STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF TRANSPORTATION, )

)

Petitioner, )

)

vs. ) CASE NO. 94-4432

) ANDERSON COLUMBIA COMPANY, INC., )

)

Respondent. )

)

RECOMMENDED ORDER

This matter came on for hearing in Tallahassee, Florida, before David M. Maloney, Hearing Officer of the Division of Administrative Hearings, on August 26, 1994. The hearing transcript was filed with the Division of Administrative Hearings on September 14, 1994.

Proposed Recommended Orders were filed by Petitioner and Respondent on September 22 and September 23, 1994, respectively. The attached appendix addresses proposed findings of fact by number.

APPEARANCES

For Petitioner: Jack R. Leonard, Esquire

Assistant General Counsel Department of Transportation

605 Suwannee Street, Mail Station No. 58 Tallahassee, Florida 32399-0458

For Respondent: Brant Hargrove, Esquire

J. Victor Barrios, Esquire Beck, Spalla & Barrios 1026 East Park Avenue

Tallahassee, Florida 32301 STATEMENT OF THE ISSUES

Whether Anderson Columbia Company, Inc. is delinquent because of unsatisfactory progress being made on a road construction project, and, if so, whether Anderson's Certificate of Qualification should be suspended or revoked?

PRELIMINARY STATEMENT

On August 10, 1994, the Division of Administrative Hearings received a letter from the Department of Transportation, ("DOT" or the "Department,") asking that a hearing officer be assigned to conduct a proceeding pursuant to Section 120.57(1), Florida Statutes. Attached to the letter was a copy of a request for formal hearing submitted to DOT by Anderson Columbia Co., Inc., ("Anderson".) The request seeks a determination of whether a Notice of Delinquency issued by DOT to Anderson should be sustained. Ultimately, Anderson

seeks a final order determining that it is not delinquent in the progress of work under the contract cited in the Notice of Delinquency.

The letter of the Department noted that this case is governed by Section 337.16, Florida Statues, which bears the catchline, "Disqualification of delinquent contractors from bidding; denial, suspension, and revocation of certificates of qualification; grounds; hearing." Subsection (1)(b) of the statute requires that the hearing be held within 30 days after receipt by the hearing officer of the request for hearing and that the recommended order be issued within 15 days after the hearing. In compliance with the 30-day requirement, the hearing was held on August 26, 1994. The parties, however, waived the recommended order time requirement, wishing themselves to take more than 15 days for submission of proposed recommended orders.

At hearing, one joint exhibit was offered and admitted into evidence. The Department called as witnesses Edward Riley Griffin, Tyrus Frank Rudd, James Edward Martin, and Henry Harrison Haggerty. In addition, DOT offered 42 exhibits into evidence. All were admitted. Anderson called as witnesses James

1. Lairscey, Charles Edward Brown, Kenneth Howard Murphy, Zachary Vincent Smallwood, Richard Dunn, and Terrill Hayes McRae. The exhibits offered by Anderson, four in number, were all admitted into evidence.

   
   

   FINDINGS OF FACT

   
   

   1. The Parties

      
      

      1. The Department of Transportation is the agency of the State of Florida responsible for the construction and maintenance of roads designated as part of the State Highway System. Section 20.23, F. S. As such, it is authorized to enter into contracts for the construction and maintenance of roads in the system. Section 337.11, F. S.

         
         

      2. Anderson is a road and bridge construction company with its principal place of business located at 2 Guerdon Road, Lake City, Florida 32055.

         
         

   2. The Contract and the Project

      
      

      1. On August 25, 1993, the Department awarded to Anderson Contract No. 18,498 (the "contract,") which governs State Project 32100-3449, (the "project.") The contract was executed by the parties the following September 10.

         
         

      2. The project consists of the milling, widening and resurfacing of Interstate 75 (State Road No. 93) in Hamilton County, Florida, from a point north of State Road No. 6 to the Georgia State Line, a distance of approximately

         9.571 miles.

         
         

      3. The contract called for the work to be completed in 270 calendar days. As to when this time period would begin to run, the contract states,

         
         

         It is understood and agreed that the date on which calendar days will begin to be charged to the project shall be either (1) the 16th calendar day from the date of issuance of the initial notice to begin

         work or (2) the date on which the Contractor actually begins work, whichever date is the earlier.

