Judges: J. D. PARRISH
Agency: Department of Management Services
Latest Update: Jan. 05, 1988
Summary: The central issue in this case is whether Petitioner should be awarded Bid No. 432-730-310-W for configurations 1, 2, and 3, Service Area 1.No bidder had unfair advantage over another agency may in its discretion waive minor irregularities therefore Petition should be dismissed.
87-4912STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
AUDIO LABS, INC., d/b/a AMERICAN ) TELEPHONE COMPANY, )
)
Petitioner, )
)
vs. )
)
STATE OF FLORIDA, DEPARTMENT )
OF GENERAL SERVICES, ) CASE NO. 87-4912BID
)
Respondent, )
and )
)
INTER-TEL, INC., )
)
Intervenor. )
)
RECOMMENDED ORDER
Pursuant to notice, a final hearing in the above-styled matter was held on November 17-18, 1987, at Tallahassee, Florida, before Joyous D. Parrish, a duly designated Hearing Officer of the Division of Administrative Hearings. The parties were represented at the hearing as follows:
For Petitioner: Edward W. Dougherty, Jr., Esquire
Post Office Box 11127 Tallahassee, Florida 32302-3127
For Respondent: Susan B. Kirkland, Esquire
Department of General Services
453 Larson Building
Tallahassee, Florida 32399-0955
For Intervenor: Joseph W. Lawrence, II, Esquire
Post Office Box 589
Tallahassee, Florida 32302-0589 BACKGROUND AND PROCEDURAL MATTERS
On June 10, 1987, the Department of General Services (Department) mailed an Invitation to Bid (ITB) for Electronic Key Telephone Communications Systems, Bid No. 432-730-310-W, to prospective bidders. This ITB requested bids for seven different system configurations to be located in four geographical service areas. The purpose of the bid was to establish a twelve-month contract for the purchase of systems by all State of Florida agencies. The systems ranged in size from eight (configuration 1) to one hundred twenty station instruments (configuration 7). Service Area 1 was identified as the "western" district comprised of twenty Panhandle counties whose eastern border was the east line of Madison, Lafayette and Dixie Counties. Tabulations for the bids received for Bid No. 432-730-310-W were posted on October 13, 1987.
On October 15, 1987, Audio Labs, Inc., d/b/a American Telephone Company (Petitioner) filed a letter giving notice of its intent to protest the bid awards. In the "Protest of Formal Bid Award" filed with the Department on October 23, 1987, Petitioner challenged all bid awards for the seven configurations in Service Area 1 and, on November 2, 1987, the case was forwarded to the Division of Administrative Hearings for formal proceedings.
Inter-Tel, Inc. (Inter-Tel) filed a petition to intervene which was granted by an Order entered November 4, 1987. Thereafter, Petitioner sought leave to amend its formal protest in order to correct errors, to eliminate its claims in four of the seven configurations, and to clarify the allegations relating to configurations 1, 2, and 3. Inter-Tel filed a response opposing the request to amend. The Department filed a statement confirming notification of the protest had been given to other bidders on November 16, 1987.
After hearing argument from the parties, Petitioner's request to amend was granted on November 17, 1987. The amended protest alleged Petitioner was the lowest and best bidder for configurations 1, 2, and 3 for Service Area 1. More specifically, Petitioner claimed as to configuration 1: that although Petitioner was the seventh lowest bidder, the other bidders should be found non- compliant; as to configuration 2: that although Petitioner was the fourth lowest bidder, the other bidders should be found non-compliant; and as to configuration 3: that although Petitioner was the seventh lowest bidder, the other bidders should be found non-compliant. Petitioner claimed that Respondent had abused bidding procedures by waiving minor irregularities for some bidders and disqualifying other bidders for insignificant irregularities.
At the hearing, Petitioner presented the testimony of John Fain, F. Lewis Houston, Harmond H. Curry, Sr., and Raymond D. McCorkle. The Respondent presented the testimony of F. Lewis Houston and Roger L. Fisher. Petitioner offered into evidence Petitioner's Exhibits 1-13 and Respondent offered Respondent's Exhibits 1-12. All exhibits were admitted into evidence.
