No transcript of the hearing was filed. Both parties filed proposed recommended orders which were considered in the preparation of this Recommended Order. The proposed findings of fact are ruled upon either directly or indirectly as reflected in this Recommended Order, and in the Appendix which is attached and hereby made a part of this Recommended Order.
Lee County School District (District) Invitation to Bid #4908 (ITB) was provided to the vendors on December 9, 1992. The ITB sought bids for 61 hardware and tool items to be used in the District Supply Department.
The District maintains an inventory of hundreds of miscellaneous hardware items. Quantities of available materials are monitored through a computerized system which is used to generate a list of items which need to be replenished. The District has historically utilized ITB's to acquire hardware items in order to maintain appropriate inventory levels.
Eight sealed bids were opened on January 6, 1993 at 2:00 p.m. Bids were submitted by Parker-Mahn Ace Hardware, W.W. Grainger, Action Bolt & Tool, Biscayne Electric & Hardware Distributors, Bob Dean Supply, Scotty's, Shadbolt & Boyd, and the Petitioner.
The ITB states that the School District of Lee County: reserves the right to waive minor variations
to specifications, informalities,
irregularities and technicalities in any bids; to reject any and all bids in whole or in part with or without cause, and/or to accept bids that in its judgement will be in the best interest of the District. The District further reserves the right to make awards on a multiple, lump sum, or individual item basis or combination as shall best serve the interest of the District unless otherwise stated.
Three of the vendors bid on all 61 items. The remaining vendors bid on some but not all of the items.
The bids were tabulated by personnel in the Purchasing Department. The information in the bids is set forth in tabulation sheets which facilitate comparison of buds.
On January 7, 1993, the Petitioner sent a letter to the Respondent stating that there were only "two authentic submissions: Ace Hardware and S.W. Supply, Inc."
The tabulation sheets and additional materials included in the bid responses were forwarded to the Supply Department where supply personnel reviewed the submissions and made recommendations to the Purchasing Department as to which vendors should receive awards.
As part of the evaluation of the bid proposals, the District determined that the cost of the total bid award would be lower if the awards were made on an individual item basis. The District considered prompt payment discounts in making this determination.
The total amount of the proposed awards to the eight vendors is
$7,104.55. Were the Petitioner to receive awards for all items, the total amount of the award would be $7,965.00, accounting for the Petitioner's proposed prompt payment discount.
The Purchasing Department posted a Notice of Intention to Award on January 15, 1993. The proposed awards were made on an individual item basis. All eight vendors received awards.
The parties have stipulated that the Petitioner timely filed a notice of protest.
Subsequent to the January 15 posting, the Petitioner discovered several errors in determining the proposed awards. In the Petitioner's formal protest, four awards are identified as incorrect.
Despite the Petitioner protest, the first item identified was correctly awarded because the Petitioner failed to account for the prompt payment discount offered by the winning vendor. A second item protest was based on clerical error and was withdrawn by the Petitioner. The two remaining items were resolved and were addressed in a corrected Notice of Intention to Award posted February 16, 1993.
There is no evidence that the errors were other than mistakes made in calculation or transcription of bid data from the vendor's documents to the bid tabulation form. No further specifically challenged items were identified by the Petitioner prior to the hearing.
General condition 1.d. of the ITB states as follows:
For purposes of evaluation, the bidder must indicate any variances from specifications, terms and/or conditions regardless of how slight. If variations are not stated in the proposal, it will be assumed that the product or service fully complies with the specifications, terms and conditions herein. (emphasis supplied)
General condition 6 of the ITB states as follows:
Use of brand names, trade names, make, model, manufacturer, or vendor Catalog Number in the specifications is for the purpose of establishing a grade or quality of material only. It is not the District's intent to rule out other competition; therefore, the phrase OR APPROVED EQUAL is added. However, if a product other that specified is bid, it is the vendor's responsibility to submit with the bid brochures, samples and/or detailed specifications on item(s) bid. The District shall be the sole judge concerning the merits of bids submitted. If a bidder does not indicate what he is offering in the proper blank and if the bidder is successful in being awarded the item(s) then the bidder shall be obligated to furnish the specified item(s).
If packing is different from that specified, the bidder must note manner and amounts in which packing is to be made. (emphasis supplied)
Only one vendor, Parker-Mahn Ace Hardware, proposed to supply all items exactly as specified in the ITB. The remaining vendor proposals included at least some items which varied in some respects from the items identified in the ITB.
Where a vendor fails to identify that a product bid is "not as specified", the proposal is evaluated as if all specifications have been met, in which event, price is the determining factor in determining the award. Where a vendor identifies a variance related to a specified item, the proposal is evaluated as if all specifications other than the identified variance are met. If the product is determined by the Supply Department to be the equivalent of the product identified in the ITB, price is again the determining factor in determining the award.