         Petitioner's Ex. No. 2A, Form 375-020-28F.

         
         

      4. On October 8, 1993, the Department, through its District Office Engineer, issued the initial notice to begin work. As stated in the contract, the notice stated that the "contract time" would begin to be charged within 16 days of October 8, or October 24, 1993, "unless work is started before that time." Petitioner's Exhibit No. 11. The notice cautioned, consistent with the contract, that "all necessary work is to be completed in 270 calendar days," id., and requested that the office be notified when Anderson expected to begin work.

         
         

      5. Anderson did not commence work prior to October 24, 1993.

         Consequently, the 270-day time period for completion of the work began to run on that date.

         
         

   3. The Importance of Time and the Initial Schedule.

      
      

      1. Time is an essential element of the contract. Petitioner's Ex. No. 2B, Standard Specifications for Road and Bridge Construction, 1991, (the "Standard Specifications,") Article 8-8.1, p. 68. The Standard Specifications, incorporated into the contract, state further in Article 8-8, "Failure of Contractor to Maintain Satisfactory Progress," that,

         
         

         as delay in the prosecution of the work will inconvenience the public, obstruct traffic, and interfere with business, it is important that the work be pressed vigorously to completion. Moreover, the

         cost to the Department for the administration of the contract, including engineering, inspection, and supervision, will be increased as the construction period is lengthened.

         
         

      2. To assist the Department and Anderson in completing the project on schedule, the contract required that Anderson submit to the Engineer, (in this case the engineering firm of Reynolds, Smith and Hill,) a Critical Path Method schedule. Such a schedule is a chart prepared by the Contractor, approved by DOT, whereby the contractor identifies the time frames in which various phases of the work are to begin and end. It identifies items on the schedule critical to completing the project on time and it identifies "float time," time when work would not necessarily be going on if the work was progressing as scheduled. If a contractor falls behind on an item critical to completion, the contractor may use float time to catch up.

         
         

      3. Relatively early in the life of the contract, it was agreed that the contractor would provide DOT with a bar chart or a work progress schedule in lieu of a Critical Path Method schedule. The reason for the substitution was not elucidated at hearing. But the substitution contributed to events which led to this proceeding. A bar chart does not identify float time. Furthermore, in the case of a bar chart, unlike a Critical Path Method schedule, controlling items of work cannot be determined by reference to the chart.

         
         

      4. An initial bar chart was submitted by Anderson and signed on Anderson's behalf on September 30, 1994. It was approved by Reynolds, Smith and Hill through the signature of Resident Engineer Edward Riley Griffin on October 4, 1993, and finally by DOT on October 6, 1993, when its District Construction

         Engineer signed the chart. The initial bar chart shows completion within 270 days of calendar time presumably commencing on October 24, 1993.

         
         

      5. Anderson did not commence work, however, in October of 1993. Work was not commenced on the project until February 28, 1994, more than four months later.

         
         

   4. The Supplemental Agreement

      
      

      1. In the interim, an event unforeseeable at the time of bid occurred: DOT and Anderson entered an agreement supplemental to the contract. Fully executed in December, the supplemental agreement addresses the original contract's provision for a crack relief layer composed of bituminous material covered with single application of aggregate, (the "bituminous interlayer".) In place of the bituminous interlayer, the agreement announces DOT's desire to substitute a "rubber asphalt membrane interlayer for crack relief," Petitioner's Ex. No. 19. In other words, DOT wanted a crack relief layer that utilized crumb rubber.

         
         

   5. Crumb Rubber

      
      

      1. Crumb rubber is ground and melted rubber from used tires. Use of crumb rubber for crack relief layers in the construction and resurfacing of roads has several advantages. For one, the reuse of used tires has environmental benefits, such as the conservation of land fill space and prevention of other negative impacts to the environment associated with disposal of used tires. For another, it is highly effective in preventing the cracking of roads, the purpose of a crack relief interlayer.