At the conclusion of Petitioner's case, Inter-Tel moved for a directed verdict on configuration 3. Ruling on such motion was reserved at that time but is addressed fully in the conclusions of law and recommendation of this Order.
The transcript of the proceedings was filed on December 2, 1987. The parties were granted leave until December 14, 1987, to file their proposed findings of fact and conclusions of law. Proposals submitted by Petitioner and the Department have been carefully considered in the preparation of this Recommended Order. Specific rulings on the proposed findings of fact are included in the attached Appendix.
ISSUE
The central issue in this case is whether Petitioner should be awarded Bid No. 432-730-310-W for configurations 1, 2, and 3, Service Area 1.
FINDINGS OF FACT
Based upon the testimony of the witnesses and the documentary evidence received at the hearing, I make the following findings of fact:
The ITB for Bid No. 432-730-310-W consisted of three sections: general conditions, special conditions, and technical specifications. Bidders were
evaluated on their technical and non-technical responses to the ITB. Once the Department determined the bidders to be compliant with their non-technical responses, they were ranked according to the evaluation award criteria described in Appendix F of the ITB.
Once ranked, the Department forwarded the bid responses to the engineering staff of the Division of Communications for a technical review. This technical review consisted of verifying a lowest compliant bidder and a competitive compliant bidder.
To complete the technical review the engineering staff considered the responses submitted on the ITB forms, technical literature provided by the bidder, and technical responses submitted to supplement other information.
To the extent that an ambiguity in one response was satisfactorily explained elsewhere in the bid documentation, the bidder was given the benefit of the doubt and found to be responsive to the ITB.
Prior to submitting bids, all bidders were given an opportunity to raise questions regarding the ITB at a pre-bid conference conducted by the Department. Petitioner's representative attended the conference and received a copy of the specimen bid.
The ITB required specific mandatory responses. Failure to include the mandatory information resulted in the disqualification of the bid.
An equipment list for the baseline system was a mandatory requirement of the ITB. Identification of the manufacturer and the part number, if any, were required to be provided.
Another mandatory feature required by the ITB was a "handsfree" intercom. The ITB defined this feature as follows:
Handsfree answer and talk back on intercom: Enables a station user to answer an intercom call through the station instrument's internal speaker/microphone without lifting the instruments handset. (This feature shall not be controlled by the calling party instrument intercom button.)
Speed-dialing was another mandatory feature of the ITB. This feature could be provided at the station (an individual telephone) or by the system. If at the station, there was no requirement that the instrument retain memory in the event of a power outage. The central memory of the system, however, had to retain its memory in the event of a power failure.
The ITB prohibited a method of programming which required access to the inside of the Key Service Unit (KSU) to make switch settings or set a switch to enter and/or leave the program mode.
All mandatory operational service features of the ITB were listed on page 27, Section 3.4.
Optional operational service features and equipment were listed on page 34, Section 3.16.8 of the ITB. An optional operational feature listed was
"Station Message Detail and Equipment." The bidding of an SMDR or an option for an SMDR was not required. No bidder was disqualified because it failed to bid an SMDR or an SMDR option.
All bidders were required to submit a spare parts price list. Any bidder failing to submit the list was disqualified. Any bidder which submitted the list automatically met the requirement. The lists were not evaluated as art of the bid criteria and no bidder was disqualified based upon the content of the information supplied on the list.
Configuration 1
The Department determined Petitioner to be the seventh lowest bidder for configuration 1. Lower bidders, in order of their ranking, were Henkels & McCoy, Southern Bell Advanced, St. Joe Communications, Inter-Tel, Lanier Business, and Tel-Plus Communications. Tel Plus was considered the low compliant bidder and Inter-Tel was the competitive compliant bidder.
Following a complete review of the bid responses, the parties agreed that Southern Bell Advanced, St. Joe Communications, and Lanier Business were non-compliant for configuration 1.
