STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ALAN TAYLOR, ELIZABETHAN ) DEVELOPMENT, INC., ELIZABETHAN ) INTERIORS, GMR PROPERTIES, and )

ALAN TAYLOR, as agent for )

GMR PROPERTIES, )

)

Petitioner, )

) CASE NO. 93-3922BID

vs. )

) DEPARTMENT OF LABOR AND EMPLOYMENT ) SECURITY, )

)

Respondent. )

)

RECOMMENDED ORDER

On August 16, 1993, a formal administrative hearing was held in this case in Tallahassee, Florida, before J. Lawrence Johnston, Hearing Officer, Division of Administrative Hearings.

APPEARANCES

For Petitioners: Alan Taylor

170 East Lake Elbert

Winter Haven, Florida 33881

For Respondent: Edward A. Dion, Esquire

Assistant General Counsel Department of Labor and

Employment Security

Hartman Building, Suite 307-2012 Tallahassee, Florida 32399-2189

STATEMENT OF THE ISSUES

The issue in this case is whether the Respondent, the Department of Labor and Employment Security, acted fraudulently, arbitrarily, illegally, or dishonestly in rejecting the bid of the Petitioners to lease office space to the Respondent on the ground that the proposed space was not "dry and measurable" at the time of the bid.

PRELIMINARY STATEMENT

On or about June 22, 1993, the Respondent, the Department of Labor and Employment Security (DLES), notified the Petitioners that DLES intended to reject their bid to lease office space to the Respondent in Winter Park, Florida, Lease Number 540:0977.

On or about July 7, 1993, the Petitioners filed a formal bid protest and petition for formal administrative proceedings. The matter was referred to the Division of Administrative Hearings on July 14, and was assigned to this Hearing Officer on July 16, 1993. By Notice of Hearing issued on the same day, final hearing was scheduled for July 26, 1993.

Through counsel, the Petitioners moved for a continuance. Since the parties stipulated to the continuance, and to a waiver of the statutory deadline for convening the final hearing, final hearing was continued to August 16, 1993. On August 12, 1993, counsel for the Petitioners filed an uncontested Motion to Withdraw as Counsel for Petitioner, which was granted.

At the final hearing, Alan Taylor appeared and testified on behalf of the Petitioners. He also had Petitioners' Exhibits 1 through 7 admitted in evidence. The DLES called three witnesses and had Respondent's Exhibits 1 through 4 admitted in evidence.

Neither party ordered the preparation of a transcript of the final hearing.

The parties were given ten days in which to file proposed recommended orders. Explicit rulings on the proposed findings of fact contained in the parties' proposed recommended orders may be found in the attached Appendix to Recommended Order, Case No. 93-3922BID.

FINDINGS OF FACT

1. The bid specifications in the solicitation by the Respondent, the Department of Labor and Employment Security (DLES) for its Lease No. 540:0977 (office space in Orange County) required that proposed space be in an existing building "dry and capable of being physically measured to determine net rentable square footage at the time of bid submittal."

   
   

2. The requirement that proposed office space in response to Lease No. 540:0977 be "dry and measurable," as described in the preceding finding, is a long-standing, standard requirement found in the bid specification form developed by the Department of Management Services (DMS) (formerly the Department of General Services (DGS)) for use by all agencies of the State of Florida.

   
   

3. DMS' (and, formerly, DGS') long-standing interpretation of the "dry and measurable" requirement in the standard bid specification form is that the building must have a roof and walls, with windows either in place or covered over so that the building interior stays dry in adverse weather conditions.

   
   

4. In response to the DLES solicitation for bids for its Lease No. 540:0977, the Petitioners submitted a bid for space in a former Publix strip shopping mall, formerly known as the Northgate Shopping Center, located at 5023 Edgewater Drive, in Winter Park, Florida. At the time of the bid, the mall was unoccupied and in the process of being renovated and was a designated construction site. The building had been gutted, and the glass in the front of the building had been removed. The glass could be referred to as "windows" but actually would make up the top two-thirds of the front wall of the building. As a result, without the glass, the front "wall" consisted of a three to four foot rise of concrete blocks, and the front of the building was otherwise open.