         
         

      2. The use of crumb rubber for crack relief interlayers and for use in friction course mixes is a relatively new process. The Department began development of its use in 1988. Its use became fully implemented by the Department during the life of the contract, in January 1994. Before January of 1994, it had been expected for some time that the federal government would mandate a certain amount of usage of crumb rubber in road construction projects. The State of Florida, through the Department, wanted to set the pace in crumb rubber utilization for the rest of the nation. The Department, therefore, had encouraged companies engaged in the road construction business, such as Anderson, to be ready to use crumb rubber.

         
         

      3. Anderson responded favorably to DOT's encouragement. At the time of hearing, Anderson had spent approximately one million dollars to utilize crumb rubber in its road construction business. In November of 1993, for example, Anderson purchased a crumb rubber plant from HeatTec of Chattanooga, Tennessee, at a cost of $282,357, and had it shipped to its Lake City yard for use on the project.

         
         

      4. But, the use of crumb rubber in crack relief layers as a relatively new process is not without obstacles. In addition to unforeseen problems one might encounter in the application of any new technology, there are specifications for the application of a crack relief layer composed of crumb rubber that differ from the specifications for the application of a bituminous interlayer. Two of these specifications are affected by weather. First, the surface onto which the crumb rubber, heated to 300 degrees fahrenheit, is applied must be drier than the surface onto which a bituminous interlayer would be applied. Second, and most importantly to this case, the temperature of the

         ambient air at the site of the application of a crumb rubber interlayer must not be lower than 50 degrees fahrenheit.

         
         

   6. Anderson's Concerns about Time and Crumb Rubber

      
      

      1. Prior to the execution of the Supplemental Agreement, Terrill Hayes McRae, Anderson's President, expressed concerns to DOT about delay to the completion of the project caused by the switch to crumb rubber. New equipment to produce and install the rubber asphalt membrane interlayer would be needed. It would take time to order a new crumb rubber plant, have it shipped to Lake City and erect it at the company's Lake City facilities. Even more significantly, the supplemental agreement would not be executed until early in December, usually, a cold month. With winter, the coldest season of the year, yet to begin, it was not a good time to conduct the installation of a rubber membrane interlayer which required the ambient air to be relatively warm.

         
         

      2. The Department has forms for supplemental agreements for road construction. DOT Form 700-010-45 was used for the agreement in this case. The form has a provision to take into account the addition of calendar days to the time for completion of the contract's work caused by the supplemental agreement. In this case, the "additional days" provision shows no days were added to the contract time by virtue of the supplemental agreement having been entered.

         
         

      3. No additional days being granted on the face of the agreement heightened Mr. McRae's concerns. He addressed them directly to Henry Haggerty, DOT's District Construction Engineer for District 2, in a conversation in the presence of Charles Edward Brown, a DOT employee, prior to full execution of the supplemental agreement.

         
         

   7. Different Interpretations of the Conversation

      
      

      1. Mr. McRae understood that the supplemental agreement would not reflect any extension of time for completion of the project before he signed it. But he left the conversation with Mr. Haggerty with what he felt was an assurance that the extra time needed for proper installation of a crumb rubber interlayer "would be handled." (Tr. 358.) Had Mr. McRae felt that he had not been given an assurance of additional time, he would not have signed the supplemental agreement and the use of crumb rubber on the project, therefore, would have been lost.

         
         

      2. Mr. Haggerty does not dispute that the representation was made that the time problem caused by the switch to crumb rubber would be handled. But, it was Mr. Haggerty's understanding that work would commence on the project soon after the conversation, certainly by some time in December. He also understood that Anderson would submit controlling items of work, matters which could not be determined from the bar chart used by Anderson in lieu of a Critical Path Method schedule.

         
         

      3. Charles Brown, district office engineer for the Department, witnessed the conversation between Mr. McRae and Mr. Haggerty. Mr. Brown, earlier, had discussed on several occasions with Mr. McRae the time problem posed by the switch to the crumb rubber interlayer. Mr. Brown suggested to Mr. McRae that the running of the time period for completion could be suspended for vacation or for other reasons, such as weather, that inhibited progress of the work.

