STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

BUCCANEER STEEL ERECTORS, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 86-0495BID

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent, )

and )

)

HAWKINS CONSTRUCTION, INC., )

)

Intervenor. )

)

RECOMMENDED ORDER

Pursuant to notice, a final hearing was held in this case on March 3, 1986, in Tallahassee, Florida, before Donald D. Conn, a duly designated Hearing Officer of the Division of Administrative Hearings. The parties were represented by:

For Petitioner: Dennis R. Longs, Esquire

2101 U.S. Highway 19, North, Suite 201 Palm Harbor Florida 33563

For Respondent: Sam Powers Esquire

Department of Health and Rehabilitative Services

1323 Winewood Boulevard

Tallahassee, Florida 32301

For Intervenor: John P. Fons, Esquire

Post Office Drawer 11307 Tallahassee, Florida 32302

Buccaneer Steel Erectors, Inc., a Petitioner, sought a hearing on the decision of the Department of Health and Rehabilitative services, Respondents to reject its bid and award a contract for work to be performed on the Statewide Regional Juvenile Detention Center in Pasco County to Hawkins Constructions Inc., which was granted leave to intervene. At the hearing, Petitioner called two witnesses and introduced five exhibits. Respondent and Intervenor did not call any witnesses or introduce any exhibits, although there were seven joint exhibits which were also received in evidence. No transcript of the hearing has been filed.

The parties were allowed to submit posthearing proposed findings of fact and conclusions of law and a ruling on each proposed finding that was timely filed is included in the Appendix to this Recommended Order.

FINDINGS OF FACT

1. Respondent advertised for bids for work to be performed on the Statewide Regional Juvenile Detention Center located in Pasco County identified as Project Number HRS 85-300000. In response to this advertisements Petitioner and Intervenor timely submitted bids on January 23, 1966.

   
   

2. According to calculations performed by Respondent, Petitioner was low bidder and Intervenor was the next lowest bidder. The construction budget for this job is $1.5 million, and both bids are considered by Respondent to be within budget. Depending on the alternatives chosen within each bid, Petitioner's bid is lower than Intervenor's by between approximately $6,000 and

   $40,000.

   
   

3. Section B-14 of the advertisement for bids requires each bidder to submit a list of the subcontractors who will perform work on the job for him and specifies that only one subcontractor shall be listed for each phase of the work. Section D of the advertisement for bids specifies the work areas for which a subcontractor must be listed and states that said list is an integral part of each bid submitted. The subcontracting areas include electrical plumbing, mechanical, roofing security control systems, food service equipment and fire protection.

   
   

4. Petitioner's bid was rejected on February 4, 1986, because its bid failed to include a roofing subcontractor's name as required in the advertisement for bids.

   
   

5. Petitioner does not dispute that its bid was incomplete when submitted since it failed to identify a roofing subcontractor. However, Petitioner contends this omission was a result of clerical error in typing the bide and that, in fact, it had selected Republic Roofing as its subcontractor. John Breen, Petitioner's project manager, testified that it was his intent to use Republic Roofing when he submitted the bide that he had a firm bid from Republic Roofing, and that when this omission was brought to his attention after bids were opened, he identified Republic Roofing in writing on January 24 and 29, 1986, to Brian Seufert an intern architect working for Respondent's project architect. Seufert confirms Breen's testimony through affidavit jointly filed by the parties. Seufert indicates that the project architect has no reason to believe that Petitioner could not perform the work required by the project. By affidavit jointly filed by the parties, Joyce Kleja secretary for Petitioners also supports Breen's testimony about her clerical error in omitting the roofing subcontractor when she typed the bid.

   
   

6. Ray Scerbo, an estimator for Republic Roofing, disputes the testimony of Breen through jointly filed affidavit. Scerbo indicates it was not until a couple of days after the bid opening that he was told by Petitioner that Republic Roofing "had the job" if Petitioner was awarded the contract. This conflicts with the first written notice from Breen to Seufert dated January 24, 1986, as well as Seufert's affidavit that Petitioner told Seufert on January 24, 1986, that Republic Roofing had been selected. Scerbo is no longer employed by Republic Roofing.

   
   

7. After considering all of the evidence, it is specifically found that Petitioner's omission of Republic Roofing from its list of subcontractors was through clerical error and that Petitioner had firmly decided to use Republic Roofing for subcontracting work prior to submission of its bid.

8. The advertisement for bid required all subcontractors to be listed in any bid in order to allow Respondent to review prior performance and licensure of subcontractors, and also to prevent "bid shopping". Bid shopping is a practice which inflates a general contractor's bid and therefore the actual award by encouraging subcontractors to initially submit high bids to the general contractor and then negotiate a lower price with the general contractor who has received the award. The general contractor's bid remains inflated however and in this way the cost to the state is increased.

