STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

QUINN CONSTRUCTION,INC., )

)

Petitioner, )

)

vs. ) Case No. 99-2277BID

)

)

STATE OF FLORIDA, ) DEPARTMENT OF TRANSPORTATION, )

)

Respondent, )

)

and )

) COASTAL MARINE CONSTRUCTION, ) INC. )

)

Intervenor. )

)

RECOMMENDED ORDER

Daniel Manry, Administrative Law Judge of the Division of Administrative Hearings, conducted the administrative hearing in this case on June 14, 1999, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Mike Piscitelli, Esquire

560 East Broward Blvd.

Fort Lauderdale, Florida 33394

Suzanne Grutzner, Esquire 1321 77th Street, East Palmetto, Florida 34221

For Respondent: Brian F. McGrail, Esquire

Department of Transportation Haydon Burns Building

605 Suwannee Street, Mail Station 58

Tallahassee, Florida 32399-0458

For Intervenor: Daniel Te Young, Esquire

Post Office Box 589

Tallahassee, Florida 32302-0589

STATEMENT OF THE ISSUE

The issue in this proceeding is whether the proposed award of a contract to PCL Civil Contractors, Inc. ("PCL"), for the rehabilitation of the Jewfish Creek Bridge in Monroe County, Florida violates Section 120.57(3), Florida Statutes (1997). (All chapter and section references are to Florida Statutes (1997) unless otherwise stated.)

PRELIMINARY STATEMENT

Petitioner timely filed its bid protest on March 18, 1999. On May 20, 1999, Respondent referred the matter to the Division of Administrative Hearings ("DOAH") to conduct an administrative hearing.

On June 7, 1999, Coastal Marine Construction, Inc. ("Coastal") filed a Motion to Intervene. The Motion to Intervene was granted at the hearing. Intervenor seeks award of the bid if the bid is not awarded to Petitioner or PCL. PCL is not a party to this proceeding.

On June 7, 1999, Petitioner filed a Motion for Continuance. The Motion for Continuance was denied on the record at the hearing.

At the hearing, Petitioner presented the testimony of two witnesses, filed four deposition transcripts, and submitted 13 exhibits for admission in evidence. Respondent presented the testimony of two witnesses and submitted five exhibits for admission in evidence. Intervenor called no witnesses and submitted no exhibits, but did cross-examine some witnesses.

The identity of the witnesses and exhibits, and any

attendant rulings, are set forth in the Transcript of the

hearing filed on July 1, 1999. Petitioner and Respondent timely filed their respective proposed recommended orders ("PROs") on July 12, 1999. Intervenor did not file a PRO.

FINDINGS OF FACT

1. On September 24, 1998, Respondent issued an invitation to bid ("ITB") on a proposed contract for the rehabilitation of the Jewfish Creek Bridge in Monroe County, Florida. The ITB identified the project as Financial Project No. 250533-1-52-01 and contract number E-6844.

2. Respondent budgeted $707,323 for the project and established two disadvantaged business enterprise ("DBE") goals. Eight percent of the total amount actually expended for the project was reserved for non-minority female DBEs. Four percent of the total project expenditure was reserved for Black American DBEs.

3. On October 1, 1998, five bidders submitted bids. Petitioner submitted the lowest bid in the amount of

   $855,899.74.	PCL submitted the second	lowest bid of
   $940.471.50,	and Coastal submitted the	third lowest bid of
   $951,071.11.

4. The fourth and fifth lowest bids were submitted by M&J Construction Co. ("M&J") and by The Walsh Group dba Archer Western ("Archer"). The respective bids of M&J and Archer were $1,100,471.88 and $1,149,000.

5. Respondent determined that the bids from M&J and Archer were non-responsive. Neither M&J nor Archer protested Respondent's determination, and Respondent's

   determination is not at issue in this proceeding.

6. Respondent proposes to award the contract to PCL as the second lowest bidder. Respondent proposes that the bid submitted by Petitioner is non-responsive because it does not meet established DBE goals; and because it fails to demonstrate Petitioner's good faith effort to meet applicable DBE goals. In addition, Respondent proposes that the bids submitted by PCL and Coastal are responsive because each meets applicable DBE goals for the project.

