STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

PROFESSIONAL TESTING SERVICE, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 91-7429BID

)

DEPARTMENT OF PROFESSIONAL )

REGULATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the above matter was heard before the Division of Administrative Hearings by it duly designated Hearing Officer, Donald R. Alexander, on December 2, 1991, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Joseph W. Lawrence, II, Esquire

Post Office Box 1116

Fort Lauderdale, Florida 33302

For Respondent: Vytas J. Urba, Esquire

1940 North Monroe Street, Suite 60

Tallahassee, Florida 32399-0792 STATEMENT OF THE ISSUES

The issues are whether Applied Measurement Professional, Inc.'s response to RFP 91-002 was nonresponsive, and if so, whether respondent's acceptance of the same was unlawful.

PRELIMINARY STATEMENT

This matter began on November 4, 1991, when petitioner, Professional Testing Service (PTS), filed its written protest to an award of a contract by respondent, Department of Professional Regulation (DPR). The contract called for the successful firm to assist DPR and the Florida Real Estate Commission in production and scoring of the Florida Real Estate and Appraisal Examination for the period beginning approximately January 1, 1992, through June 30, 1993, with a renewal for one to two years. According to the written protest, the apparent successful firm, Applied Measurement Professionals, Inc. (AMP), had submitted a response which did not conform to the request for proposal (RFP) in a number of respects. More specifically, the protest alleged that, contrary to the instructions in the RFP, AMP's proposal did not set forth the costs for those candidates who were scheduled to take the examination but did not appear, and AMP submitted nine cost categories making up the cost per candidate even through the RFP specified that only eight components should be used. In addition, the protest alleged that AMP was not a responsible firm because AMP is not

authorized to transact business in the State of Florida, and that at least one member of a six-person DPR evaluation committee was unaware that AMP's proposal was nonresponsive. In an amendment to its protest filed on November 13, 1991, PTS alleged further that AMP's proposal was nonresponsive because, contrary to the RFP, AMP represented that it would not maintain an office in the Orlando area to supply support personnel at examination sites for administration of contract services, and AMP illegally qualified its bid by stating it would train DPR staff to furnish unofficial grade reports to candidates, or in the alternative, it would assess an additional unspecified fee per candidate if AMP personnel were required to perform that task.

The matter was referred by respondent to the Division of Administrative Hearings on November 20, 1991, with a request that a hearing officer be assigned to conduct a formal hearing. By notice of hearing dated November 21, 1991, a final hearing was scheduled on December 2, 1991, in Tallahassee, Florida.

At final hearing, petitioner presented the testimony of Dale L. Cox and David B. Cox, its president and vice-president, respectively. Also, it offered petitioner's exhibits 1-5. All exhibits were received in evidence. Respondent presented the testimony of George Stuart, Secretary of the Department of Professional Regulation, Virginia C. Stuart, a member of the Florida Real Estate Commission, and Ella D. Hall, a DPR psychometrician. Also, it offered respondent's exhibits 1-3. All exhibits were received in evidence.

The transcript of hearing (two volumes) was filed on December 9, 1991.

Proposed findings of fact and conclusions of law were filed by the parties on December 20, 1991. A ruling on each proposed finding of fact is made in the Appendix attached to this Recommended Order.

FINDINGS OF FACT

Based upon all of the evidence, the following findings of fact are determined:

1. Background

   
   

   1. On August 16, 1991, respondent, Department of Professional Regulation (DPR), issued Request for Proposal No. 92-002 (RFP) to various firms inviting them to submit proposals for assisting DPR and the Florida Real Estate Commission (Commission) in the production and scoring of the Florida Real Estate and Appraisal Examination for the period beginning January 1, 1992, through June 30, 1993, with a renewal option for one to two years. More specifically, the contract called for the successful firm to develop examinations from a bank of questions provided by the Commission, administer periodic examinations, score and analyze tests, and perform other related support services. Such proposals were to filed no later than 2:00 p.m. on September 20, 1991. Thereafter, and in accordance with the RFP, a six-person committee composed of representatives of the DPR, Commission and Division of Real Estate (Division) would evaluate the proposals and make a recommendation to the Secretary of DPR, who retained final authority to award the contract.

      
      

   2. Proposals were timely filed by three firms, including petitioner, Professional Testing Service, Inc. (PTS), Applied Measurement Professionals, Inc. (AMP), and National Assessment Institute (NAI). After these proposals were evaluated by the committee, AMP was recommended for award of the contract. By a 4-3 vote, the Commission concurred with this recommendation. On October 24, 1991, the Secretary of DPR selected AMP as the recipient of the contract, and

      notice to that effect was posted. Citing various alleged irregularities in the review process, PTS filed its formal protest to the award of the contract on November 4, 1991. After efforts to informally resolve this dispute were unsuccessful, this proceeding ensued.

