STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

JET VAC SANITARY SERVICE, )

)

Petitioner, )

)

vs. ) CASE NO. 88-3331BID

)

FLORIDA DEPARTMENT OF )

TRANSPORTATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, this cause came on for formal hearing before P. Michael Ruff, duly designated Hearing Officer, on July 22, 1988, in Tallahassee, Florida. The appearances were as follows:

APPEARANCES

For Petitioner: Ray Heath

William B. Singleton

Jet Vac Sanitary Services Post Office Box 186

New Smyrna Beach, Florida 32070

For Respondent: Bruce A. Campbell, Esquire

Senior Litigation Attorney Office of General Counsel Department of Transportation Haydon Burns Building

605 Suwannee Street

Tallahassee, Florida 32399-0450

This case concerns an Invitation to Bid promulgated by the Department of Transportation (Respondent) whereby it sought competitive bids for the provision of a storm sewer line cleaner which the Department contemplates purchasing. The key specifications at issue as a result of that procurement effort concern the device's ability to vacuum gutters while in motion and the specification that it should be a standard production model with a minimum of five units in satisfactory service for a periods of at least one year prior to bid opening.

Bids were submitted by Jet Vac Sanitary Services (Jet Vac) and Vac-Con, Inc., both, manufacturers and/or distributors of sewer line cleaning equipment.

The bids were evaluated, and the Department elected to select the bid submitted by Vac-Con, Inc. as the lowest, most responsive bid to the published specifications. Thus, the Department duly noticed its intent to award bid number MY3188B5 to Vac-Con, Inc. The Petitioner herein, Jet Vac, timely filed a formal protest to the Department's proposed award to Vac-Con, and this formal proceeding ensued.

The cause came on for hearing as noticed, at which the Petitioner, Jet Vac, presented the testimony of Bill Gaffe, a manufacturer's representative of Peabody-Myers, the manufacturer of the sewer cleaning machine which was the subject of Petitioner's bid submittal. Jet Vac's Exhibits 1-4 were admitted into evidence. The Department (DOT) presented the testimony of Harry Burt, its engineer in charge of procuring the machines at issue and evaluating the bids.

The Department's Exhibits A, B and C were admitted into evidence. The parties elected to order a transcript of the proceedings and availed themselves of the right to file Proposed Findings of Fact and Conclusions of Law in the form of Proposed Recommended Orders. They concomitantly waived the requirements of Rule 28-5.402, Florida Administrative Code, and timely submitted their Proposed Recommended Orders which have been considered in the rendition of this Recommended Order , as well as being specifically ruled on in the Appendix attached hereto and incorporated by reference herein. The issues to be resolved in this proceeding concern whether the bid submitted by Vac-Con, Inc. for the storm sewer line cleaner at issue, was responsive to the specifications in the Invitation to Bid which involved a question of whether or not this sewer cleaner device can be used to vacuum gutters while it is in motion and whether that equipment is a standard production model as shown by there being a minimum of five such units in satisfactory service for a period of one year or more.

FINDINGS OF FACT

1. The Department of Transportation, pursuant to its decision to procure certain sewer line cleaning equipment, issued an Invitation to Bid to potential vendors of such equipment. The specifications in that Invitation to Bid which are at issue in this proceeding concern the specified ability of the machine being proposed to vacuum gutters while being driven or, that is, in motion. The other specification at issue was that the machine had to be a standard production model with five of such machines in service for one year prior to May 1988. The sewer line cleaner specified had to have a nine cubic yard capacity. The bids were received, including that of Vac-Con, Inc. and Jet Vac Sanitary Service. The bid results were posted on June 3, 1988, noticing the Department's intent to award the contract for the nine cubic yard sewer line cleaner to Vac- Con, Inc. Jet Vac Sanitary Service timely filed a formal protest of that intended bid award on June 17, 1988. The Petitioner's formal protest was transmitted to the Division of Administrative Hearings and duly came on for hearing. The Petitioner is contending that the Vac-Con model V290 storm sewer line cleaner does not meet the specifications in the Invitation to Bid because it will not vacuum gutters while in motion in the configuration set forth in

   Vac-Con's published specifications for its standard models. It asserts, in conjunction with this argument, that the alternative configuration proposed by Vac-Con would in effect render this a nonstandard production model of which Vac- Con has not had five in service prior to May 1988, which would represent a departure from the bid specifications and thus result in a non-responsive bid.

