Judges: D. R. ALEXANDER
Agency: Department of State
Latest Update: Sep. 25, 1990
Summary: Challenge to award fo bid for floor space was not sustained.
83-2952.PDFSTATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
GEORGE WINCHESTER, a partner in ) GEORGE and LEWIS WINCHESTER ) CONSTRUCTION COMPANY, )
)
Petitioner, )
)
vs. ) CASE NO. 83-2952BID
) DEPARTMENT OF STATE, BUREAU OF ) MANAGEMENT SYSTEMS, )
)
Respondent. )
)
RECOMMENDED ORDER
Pursuant to notice, a formal hearing was held in the above case before The Division of Administrative Hearings by its duly designated Hearing Officer, DONALD R. ALEXANDER, on October 21, 1983, in Tallahassee, Florida.
APPEARANCES
For Petitioner: Ernest W. Welch, Esquire, and
W. Bradley Munroe, Esquire
107 South Monroe Street Tallahassee, Florida 32301
For Respondent: R. Stephen Nall, Esquire
Office of General Counsel Department of State, The Capitol Tallahassee, Florida 32301
For Intervenor/ Edwin A. Green, II, Esquire Respondent: 1017 Thomasville Road
Tallahassee, Florida 32301 BACKGROUND
On June 17, 1983, Respondent, Department of State, Bureau of Management Systems, issued Invitation to Bid No. DOS 80-82/83 for 22,089 square feet of office space in Leon County, Florida. Such bids were to be filed with Respondent no later than 2:15 p.m. on July 27, 1983, when all bids would be publicly opened. On August 1, 1983, the Department's Division of Administration advised Intervenor/Respondent Hobco, Inc., that it had been awarded the bid to provide 22,089 square feet of office space for Respondent. On August 2, 1983, Petitioner, George Winchester, a partner in George and Lewis Winchester Construction Company, filed his notice of protest pursuant to Subsection 120.53(5)(b), Florida Statutes. After informal efforts to resolve the controversy were unsuccessful, the matter was referred by Respondent to the Division of Administrative Hearings on September 13, 1983, with a request that a
Hearing Officer be assigned to conduct a hearing. By notice of hearing dated October 5, 1983, the final hearing was scheduled for October 21, 1983, in Tallahassee, Florida.
At the final hearing, Petitioner testified on his own behalf and presented the testimony of Michael L. Jett, an expert in radio communications systems, Charles Pumphrey, a Tallahassee household goods mover, and Roy Mayo, an expert in reading and interpreting building specifications, and offered Petitioner's Exhibits 1-3; all were received in evidence except Exhibit 3. Respondent presented the testimony of Alice D. Atkinson, Department purchasing agent, and Brenda M. Carson, Director of the Department's Division of Administration, and offered Respondent's Exhibits 1-8; all were received in evidence.
Intervenor/Respondent presented the testimony of Alfred L. Buford, an expert in real estate matters and commercial leases, and Louis Winnick, a professional engineer, and offered Intervenor's Exhibits 9 and 10; both were received in evidence.
There was no transcript of hearing prepared in this proceeding. Proposed findings of fact and conclusions of law were filed by the parties on October 28, 1983, and have been considered by the undersigned in the preparation of this Order. Findings of fact not included in this Order were considered irrelevant, immaterial to the results reached, or were not supported by competent and substantial evidence.
The issues herein as framed in Petitioner's request for a hearing are (1) whether all bids solicited by the Department of State should be rejected, and the bid relet, or (2) whether the Department of State should extend the present lease for a period of eleven months as permitted by Subsection 255.25(3)(b), Florida Statutes.
Based upon all of the evidence, the following findings of fact are determined:
FINDINGS OF FACT
On June 17, 1983, Respondent, Department of State, Bureau of Systems Management, issued Invitation to Bid No. DOS 80-82/83 to prospective bidders to provide 22,059 square feet of office space for use as offices for the Division of Licensing and Division of Corporations in Leon County, Florida. According to the general specifications and requirements, the space was to be located within one mile of the Capitol Building and available by August 1983, or within 30 days after execution of a valid lease. Sealed bids were to be received no later than 2:15 p.m. on July 27, 1983. At that time, all bids would be publicly opened.