   There was a 12-foot, eight-inch overhang over the front "wall," but wind-blown rain could enter the building, and apparently did. (There was standing water on the floor of the gutted building. There also were missing or unsecure doors along the back wall of the building.)

5. When Susan Early, the DLES employee in charge of the bid solicitation, received the Petitioners' bid and saw the photographs of the building required by the bid solicitation, she questioned whether the building was "dry and measurable." To help answer her question, she asked another DLES employee, who was located in the Orlando area, to go to the site, take pictures, and send a report of her findings, together with the photographs. The report and photographs indicated to Early that the building was not "dry and measurable." But, instead of relying on the information she had, she sent another, Tallahassee-based DLES employee to the site and received confirmation of her understanding as to the condition of the building. She then contacted Mary Goodman, the person at DMS who had the most experience in the area of soliciting and evaluating bids of leased office space, and who ultimately would be responsible for approving the DLES lease. Goodman advised Early that the DLES should reject the Petitioners' bid as non-responsive because it was not "dry and measurable."

   
   

6. The DLES also rejected, as being non-responsive, the only other bid received in response to the bid solicitation.

   
   

7. In the Final Order, The Koger Company v. Div. of Admin. Hearings, DOAH Case No. 88-3357BID, entered September 21, 1988, the Division of Administrative Hearings rejected a bid as not offering "dry and measurable" space because the building "had a roof, a slab, and walls, which comprised 50 percent of the vertical plane from the slab to the roof." The bidder's argument that the building "had a four foot overhang" and that "the overhang prevented rain from entering the building" was rejected as not being credible "given the large amount of window space which was not enclosed." The winning bid, which was upheld as being a "dry and measurable" was an abandoned bowling alley that "had walls, a slab, and portions of the exterior walls were boarded over, possibly in the location of existing windows or window openings. The roof did have a hole, which was approximately three feet in length and allowed water to leak into the building." (Citations to the record omitted.)

   
   

8. The facts derived from the Final Order, The Koger Company v. Div. of Admin. Hearings, supra, do not in themselves prove that the DLES acted fraudulently, arbitrarily, illegally, or dishonestly in rejecting the Petitioners' bid. Although the Petitioners' bid in this case was for a building that once had a certificate of occupancy, the Petitioners' bid in this case is more similar in other respects to the rejected bid than the successful bid in the Koger Company case. For example, like the rejected bid in the Koger Company case, the Petitioners' bid had partial exterior walls.

   
   

9. The Petitioners proved that they also submitted a bid for the lease of office space in the Northgate Shopping Center in response to a bid solicitation by the Florida Department of Corrections (Parole and Probation Commission). The bid was evaluated, along with others, and the lease was awarded to another bidder. It can be inferred from this that the Department of Corrections made a determination that the Petitioners' bid was "dry and measurable." However, those facts alone do not prove the DLES, in this case, acted fraudulently, arbitrarily, illegally, or dishonestly. They only would prove that the two agencies interpreted the phrase "dry and measurable" differently.

   
   

10. There also was evidence that the Department of Health and Rehabilitative Services (HRS) interprets the phrase "dry and measurable" differently than DLES does. But it was not proven whether HRS would have accepted a bid for space having the characteristics of the Petitioners' bid.

11. The Petitioners argued persuasively from the evidence presented that the requirement that bid space be "dry," as interpreted by the DMS and the DLES, can be impractical when applied to the real world of building renovations and may exclude possible good lease opportunities. Sometimes, space in a building under construction or substantial renovation can be leased at lower rates. Presumably for that reason, the Department of Corrections (Parole and Probation Commission) and HRS interpret the requirement differently. But, given the requirement that bid space be "dry," it cannot be said that the DLES acted fraudulently, arbitrarily, illegally, or dishonestly in rejecting the Petitioners' bid.