   The Respondent, however, contends that the alternative configuration proposed by Vac-Con is merely an options package to an existing standard production model machine and thus is in conformance with the specification. The Respondent has been advised by Vac-Con that the V290 machine will perform as specified and that at least five machines have been so configured and have been in service for the required one year or greater period.

   
   

2. It is stipulated that Jet Vac Sanitary Service was the next lowest bidder after Vac-Con and has standing to protest the Intent to Award. Jet Vac was a responsive bidder. It is also stipulated that the configuration of the model V290 depicted in Vac-Con's promotional material itself will not meet the specifications set forth in Respondent's Invitation to Bid. The dispute is

   whether the Vac-Con machine, as optionally modified, as proposed by Vac-Con, meets the specification concerning the machine being a standard production model.

   
   

3. In response to the Invitation to Bid, Vac-Con, Inc. submitted a bid for its Vac-Con model V290. It accompanied that bid with a written statement of the model specifications which coincided with the specifications required by the Invitation to Bid. It specified, that is, that it would comply with the requirement that the vehicle be able to vacuum gutters while being driven in motion. Jet Vac in turn submitted a bid which was responsive, but it was not the lowest bid.

   
   

4. Vac-Con, Inc., in other bids submitted in the past year as well as in its advertising literature, describes the V290 model of sewer line cleaner as one in which the vacuum compressor is driven by the truck engine, that is the engine which provides the motive power to the vehicle. In order to operate the vacuum compressor as described in that literature, the rear axle of the truck has to be disengaged, with the result that the unit cannot vacuum and drive at the same time. This configuration of the V290 model which has the vacuum being operated by the truck engine or chassis engine, is the normal type of unit offered by Vac-Con in its vehicle demonstrations and literature, as recently as one week prior to trial. In order for the V290 to comply with the bid specifications at issue, it must be reconfigured so that the vacuum compressor is run by an auxiliary engine and not the motive power engine. The power available to operate the vacuum compressors which vacuum trash from gutters and so forth, would be reduced from the chassis engine which, in the normal configuration of that model, operates the vacuum compressors. The reconfiguration whereby the vacuum compressors would be run off the auxiliary engine, and not the motive engine, would require a reversal of the V-belt drives used by the normal unit. This alternate configuration would be obvious to the casual observer.

   
   

5. The intent of the term "standard production model" in the specifications at issue is to ensure that a machine purchased will have ready availability of manufacturer's replacement parts out of stock. This serves to prevent the purchaser from having to do development work on new models which are not in standard production runs and do not have inventories of spare parts in the manufacturer's stock as yet. Because the alternate configuration of the unit, whereby it would vacuum while moving, running its vacuum equipment off of its auxiliary engine, requires new engineering and reevaluation of the power of the V290's auxiliary motor, the specification language requiring a "standard production model" and requiring that five such units be operational in the field, requires in this instance that five units in the alternate configuration at issue be found to have been in satisfactory field service for one year.

   
   

6. The written description submitted by Vac-Con, Inc. in response to the bidding documents, describes a machine which complies with the specification requiring the ability of the machine to vacuum while it is in motion. That description was specially prepared for purposes of this bid. Indeed it is not a machine represented, at the time of the bid, in the company's advertising literature, catalog data or other published brochures and like sources of information in order to verify that indeed Vac-Con did have five units in the alternative configuration in satisfactory service. The Department's representative, Mr. Burt, telephoned individuals whose names had been supplied him by Vac-Con as being persons who could verify that the alternative, which could vacuum in motion with the vacuum blower run off the auxiliary engine, was indeed in service. Using these names supplied him by Vac-Con and names of

   persons some of those people in turn gave him, who had such altered machines operating in satisfactory service, Mr. Burt telephoned each of the individuals whose names had thus been furnished by Vac-Con and its customers. He thus confirmed that there were indeed at least five units in service in the field, for at least one year, which had the ability to vacuum gutters while in motion, with the vacuum equipment being operated by the auxiliary engine on the machine.