7. It is uncontroverted that Petitioner failed to meet applicable DBE goals. The issues for determination are whether Respondent's proposed evaluation of Petitioner's good faith efforts to meet applicable DBE goals and Respondent's proposed determination that PCL and Coastal met DBE goals is contrary to governing statutes, rules, and policies; and, if so, whether Respondent's proposed agency action is "clearly erroneous, contrary to competition, arbitrary, or capricious."

1. Contrary to Applicable Statutes

   1. As a threshold matter, Respondent's proposed agency action is contrary to Section 120.57(3)(d)3. Section 120.57(3)(d)3 provides that if the subject of a protest is not resolved within seven days after the receipt of a formal written protest, "the agency shall refer the protest" to DOAH. (emphasis supplied)

   2. Petitioner first filed its formal protest of the proposed agency action on November 11, 1998. For reasons discussed hereinafter, Respondent did not refer the protest to DOAH within seven days. Rather, Respondent referred the

      protest to DOAH on May 20, 1999, approximately 190 days after the formal protest.

   3. On March 14, 1999, Respondent issued a second notice of intent to award the contract to PCL. Petitioner timely filed a second formal written protest on March 18, 1999. Respondent did not refer the matter to DOAH until May 20, 1999, approximately 33 days later.

   4. Unlike Section 120.57(3)(e), there is no provision in Section 120.57(3)(d)3 which authorizes Respondent to ignore the seven-day requirement upon stipulation by all of the parties. Even if such authority exists by implication in Section 120.57(3)(d)3, no evidence shows that the seven-day requirement in Section 120.57(3)(d)3 was waived by an express stipulation, written or oral, knowingly executed by all of the parties. Any stipulation would arise from a combination of implied statutory authority and tacit acquiescence or waiver by the all of the parties.

2. Contrary to Applicable Rules

   1. Respondent's proposed evaluation of Petitioner's good faith efforts to comply with applicable DBE goals is contrary to Florida Administrative Code Rule 14- 78.003(2)(b)3.f.(IV), Rule 14-78.003(2)(b)6.c and d, and Rule 14-78.003(2)(b)f and h. (Unless otherwise stated, all references to rules are to rules promulgated in the Florida

      Administrative Code in effect on the date of this Recommended Order.) Rule 14-78.003(2)(b)3.f.(I)-(XI) prescribes the

      criteria by which Respondent must evaluate Petitioner's good faith efforts to meet applicable DBE goals.

   2. Rule 14-78.003(2)(b)3.f.(IV) requires Respondent to consider whether applicable DBE goals were met by the other bidders. Applicable DBE goals were not met by either PCL or Coastal.

   3. The information needed to consider whether PCL and Coastal met applicable DBE goals was included in their respective bids and available for Respondent's consideration in accordance with Rule 14-78.003(2)(b)3.f.(IV). Respondent did not consider the relevant information in the bids submitted by PCL and Coastal. Rather, Respondent merely accepted the conclusion of each bidder, on the face of its bid, that each bidder met applicable DBE goals.

      1. The PCL Bid

   4. The PCL bid contained two DBE utilization forms. One indicated an intent to subcontract $76,000, or approximately eight percent of the bid amount, to ABC Barricade Co. ("ABC") for traffic management. The other utilization form indicated an intent to subcontract $38,000, or approximately four percent of the bid amount, to TCOE Corporation ("TCOE") to furnish and install roadway steel.

      ABC is certified by Respondent as a non-minority

      female DBE, and TCOE is certified by Respondent as a Black American DBE, defined in Rule 14-78.002(18)(a)1.

   5. The bids of Petitioner and Coastal also included subcontracts with ABC. However, the amount of the subcontract

      in the PCL bid was approximately twice the amount of the respective subcontracts in the bids from Petitioner and Coastal.

   6. Of the $76,000 PCL was to pay to ABC, the PCL bid showed that $53,430, or approximately 70 percent, was designated for payment to off-duty law enforcement officers. The PCL bid did not specify whether ABC would perform a commercially useful function for the $53,430 earmarked for law enforcement or whether ABC would subordinate over 70 percent of its contract to a non-DBE, the law enforcement agency.

   7. Rule 14-78.003(2)(b)6.c authorizes Respondent to count toward the DBE goals achieved by PCL only those expenditures to DBEs that perform a commercially useful function. The rule states that a DBE such as ABC performs a commercially useful function when:

      . . . it is responsible for execution of a distinct element of the work of a contract and carrying out its responsibilities by actually performing, managing, and supervising the work involved.