      
      

2. The Vendors Who Submitted Proposals

   
   

   1. Petitioner is a Florida corporation with offices located at 223 Pasadena Place, Orlando, Florida. It has provided various licensure examination services to DPR for the past eighteen years. Except for a two year break in 1984 and 1985, for the last eleven years PTS has held the contract with DPR to provide licensure examination services on the real estate examination, and pending resolution of this dispute, it continues to provide such services.

      
      

   2. AMP did not intervene as a party in this cause. However, according to its proposal, AMP is a Kansas corporation with offices at 8310 Nieman Road, Lenexa, Kansas, and has been in the business of developing and administering examinations since 1984. Among other things, it now provides assistance to the State of Michigan for the real estate licensure examination. AMP maintains no offices or personnel in the State of Florida.

      
      

   3. Although NAI submitted a response to the RFP, it is not a party to this action. Located in Clearwater, Florida, with branch offices in other cities in Florida and throughout the country, NAI has provided assessment services to various state governments since 1976. It has administered the DPR contractor examination for the last fourteen years.

      
      

3. Events Leading to the Issuance of RFP 92-002

1. In May 1991, DPR issued RFP 91-009 requesting proposals for assistance in the development and administering of real estate examinations. That RFP requested proposals on three components of the real estate examination services, including (a) application processing, (b) test development, grading and review, and (c) administration of the examination. Items (a) and (c) and a portion of item (b) had previously been handled by the Division, the administrative arm of the Commission. In response to RFP 91-009, proposals were filed by PTS, AMP, NAI, and two other vendors. PTS was recommended for award of the contract as to two components while AMP was recommended for the award of the contract as to one component even though its proposal had been deemed to be nonresponsive.

   However, DPR eventually decided to reject all proposals and issue a new RFP.

   The new RFP (91-002) did not call for proposals on items (a) and (c) and the test development portion of item (b) since the Division determined that it would continue to perform those functions. Even so, while RFP 91-002 was more narrow in scope of services than was 91-009, it nonetheless contained some of the same terms, conditions and requirements as did the earlier RFP. It is also noted that, with one minor exception relating to on-site grading, the scope of services under the existing contract held by PTS and those enumerated in RFP 91- 002 are the same.

   
   

2. Prior to the time for submitting responses to RFP 91-009, the Division, whose director was designated as contract manager, and Commission conducted a pre-bid conference with interested vendors to answer questions concerning the RFP. Both RFP 91-009 and 91-002 contained an identical requirement that the successful firm "(m)aintain an office/center in the greater Orlando area." In response to a question by a vendor as to whether DPR would "accept proposals that identify Tallahassee as the office/center site for the provider's office in

   lieu of Orlando", the response given was "no, Orlando is the designated site." Other questions and answers concerning the same topic were as follows:

   
   

   Q. Would the Department consider allowing

   the contractor (for application processing function only) to maintain offices in Tallahassee instead of Orlando, provided that 1)regular meetings are held in Orlando, and

   2) reports can be delivered to the Department's offices in Orlando?

   A. No. Because the application processing function relating to deficient applications must be closely coordinated with the records section, the investigative section, the legal section, administrative section of the Division of Real Estate and the Florida Real Estate Commission. Florida Statutes require that the office of the Division of Real Estate and the Florida Real Estate Commission be located in Orlando. Therefore, Divisional functions must be performed in the Orlando area.

   Q. Is Orlando the only site the Department

   will agree to, or is the Department flexible to the location if all requirements can be met from another site in the State of Florida?

   1. Orlando is the only site.

      
      

      The above questions and answers, together with others asked and answered at the conference, were transcribed by DPR and then furnished to all interested vendors. Since AMP filed a proposal in response to RFP 91-009, it may be reasonably inferred that AMP was privy to the above clarifying information. It is noted that there was no pre-bid conference prior to the filing of proposals in response to RFP 91-002.

      
      

   2. The RFP

   
   

3. A copy of RFP 91-002 is found on pages 90 through 108 of petitioner's composite exhibit 1. The RFP includes sections relating to statement of need, purpose, scope of work, DPR responsibilities, provider responsibilities, general information, documents required in submitting a proposal, the proposal format, proposal rating criteria, and an appendix delineating the manner in which points would be awarded in the evaluation process. Prior to the submission of the proposals, no vendor formally challenged any provision in the RFP as being unreasonable, ambiguous, or otherwise unlawful in any respect. A number of provisions within RFP 91-002 are relevant to this controversy and are cited below.

   
   

4. First, there is a general requirement found in Article VIII which requires all responses to be prepared in a manner consistent with the requirements of the RFP. More specifically, this article provided that

   
   

   Respondents must follow the proposal format as set forth under Section III in this request for proposal. The provider shall refer to the request for proposal to ensure

   all required information is submitted. By following the designed format of proposals, respondents will have a uniform method of presenting information helping assure complete fairness by the review team in evaluating proposals.