   
   

   CONCLUSIONS OF LAW

   
   

9. The Division of Administrative Hearings has jurisdiction over the parties and subject matter in this case. Sections 120.53(5) and 120.57(1); Florida Statutes.

   
   

10. Section 255.0515, Florida Statutes, provides:

    
    

    With respect to state contracts let pursuant to competitive bidding . . . the contractor shall not remove or replace subcontractors listed in the bid subsequent to the lists being made public at the bid opening,

    except upon good cause shown.

    
    

11. This statute was construed by the Court in E. M. Watkins Co. Inc. v. Board of Regents, 414 So.2d 583 (Fla. 1st DCA 1982) to require bidders to include their listing of subcontractors prior to bid opening and to preclude any supplemental subcontractor list after such opening. This construction was based upon the Court's review of the legislative history and intent in enacting this statute which it found was to prevent competitive advantage, insure the quality of subcontractors insure public confidence in the bidding process and encourage future competition by discouraging "bid shopping." This statute requires all subcontractors to be listed in a bid, and the "good cause" exception goes only to the removal or replacement of a listed subcontractor not the addition of an omitted subcontractor.

    
    

12. While Petitioner's omission in this case was unintentional and purely the result of clerical error, that fact does not excuse Petitioner's failure to comply with Section 255.0515, supra, and also with Sections B-14 and D of Respondent's advertisement for bids. The terms of the bid advertisement are consistent with this statute, and Respondent has properly exercised its discretion in soliciting bids and accepting Intervenor's bid which fully complied with its advertisement. As reiterated in Baxter's Asphalt and Concrete, Inc. v. Department of Transportation, 475 So.2d 1284 (Fla. 1st DCA 1985):

    
    

    A public body has wide discretion in soliciting and accepting bids . . . and its decisions, when based on honest exercise of this discretion, will not be overturned by

    a court even if reasonable persons may disagree.

    
    

    Citing, Liberty County v. Baxter's Asphalt and Concrete, 421 So.2d 505, 507 (Fla. 1982).

13. The record in this case demonstrates that Petitioner's bid contained a material omission in that it failed to list a roofing subcontractors and based thereon Respondent honestly and properly exercised its discretion in rejecting Petitioner's bid and awarding the contract to Intervenor.

RECOMMENDATION

Based upon the foregoing it is recommended that Respondent enter a Final Order awarding Project Number HRS 85-300000 to Intervenor.

DONE and ENTERED this 1st day of April 1986, at Tallahassee Florida.

DONALD D. CONN

Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

FILED with the Clerk of the Division of Administrative Hearings this 1st day of April 1986.

APPENDIX

(DOAH CASE NO. 86-0495B1D)

Petitioner has submitted a memorandum and a Proposed Recommended Order, both of which appear to set forth proposed findings of fact in unnumbered paragraphs. For purposes of ruling thereon, the unnumbered paragraphs which appear to set forth proposed findings have been consecutively numbered.

Memorandum:

1. Introductory material and not a proposed finding of fact.

2. Adopted in part in Findings of Fact 1, 2, 3, 4, but otherwise rejected as cumulative and unnecessary.

3. Adopted in Findings of Fact 5, 7.

4. Rejected as simply a summary of testimony and evidence and not a proposed finding of fact.

5. Rejected as irrelevant.

6. Adopted in part in Findings of Fact 5, 6.

7. Adopted in part in Finding of Fact 4, but rejected in part in Finding of Fact 2 and otherwise rejected as not based on competent substantial evidence.

Proposed Recommended Order:

1. Adopted in part in Findings of Fact 1, 3, but otherwise rejected as unnecessary and irrelevant.

2. Rejected as irrelevant.

3. Adopted in part in Finding of Fact 2, but otherwise rejected as contrary to Finding of Fact 2.

4. Adopted in Finding of Fact 5.

5. Adopted in Findings of Fact 5, 7.

6. Adopted in Finding of Fact 4.

Rulings on Respondent's and Intervenor's jointly filed Proposed Findings of Fact:

1. Adopted in Findings of Fact 1, 3.

2. Adopted in Findings of Fact 1, 2.

3. Adopted in Findings of Fact 4, 5.

4. Adopted in Finding of Fact 8.

5. , 6. Adopted in Findings of Fact 6, 7.

COPIES FURNISHED:

Dennis R. Long Esquire 2101 U.S. Highway 19 North

Suite 201

Palm Harbor, Florida 33563

Sam Powers Esquire Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee Florida 32301

William Page; Jr., Secretary Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32301

John P. Fons Esquire Post Office Drawer 11307

Tallahassee, Florida 32302

Docket for Case No: 86-000495BID

Orders for Case No: 86-000495BID