      
      

   8. If ABC did not perform a commercially useful function, ABC would subordinate more than 49 percent of the subcontract work. In such a case, Rule 14-78.003(2)(b)6.d provides that none of the DBE subcontract amount may be counted toward the DBE goals for PCL.

   9. Respondent counted the ABC contract toward PCL's DBE goals without considering whether the ABC contract complied with the requirements in Rule 14-78.003(2)(b)6.c and d,

      pertaining to a commercially useful function and the subordination of more than 49 percent of the contract amount. Respondent has no authority under its rules to count the ABC contract toward PCL's DBE goals unless the contract complies with applicable requirements in Rule 14-78.003(2)(b)6.c and d.

   10. Respondent violated Rule 14-78.003(2)(b)3.f.(IV) by counting the ABC contract toward PCL's DBE goals without considering whether the ABC contract qualified under Rule 14- 78.003(2)(b)6 c and d. Respondent's proposed evaluation of Petitioner's good faith efforts to comply with applicable DBE goals is contrary to Rule 14-78.003(2)(b)6.c and d and Rule 14-78.003(2)(b)3.f(IV).

   11. The PCL subcontract with TCOE did not require TCOE to perform a commercially useful function. The vice-president of TCOE could not recall another project in which TCOE had ever furnished and installed roadway steel and did not recall any current jobs in which TCOE is performing such work. TCOE did not have a supplier lined up to supply the necessary steel. TCOE does not fabricate the particular type of steel required to be furnished and installed in this project.

   12. The vice-president for TCOE could not state a price for roadway steel which TCOE agreed to fabricate and supply to PCL. He could not state the factors TCOE used in preparing the estimate given to PCL.

   13. The square-foot price of the steel quoted by TCOE was between a half and a third less than the price quoted by

       the other two low bidders and approximately one third less than Respondent's average. In addition, the TCOE bid included

       400 tons less than the other two bids.

       
       

   14. Respondent counted the TCOE contract toward PCL's DBE goals without considering whether the TCOE contract complied with the requirements in Rule 14-78.003(2)(b)6.c and d, pertaining to a commercially useful function and the subordination of more than 49 percent of the contract amount. Respondent has no authority under its rules to count the TCOE contract toward PCL's DBE goals unless the contract complies with applicable requirements in Rule 14-78.003(2)(b)6.c and d.

   15. Respondent violated Rule 14-78.003(2)(b)3.f.(IV) by failing to consider whether PCL's subcontract with TCOE could be counted toward PCL's DBE goals under Rule 14- 78.003(2)(b)6.c and d. Respondent's proposed evaluation of Petitioner's good faith efforts to comply with applicable DBE goals is contrary to Rule 14-78.003(2)(b)6.c and d and Rule 14-78.003(2)(b)3.f(IV).

       1. The Coastal Bid

   16. The bid submitted by Coastal included three DBE utilization forms. Coastal submitted one form indicating an intent to subcontract $44,992 to ABC, or approximately 4.7 percent of the project. The subcontract with ABC is not at issue.

   17. Coastal also indicated an intent to subcontract Jayaldon Enterprises, Inc. ("Jayaldon") and Acutec, Inc. ("Acutec") for separate types of roadway steel. Jayaldon and

       Acutec are each certified as a DBE. The contract amounts were

       $51,973.36 for Jayaldon and $97,823.22 for Acutec. Pursuant to Rule 14-78.003(2)(b)6.f, Respondent counted 60 percent of each contract, or $31,184.01 for Jayaldon and $58,693.93 for Acutec, toward Coastal's DBE goals.

   18. Jayaldon would not perform a commercially useful function within the meaning of Rule 14-78.003(2)(b)6.c. In addition, Jayaldon is a sales representative company for Florida Structural Steel and is not a regular dealer. A regular dealer is defined in Rule 14-78.002(15) to mean:

       . . . a firm that owns, operates, or maintains a store, warehouse, or other establishment in which the materials or supplies required for the performance of the contract are brought, kept in stock, and regularly sold to the public in the usual course of business. To be a regular dealer, the firm must engage in, as its principal business and in its own name, the purchase and sale of the products in question. A regular dealer in such bulk items as steel, cement, gravel, stone, and petroleum products does not need to keep such products in stock, if the dealer owns or operates the appropriate distribution facility. Brokers and packagers shall not be regarded as . . . regular dealers within the meaning of these rules.