         
         

      4. Mr. Brown, however, had no authority to grant such a suspension. He told Mr. McRae to take it up with the appropriate personnel. This was done in

         the conversation with Mr. Haggerty. Mr. Brown agreed that Mr. Haggerty told Mr. McRae that the time problem "would be handled." But Mr. Brown's understanding was that the matter of extensions could only be handled "in accordance with the Department's standard specifications and ordinary procedures." (Tr. 227-8.) Included among the Department's procedures are those contained in the Department's Construction Project Administration Manual, ("CPAM,") and in the Department's Standard Specifications.

         
         

   8. CPAM and the Standard Specifications as to Extensions of Contract Time.

1. Chapter 4, Section 2 of CPAM, deals with delays for inclement weather and reads as follows:

   
   

   No weather delays will be recognized before

   the contractor actually begins work or attempts to begin work in accordance with the approved product work schedule.

   
   

   (Tr. 88.) But CPAM is not incorporated by reference into the contract.

   
   

2. Unlike CPAM, the Standard Specifications are incorporated by reference into the contract. Standard Specification 8-7.3.2, entitled Contract Time Extensions, deals with time extensions generally and the granting of weather days specifically. It reads, in pertinent part,

   
   

   The Department may grant an extension of contract time when a controlling item of work

   is delayed by factors not reasonably anticipated or foreseeable at the time of bid. Such extension of time may be allowed only for delays occurring

   during the contract period or authorized extensions of the contract time period.

   * * *

   Time extensions for delays caused by the effects of inclement weather will be handled differently from those resulting from other types of delay.

   These time extensions are justified only when rains or other inclement weather conditions or related adverse soil conditions prevent the Contractor

   from productively performing controlling items of work resulting in:

   ... The Contractor being unable to work at least

   50 percent of the normal work day on pre-determined controlling work items due to adverse weather conditions ...

   The Engineer will continually monitor the effects of weather and when found justified grant time extensions on either a bimonthly or monthly basis. The Contractor will not be required to submit a request for additional time due to the effects of weather.

   Delays in delivery of materials or component equipment which affect progress on a controlling item of work will be considered as basis for grant- ing a time extension if such delays are beyond the control of the Contractor or supplier.

   * * *

   In general, the Contractor shall furnish substantiating letters from a representative number of manufacturers of such materials or equipment clearly confirming that the delay in

   delivery was in no way the fault of the Contractor.

   
   

   Petitioner's Ex. No. 2B, the Standard Specifications, pgs. 66-67. Unlike CPAM, the Standard Specifications do not expressly require work to commence on a contracted project before weather days may be granted.

   
   

   i. Requests for Extensions and DOT's Decisions

   
   

3. Anderson made several requests for extensions based on the switch to crumb rubber and based on weather-related delays prior to the commencement of construction. None of them were granted. Suspensions of contract time were allowed, however, for other reasons and extensions of time were granted for weather after work had commenced.

   
   

4. The first request for an extension that was not granted occurred on November 9, 1993, well before the supplemental agreement was entered. The request, for a time suspension needed for the installation of the crumb rubber plant, was denied on November 19, 1993, in a letter from Resident Engineer E. R. Griffin. (Petitioner's Ex. No. 18.)

   
   

5. The Department was aware that Anderson was installing crumb rubber on a job near Gainesville in Alachua County. And the Department was of the belief that if Anderson could install it in Alachua County without a crumb rubber plant in Lake City, it could install it in Hamilton County. But, the source of the crumb rubber used on the Alachua County job was a plant in Lloyd, in the area of Tallahassee, considerably west of the Hamilton County project. (Tr. 335.)

   
   

6. In December, the plant was moved to Chattahoochee, another 40 to 50 miles to the west. The use of the Chattahoochee plant as a source for heated crumb rubber would not have been wise for a project in Hamilton County in the winter because of a combination of both the high temperature to which the crumb rubber must be heated at the plant and maintained en route to the site in order to ready it for installation as well as the necessary temperature of the ambient air at the site of installation.