Petitioner, George E. Winchester, a partner in George and Lewis Winchester Construction Company, is the current lessor to Respondent of space used by the two divisions that will utilize the space requested in the bid. The monthly rental amount is $12,639.50. Although the lease expired on August 11, 1983, Respondent continues to lease the office space from Petitioner while this controversy remains pending.
As is pertinent here, paragraph eleven of page seven of the Invitation to Bid contained the following miscellaneous requirements:
Pest control.
Soundproofing in specified areas (see floor plan Attachment H).
Office must be prewired for telephone service (DMS-100 telephone system) 50-pair cable to
support 20-button sets.
Special climate control for selected areas where a concentration of heat-producing
machines are located. All such equipment
must be maintained at a maximum of 78 degrees.
Capability for coaxial cable to be installed in all areas at lessor's expense.
Capability for lessee to install additional coaxial cable at a later date.
Office space must be able to receive dedicated electrical outlet for EDP and other specialized equipment.
Offices to be prewired to provide for public announcement system in specified areas (Space 8,060 square feet).
Offices to be located on one floor in reasonably close proximity (desired for Space 8,060 square feet).
Window coverings to be provided on all windows.
If office space has structural pillars or protrusions, lessee reserves the right to require decorative treatment of those struc- tures.
Attached to the Invitation to Bid was a one-page document entitled "Attachment H" which provided a suggested configuration of offices and rooms. The "specific electrical, telephone and soundproofing requirements" within the office area were also reflected in Attachment H.
Paragraph five of the General Conditions of the Invitation to Bid provides as follows:
INTERPRETATIONS Any questions concerning conditions and specifica- tions shall be directed in writing to this office for receipt no later than ten (10) days prior to the bid opening. Inquiries must reference the date of bid opening. No inter-
pretation shall be considered binding unless provided in writing by the State of Florida in response to requests in full compliance with this provision.
Petitioner was in possession of The Invitation to Bid for several weeks prior to The bid deadline of July 27, 1983. However, because he considered the matter to he only a "small lease," and one which would not take a great deal of time to prepare, he waited until five or six days before July 27 to begin preparations for submitting a bid.
In reviewing paragraph eleven on page seven of the general specifications and requirements, he concluded that items 2, 3, 4, 5, 7, 8, 9 and
10 were too "vague" to prepare a bid. In an effort to clarify the alleged
ambiguities, he sought assistance from Department personnel on Thursday, July
He was advised to contact a Mr. Cushing, chief of the Department's Bureau of Management Systems. He did so by telephone on July 22 but did not receive satisfactory information. Finally, on the afternoon of July 26, he met with five or six employees of the Department of State to discuss the items in question. After the meeting, Winchester did not indicate he was still confused. Based upon Winchester's questions, the Department decided to issue a revised page seven. The revisions were not substantive in nature but were merely intended to provide further clarification and assistance to the bidders. As revised, paragraph eleven of page seven provided as follows:
Pest control (once monthly--professional exterminator.)
Soundproofing in specified area (see floor plan Attachment H). (Maximum soundproofing acoustical tile to be used in two rooms--
llx7 and 18x10--which will house computer equipment; other rooms specified for sound- proofing should have material to prevent voices from being heard through the walls.)
Office must be prewired for telephone service (DMS-100 telephone system) 50-pair cable to
support 20-button sets.
Special climate control for selected areas where a concentration of heat-producing
machines are located. All such equipment
must be maintained at a maximum of 78 degrees.
Capability for coaxial cable to be installed in all areas at lessor's expense.
Capability for lessee to install additional coaxial cable at a later date.
Breaker box or fuse box must be able to receive three 220 lines for EDP and other specialized equipment.
Offices to be prewired to provide for public announcement system in specified areas (Space
A 8,060 square feet only). (Muzak-type sys- tem with PA capability is acceptable.)
Offices to be located on one floor in reasonably close proximity (desired for Space A 8,060 square feet).
Window coverings to be provided on all windows (flame-retardant drapes or mini-blinds)
If office space has structural pillars or protrusions, lessee reserves the right to require decorative treatment of those struc- tures. (The structural protrusions shall be made compatible with the wall areas in the
rooms in which they are located.)