   19. Jayaldon does not stock steel in a warehouse and does not fabricate steel. If Coastal had been awarded the contract, Jayaldon would have submitted an order to Florida Structural Steel and Florida Structural Steel would have fabricated the steel and shipped it directly to Respondent at the project site. Jayaldon would not have been responsible for execution of a distinct element of work by actually

       performing, managing, and supervising the work involved.

       
       

   20. Acutec is an electrical contractor and is not a regular dealer in roadway steel within the meaning of Rule 14- 78.002(15). Coastal contacted Acutec after the bids were submitted and asked Acutec to serve as a pass-through for supplying steel roadway floor. If awarded the contract, Acutec would have ordered the structural steel from an independent supplier, marked it up, and had the supplier ship the steel to Coastal.

   21. Rule 14-78.003(2)(b)6.h authorizes Respondent to count toward Coastal's DBE goals only prescribed expenditures from the Jayaldon and Acutec contracts. Pursuant to Rule 14- 78.003(2)(b)6.h.(I), Respondent is authorized to count only the fees or commissions charged by each company for assistance in the procurement of materials or supplies. However, Respondent did not count the expenditures in the contracts with Jayaldon and Acutec pursuant to Rule 14-78.003(2)(b)6.h.

   22. Pursuant to Rule 14-78.003(2)(b)6.f, Respondent counted 60 percent of the contested expenditures toward Coastal's DBE goals. Rule 14-78.003(2)(b)6.f authorizes Respondent to do so only if Jayaldon and Acutec are regular dealers. Neither Jayaldon nor Acutec is a regular dealer in roadway steel as defined in Rule 14-78.002(15).

   23. When Respondent counted 60 percent of the expenditures to Jayaldon and Acutec toward Coastal's DBE

   goals, Respondent violated Rule 14-78.003(2)(b)3.f (IV) by failing to consider whether Coastal met its DBE goals.

   Respondent's proposed evaluation of Petitioner's good faith efforts to comply with applicable DBE goals is contrary to Rule 14-78.003(2)(b)3.f.(IV) and Rule 14-78.003(2)(b)6.f and h(I).

3. Contrary to Policy

   1. On February 9, 1994, Respondent issued a memorandum entitled, "Disadvantaged Business Enterprise Good Faith Efforts Review Committee" (the "Memorandum"). The Memorandum officially stated agency policy for the organization of the Good Faith Efforts Review Committee (the "Committee") and the Committee's review and recommendations concerning contractors' documentation of their good faith efforts to comply with DBE goals established by Respondent in a bid or request for proposal. The policy applies to local districts as well as the central office.

   2. The Committee consists of three primary and two alternate members. The chairperson is appointed by the director of administration. The other two members of the Committee are the manager of the minority programs office and an employee from the office of construction who is appointed by the director of construction. Alternate members are appointed by the director of administration and the director of construction.

   3. Prior to any meeting of the Committee, the minority programs office must prepare copies of relevant bid documents

      and other working papers to assist the Committee in its

      analysis. The Committee members then meet and review the bidders' good faith efforts in accordance with the criteria set forth in Rule 14-78.003(2)(b)3.f. The chairperson must prepare minutes to document the Committee meeting.

   4. At the conclusion of the meeting, a member of the Committee must write a Committee report. The report must include the Committee's recommendations and its rationale in support of the recommendations. The report must also include copies of all materials used by the Committee in its analysis. Each member of the Committee must sign the report. The Committee must distribute the report to all members of the technical review committee as well as the members of the contracts award committee.

   5. Respondent's review of Petitioner's good faith efforts was contrary to officially stated agency policy in the Memorandum. After the bids were opened and evaluated on October 1, 1998, Respondent's Contracts Administrator for District 6 prepared a memorandum to the Technical Review Panel. The memorandum summarized the bids and stated that the "lowest bidder has not met DBE goals. Second lowest bidder has met goals." The memorandum recommended that the contract be awarded to PCL.

   6. The memorandum, including its recommendation, was distributed to members of Respondent's technical review committee. Rather than conducting a meeting of the technical review committee, each member of the committee submitted a memorandum indicating whether to reject or to accept the

      recommendation to award the contract to PCL.