The Henkels & McCoy bid provided a "handsfree" feature as described above in paragraph 8.
The Henkels & McCoy bid did not provide an SMDR or an SMDR option.
The Inter-Tel bid did not provide an SMDR or an SMDR option.
The Tel Plus bid included a spare parts price list.
The Tel Plus bid included an equipment list for the baseline system, however, such list did not completely and accurately describe the baseline system. The discrepancies with the equipment list were fully explained elsewhere in Tel Plus' bid response.
Configuration 2
The Department determined Petitioner to be the fourth lowest bidder for configuration 2. Lower bidders, in order of their ranking, were Inter-Tel, Tel Plus Communications, and St. Joe Communications. St. Joe was determined to be non-compliant, leaving Tel Plus as the low compliant bidder and Inter-Tel as the competitive compliant bidder.
The Inter-Tel bid provided a statement indicating the equipment bid would be modified to relocate a "DIP" switch to the outside of the KSU. This modification was necessary to comply with the requirement described in paragraph
This modification is a minor, simple procedure done by many technicians.
No documentation was provided as to how Inter-Tel intended to make the modification. The parties agreed, however, that the modification could be done.
The Inter-Tel bid provided the speed-dialing feature described in paragraph 9 at the station.
The findings of fact relating to configuration 1 and the Tel Plus bid are applicable to configuration 2.
Configuration 3
The Department determined Petitioner to be the seventh lowest bidder for configuration 3. Lower bidders, in order of their ranking, were Business Telephone Systems, Henkels & McCoy, Marcom Telecommunications, Lanier Business, Tel Plus Communications, and Inter-Tel. Inter-Tel was determined to be the low compliant bidder with Henkel & McCoy the competitive compliant bidder.
Following a complete review of the bid responses, the parties agreed that Marcom, Tel Plus and Lanier were non- compliant for configuration 3.
The Business Telephone bid included a spare parts price list.
The Business Telephone bid failed to include on the baseline equipment list the surge protector part number, however, such information was provided elsewhere in the bid response.
The Business Telephone bid failed to include a part number for wiring, however, the part number for wiring was not required.
The Henkels & McCoy bid included a spare parts price list.
The Henkels & McCoy bid failed to list a console card on the baseline equipment list, however, this was to be provided with the console which was properly described elsewhere in the bid response.
The findings of fact relating to configuration 2 and the Inter-Tel bid are applicable to configuration 3.
Petitioner's bid for configuration 1 was $3641.08. The lowest responsive bid was $2343.00.
Petitioner's bid for configuration 2 was $5407.97. The lowest responsive bid was $4723.00.
Petitioner's bid for configuration 3 was $12,136.90. The lowest responsive bid was $9271.00.
The parties stipulated that Petitioner timely filed its notice of intent to protest and the formal protest of bid award.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of these proceedings.
Generally, an ITB defines the scope of the work required by soliciting bids responsive to the detailed plan and specifications required by the agency. In the case at issue, the ITB required certain features in the configurations specified and allowed all bidders to submit documentation that complied with the specifications. Any question relating to the ITB specifications should have been raised prior to bid submittal.
In Liberty County v. Baxter's Asphalt & Concrete, Inc., 421 So.2d 505 (Fla. 1982), the Florida Supreme Court, citing Webster v. Belote, 138 So. 721, 724 (Fla. 1931), reiterated that public bid statutes:
serve the object of protecting the public against collusive contracts and prevent favoritism toward contractors by public officials and tend to secure fair competition upon equal terms to all bidders, [and] they remove temptation on the part of public officers to seek private gain at the tax- payers' expense, are of highly remedial character, 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.
The purpose of competitive bidding is to secure a lowest responsible offer meeting all requirements of the ITB. A variation from the ITB which gives one bidder an advantage over others restricts or stifles competition and is, therefore, impermissible. Tropabest Foods, Inc. v. State, Department of General Services, 493 So.2d 50 (Fla. 1st DCA 1986).