All three prospective bidders were either advised by telephone or in person that afternoon that a revision was being issued. The Petitioner received his copy shortly after his meeting with the Department's representatives.
After receiving the revision, Winchester called several subcontractors the next morning to obtain price quotations for the various items. Although he still maintained the bid was a guess" and he did not know if he could make any
profit, he was nonetheless sufficiently informed to prepare specific prices for each item he had questioned. The bid package was filed prior to the deadline.
Winchester did not use other professionals to interpret the specifications or to assist him in the preparation of his bid. He also did not avail himself of the provisions in paragraph five of the General Conditions which permitted him to make written inquiry to the Department concerning any alleged ambiguities.
On the afternoon of July 27, 1983, the bids, numbering three, were opened by Respondent. 1/ Thereafter, on August 1, 1983, the Director of the Department's Division of Administration wrote Intervenor/Respondent, Hobco, Inc., a letter which reads in pertinent part as follows:
In response to your bid to provide 22,089 square feet of office space to the Department of State, you are hereby notified that you are awarded the bid.
The award prompted the instant proceeding.
Although item 9 stated that offices were "to be located on one floor in reasonably close proximity," this was not a mandatory requirement. Rather, it was a preference on the part of the Department. This was confirmed by a letter from the Department to Crown Properties, another bidder, which had made a written inquiry to the Department on June 23, 1983, concerning that provision. Further, the specifications indicate that one floor was "desired," and that in the weighting process, the providing of one floor was not a dispositive attribute in determining the award.
The evidence is conflicting as to whether certain items within the miscellaneous requirements in question are vague and ambiguous. However, it is found that the evidence is more persuasive that the specifications were sufficiently clear to allow a bidder to formulate a competitive bid to lease office space. A reading of the specifications themselves, including Attachment H, a visual inspection of the presently leased premises, and the use of other professionals for assistance would provide sufficient information relative to soundproofing, communications and electrical requirements to prepare a bid that would conform with specifications. Moreover, the General Conditions of the Invitation to Bid provided all prospective bidders with the opportunity to make written or oral inquiry concerning any "conditions and specifications" that they questioned.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction of the subject matter and the parties here to pursuant to Subsection 120.57(1) , Florida Statutes.
Initially, a letter dated August 7, 1979, from an employee of Respondent to Petitioner is hereby received in evidence as Petitioner's Exhibit
Although an objection to its admissibility was originally sustained, it is concluded that there is sufficient evidence to support a finding that the letter in question is what Petitioner claims it to be. Section 90.901, Florida Statutes.
It is important to note that Petitioner does not claim that Hobco failed to comply with bid specifications or applicable bidding statutes. Rather, in its request for a hearing, it contends that (a) certain specifications in paragraph eleven on page seven of the general specifications and requirements were so "vague and ambiguous" as to he unintelligible and therefore impossible to comply with; (b) the specifications were designed to be
a single-source item in favor of Hobco and were accordingly in violation of Rule 13D-7.092(4)(a), Florida Administrative Code; (c) the terms and specifications were changed as to Petitioner only at 5:00 p.m. the day before the bids were to be opened; and (d) the award to Hobco was arbitrary and capricious. These contentions will be dealt with separately.
Petitioner first contends that the specifications were so vague and ambiguous that he was unable to intelligently prepare a bid. Although the evidence is conflicting in this regard as to a small number of items, it is concluded that the greater weight of evidence supports a finding that the specifications were sufficiently clear and unambiguous so as to permit fair competition upon equal terms from all bidders. Wester v. Belote, 138 So. 721, 724 (Fla. 1931); Aurora Pump, Division of General Signal Corporation v. Goulds Pumps, Inc., 424 So.2d 70, 74 (Fla. 1st DCA 1952). Indeed, the rule governing the leases for real property by all state agencies provides that "[s]pecifications shall be drawn . . . in general terms." Rule 13D- 7.092(4)(a), Florida Administrative Code. Moreover, it was the responsibility of all bidders to timely request clarification of any ambiguous provisions no later than ten days prior to the opening of the bids. Petitioner failed to do so on a timely basis and waited until six days before the deadline to begin preparing his bid submission. Other jurisdictions have held this to be a waiver of the right to complain of any resulting misunderstandings. Newsom v. U.S., 676 F.2d 647 (U.S. Ct. Cl., 1982); Century Metal Parts Corp. v. U.S., 474 F. Supp. 436 (E.D. N.Y. 1979). Because all bidders were given the same specifications, the same interpretations, and the same opportunity to come up with the most economic means of supplying the Department's requirements, and the specifications themselves were sufficiently clear, Petitioner's contention that they were vague and ambiguous is deemed to be unavailing.