   7. The Contracts Administrator for District 6 distributed Petitioner's bid, including the evidence of Petitioner's good faith effort to meet DBE goals, only to Respondent's district compliance officer. When the District Compliance Officer received Petitioner's bid from the Contracts Administrator, the District Compliance Officer reviewed the documents with the Assistant District Engineer for District 6.

   8. The District Compliance Officer and Assistant District Engineer discussed and evaluated Petitioner's good faith submittal, but did not report their conclusion to other members of the technical review committee. Rather, the District Compliance Officer submitted a memorandum to the Contracts Administrator stating, "Quinn Construction did not meet the goal therefore it's my recommendation to reject their bid." The District Compliance Officer submitted the memorandum in the name of his supervisor concluding that "Quinn Construction did not meet DBE goals."

   9. On October 29, 1998, Respondent posted its notice of intent to award the contract to PCL. On November 2, 1998, Petitioner timely filed its notice of protest. On

      November 11, 1998, Petitioner timely filed its formal written protest of the notice of intent to award the contract to PCL.

   10. As a result of Petitioner's protest, District 6 determined that it should formalize the process by which it reviewed good faith effort submittals. The supervisor for the District Compliance officer appointed the District Compliance

       Officer and the Assistant District Construction Engineer

       to the newly created District 6 Good Faith Efforts Committee.

   11. By telephone conference, the three District 6 employees met with three individuals from Respondent's central office. The three individuals in the central office were the Manager of the Minority Programs Office, a representative of Respondent's administration office, and a representative of Respondent's office of construction.

   12. The manager of the minority programs office prepared minutes of the meeting. The minutes are in evidence in this proceeding.

   13. The participants in the telephone conference concluded that Petitioner's bid was non-responsive. The Committee based its conclusion on several grounds. The Committee determined that Petitioner did not solicit from 47 of 68 companies listed in the DBE Directory as doing the types of work being solicited by the prime contractor in the geographic area where the work was to be performed. The Committee also determined that Petitioner sent solicitation letters by fax rather than by certified mail. Finally, the Committee determined that the second and third low bidders achieved applicable DBE goals.

   14. On March 14, 1999, Respondent posted its second notice of intent to award the contract to PCL. On March 18, 1999, Petitioner timely filed its second protest of Respondent's proposed agency action.

   15. The first proposed evaluation of Petitioner's good faith efforts to comply with applicable DBE goals is contrary

       to officially stated agency policy in the Memorandum. The

       first District 6 good faith review committee did not include the three members required by agency policy. The committee did not receive required information in advance of the meeting. The committee neither prepared minutes of the meeting nor authored a report which included the committee's recommendations and supporting rationale. The committee did not otherwise disseminate its findings to the contracts awards committee or to the technical review committee.

   16. The second evaluation of Petitioner's good faith efforts to comply with applicable DBE goals was contrary to officially stated agency policy in the Memorandum. The Committee was not constituted in accord with membership requirements prescribed in the Memorandum. A member of the Committee did not write a report, and all of the Committee members failed to sign the required report. Copies of materials used by the Committee in its analysis were not attached to a report of the Committee. A report was not distributed to all members of the contract awards technical review committee and the contracts award committee.

   17. Minutes of the telephone conference conducted by the Committee were sent only to the minority programs office.

       The minutes were not disseminated either to the contracts awards technical review committee nor to the contract awards committee.

   18. After the telephone conference meeting of the Committee, a subsequent meeting of the technical review committee did not occur. The technical review committee

   received no further information for their

   consideration in voting whether to award or to reject the bid.

   
   

4. Petitioner's Good Faith Efforts

1. Petitioner's bid contains a DBE utilization summary form indicating an intent to subcontract with ABC in the amount of $38,000, or approximately five percent of the total project. Petitioner's bid also contains documentation of Petitioner's good faith effort to obtain additional minority participation. Both the DBE utilization summary form and the documentation of good faith efforts comply with the requirements of Rule 14-78.003(2)(b)3.

2. In its bid, Petitioner submitted proof of solicitation of 26 qualified DBE firms. Each firm is listed in Respondent's monthly DBE Directory as performing work included in the project, either in Monroe County or statewide.