   
   

7. On January 4, 1994, a second request was denied. The Resident Engineer, wrote to Anderson in response to the request for a time suspension until February 28, 1994, an expected date of commencement, based on the "50 degree weather limitation on Asphalt Crumb Rubber Interlayer." Petitioner's Ex. No. 23. The basis for the denial is stated in the letter:

   
   

   Time extensions for delays caused by the effects of inclement weather will be granted per the Standard Specifications. No time extensions

   due to inclement weather can be granted until work begins.

   
   

   Id. Although the Standard Specifications do not explicitly require that work have been commenced for a weather extension to be granted, they do provide criteria governing extensions of contract time.

8. The Standard Specifications allow weather days when the contractor is unable to work at least 50 percent of the work day on "pre-determined controlling work items due to adverse weather." A controlling item of work is defined as: "Those work items that are directly interrelated such that each has a definite influence on the progress of overall work." Petitioner's Ex. No. 2B, The Standard Specifications, Section 1-14, p. 3.

   
   

9. Indeed, prior to January 4, 1994, Anderson had not submitted controlling work items. At bi-weekly meetings with DOT, Anderson had consistently told the Department that it did not have controlling items of work to submit.

   
   

10. Although controlling work items had not been submitted, DOT was on notice that the Crumb Rubber Interlayer was a controlling item of work. First of all, it obviously meets the definition of controlling work item. It is clearly interrelated to other work items and the progress of the work. Moreover, Anderson had so informed DOT in writing. On December 20, 1994, Bryan Richards, Contracts Coordinator for Anderson, had stated so much in the written request to the Resident Engineer for a suspension until February 28, 1994 that led to the denial: In reference to Crumb Rubber Interlayer (controlling work

    item), Anderson Columbia is requesting a time suspension until February 28, 1994 due to the 50 degree weather limitations on application of Rubber Interlayer of Crack Relief. (e.s.), Petitioner's Ex. No. 21.

    
    

11. On June 13, 1994, the Resident Engineer denied a request for an additional 122 calendar days due to inclement weather prior to commencement of work. The Resident Engineer did not invoke CPAM but referred to the earlier letter of January 4, 1994, which had referred to the Standard Specifications as the authority for the bar to granting weather days prior to commencement of work.

    
    

12. Other extensions or suspensions of time were granted. The June 13 letter acknowledges the granting of 11 weather days after the commencement of work on February 28, 1994, but before May 31, 1994. In addition to weather days after commencement of work, DOT suspended the running of contract time for vacation time by Anderson for a period during November and December.

    
    

    1. Other reasons advanced by Anderson for not commencing until February 28, 1994

       
       

13. Beyond the time required to obtain the crumb rubber plant and the imprudence of trying to embark on the application of a crumb rubber interlayer in the middle of winter, there were other reasons, albeit related to the switch to crumb rubber, for not commencing the project until February 28.

    
    

14. In a letter to the District Construction Engineer, the Resident Engineer had stressed that "the contractor is asked to pay special attention to MOT [maintenance of traffic] compliance." Petitioner's Ex. No. 10, p. 2.

    Safety was of primary importance to DOT. And an objective of the project, among others, was that it be safe. Respondent's Ex. No. 1, p. 2.

    
    

15. During the winter months, December, January and February, traffic volume along the stretch of road subject to the project increases dramatically. It would not be prudent to mill a road heavily traveled without an assurance that it could be paved as promptly as possible because a milled out road is hazardous. The longer a milled road goes unpaved, the more potential there is for accidents.

    1. The Contract's Standards for Delinquency and the Monthly Estimates of Progress

       
       

16. In addition to standards for delinquency found in the Florida Statutes and DOT rules, the contract, through the Standard Specifications, recites standards, among them the "15 percent standard:"

    
    

    1. Under the relevant rule provisions, a contractor is delinquent when unsatisfactory progress is being made under these conditions:

       * * *

       (3) The allowed contract time has not expired and the percentage of dollar value of completed work is 15 percentage points or more below the dollar value of work which should have been completed according to the approved working schedule for the project. After falling 15 percent behind, the delinquency continues until the percentage of dollar value of completed work is within five percentage points of the dollar value of work which should have been completed according to the approved working schedule for the project.

       
       

       Petitioner's Ex. No. 2B, the Standard Specifications, Article 8-8.2, p. 69.

