period of time for the filing by agreement, the parties concomitantly the requirement of Rule 28-5.402, Florida Administrative Code.

The proposed findings of facts submitted have been considered in the formulation of this recommended order and are addressed also in the appendix attached hereto and incorporated by reference herein.

FINDINGS OF FACT

1. In July, 1989 the District published its request for bids (number 8980) for an atomic absorption spetrophotometer in local newspapers and to prospective interested parties, as shown in joint Exhibit 1 in evidence. The specifications for the instrument were included in the bid package and were authored by Mark Rials, the District's Laboratory Supervisor. The District received two bids for the instrument in response to the request for bids, one from Varian for approximately $57,000 and one from Perkin-Elmer for approximately $59,900.

   
   

2. Mark Rials evaluated the bids. Upon evaluation it was determined that the Varian instrument proposal did not meet bid specifications in three major areas. The specifications required a system capacity of 40 megabytes, hard drive capability. The capacity offered by Varian in its bid was for 20 megabytes. The specifications required a combination of a 5 1/4 inch disk drive for its computer system as well as a 3 1/2 inch disk drive. Varian only bid the

   3 1/2 inch diskdrive. It did not offer the 5 1/4 inch disk drive which was required. Additionally, at item IX of the specifications, the District required that a list be submitted with the bid which stated, on an item-by-item basis, how the instrument met or exceeded the specifications. Each item in the specifications had been carefully selected to insure optimum performance for the laboratory so that exceptions to the specifications were required to be noted and attached in the bid response. Varian failed to conform to this item of the specifications. This item allowed a vendor to describe in its bid response how it could differently meet the specifications in a better manner or even exceed the specifications, but Varian failed to provide this itemized list.

   
   

3. It was also determined that the Varian bid did not conform with the specifications of item IV page 4 of the invitation to bid document concerning the provision of service manuals, system and application software documentation, methods, manuals, parts catalogs, supplies, accessories, catalog, and training

   manuals. Conversely, it was determined that the Perkin-Elmer bid was responsive in all respects, met the bid specification in these major categories and was the most responsive bidder.

   
   

4. After witness Rials conducted the evaluation of the bids, in terms of compliance with the specifications, he and the District determined that the Perkin-Elmer bid was the lowest, responsive bidder which met all specifications. It duly published the intended award and notified all bidders of the bid results. In this evaluation and award process it was demonstrated that the District followed all applicable procedures in its rules and policies concerning evaluation and award.

   
   

5. Varian timely filed an objection to the award of the bid; and in accordance with its normal bid protest procedures, the District scheduled a conference between representatives of Varian and District representatives to review Varian's bid. Varian made several statements at that meeting which constituted a substantial deviation from the bid package it had earlier submitted and amounted to an attempted restructuring of its bid in an effort to meet bid specifications. The District declined to countenance this effort and adhered to its initial intent to reject the bid which was submitted by Varian and to not allow the attempted material deviations to be ascribed to Varian's bid, after the point of bid opening and announcement of award.

   
   

6. In summary, based upon the bid specifications issued by the District the evaluator's determination concerning the specifications that the evaluator drafted was that the Varian instrument failed to meet bid specifications because of the major deficiencies in the areas found above, regarding systems capacity, computer disk drive availability, and specification response. It has clearly been demonstrated by competent substantial evidence that the District's decision to reject Varian's bid was a reasonable one. It was based solely on a fair comparison of the response of the two bids to the specifications contained in the invitation to bid and notice to all potential vendors. In consideration of the facts established by the evidence in this record, it is found that the bid by Perkin-Elmer substantially met all bid requirements or specifications, even though the Perkin-Elmer bid was the second low bidder in terms of dollar cost. Since the low-cost bidder, Varian, failed to meet major bid specifications, the facts demonstrate that the Perkin-Elmer bid was the most responsive of the two bids at issue and is, therefore, the best bid. Consequently, award should be given to the Perkin-Elmer bid for the instrument in question.

   
   

   CONCLUSIONS OF LAW

   
   

7. The Division of Administrative Hearings has jurisdiction of the subject matter of and the parties to this proceeding. Section 120.57(1), Florida Statutes (1987).