3. In relevant part, Respondent's proposed evaluation of Petitioner's good faith effort to comply with applicable DBE goals states that Petitioner failed to contact 47 companies listed in the DBE Directory as doing work solicited by the contractor for the project. Of the 47 DBEs, 22 were maintenance or traffic subcontractors. Petitioner had a firm agreement with ABC. ABC was the same DBE used by PCL and Coastal.

4. Another 17 of the 47 DBEs were painters who did not have the QP2 certification required for the project specifications. There was no reason for Petitioner to contact painters who were not QP2 certified.

5. Another three of the 47 DBEs did not perform any item of work available on the project. Another four of the 47 DBEs had telephone numbers that were either disconnected or answered by different parties or entities.

6. The remaining DBE was TCOE. TCOE was not interested in submitting a bid to Petitioner for this project.

7. Rule 14-78.003(2)(b)3.f.(I) requires Respondent to consider whether a contractor contacts DBEs by certified mail. Although Respondent prefers that bidders contact DBEs by certified mail, Respondent does not require notice by certified mail.

8. Petitioner provided reasonable notification to DBEs by fax. Petitioner included a fax log with its bid to show that the transmittals were successful.

9. Petitioner selected economically feasible portions of the work to be performed by DBEs. Petitioner made all items in the contract available for subcontracting.

10. Petitioner offered to assist DBEs in reviewing the contract plans and specifications. Petitioner submitted all quotations received from DBEs. Petitioner was not asked to assist any DBE in obtaining bonding, lines of credit, or insurance.

11. Within the last six months, Petitioner has used DBEs on other contracts. Petitioner's utilization of DBEs has exceeded contract goals established by Respondent in each case.

    CONCLUSIONS OF LAW

12. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this proceeding. The parties were duly noticed for the administrative hearing. Sections 120.569 and 120.57(1).

13. In relevant part, Section 120.57(3)(f) provides:

    
    

    In a competitive procurement contest, other than a rejection of all bids, the Administrative Law Judge shall conduct a de novo proceeding to determine whether the agency’s proposed action is contrary to the agency’s governing statutes, the agency’s rules, or policies, or the bid or proposal specifications. The standard of proof for such proceedings shall be whether the proposed agency action was clearly erroneous, contrary to competition, or arbitrary, or capricious

    . . . .

    
    

14. A determination of whether Respondent's proposed agency action is contrary to applicable statutes, rules, or policy is properly based on the evidence available to Respondent at the time Respondent opened the bids as well as the evidence adduced at hearing. A bid protest proceeding is a de novo proceeding. Section 120.57(3)(f). Cf., Intercontinental Properties, Inc., v. State, Department of Health and Rehabilitative Services, 606 So. 2d 380, 386 (Fla. 3d DCA 1992)(holding that evidence at the hearing may be considered to correct minor irregularities).

15. The evidence shows that Respondent's proposed agency action violates Section 120.57(3)(d)3. Respondent did not refer the bid protest to DOAH within seven days after the

    formal written protest. Respondent failed to evidence its reasons for failing to comply with statutory time requirements, and Respondent failed to cite any authority for failing to comply with the terms of the statute.

16. Respondent's proposed evaluation of Petitioner's good faith effort to comply with applicable DBE goals is contrary to applicable rules and agency policy. For reasons stated in the Findings of Fact and incorporated here by this reference, Respondent's proposed evaluation of Petitioner's good faith efforts is contrary to Rule 14-8.003(2)(b)3.f.(IV), Rule 14-78.003(2)(b)6.c. and d, and Rule 14-78.003(2)(b)6.f. and h.

17. Each violation of statute, rule, and policy is clearly erroneous. The cumulative effect of all of the violations is also clearly erroneous.

18. Respondent interprets relevant rules to mean that Respondent may count subcontracts with DBEs based on conclusions on the face of each bid that the bidder has met applicable DBE goals. Respondent argues that its rules authorize Respondent to count DBEs toward a bidder's DBE goals without considering whether the DBE performs a commercially useful function; subordinates less than 49 percent of the contract; and is a regular dealer.

19. Respondent argues that compliance with the foregoing requirements in Respondent's rules are properly determined during the performance of a contract and not during bid

    evaluation. However, Respondent's interpretation of Rule 14- 78.003(2)(b)6.c, d, f, and h conflicts with the plain language of the introductory language in Rule 14-78.003(2)(b)6.