    
    

    CONCLUSIONS OF LAW

    
    

12. Under the decision of the Florida Supreme Court in Dept. of Transp. v. Groves-Watkins Constructors, 530 So. 2d 912, 914 (Fla. 1988), the question for determination in this bid protest is "whether the agency acted fraudulently, arbitrarily, illegally, or dishonestly." See also Asphalt Pavers, Inc., v. Dept. of Transp., 584 So. 2d 55 (Fla. 1st DCA 1992); Scientific Games v. Dittler Bros., 586 So. 2d 1128 (Fla. 1st DCA 1991). (Both stand for the proposition that Groves-Watkins applies not only where the agency rejects all bids but also where the agency makes an award.)

    
    

13. Under the facts of this case, the DLES did not act fraudulently, arbitrarily, illegally, or dishonestly in rejecting the Petitioners' bid.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Respondent, the Department of Labor and Employment Security, enter a final order rejecting the bid of the Petitioners to lease office space to the Department in Winter Park, Florida, Lease Number 540:0977.

RECOMMENDED this 9th day of September, 1993, in Tallahassee, Florida.

J. LAWRENCE JOHNSTON Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 9th day of September, 1993.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-3922BID

To comply with the requirements of Section 120.59(2), Fla. Stat. (1991), the following rulings are made on the parties' proposed findings of fact:

Petitioner's Proposed Findings of Fact.

1.-3. Accepted and incorporated to the extent not subordinate or unnecessary. It should be noted, however, that the missing "windows" in front made up approximately two-thirds of the front wall of the building.

1. Rejected as not proven, according to the DLES interpretation of the "dry and measurable" requirement, that the bid space was "existing." Otherwise, accepted and incorporated to the extent not subordinate or unnecessary.

2. It should again be noted that the missing "windows" in front made up approximately two-thirds of the front wall of the building. Otherwise, accepted and incorporated to the extent not subordinate or unnecessary.

3. Rejected in part as not proven, in part as argument, and in part as irrelevant. It also should again be noted that the missing "windows" in front made up approximately two-thirds of the front wall of the building. Otherwise, accepted and incorporated to the extent not subordinate or unnecessary.

4. Accepted and incorporated to the extent not subordinate or unnecessary.

5. In part, rejected as irrelevant and not proven. (Evidence as to the HRS manual and related facts was excluded as being irrelevant.) The rest is accepted but largely subordinate and unnecessary.

6. Irrelevant and unnecessary. (It was established at the hearing that the Petitioners' bid was rejected only because the bid space was not "dry"; DLES does not contend that it was not "measurable.")

7. Accepted but subordinate and unnecessary.

8. In part, irrelevant, subordinate and unnecessary (what Mr. Taylor's definition is.) In part, cumulative. In part, rejected as argument. In part, accepted and incorporated (that the requirement that bid space be "dry," as interpreted by the DMS and the DLES, can be impractical when applied to the real world of building renovations and may exclude possible good lease opportunities.)

9. Rejected as irrelevant and unnecessary. (Assuming it acts consistently from case to case, an agency's choice not to waive technicalities cannot be called "acting fraudulently, arbitrarily, illegally, or dishonestly.")

10. Rejected as being argument and as not proven.

Respondent's Proposed Findings of Fact.

1. Except for the number of square feet, which is in error, accepted and incorporated.

2.-5. Accepted and incorporated.

6. Rejected as contrary to the findings of fact and the greater weight of the evidence that there were no walls in front. (They extended only about a third of the way up to the ceiling.)

7.-8. Accepted and incorporated.

9. Accepted but subordinate and unnecessary.

COPIES FURNISHED:

Alan Taylor

170 East Lake Elbert

Winter Haven, Florida 33881

Edward A. Dion, Esquire Assistant General Counsel Department of Labor and

Employment Security

307 Hartman Building

2012 Capital Circle South East Tallahassee, Florida 32399-2189

Shirley Gooding, Secretary Department of Labor and

Employment Security

303 Hartman Building

2012 Capital Circle South East Tallahassee, Florida 32399-2152

Cecilia Renn, Esquire Chief Legal Counsel Department of Labor and

Employment Security

307 Hartman Building

2012 Capital Circle South East Tallahassee, Florida 32399-2152

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit to the Department of Labor and Employment Security 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 consult with the Department of Labor and Employment Security concerning its rules on the deadline for filing exceptions to this Recommended Order.

Docket for Case No: 93-003922BID

Orders for Case No: 93-003922BID