STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

THE URBAN GROUP, )

)

Petitioner, )

)

vs. ) CASE NO. 94-5967BID

) DEPARTMENT OF TRANSPORTATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its designated Hearing Officer, Joyous D. Parrish, held a formal hearing in the above-styled case on January 10, 1995, in Fort Lauderdale, Florida.

APPEARANCES

For Petitioner: Mitchell B. Polay

Mark H. Klein

750 Southeast Third Avenue, Suite 205 Fort Lauderdale, Florida 33316

For Respondent: Thomas H. Duffy

Assistant General Counsel Department of Transportation 605 Suwannee Street

Tallahassee, Florida 32399-0450 STATEMENT OF THE ISSUES

The central issue in this case is whether the Department of Transportation (Department) acted arbitrarily, fraudulently, illegally or dishonestly in its award of bid ITB-DOT-94-95-4004 to Kemp Services, Inc. (Kemp).

PRELIMINARY STATEMENT

This case began on September 26, 1994, when the Petitioner filed a formal notice of protest. The protest claimed that the Department erred in awarding ITB-DOT-94-95-4004 to Kemp Services, Inc., as Kemp "did not meet the bare qualification requirements of the ITB." More specifically, Petitioner alleged Kemp's bid was defective for several reasons: that paragraph 1.7.5 required the bidder to be authorized to do business in the State of Florida; that Kemp's bid was non-responsive and contrary to paragraph 1.18.1 of the ITB; that to be a qualified bidder Kemp had to have at least two years of experience providing two of the six services outlined in the scope of services; that Kemp did not have an occupational license; and that Kemp failed to completely fill out required forms. As a result, Petitioner argued, The Urban Group, Inc., should have received the contract as the second lowest bidder who established it is responsible and responsive to the ITB.

At the hearing, the Petitioner presented the testimony of the following witnesses: Howard Steinholtz, president of The Urban Group, Inc.; Joe Faluade, vice president of Kemp Services, Inc.; James Nardi, operations supervisor for Petitioner; and Don Gentile, the Department's real estate/environmental administrator responsible for reviewing the subject bid documents and checking references listed therein. Its exhibits numbered 1 through 7 have been admitted into evidence.

Mr. Gentile; Ron Kaven, a right of way specialist II for the Department who took pictures of various properties; Mr. Faluade; and Stacy Weiss, a programming and contracts operations manager II for the agency, testified on behalf of the Department. Its exhibits numbered 1 through 9 have also been admitted.

A transcript of the proceeding has not been filed. Stipulations of fact from the parties' prehearing stipulation are included in the findings of fact below. Specific rulings on the parties' proposed findings of fact are included in the appendix at the conclusion of this order.

FINDINGS OF FACT

1. The Department issued an invitation to bid (ITB) and solicited bids for district-wide miscellaneous property management maintenance services pursuant to ITB-DOT-94-95-4004.

   
   

2. Kemp Services, Inc. (Kemp), submitted the lowest bid for the subject

   ITB.

   
   

3. Petitioner, Urban Group, Inc., submitted the second lowest bid for the

   subject ITB.

   
   

4. Section 1.1 of the ITB provided: Invitation

   The State of Florida Department of Transport- ation requests written bids from qualified firms to MAINTAIN RIGHT-OF-WAY STRUCTURES

   AND VACANT LOTS BY PROVIDING CLEAN-UP SERVICES, LAWN SERVICES, LANDSCAPE SERVICES, SECURING

   OF BUILDINGS, AND OTHER MISCELLANEOUS HANDYMAN AND SKILLED LABOR SERVICES. ALSO PROVIDE SERVICES FOR SIGN REMOVAL FOR STRUCTURES ILLEGALLY ON THE DEPARTMENT'S RIGHT-OF-WAY

   OR ILLEGALLY ON PRIVATE PROPERTY IN THE FOLLOWING FIVE COUNTY AREA: BROWARD, MARTIN, PALM BEACH, ST. LUCIE AND INDIAN RIVER COUNTIES.

   
   

   For the purpose of this document, the term "bidder" means the prime Consultant acting

   for itself and those individuals, partnerships, firms, or corporations comprising the bidder's team by joint venture or subcontract. The term "bid package" means the complete response of the bidder to the Invitation To Bid, including properly completed forms and supporting documentation. [Emphasis in text.]

5. The services were to be provided on an as-needed basis for the term of the agreement, two years.

   
   

6. Section 1.7.1 of the ITB provided: Qualifications

   1.7.1 Bidders must meet the following minimum qualifications:

   
   

   BIDDERS MUST HAVE AT LEAST TWO YEARS EXPERIENCE PROVIDING AT LEAST TWO (2) OF THE SIX SERVICES OUTLINED IN THE SCOPE OF SERVICES IN EXHIBIT "A". BIDDERS MUST HAVE BEEN IN CONTINUOUS BUSINESS FOR THE PAST TWO (2) YEARS AND COMPLETE

   FORM "F" WITH THE INFORMATION REQUESTED REGARDING WORK EXPERIENCE AND REFERENCES. ALL REFERENCES WILL BE CHECKED.