   
   

7. The Department has a policy of relying upon the representations of its suppliers. It does not inspect each piece of equipment before it writes a purchase order after awarding a bid. It instead reserves the right to reject any piece of equipment that does not meet specifications, after purchase. The Department does not wish to get into an adversary relationship with its suppliers and, in turn, vendors typically do not want an adversary or unfavorable relationship with the Department and do not want future disqualifications from bidding based upon any lack of integrity or misrepresentations in responding to bid specifications. Accordingly, the representations made on the bidding document have historically been quite accurate and have a high degree of probability of reliability. Hence, the Department has not, in the exercise of its discretion, followed a policy of physically inspecting each piece of equipment and independently verifying its existence or capabilities. It rather has effectively, in the past, relied upon the vendor's representations regarding the capacities or capabilities of equipment. In fact, the Department has neither the staff nor the time to make any further pre-award investigations, especially due to the nationwide market and indeed, to some extent, international market, in which it seeks to procure equipment of all sorts. In any event, being satisfied that the equipment would perform as represented and verifying that at least five such configured machines were in active field service for a year or more, the Department concluded that, in the exercise of its discretion, that the specifications had been adequately responded to and that the award should be made to Vac-Con as lowest, most responsive bidder. Insufficient proof to the contrary was offered at the hearing.

   
   

   CONCLUSIONS OF LAW

   
   

8. The Division of Administrative Hearings has jurisdiction over the parties to and the subject matter of these proceedings. Sections 120.53(5) and 120.57(1), Florida Statutes.

   
   

9. The Department of Transportation is authorized to purchase commodities and equipment by competitive bidding, pursuant to Sections 337.02 and 287.062, Florida Statutes.

   
   

10. Section 287.021, Florida Statutes, defines the following terms which are applicable to Section 287.062 and the instant case:

    
    

    "a. Section 287.012(7): 'Invitation to Bid' means a written solicitation for sealed, competitive bids with the title, date,

    and hour of the public bid opening designated and specifically defining the commodity, a group of commodities or services for which bids are sought. It includes instructions prescribing all conditions for bidding and shall be dis- tributed to all prospective bidders sim- ultaneously. The Invitation to Bid is

    used when the agency is capable of specifically defining the scope of work for which a contractual service is required or when the agency is capable of establishing precise specifications defining the actual commodity or group of commodities required.

    
    

    1. Section 287.012(9): 'Qualified bidder' or 'qualified offeror' means a person

       who has the capability in all respects to perform fully the contract require- ments and has the integrity and reliability which will assure good faith performance.

       
       

    2. Section 287.012(12): 'Responsive bid- der' or 'responsive offeror' means a person who has submitted a bid which conforms in all material respects to the Invitation to Bid or request for proposals."

       
       

11. Chapter 13A, Florida Administrative Code, which implements Chapter 287, provides in pertinent part as follows:

    
    

    "13A-1.001(4) Formal Invitation to Bid - a formal Invitation to Bid is defined as a solicitation for sealed bids with a title, date, and hour of the public bid opening designated specifically defining the commodity or service included. It should include printed instructions prescribing all conditions for bidding and provide for a manual signature of an authorized representative, and be distributed to all prospective offerors at the same time. Any person or firm permitted to prepare bid solicitation so as to restrict competition for its personal benefit shall not be permitted to offer a bid to that solicitation.

    
    

    (13) Valid Bid Proposal - A responsive offer in full compliance with the bid/proposal specifications and conditions by a respon- sible person or firm. The responsiveness of the bid or proposal and the qualifications or responsibility of the offeror will be determined as of the time the bids/proposals are made public.

    
    

    1. Responsive bidder/offeror means a person or firm which has submitted a bid/proposal which conforms in all material respects to the Invitation to Bid or request for a proposal.

    2. Responsible or qualified bidder/offeror means a person or firm with the capability in all respects to perform fully the contract requirements and the integrity and reliability to ensure a good faith performance. Failure to provide information to determine responsibility in response to a condition of a bid/proposal requiring information may be cause for such bid/proposal to be rejected.

    
    

    13A-1.002(10) Right to Waive Minor Irregularities - The agency shall reserve the right to waive any 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 interest of the agency. Variations which are not minor cannot be waived."