   
   

8. The burden of proof to go forward with evidence is upon the Petitioner, the putative unsuccessful bidders to establish the affirmative of the issue raised by its petition, that is, that it is entitled to the award as the lowest, best, most responsive bidder. Florida Department of Transportation v. J.W.C. Company, Inc., 396 So.2d 788 (Fla. 1st DCA 1981). The unsuccessful bidder of the instrument in question, Varian, is a substantially affected party with regard to this proceeding and has standing to contest the agency's intended action of awarding to Perkin-Elmer. It was this Petitioner's burden to show that, indeed, it responded adequately in all material respects to the invitation to bid promulgated to all vendors and, therefore, that in conjunction with its being the lowest cost bidder, that it was the most responsive bidder. If that

   were demonstrated by competent, substantial evidence in this record, such that corresponding facts to that effect could be found, failure to award to that bidder would constitute an arbitrary action by the agency. Liberty County v. Baxter's Asphalt and Concrete, Inc., 421 So.2d 505 (Fla. 1982); Capeletti Brothers, Inc. v. Department of General Services, 432 So.2d 1459 (Fla. 1st DCA 1983). In order to show this the bidder must show that his bid was responsive to and complied with all specifications and that the agency's initial evaluation of the bid responses, including the Petitioner's, was not rationally accomplished and formulated. If that could be shown and the agency proceeded to ignore a factual showing to that effect, then a decision not to award to the challenging bidder would be beyond the honest exercise of the agency's discretion, which action should then be overturned. Couch Construction Company, Inc. v. Department of Transportation, 361 So.2d 172 (Fla. 1st DCA 1978).

   
   

9. Indeed, and agency has wide discretion in soliciting and accepting bids and its decision based upon an honest exercise of that discretion will not be overturned by the courts, even if reasonable persons disagree with the outcome.

   C.H. Barco Contracting Company v. State Department of Transportation, 483 So.2d 796 (Fla. 1st DCA 1986); Liberty County supra. This proceeding is a de novo proceeding, however. It is not a proceeding designed to merely review the agency's intended action to determine if it was arbitrary or amounted to an excision of the agency's honest exercise of discretion. That standard concerns a review of the agency's final action. Section 120.57 proceeding such as this does not involve a review of agency action, but a de novo effort to adduce evidence and to find facts, based upon which facts a formulation of the appropriate final agency action can be made. The final agency action made after a recommended order to this effect is entered is then reviewed according to the standard enunciated in this case law. It must, therefore, be considered whether the record in this proceeding establishes facts which should that the agency's proposed action would be unreasonable or not in accordance with the facts found.

   
   

10. The unrefuted, preponderant evidence adduced clearly shows that the bid by Perkin-Elmer was the lowest bid which actually met specifications. It was thus the most responsive bid. Although the Petitioner's bid was lower in terms of dollar cost, the Petitioner's bid did not meet bid specifications in several major ways and was thus an unresponsive bid. Given the facts found above which show this circumstance, an award to Perkin-Elmer, even though the higher bidder in terms of cost, would be in accordance with the facts established in this de novo proceeding. It would not constitute an arbitrary agency action or one which exceeds the bounds of the agency's honest exercise of discretion, as referenced in the above decisional authority.

    
    

11. In summary, the Petitioner claims that, its bid met specifications and that it should have been awarded the bid. The evidence, supportive of the above findings of fact, however, shows that it did not conform to specifications. There has been no demonstration that in the promulgation of the bid specifications or the evaluation of the responses thereto, that the agency has departed from the evaluation criteria in those specifications contained in the invitation to bid's in evaluating and selecting the winning bidder. The Petitioner simply failed to sustain its burden in this proceeding.

RECOMMENDATION

Having considered the foregoing findings of fact and conclusions of law, the evidence of record, the candor and demeanor of the witnesses, and the pleading and arguments of the parties it is therefore

RECOMMENDED:

That the Southwest Florida Water Management District issue a final order denying the petition filed by Varian Instrument Group and awarding bid number 8980 to Perkin-Elmer Corporation, as the lowest, responsive bidder.

DONE and ENTERED this 6th day of February, 1990, in Tallahassee, Florida.

P. MICHAEL RUFF Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, FL 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 7th day of February, 1990.

APPENDIX

Respondent's Proposed Findings of Fact 1-9 are accepted. Petitioner Filed No Proposed Findings of Fact.

COPIES FURNISHED:

Mr. Peter G. Hubbell Executive Director Southwest Florida Water

Management District 2379 Broad Street

Brooksville, FL 34609-6899

Mickey McAllister District Sales Manager Varian Instrument Group

505 Julie Rivers Road, Suite 150 Sugar Land, TX 77478

A. Wayne Alfieri, Esquire Edward B. Helvenston, Esquire Assistant General Counsel Southwest Florida Water Management District

2379 Broad Street

Brooksville, FL 34609-6899

Docket for Case No: 89-005058BID

Orders for Case No: 89-005058BID