   
   

   FAILURE TO PROVIDE FORM "F" AND THE WORK EXPERIENCE REQUESTED WILL CONSTITUTE A NON-

   RESPONSIVE BID. [Emphasis in text.]

   
   

7. Section 1.7.4 of the ITB provided: Qualifications of Key Personnel

   Those individuals who will be directly involved in the project must have demonstrated experience in the areas delineated in the scope of work.

   Individuals whose qualifications are presented will be committed to the project for its duration unless otherwise accepted by the Department's Contract Manager. Where State of Florida registration or certification is deemed appropriate, a copy of the registration or certificate should be included in the bid package.

   
   

8. Section 1.7.5 of the ITB provided: Authorizations and Licenses

   The Consultant must be authorized to do business in the State of Florida. Such authorization and/or licenses should be obtained by the bid due date and time, but in any case, will be required prior to award of the contract. For corporate authorization, contact:

   Florida Department of State Division of Corporations The Capitol Building

   Tallahassee, Florida 32399

   (904)487-6052

   
   

9. Other than the provisions above, no other licensure or authorization to do business was required by the ITB.

10. Section 1.8.2 of the ITB provided: Responsiveness of Bids

    All bids must be in writing. A responsive bid is an offer to perform the scope of services called for in this Invitation to Bid. Bids found to be non-responsive shall not be considered. Bids may be rejected if found

    to be irregular or not in conformance with the requirements and instructions herein

    contained. A bid may be found to be irregular or non-responsive by reasons, including, but not limited to, failure to utilize or complete prescribed forms, conditional bids, incomplete bids, indefinite or ambiguous bids, improper

    undated or unsealed signatures (where applicable).

    
    

11. Section 1.8.4 of the ITB provided: Other Conditions

    Other conditions which may cause rejection of bids include evidence of collusion among bidders,

    obvious lack of experience or expertise to perform the required work, or failure to perform or meet financial obligations on previous contracts, or

    in the event an individual, firm, partnership,

    or corporation is on the United States Comptroller General's List of Ineligible Contractors for Federally Financed or Assisted Projects.

    
    

    Bids will be rejected if not delivered or received on or before the date and time specified as the due date for submission.

    
    

12. Section 1.8.5 of the ITB provided: Waivers

    The Department may waive minor informalities or irregularities in bids received where such is merely a matter of form and not substance, and the correction or waiver of which is not

    prejudicial to other bidders. Minor irregular- ities are defined as those that will not have an adverse effect on the Department's interest and will not affect the price of the Bids by giving a bidder an advantage or benefit not enjoyed by other bidders.

13. Section 1.18.1 of the ITB provided: Award of the Contract

    The Department intends to award a contract to the responsible and responsive bidder who bids the lowest cost as identified in Form "C", Bid Blank, attached hereto and made a part hereof.

    
    

14. The ITB did not specify a minimum number of employees, vehicles or hours of service for a bidder to be deemed responsible or responsive.

    
    

15. At all times material to this case, Kemp has been in continuous business for the past two (2) years, and completed form "F" with the information requested regarding work experience and references. The Department's agent, Mr. Gentile, checked with two of the references listed by Kemp to verify information relative to this bid requirement.

    
    

16. At all times material to this case, Kemp had at least two years experience providing at least two (2) of the six services outlined in the scope of services. The Department's agent, Mr. Gentile, checked with two of the references listed by Kemp to verify information relative to this bid requirement.

    
    

17. While Mr. Gentile was authorized to check with all references listed by Kemp, the failure to do so does not discount the information obtained from the sources that were checked.

    
    

18. Kemp had an appropriate occupational license to perform work in the tricounty area, but did not have occupational licenses with the City of Hollywood or Broward County.

    
    

19. At all times material to this case, Kemp maintained a warehouse to secure the equipment to be used such as lawnmowers, trimmers, and cleaning supplies/equipment.

    
    

20. After the bid protest was filed, the Department verified that Kemp had used the warehouse as it claimed. No evidence to the contrary was presented.

    
    

21. The mailing address Kemp listed on the first page of its bid response was 8637 S. Sutton Drive, Miramar, Florida. Mr. Faluade resides at that address. He listed that address for mail purposes.

    
    

22. The business address for Kemp listed on the bid response was 6200 Johnson Street, Miramar, Florida. This address is a store-front facility with limited office equipment and furniture. Kemp maintains an office at this location but stores its equipment elsewhere as noted above.

    
    

23. Kemp was the lowest responsive, responsible bid for ITB-DOT-94-95- 4004.

    
    

    CONCLUSIONS OF LAW

    
    

24. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

25. Petitioner's substantial interests have been and will be affected by the Department's award of the contract to Kemp. As Petitioner has shown that the agency action will result in an injury-in-fact, which is of the type that the statute under which the agency acted is designed to protect, Petitioner has established standing in this proceeding. See Fairbanks, Inc. v. Department of Transportation, 635 So.2d 58 (Fla. 1st DCA 1994).