Rule 13A-1.002(10), Florida Administrative Code, provides:
Right to Waive Minor Irregularities -- The agency shall reserve the right to waive any minor irregularities in an otherwise valid bid/proposal. A minor irregularity is a variation from the invitation to bid/request for proposal terms and conditions which does not affect the price of the bid/proposal, or give the bidder or offeror an advantage or benefit not enjoyed by other bidders or offerors, or does not adversely impact the interests of the agency. Variations which are not minor cannot be waived.
In exercising the discretion afforded it, an agency may not act arbitrarily or capriciously but may act upon facts reasonably calculated to support its conclusion. See, Wood- Hopkins Contracting Company v. Roger J. Au & Son, 354 So.2d 446 (Fla. 1st DCA 1978).
To establish standing to challenge the intended agency action, a party must show it has a substantial interest to be determined by the agency. In other words, the unsuccessful bidder must establish its entitlement to receive the award should the challenge prove successful. Westinghouse Electric Corporation v. Jacksonville Transportation Authority, 491 So.2d 1238 (Fla. 1st DCA 1986).
While Petitioner gamely alleged facts to claim an entitlement to the awards for configurations 1, 2, and 3 in service area 1, the proof submitted failed to establish the Department acted arbitrarily or capriciously.
In configuration 1, three bidders were lower than Petitioner: Henkels & McCoy, Inter-Tel, and Tel Plus. The weight of evidence established each of these bidders to be responsive to the requirements of the ITB.
In configuration 2, two bidders were lower than Petitioner: Inter-Tel and Tel Plus. The weight of evidence established each of these bidders to be responsive to the requirements of the ITB.
In configuration 3, three bidders were lower than Petitioner: Business Telephone, Henkels & McCoy, and Inter-Tel. The weight of evidence established each of these bidders to be responsive to the requirements of the ITB.
Petitioner misinterpreted the "handsfree" definition and, therefore, the challenge to the Henkels & McCoy bid on that basis was in error. Additionally, since an SMDR or SMDR option was not required of any bidder, Petitioner's challenge to Henkels & McCoy and Inter-Tel on that basis must fail.
Petitioner challenged the Inter-Tel bid for configuration 2 because a modification was necessary in order for the Inter-Tel equipment to comply with a requirement of the ITB. Petitioner did not dispute that the modification could be made. Instead, Petitioner claimed that without documentation explaining the intended relocation of a switch, it is impossible to verify that the modification would be made and still meet all conditions of the ITB. The Department did not require documentation since the relocation of the switch was a minor modification. The Department did not waive a requirement of the ITB. Assuming, arguendo, documentation for the relocation of the switch had been required by the ITB and that the Department waived such documentation, there is no evidence from which it may be concluded that such waiver gave Inter-Tel an advantage or benefit not available to other bidders. All bidders were required to comply with the technical aspects of the ITB (whether submitting new equipment or modified new equipment).
Since speed dialing could be provided by the system or at the station, the challenge to the Inter-Tel bid claiming loss of speed dialing memory in the event of a power outage must fail. Memory at the station is not required by the ITB.
Petitioner failed to establish that Business Telephone Systems was not responsive to the ITB. When taken as a whole, the Business Telephone Systems response supplied all information required by the ITB. All bidders were allowed to submit supplemental information to the ITB form. When such information provided a required response, it was deemed responsive whether submitted in one location or another. Similarly, the Henkels & McCoy response, taken as a whole, complied with the ITB.
Petitioner was not the second lowest bidder in any of the three configurations challenged. Accordingly, Petitioner's challenge of the awards must fail.
RECOMMENDATION
Based on the foregoing, it is
RECOMMENDED that the Department of General Services enter a Final Order dismissing the formal protest of the Petitioner.
DONE and ENTERED this 5th day of January, 1988, in Tallahassee, Leon County, Florida.
JOYOUS D. PARRISH
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 5th day of January, 1988.