       
       

17. The monthly estimates for the months of March, April, May, June, July and August, reveal that Anderson Columbia's percentage of completed work was 15 percentage points or more below the dollar value of work which should have been completed through August 14, 1994, according to the approved working schedule for the project.

    
    

    1. The Notice of Delinquency and its aftermath

    
    

18. On June 22, 1994, Anderson was given notice that the Department believed that progress on the project was 42 percent behind the work progress schedule. Had Anderson received extensions totalling 55 days as of June 19, 1994, Anderson would not have been delinquent under the contract. Had Anderson received an extension based on the switch to crumb rubber for the time between October 24, 1993, when it was supposed to have commenced work, and February 28, 1994, when it actually commenced work, the extension would have covered more than the 55 days necessary to save it from delinquency.

    
    

19. Without such extensions, however, Anderson, was, in truth, just as the Department believed, 42 percent behind the work progress schedule.

    
    

20. Following issuance of the Notice of Delinquency, Anderson began to pursue completion of the project with great diligence. In fact, despite the late start, Anderson, at the time of hearing, was expected by the parties, including the Department, to finish the project on time.

    
    

21. Expectation by the Department after issuance of the notice of delinquency, that Anderson, would finish, after all, on time did not have any effect on the Department's decision to pursue the delinquency. The Department testified that it pursued the delinquency after realizing Anderson would likely finish on time because Anderson fell below the 15 percent standard. In other

    words, Anderson's failure in this case to work within the 15 percent standard demanded that delinquency be pursued.

    
    

22. But when a company falls below the 15 percent standard in the District in which the project is located, the Department normally allows the contractor to amend its job progress schedule. The District Construction Engineer in this case, Mr. Haggerty, has never been involved in a final hearing, other than this, in which a contractor fell below the 15 percent standard because those cases are typically worked out by a schedule modification.

    
    

23. The same is true statewide. When the contractor is expected to finish on time, James B. Lairscey, the Department's Director of the Office of Construction, in his three years in this position of statewide responsibility, has never seen a notice of delinquency pursued beyond negotiation. Before his elevation to a Department Directorship, Mr. Lairscey served the Department in District 7, covering Pinellas, Hillsborough, Pasco and Hernando Counties. In his thirteen years of experience there, as district construction engineer overseeing all projects within the district for three years and resident engineer for 10 years, he had never seen it happen either. Modification of the work progress schedule is the practice of the Department, in Mr. Lairscey's view, as long as the contractor "can show and give good reason to resubmit a new schedule." (Tr. 126.)

    
    

24. The Department, however, felt constrained by CPAM and the need for controlling items of work to have been submitted under the Standard Specifications. It could not allow resubmission of a new schedule in this case because Anderson "didn't start the work during that period of time [prior to February 28 when the schedule required commencement the previous October] and [Anderson] didn't submit controlling items of work." (Tr. 219.)

    
    

    CONCLUSIONS OF LAW

    
    

25. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this proceeding. Section 120.57, Florida Statutes.

    
    

26. For a contractor, the consequences of being declared delinquent are serious. They are outlined in Section 337.16, Florida Statutes,

    
    

    (1) A contractor shall not be qualified to bid when an investigation by the department discloses that such contractor is delinquent on a previously awarded contract, and in such case his certificate of qualification shall be suspended or revoked. Any contractor whose certificate of qualification is suspended or revoked for delinquency shall also

    be disapproved as a subcontractor during the period of suspension or revocation ...

    
    

    At a minimum, the contractor's "certificate of qualification shall be suspended for the number of days that it is administratively determined that

    the contractor was delinquent even if the delinquency is cured during the pendency of the hearing proceed- ings." Section 337.16 (1)(b), F. S. Without doubt, the severity of the consequences of delinquency is warranted in order to keep contractors on the path

    of ensuring work on road construction projects is "pressed vigorously to completion." The Standard Specifications, finding of fact no. 8, above.

    
    

27. "A contractor is delinquent when unsatisfactory progress is being made on a construction project". Section 337.16(1)(a), F. S. Unsatisfactory progress is "determined in accordance with the contract provisions." Id.