Where the ITB specifies a brand name followed by the word "ONLY", the vendor may not bid another brand. Where the ITB does not qualify the brand name as "only", the vendor may propose an equivalent product. Where a vendor does not identify the brand name of the item to be supplied, the vendor presumed to be bidding an item which will meet the specifications. If the vendor delivers goods which are not as specified, the District rejects delivery and cancels the order.
The evidence establishes that, where bid items were not as specified in the ITB, the District had access to sufficient information to permit a determination of equivalency and an award of bids. The evidence fails to establish that, except as stated herein, the Petitioner should have received an award other that as set forth in the February 16, 1993, Notice of Intent to Award.
General condition 5 of the ITB states as follows:
Cash discount for prompt payment of invoices will be considered in making awards. The District prefers cash discount items which allow at least twenty (20) days for approval and payment of invoices.
Four vendors included proposals for prompt payment discounts in the responses. One vendor offered a 2 percent discount for payment within 20 days, one offered a 1 percent discount for payment within 15 days and one offered a 1 percent discount for payment within 10 days. The Petitioner offered a 12 per cent discount for payment within five days, but only if the Petitioner received the award for all items bid.
The District preference for a 20 day payment period reflects the time needed to accept delivery, process invoices and make payment for goods received. The District has accepted a five day prompt payment discount when the purchase was for a single item and the delivery date was specified. Such payment is otherwise difficult and results in other vendor payments being delayed. There is no evidence that based on the costs of goods involved in this bid, the savings are of such event as to warrant such extraordinary treatment of deliveries and invoices.
General condition 16 of the ITB states as follows:
Any and all special conditions that may vary from these General Conditions shall have precedence.
Special condition 1 of the ITB states as follows:
A SAMPLE OR COMPLETE SPECIFICATION SHEET MUST ACCOMPANY EACH BID ITEM THAT IS NOT "AS SPECIFIED." IF AN ITEM CANNOT BE EVALUATED, IT WILL BE DISQUALIFIED.
Parker-Mahn Ace Hardware submitted product brochures or other materials related to items bid. The Petitioner submitted an extensive selection of photocopies pages from a hardware product catalog. W.W. Grainger submitted an index of part numbers and identified where such parts could be located in the Grainger catalog, which was on file with the District. Action Bolt and Tool included product information by brand name and model number in the ITB response.
The remaining four vendors (Biscayne Electric & Hardware Distributors, Bob Dean Supply, Scotty's, and Shadbolt & Boyd) attached no specification sheets or other descriptive materials for items bid.
As stated previously, the ITB directed vendors to submit specification sheets for "not as specified" items. The request for such information was intended to facilitate the review of the bids by eliminating the need for District personnel to consult vendor product catalogs already in the District files. The ITB also provided for disqualification where an item could not be evaluated.
The Petitioner asserts that the failure to submit such product information materials with the bids is a material defect which cannot be waived and which renders the bids nonresponsive. The evidence fails to support the assertion.
Of the four vendors which included no specification sheets, all four had product catalogs on file in the Purchasing and/or Supply Departments of the Lee County School Board. The District had sufficient information to evaluate the bids submitted by the vendors with catalogs on file.
The Petitioner asserts that it was disadvantaged by the District's decision to waive the failure to attach specification sheets where catalogs were on file, because it was allegedly not possible to compare his bid to those submitted by the other vendors. The evidence does not support the assertion.
The relevant catalogs are on file in the Purchasing and Supply Departments of the District and are available for public inspection. There is no evidence that the Petitioner sought at any time to reference the materials on file. The fact that the omitted specification sheets made such a comparison less convenient than it would have been had such sheets been attached to the bids does not render the bid proposals nonresponsive.
At hearing, the Petitioner challenged many of the individual intended awards announced by the District. Prior to the hearing, the Petitioner had not asserted that such items were inappropriately awarded. The evidence fails to establish that the Petitioner would be entitled to an award of any of the additional items challenged at hearing.
In the case of individual items, a bidder other than the Petitioner would be entitled to the award if the Petitioner's challenge succeeded. None of the other bidders challenged the proposed bid awards. No vendors intervened in this proceeding. Accordingly the Petitioner is not affected by such individual awards and is without standing to challenge the items first identified at hearing.
The Petitioner asserted that if the low bidder for each identified product is disqualified, and the next lowest bid included in the total bid calculation, the Petitioner's total bid, including the prompt payment discount, would be lower than the total of individual bids, and that accordingly, he would be entitled to an award of all items. The evidence fails to support the assertion.
The Petitioner identified one item at hearing for which the Petitioner should have received the award. The ITB sought bids to supply 24 galvanized one quart metal funnels, item #58115. One of the vendors proposed to supply a plastic funnel at a cost of .56 each. The next lowest bidder was the Petitioner which proposed to supply the metal funnel requested at a cost of $1.44 each.
On a previous bid, a plastic funnel was proposed by a vendor and rejected by the District as not meeting the specifications. Although in the instant case, purchasing personnel were informed by supply personnel that a plastic funnel would serve the same purpose and was acceptable, the vendors were not provided the opportunity to bid on the provision of the plastic funnels.