APPENDIX
Rulings on Findings of Fact submitted by Petitioner:
Paragraph 1 is accepted.
Paragraph 2 is accepted.
Paragraph 3 is accepted in part. The information requested on the spare parts price list was for planning purposes only. Response of hourly rate etc. was not required to comply with the ITB.
Paragraph 4 is accepted; see Finding of Fact paragraph 13.
Paragraph 5 is accepted.
6 With regard to paragraphs 6-8, to the extent such paragraphs track the language of the ITB they are accepted; however, the SMDR or SMDR option was not a mandatory item of the bid. It was indicated as an optional operational feature.
To the extent paragraph 9 sets forth optional operational features (as described in Section 3.16.8 of the ITB) it is accepted; however this specific proposed Finding is irrelevant and unnecessary to the conclusion of issues raised in this proceeding.
Paragraph 10 is accepted.
Paragraph 11 is rejected. The SMDR or SMDR option was an optional operational feature. No bidder was disqualified because it did not have the SMDR or an SMDR option.
Paragraph 12 is accepted.
Paragraph 13 is accepted.
Paragraph 14 is accepted.
Paragraph 15 is accepted.
Paragraph 16 is accepted.
Paragraph 17 is accepted.
With regard to paragraphs 18-20, to the extent such paragraphs track the information on p.23 of ITB they are accepted; however, the listing of the printed circuit card may not be required when bid as a component of the console which is properly described in the bid response.
Paragraphs 21-23 are accepted, however, speed dialing may be provided at the station which does not require memory retention.
Paragraph 24 is accepted.
Paragraphs 25-26 are accepted.
Paragraphs 27-29 are accepted.
Paragraphs 30-33 are rejected. Each paragraph makes a conclusion contrary to the weight of evidence.
Paragraph 34 is accepted.
Paragraph 35 is rejected as unnecessary. For the reasons explained in the conclusions of law, whether Petitioner was or was not compliant is not material. Assuming, arguendo, Petitioner was compliant, it still lacked sufficient standing to challenge the awards.
Paragraph 36-38 are rejected as contrary to the weight of evidence.
Paragraphs 39-40 are accepted.
Paragraphs 41-44 are rejected as contrary to the weight of the evidence.
Rulings on Findings of Fact submitted by the Department.
Paragraphs 1-7 are accepted.
Paragraph 8 is accepted to the extent it rephrases the definition found in the ITB.
Paragraphs 9-11 are accepted.
With regard to paragraph 12, the system was required to retain memory. Accordingly, that reference is accepted, however, the station was not required to retained memory.
Paragraphs 13-15 are accepted.
Paragraphs 16-18 are accepted.
Paragraphs 19-21 are accepted.
Paragraph 22 is accepted in part as it correctly restates the ranking of the bidders; the rest of the paragraph is rejected as argumentative.
Paragraph 23 is accepted in part as it correctly states the ranking of the bidders and disqualifications; however the rest is rejected as argumentative.
Paragraph 24 is accepted in part as it correctly states the ranking of the bidders, however, the rest is rejected as argumentative.
Paragraph 25 is rejected as unnecessary.
Paragraph 26 is accepted.
COPIES FURNISHED:
Edward W. Dougherty, Jr., Esquire Post Office Box 11127 Tallahassee, Florida 32302-3127
Susan B. Kirkland, Esquire Department of General Services
453 Larson Building Tallahassee, Florida 32399-0955
Joseph W. Lawrence, II, Esquire Post Office Box 589 Tallahassee, Florida 32302-0589
Ronald W. Thomas, Executive Director Department of General Services
Room 133, Larson Building Tallahassee, Florida 32399-0955
Docket for Case No: 87-004912BID
Orders for Case No: 87-004912BID
| Issue Date |
Document |
Summary |
|
Feb. 23, 1988 |
Agency Final Order
|
|
|
Jan. 05, 1988 |
Recommended Order
|
No bidder had unfair advantage over another agency may in its discretion waive minor irregularities therefore Petition should be dismissed.
|