    
    

28. The "fifteen percentage standard," recited in the contract and quoted in finding of fact no. 35, above, is also stated in Rule 14-23.012, Florida Administrative Code, as follows:

    
    

    (3) For contracts where contract time is 200 days or more, the allowed contract time has not expired and the percentage of dollar value of completed work is 15 percentage points or more below the dollar value of work which should have been completed according to the contractor's approved working schedule for the project.

    After falling 15 percent behind, the delinquency shall continue until the percentage of dollar value of completed work is within five percentage points of the dollar value of work which should have been completed according to the contractor's approved working schedule for the project.

    
    

    It is this standard by which delinquency is to be determined in this proceeding.

    
    

29. But the application of this standard is not in dispute between the parties. If the extensions that Anderson maintains it is entitled to both because of the switch to crumb rubber and through weather days should not be granted, then Anderson was clearly delinquent at the time the Notice of Delinquency was issued and thereafter through August 14, 1994.

    
    

30. The dispute, however, rather than being over application of the "15 percentage standard," is over whether extensions should have been granted through February 28, 1994, because of the switch to crumb rubber or at least for weather days prior to February 28, 1994 when the ambient air temperature prevented the application of crumb rubber or the weather was otherwise inclement.

    
    

31. The Department maintains that its hands are tied by CPAM with regard to weather days, and by Anderson's failure to submit controlling items of work, a prerequisite, in the Department's view, for the granting of a general extension under the Standard Specifications.

    
    

32. The necessity of commencing work imposed by CPAM prior to qualifying for the receipt of weather days is quickly disposed of in this case. For all of CPAM's commendable good sense in this regard, CPAM does not apply to this case. It was not incorporated into the contract. As the statute makes clear, "unsatisfactory progress shall be determined in accordance with the contract provisions." Section 337.16(1)(a), F. S. The Department may not use CPAM as a basis for denying weather days when CPAM is not part of the contract governing the project on which the DOT believes Anderson to be delinquent.

    
    

33. Anderson argues it is entitled to 66 additional weather days. It is not necessary, however, to determine the number of weather days to which

    Anderson is entitled because ultimately Anderson should have been granted an extension for commencement of work once the switch to crumb rubber was agreed-to by the parties through the execution of the supplemental agreement.

    
    

34. The Standard Specifications allow the granting of an extension when a controlling item of work is delayed by factors not reasonably anticipated or foreseeable at the time of bid. There is no question, despite Anderson's failure to submit the crack relief layer as a controlling item of work, that both Anderson and the Department knew it to be a controlling item. Moreover, Anderson revealed its knowledge of the crack relief layer's status as a controlling item of work to the Department at least by December 20, 1993, in the letter to the Resident Engineer from Bryan Richards, its Contract Coordinator.

    
    

35. Once the decision was made to use crumb rubber for a rubber asphalt membrane interlayer for crack relief in December, the better part of discretion would have been for the Department to have handled the time problem, as Mr. Haggerty indicated it would, by granting Anderson an extension until warm weather would return to Hamilton County. It would have been injudicious and worse, dangerous, had Anderson commenced the milling of the road, a controlling item of work, without a source of crumb rubber close by and without knowing that the weather would be consistently warm enough for its application.

    
    

36. Although not a basis for escaping delinquency, the completion of the project on time without the extensions points out the lack of prejudice caused by a grant of extension for commencement of the project until February 28, 1994. It is understandable that the Department was frustrated by the late start of the project and by not having anything in writing from Anderson by way of a Critical Path Method schedule or otherwise announcing what the controlling items of work were. But, whether prompted by the issuance of the Notice of Delinquency or not, Anderson's completion of the project on time is not in doubt.

    
    

37. Unforeseeable at the time of bid, the delay to the project caused by the decision in December to switch to crumb rubber as the substance to be used in the interlayer, demanded that an extension be granted to allow work to not commence until February 28, 1994. Such an extension is not only consonant with the contract and its Standard Specifications, but it is in keeping with the practice of the Department so long as the contractor "can show and give good reason to resubmit a new schedule," Tr. 126, as explained by Mr. Lairscey. It is wise to follow the practice of the Department in this case because, in the final analysis, an extension for commencement of the project was necessary to ensure that the crack relief layer could be put down as quickly as possible so as to lessen the danger the project, while underway, posed to the public traveling on Interstate 75 in Hamilton County.