General condition 9.c. of the ITB states as follows:
If the material and/or services supplied to the District is found to be defective or does not conform to specifications, the District reserves the right to cancel the order upon written notice to the seller and return the product to the seller at the seller's expense.
In other words, the District has the right to reject delivery and cancel orders for items which are not as specified in the ITB and for which no variance was identified by the successful vendor. A vendor delivering goods which are not as specified in the vendor's proposal will not be invited to participate in the ITB process for an indeterminate period of time.
At hearing, the Petitioner asserted that item #58800 (a plastic sheet of twelve garden hose washers) was mistakenly awarded to a vendor whose proposal was for individual washers rather than the sheet. The Respondent acknowledged that accordingly the proposed vendor's bid was not the lowest. The next two lowest bids (one of which is an "as specified" bid) were received from vendors other than the Petitioner. The Petitioner therefore would not receive this award.
The Petitioner asserts that some bidders did not complete "drug-free workplace" forms. Although correct, the assertion is irrelevant. Such forms are used to determine award winners where there are identical bids ("ties"). There were no tie bids related to this case.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties to and subject matter of this proceeding. Sections 120.53(5) and 120.57(1), Florida Statutes.
The Petitioner has the burden of establishing, by a preponderance of the evidence, that the School Board's actions were contrary to the requirements of law. Department of Transportation v. J. W. C. Company, Inc., 396 So.2d 778 (Fla. 1st DCA 1981). Other than as to item #58115 addressed herein, the burden has been not met.
In an administrative challenge to an agency's decision to award a contract or to reject all bids, the scope of the inquiry is limited to whether the purpose of competitive bidding has been subverted. The hearing officer's sole responsibility is to ascertain whether the agency acted fraudulently, arbitrarily, illegally or dishonestly. Department of Transportation v. Groves- Watkins Constructors, 530 So.2d 912, at 914 (Fla. 1988). In this case, the evidence fails to establish that the School Board acted fraudulently, illegally or dishonestly in evaluating the bids received.
As to the award for item #58115, the District decision to accept an item other than that sought in the ITB was arbitrary and subverted the purpose of competitive bidding. The District had previously clearly indicated that it did not consider a plastic funnel to be the equivalent of the galvanized metal funnel identified in the ITB. Doing so placed other bidders, who sought to supply the items specified on the ITB, at a clear disadvantage. Although the
actual item is relatively insignificant and the total cost of goods is minimal, the District's decision to make multiple awards on the basis of individual items opens each item to challenge.
An agency has wide discretion in soliciting and accepting bids and is accorded substantial deference in competitive bidding activities. The agency decision, when based on an honest exercise of discretion, should not be overturned even if it may appear erroneous and even if reasonable persons may disagree. Liberty County v. Baxter's Asphalt & Concrete, Inc., 421 So.2d 505, at 507 (Fla. 1982).
Although there were errors made in some of the awards, those identified by the Petitioner at the time the initial posting of the bid calculation were corrected by the School Board and reflected in a second posted Notice of Intent to Award. Although it appears that some additional errors may have been revealed subsequent to the second posted notice, there is no evidence that the errors are based on anything other than honest mistake.
The Petitioner asserts that the bids submitted without attached specification sheets do not comply with the requirements of the ITB and so should be deemed nonresponsive and disqualified from further evaluation. The evidence establishes that the School Board had sufficient information available to permit evaluation of the bid proposals. The omission of specification sheets under these circumstances is a minor deviation which the School Board may waive.
The School Board of Lee County enter a Final Order directing that the District Purchasing Department refrain from purchasing item #58115 pending the next invitation to vendors to submit bids for miscellaneous hardware supplies and otherwise DISMISSING the Petitioner's Notice of Bid Protest.
DONE and RECOMMENDED this 2nd day of June, 1993, in Tallahassee, Florida.
WILLIAM F. QUATTLEBAUM
Filed with the Clerk of the Division of Administrative Hearings this 2nd day of June, 1993.
APPENDIX TO CASE NO. 93-1260BID
The following constitute rulings on proposed findings of facts submitted by the parties.
The Petitioner's proposed findings of fact are accepted as modified and incorporated in the Recommended Order except as follows:
7. Rejected, irrelevant. Item #58038 does not require that ONLY an Ace Hardware item may be bid. Based on the ITB, it is clear that the item bid by Action Bolt & Tool meets the specifications set forth in the proposal.
11-12. Rejected, irrelevant.
14. Rejected, irrelevant. The evidence fails to establish that the Petitioner attempted to obtain the materials used by District personnel to evaluate the bids.
16-17. Rejected, irrelevant. Respondent
The Respondent's proposed findings of fact are accepted as modified and incorporated in the Recommended Order except as follows:
9. Rejected, immaterial.
23. Rejected, irrelevant.
28. Rejected, unnecessary.
Dr. James A. Adams Superintendent
Garey F. Butler, Esquire Humphrey & Knott
All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least ten days in which to submit written exceptions. Some agencies allow a larger period within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.