    
    

26. In this case, "the scope of the inquiry is limited to whether the purpose of competitive bidding has been subverted. In short, 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, 914 (Fla. 1988).

    
    

27. In Scientific Games, Inc. v. Dittler Brothers, Inc., 586 So.2d 1128, (Fla. 1st DCA 1991) the court, citing Groves-Watkins, supra, found, at 1131:

    
    

    The Hearing Officer need not, in effect, second guess the members of the evaluation committee to determine whether he and/or other reasonable and well-informed persons might have reached a contrary result. Rather, a 'public body has wide discretion' in the bidding process and

    'its decision, when based on an honest exercise' of its discretion, should not be overturned 'even if it may appear erroneous and even if reasonable persons may disagree.'

    [Emphasis in original.]

    
    

28. In this case, the Petitioner has not established that the agency acted fraudulently, arbitrarily, illegally, or dishonestly. The Department verified that Kemp met the minimum requirements of the ITB and, therefore, must be deemed responsive and responsible. The sole other criteria for evaluation was price. Clearly, Kemp submitted the lowest bid. That the agency might get a higher quality of service had it chosen the Petitioner is not pertinent to the propriety of the agency's decision.

    
    

29. In accordance with the terms of the ITB the bid responses were reviewed and references checked by Mr. Gentile. As stated previously, Mr. Gentile checked with two of the four references listed by Kemp. He verified that the bidder had been in business the appropriate length of time and that it had done at least two of the services required in the scope of work. He was not required to verify the quality of the work performed or whether another bidder might perform the services better.

    
    

30. The ITB did not require licensure or authorization until the time of contracting, therefore, the issues as to the licensure status of Kemp at the time of its submittal are irrelevant. However, the Department established that Kemp was authorized to do business in Florida, did have a current occupational license, and did have an appropriate business location at all times material to this bid.

RECOMMENDATION

Based on the foregoing, it is, hereby,

RECOMMENDED:

That the Department of Transportation enter a final order dismissing Petitioner's challenge to the award of ITB-DOT-94-95-4004 to Kemp Services, Inc.

DONE AND RECOMMENDED this 14th day of February, 1995, in Tallahassee, Leon County, Florida.

JOYOUS D. PARRISH

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 14th day of February, 1995.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-5967

Rulings on the proposed findings of fact submitted by the Petitioner:

1. Paragraphs 1 through 4, 6, and 8 are accepted.

2. With regard to paragraphs 5, 7, and 16 noting that the additional emphasis is not in the text and that the citations are incomplete (and perhaps misleading), they are accepted.

3. Paragraph 9 is rejected as contrary to the weight of credible evidence.

4. Paragraph 10 is rejected as contrary to the weight of credible evidence.

5. Paragraph 11 is rejected as incomplete, and therefore, misleading. Corporate documents may have been filed on that date, however, the weight of the credible evidence established that Kemp had been in business the requisite amount of time.

6. Paragraph 12 is rejected as incomplete, and therefore, misleading. The business conducted by the Kemp personnel continued regardless of the business entity structure that was used.

7. Paragraph 13 is rejected as contrary to the weight of credible evidence.

8. Paragraph 14 is rejected as contrary to the weight of credible evidence or irrelevant.

9. Paragraph 15 is rejected as contrary to the weight of credible evidence.

10. Paragraph 16 is rejected as contrary to the weight of credible evidence. Moreover, no credible evidence was presented to establish that Kemp did not provide services as described in the ITB or that it was not in business the requisite time.

11. Paragraph 17 is rejected as incomplete, and therefore, misleading. The mailing address listed by Kemp was a residential address.

12. Paragraph 18 is rejected as irrelevant.

13. Paragraph 19 is rejected as contrary to the weight of credible evidence.

14. Paragraph 20 is rejected as irrelevant. Kemp probably does not have a Leon County occupational license either. It did have an appropriate occupational license at all times material to this case.

Rulings on the proposed findings of fact submitted by the Respondent:

1. Paragraphs 1 through 29 are accepted.

COPIES FURNISHED:

Thomas H. Duffy

Assistant General Counsel Department of Transportation 605 Suwannee Street

Tallahassee, Florida 32399-0450

Mitchell B. Polay Mark H. Klein

750 S.E. Third Avenue Suite 205

Fort Lauderdale, Florida 33316

Thornton J. Williams General Counsel

Department of Transportation

562 Haydon Burns Building 605 Suwannee Street

Tallahassee, Florida 32399-0450

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

605 Suwannee Street

Tallahassee, Florida 32399-0450

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least 10 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.

Docket for Case No: 94-005967BID

Orders for Case No: 94-005967BID