Petitioner next claims that the specifications were designed or structured in Hobco's favor and, as such, they constituted a violation of Rule 13D-792(4)(a), Florida Administrative Code. That rule reads as follows:
(4)(a) Specifications shall be drawn by the User Agency in general terms. They shall afford each prospective lessor interested in submitting a proposal, knowledge of the agency's space requirements. They shall not be structured to favor any specific location or lessor. (Emphasis added)
In support of this contention, Winchester relies upon the fact that item 9 of the miscellaneous requirements specified that the office space was to be located on one floor, and, because Hobco could meet this condition and Winchester could not, it constituted a violation of the foregoing rule. But the record is clear that it was indeed a "desire" or "preference" on the part of the Department, and nothing more. Therefore, it is concluded that the specifications were not structured to favor any specific location or lessor, and that Petitioner's contention must fail.
Petitioner next argues that the "revision" to the specifications on the afternoon prior to the date for submitting the bids constituted some type of error, and that such revisions applied only to Winchester. However, the evidence reveals that the so-called "revisions" were not substantive changes in the specifications themselves, but were intended only to provide further clarification and assistance to the bidders. Moreover, since no substantive changes occurred, the argument that the revisions somehow imposed new standards or requirements upon Winchester alone cannot be accepted. Therefore, Petitioner's third contention is deemed to be without merit.
Petitioner finally contends the award of the bid to Hobco was arbitrary and capricious. According to its post-hearing memorandum, the action was arbitrary and capricious because (a) the specifications contained a one- floor requirement in violation of Rule 13D-7.092(4)(a), Florida Administrative Code; and (b) if the Department had extended the present lease with Winchester for eleven months pursuant to Subsection 255.25(3)(b) Florida Statutes, there would be substantial savings to the State.
To begin with, the first ground has already been found to be without merit and need not be further considered. The second point is irrelevant to the resolution of this case. Subsection 255.25(3), supra, authorizes an agency to extend an existing lease of space for up to eleven months. The right of an agency to do so is permissive, not mandatory, and the failure to exercise this right is not a ground to nullify a lawful effort by that agency to secure its future space requirements by competitive bid.
It is well settled that an agency has wide discretion in soliciting and accepting bids for public contracts. Liberty County v. Baxter's Asphalt and Concrete, Inc., 421 So.2d 505, 507 (Fla. 1982). Petitioner must demonstrate that in exercising that discretion, the Department's decision was not based upon facts reasonably tending to support that decision. City of Pensacola v. Kirby,
47 So.2d 533, 535-536 (Fla. 1950) . Here, Petitioner has failed to do so, and it is concluded that the award of the contract to Hobco was not arbitrary or capricious.
RECOMMENDATION
Based on The foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent award Invitation to Bid No. DOS 80-82/83 to
Hobco, Inc.
DONE and ENTERED this 9th day of November, 1983, in Tallahassee, Leon County, Florida.
DONALD R. ALEXANDER
Hearing Officer
Division of Administrative Hearings The Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32301
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 9th day of November, 1983.
ENDNOTE
1/ Bids were filed by petitioner, Intervenor/Respondent and Crown properties.
COPIES FURNISHED:
Ernest W. Welch, Esquire, and
W. Bradley Munroe, Esquire
107 South Monroe Street Tallahassee, Florida 32301
R. Stephen Nall, Esquire Office of General Counsel Department of State
The Capitol
Tallahassee, Florida 32301
Edwin A. Green, II, Esquire 1017 Thomasville Road
Tallahassee, Florida 32301
The Honorable George Firestone Secretary of State
The Capitol
Tallahassee, Florida 32301
Docket for Case No: 83-002952
Orders for Case No: 83-002952