    
    

12. The Department is charged with proceeding with the exercise of its discretion in a rational and non-arbitrary way. Couch Construction Co. vs. Department of Transportation, 361 So.2d 172, 175 (Fla. 1st DCA 1978). Based upon the evidence of record and the above Findings of Fact, it has been established that the Department acted rationally in exercising its discretion to decide that a V290 unit exists which does vacuum gutters while it is in motion. That function does require a modification of the configuration appearing in Vac- Con's published promotional literature and, apparently, which was more commonly produced in the past. That modification is easily accomplished, however, with standard stock parts. The manufacturer's bid that was submitted stated that the manufacturer had elected to change the configuration of its more commonly sold machine, to use the auxiliary engine to drive the vacuum compressor. The Department received adequate verification by phone from customers of Vac-Con that such units do exist and are in satisfactory operation in accordance with the bid specification as to that issue. It would be neither arbitrary nor an abuse of discretion if the Department, believing such representations, elected to finally determine that the Vac-Con V290 machine met the specifications in the Invitation to Bid documents. This is true even though the evidence also shows that Vac-Con continues to market an existing machine that will not vacuum while it is in motion and as against testimony from the competitor's sales representative to the effect that he has not seen such a modified V290 unit in operation. As shown in the above Findings of Fact, the Department's representative made adequate verification that the V290, as altered to vacuum while in motion, is in satisfactory service in accordance with the bid specifications.

    
    

13. Because the modification at issue involves significant changes in the configuration of the V290 machine, the specification that the required number should have been in service satisfactorily for a year in order to comply with the Specification, is critical. The failure to meet that specification would not be a waivable, minor irregularity

14. The question then becomes, what investigative effort must the procuring agency engage in to confirm the bidder's representations so that the exercise of its discretion, should it choose that bidder to award, be rational and reasonable. The Department does not have the manpower or the time to investigate every representation of every prospective vendor, which might involve travel and inspections at numerous sites all over the country and possibly overseas. The Department has historically followed a Policy of relying on the representations of its Suppliers and their bid responses and, should a commodity or piece of equipment be found to be not in compliance with the specifications, it can be rejected. The Department does not want to incur adversary relationships with its suppliers, and suppliers have a strong incentive not to be deceptive, since they might risk, thereby, disqualification as a future "qualified bidder" because of lack of integrity and reliability and misrepresentations in their response to Invitations to Bid or Requests for Proposals. See Section 287.012(9), Florida Statutes. The potential sanction to vendors, thus, could be quite severe they engaged in any deceptive practice or representation in their response to an Invitation to Bid as is involved in this case. Thus, there is a strong rational basis for the Department to act under the assumption that responses to bid specifications are accurate and reliable.

    
    

15. Deception, normally, would be revealed upon delivery of the commodity anyway, and the cost to the Department of rejection of the commodity at that point would be relatively minor and would chiefly involve delay during which time delivery of a replacement or a rebidding is accomplished. The risk of dishonesty to the Department is much less than the risk to the contractor and the potential benefit of increased investigation seems rather small. It is thus rational to find that the Department need not devote extensive resources to pre- award investigation to confirm representations made by suppliers, especially when the Department has not been put on any notice that some anomaly or lack of reliability is attendant to any particular representation or specification response.

    
    

16. Here the Department elected to make at least a minimal investigation. That investigation, involving a phone call from Mr. Harry Burt to various users of the Vac-Con machine, confirmed that the Vac-Con machine proposed, albeit altered from that commonly purveyed by Vac-Con, did meet the specifications in the above-discussed particulars. In summary, it has been established that the Vac-Con V290 machine, configured to vacuum while in motion, is responsive to the specifications referenced above, and the Vac-Con bid was the lowest, responsive bid.

RECOMMENDATION

Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is, therefore

RECOMMENDED that a Final Order be entered awarding the contract for Florida DOT Bid Number MY3188B5 to Vac-Con, Inc.

DONE and ENTERED this 8th day of December, 1988, in Tallahassee, Florida.

P. MICHAEL RUFF 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 8th day of December, 1988.

COPIES FURNISHED:

Ray Heath

William B. Singleton

Jet Vac Sanitary Services Post Office Box 186

New Smyrna Beach, Florida 32070

Bruce A. Campbell, squire Senior Litigation Attorney Office of General Counsel Department of Transportation Haydon Burns Building

605 Suwannee Street

Tallahassee, Florida 32399-0450

Kaye N. Henderson, P.E., Secretary ATTN: Eleanor F. Turner, M.S. 58 Department of Transportation Haydon Burns Building

605 Suwannee Street

Tallahassee, Florida 32399-0450

Docket for Case No: 88-003331BID

Orders for Case No: 88-003331BID