20. The introductory language in Rule 14-78.003(2)(b)6 provides:

    The Department shall count DBE participation toward meeting DBE goals

    . . . as follows. (emphasis

    supplied)

    
    

    Rule 14-78.003(2)(b)6.c, d, f, and h, then, imposes requirements that the DBE must perform a commercially useful function, must subordinate less than 49 percent of the contract, and must be a regular dealer for Respondent to count

    60 percent of the contract price toward the bidder's DBE goals. Pursuant to Rule 14-78.003(2)(b)6 is to he purpose of the requirements prescribed in Rule 14-78.003(2)(b)6 is to "establish contract goals."

21. The doctrine that great weight must be given to an administrative construction of a statute or rule by the agency responsible for its administration is limited to matters infused with agency expertise. Zopf v. Singletary, 686 So. 2d 680 (Fla. 1st DCA 1997), reh'g denied; SAVE the St. Johns River v. St. Johns River Water Management District, 623 So. 2d 1193, 1202 (Fla. 1st DCA 1993). Respondent's interpretation of relevant rules requires no technical expertise in bridge engineering, repair, drainage, or steel fabrication.

    Respondent's interpretation requires legal skills that do not fall within the ambit of Respondent's agency expertise.

22. Even if Respondent's interpretation of its rules were infused with agency expertise, Respondent's interpretation is clearly erroneous because the interpretation conflicts with the plain language of Respondent's rules. An agency construction that conflicts with the plain language of a statute or rule is clearly erroneous. Legal Environmental Assistance Foundation, Inc. v. Board of County Commissioners of Brevard County, 642 So. 2d 34, 36 (Fla. 1994); Hughes v. Variety Children's Hospital, 710 So. 2d 683, 685 (Fla. 3d DCA 1998); Arbor Health Care Company v. State, Agency for Health Care Administration, 654 So. 2d 1020, 1021 (Fla. 1st DCA 1995); Department of Natural Resources v. Wingfield Development Company, 581 So. 2d 193, 197 (Fla. 1st DCA 1991), reh'g denied.

23. Respondent's proposed evaluation of Petitioner's good faith efforts to comply with applicable DBE goals is contrary to agency policy. Respondent's proposed evaluation is inconsistent with officially stated agency policy in the Memorandum issued in February 1994. Respondent failed to explicate its deviation in 1998 and 1999 from its official policy stated approximately five years earlier in the Memorandum. Section 120.68(7)(e)3.

24. Respondent's attempt to correct its initial failure to comply with agency policy was not independent of the

initial evaluation and did not cure the deviation or preserve the integrity of the competitive bidding process. Moore v.

Department of Health and Rehabilitative Services, 596 So. 2d 759, (Fla. 1st DCA 1992). Respondent's second evaluation also failed to comply with officially stated agency policy, and Respondent failed to adequately explicate the inconsistencies.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is

RECOMMENDED that Respondent enter a final order finding that Petitioner submitted the lowest responsive bid to Financial Project No. 250533-1-52-01 and that Respondent's proposed evaluation of Petitioner's good faith efforts to comply with applicable DBE goals is contrary to applicable rules and officially stated agency policies, and is clearly erroneous.

DONE AND ENTERED this 3rd day of August, 1999, in Tallahassee, Leon County, Florida.

DANIEL MANRY

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847

Filed with the Clerk of the Division of Administrative Hearings this 3rd day of August, 1999.

COPIES FURNISHED:

Thomas F. Barry, Secretary Department of Transportation Haydon Burns Building

605 Suwannee Street

Tallahassee, Florida 32399-0450

Pamela Leslie, General Counsel Department of Transportation

Haydon Burns Building, Mail Station 58 605 Suwannee Street

Tallahassee, Florida 32399-0450

Mike Piscitelli, Esquire

560 East Broward Boulevard

Fort Lauderdale, Florida 33394

Suzanne Grutzner, Esquire 1321 77th Street East Palmetto, Florida 34221

Brian F. McGrail, Esquire Department of Transportation Haydon Burns Building

605 Suwannee Street, Mail Station 58

Tallahassee, Florida 32399-0458

Daniel Te Young, Esquire Post Office Box 589

Tallahassee, Florida 32302-0589

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 10 days from the date of 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: 99-002277BID

Orders for Case No: 99-002277BID