RECOMMENDATION

It is, accordingly, RECOMMENDED:

1. that Anderson be granted an extension of contract time so as to not have been required to commence work on the project until February 28, 1994;

   
   

2. that Anderson be determined not delinquent; and,

   
   

3. that the Department take no action against Anderson's Certificate of Qualification.

DONE and ORDERED this 15th day of November, 1994, in Tallahassee, Leon County, Florida.

DAVID M. MALONEY

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 15th day of November, 1994.

APPENDIX

Petitioner's proposed findings of fact Nos. 1-10, 12-21, 23, 25-27, 29-33, have been adopted, in substance, insofar as material.

With respect to petitoner's proposed finding of fact No. 11, the proposed finding is accepted except for the statement that the initial bar chart, Petitioner's Ex. No. 5, showed October 24, 1993, as the start date of construction. The bar chart does not show a start date.

With respect to petitioner's proposed finding of fact No. 22, any implication by the language that Article 8-7.3.2's elaboration by CPAM made CPAM part of the contract is rejected. Otherwise, the proposed finding is adopted.

With respect to petitioner's proposed finding of fact No. 24, weather days prior to the commencement of the project were denied on the basis of CPAM not on the basis of the contract. Otherwise, the proposed finding is adopted.

Petitioner's proposed finding of fact No. 28 is rejected. When it signed the supplemental agreement, Anderson was under the impression, whether correct or not, that contract time would, in some manner, be handled. Entry into the supplemental agreement did not constitute a waiver.

With respect to petitioner's proposed finding of fact No. 34, Anderson's requests for an extension of contract time based on the switch to crumb rubber were denied because Anderson had not submitted controlling items of work, a prerequisite, in the

Department's view to the granting of a non-weather day extension under the contract.

With respect to petitioner's proposed finding of fact No. 35, Anderson was delinquent only if the requested extensions were not granted.

With respect to petitioner's proposed finding of fact No. 36, there was no delinquency to cure if the extensions were granted.

Respondent's proposed findings of fact Nos. 1-19, 22-31, 33, 35-38, and 41, are adopted in substance, insofar as material.

With respect to respondent's proposed finding of fact No. 20, DOT project personnel did not know that the crumb rubber plant in Lloyd had been moved to Chattahoochee, but they did know that Lloyd was in the Tallahassee area and that a plant in the Tallahasse area had been the source for the Alachua County project.

With respect to respondent's proposed finding of fact No. 21, had DOT project personnel known that the crumb rubber plant that would be the source for the project had been moved to Chattahoochee, they would have taken that into consideration. The distance of the haul was of concern to the Resident Engineer because he knew distance could affect the temperature of the load. (Tr. 154.)

With respect to respondent's finding of fact No. 32, the Department's reason for denying an extension based on time needed to install the crumb rubber plant was that controlling items of

work had not been submitted, a prerequisite, in DOT's view, to extensions under the Standard Specifications.

With respect to respondent's finding of fact No. 34 and 39, some DOT personnel did not understand the difference between controlling items of work and other items of work but there is no evidence to support that all project personnel were unaware of the difference.

Respondent's proposed findings of fact Nos. 40 and 41 are conclusions of

law.

COPIES FURNISHED:

Ben G. Watts, Secretary Department of Transportation Haydon Burns Building

605 Suwannee Street

Tallahassee, Florida 32399-0458

Jack R. Leonard, Esquire Assistant General Counsel Department of Transportation

605 Suwannee Street, Mail Station No. 58 Tallahassee, Florida 32399-0458

Brant Hargrove, Esquire

J. Victor Barrios, Esquire Beck, Spalla & Barrios 1026 East Park Avenue

Tallahassee, Florida 32301

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit to the agency written exceptions to this Recommended Order. All agencies allow each party at least ten days in 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.

Docket for Case No: 94-004432

Orders for Case No: 94-004432