STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

INDUSTRIAL ENTERPRISE SANDBLAST ) AND PAINTING, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 85-3592BID

) DEPARTMENT OF TRANSPORTATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer W. Matthew Stevenson, held a formal hearing in this case on November 4, 1985 in Tallahassee, Florida.

APPEARANCES

For Petitioner: Pete Kiousis (pro se)

1502 Fox Run Drive

Tarpon Springs, Florida 32486-1547

For Respondent: Larry D. Scott, Esquire

Department of Transportation

Haydon Burns Building, Mail Station 58 Tallahassee, Florida 32301-8064

The issues for determination at the final hearing were: (1) whether the Department of Transportation may reject all bids on State Project No. 72001- 3448; and (2) whether Petitioner, Industrial Enterprise Sandblast and Painting, Inc., is the lowest responsible bidder on State Project No. 72001-3448.

PROCEDURAL BACKGROUND

By letter dated October 8, 1985, the Petitioner formally protested the rejection of its bid on State Project No. 72001-3448. This cause came on for final hearing on November 4, 1985. Pete Kiousis, owner and manager of Industrial Enterprise Sandblast and Painting, Inc., testified in his own behalf. The Respondent, Department of Transportation, presented the testimony of two witnesses. In addition, Respondent's Exhibits 1-4 were offered and duly admitted into the record.

The Respondent submitted posthearing Proposed Findings of Fact. A ruling has been made on each proposed finding of fact in the Appendix to this Recommended Order.

FINDINGS OF FACT

Based upon the documentary evidence received and the entire record compiled herein, I hereby note the following findings of fact:

1. Notice and Invitation to Bid on State Project Number 72001-3448 (the project) was extended to various contractors by the Respondent, Department of Transportation, on August 1, 1985. Sealed bids on the project were opened August 28, 1985. The scope of the project involved cleaning and painting the structural steel of the Buckman Bridge over the St. Johns River in Jacksonville, Florida. (State Bridge Numbers 720249 and 720343).

   
   

2. The bids were opened and Petitioner was the apparent low bidder on the project with a bid amount of $193,000.

   
   

3. The Department of Transportation, on October 2, 1985, rejected all bids "due to error in quantities in plans."

   
   

4. According to the contract plans and specifications utilized by the Department of Transportation for the project, the beams, girders, bracing and trusses were composed of 2,540 tons of structural steel. The plans were in error and the tonnage of structural steel was less than 2,540 tons.

   
   

5. Petitioner, upon visiting the job site as required, immediately recognized that there was less steel in the bridge than shown in the plans. In submitting and formulating his bid, the Petitioner considered the amount of work and materials which would actually be required to complete the project.

6 Prior to the bids being posted on the project, the Department of Transportation discovered that the amount of structural steel noted in the plans was grossly overestimated. On October 2, 1985, the Department of Transportation notified bidders in writing that all bids submitted on the project were rejected and that the plans would be revised and the project relet.

CONCLUSIONS OF LAW

1. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings pursuant to Section 120.57(1), Florida Statutes (1983)

   
   

2. In general, a contracting agency "has wide discretion in soliciting and accepting bids for public improvements and its decision, when based on the honest exercise of this discretion, will not be overturned by a court even if it may appear erroneous and even if reasonable persons may disagree." Liberty County v. Baxter's Asphalt & Concrete, 421 So.2d 505, 507 (Fla. 1982). Of course, the Division of Administrative Hearings is not a court. Formal administrative proceedings like these are de novo and require the Department of Transportation (DOT) to "defend its decision on the basis of what it knows at the time the order is entered." Couch Construction Co., Inc. v. Department of Transportation, 361 So.2d 172, 176 (Fla. 1978). DOT's proposed action enjoys no presumption of validity. Capeletti Brothers v. State Department of General Services, 432 So.2d 1359, 1363 (Fla. 1st DCA 1983).

3. Section 337.11(3) , Florida Statutes (1983) provides that: "The department may, at its discretion,

   award the proposed work to the lowest

   responsible bidder, or it may reject all bids and proceed to readvertise or perform the work with convict labor or free labor."

   
   

4. The initial issue in this case is whether DOT's decision to reject all bids was a responsible exercise of its discretion. In order to determine this issue, it is necessary to examine the rationale behind such decision and to weigh such rationale against the Petitioner's claim of arbitrariness and capriciousness.

   
   

5. In the instant case, DOT's decision to reject all bids was for sound reasons, within the broad discretion granted to DOT by Section 337.11(3), Florida Statutes (1983), and was not shown to have been taken in bad faith, arbitrarily nor capriciously. The fact that substantial errors existed in the stated tonnage of the project could have impacted upon the competitive nature of the bidding. It cannot be assumed that all bidders became aware of the error in the plans on the basis of their required visit to the project site. In Liberty County v. Baxter's Asphalt and Concrete at 507, the Court stated that public bid statutes: "serve the object of protecting the public against collusive contracts and prevent favoritism . . . and tend to secure fair competition upon equal terms to all bidders . . . and should receive a construction always which will fully effectuate and advance their true intent and purpose and which will avoid the likelihood of same being circumvented, evaded, or defeated." Fair competition upon equal terms to all bidders can only be achieved in the instant case by a rejection of all present bids and rebidding on the project.

   
   

6. Having concluded that DOT acted properly in rejecting all bids, the consideration of whether Petitioner is the lowest responsible bidder is unnecessary.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is, RECOMMENDED that the petition of Industrial Enterprise Sandblast and

Painting, Inc., protesting the rejection of all bids on State Project No. 72001- 3448, be dismissed.

DONE AND ORDERED this 11th day of December 1985 in Tallahassee, Florida.

W. MATTHEW STEVENSON 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 11th day of December 1985.

APPENDIX

Respondent's Findings of Fact FINDING RULING

1. Accepted; see Recommended Order paragraph 1.

2. Accepted; see Recommended Order paragraph 2.

3. Accepted, but not included because subordinate.

4. Accepted; see Recommended Order paragraph 4.

5. Accepted; see Recommended Order paragraphs 3 and 6.

6. Accepted; see Recommended Order paragraphs 3 and 6.

7. Accepted; see Recommended Order paragraph 6.

COPIES FURNISHED:

HONORABLE THOMAS E. DRAWDY, SECRETARY

DEPARTMENT OF TRANSPORTATION HAYDON BURNS BUILDING TALLAHASSEE, FLORIDA 32301

A. J. SPALLA, ESQUIRE GENERAL COUNSEL

DEPARTMENT OF TRANSPORTATION

562 HAYDON BURNS BUILDING TALLAHASSEE, FLORIDA 32301

LARRY D. SCOTT, ESQUIRE DEPARTMENT OF TRANSPORTATION HAYDON BURNS BUILDING, M.S. 58 TALLAHASSEE, FLORIDA 32301-8064

INDUSTRIAL ENTERPRISE SANDBLAST & PAINTING, INC.

P. O. BOX 1547 1502 FOX RUN DRIVE

TARPON SPRINGS, FLORIDA 32486-1547

Docket for Case No: 85-003592BID

Orders for Case No: 85-003592BID