   
   

5. Next, Article VII set forth those documents that were required to be submitted with the proposal. Among them was a requirement in paragraph 1 that the vendor submit "evidence that the organization is a legal entity." The purpose of this requirement was to ensure that DPR could enforce the agreement in the event the successful firm later attempted to back out of its commitment.

   
   

6. The RFP also prescribed twenty-three major services that were within the scope of work to be provided by the successful firm. Indeed, the RFP stated in unequivocal language that "(t)he provider shall perform the following services as outlined below." (Emphasis added) Specifically, paragraphs 22 and

23 of Article III specified that the successful firm would

1. Furnish to each candidate an unofficial grade report at the examination site at no

   additional cost to the candidate according to specifications approved by the Department.

2. Maintain an office/center in the greater Orlando area.

These two requirements, both unambiguous, were reasonably construed by participating vendors to mean that (a) the successful firm would furnish, at no cost to the candidate, on-site grade reports to those candidates who desired an unofficial grade after the examination was completed, and (b) the successful firm would maintain an office in the Orlando area to provide technical and other assistance to Commission and Division personnel regarding the examination. The interpretation as to paragraph 23 was especially reasonable since it conformed to clarifying information given to vendors at the pre-bid conference prior to the submission of proposals for RFP 91-009. Finally, despite DPR's contention to the contrary at hearing, the requirements in paragraphs 22 and 23 were considered material by the Division and Commission.

1. From DPR's perspective, an important consideration was the costs to be charged both the candidate who sat for the examination and the candidate who made application but did not take the examination. This was because DPR's experience indicated that each year a large number of candidates apply for the examination but then fail to appear and sit for the examination. Indeed, during the most recent fiscal year of record, DPR had received 38,886 applications to take the various real estate and appraiser examinations but almost 3,000 did not appear. These figures were contained in RFP 91-009 and thus were available to all vendors, including AMP. Accordingly, DPR inserted a provision in the RFP directing each vendor to develop a cost schedule reflecting the cost for both the candidates scheduled for examination and the candidates who were actually examined. This material requirement was embodied in paragraph 1 of Article VI, which provided the following instructions to the vendors:

   
   

   The costs schedule for this proposal shall be priced on a per candidate examined for the first year and each of the option years provided. *Differences between the number of candidates scheduled for exam and the number

   of candidates examined shall be compensated for at a specific rate per candidate to be set forth by the provider.* (Emphasis added between *)

   
   

   The above provision was consistent with the manner in which the existing contract holder (PTS) had calculated its candidate costs for DPR during the preceding five years. Very simply, this meant that the proposal had to include one cost figure for candidates examined and another cost figure for scheduled candidates who did not appear.

   
   

2. In calculating the costs for scheduled candidates, Appendix I, Section IV, page 3 of 3, required that all vendors develop a cost for services, including a "cost per candidate scheduled" to be made up of eight cost components: scan sheet costs, examination booklet production costs, scanning and microfilming costs, on-site grading costs, scoring costs, grade reporting/grade summary costs, security costs, and item bank maintenance costs. Therefore, each vendor was required to segregrate its costs per candidate into the eight prescribed categories, with the sum of those eight components representing the total costs per candidate scheduled.

   
   

   1. The Responses

      
      

3. A copy of AMP's proposal filed on September 20, 1991, is found at pages 257 through 392 of petitioner's exhibit 1. In response to the requirement that the vendor give "evidence that the organization is a legal entity", AMP responded that it was a private stock corporation incorporated in 1982 in the State of Kansas. Although AMP represented that "a Certificate of Good Standing with the State of Kansas is available upon request," no such certificate was enclosed with its proposal. Documentation offered by PTS confirmed that AMP is not a Florida corporation, and there is no evidence to show that AMP, as an out- of-state corporation, has registered with the Department of State to transact business in the State of Florida.

   
   

4. In its proposal, AMP provided an overall price "per candidate" but failed to differentiate between the costs incurred for candidates examined and candidates who were scheduled to take the examination but did not appear. This was contrary to the requirement in Article VI that such costs be identified for both categories and caused the proposal to be nonresponsive in a material respect.

   
   

5. Although the RFP specifically required the vendor to set out eight cost components in developing the cost per candidate scheduled, AMP submitted nine specific costs as follows:

   
   

   1. Test Development	$3.72
   2. Scan Sheet	0.10
   3. Examination Booklet Production	2.47
   4. Scanning	1.01
   5. Scoring	1.05
   6. Grade Tape Preparation	0.43
   7. Security	0.32
   8. Item Bank Maintenance	0.50
   9. On-Site Grading	0.20
   TOTAL	$9.80

   It should be noted that the first item, "Test Development" costs, which included

   38 percent of AMP's total price, was not a category contained in or authorized by the RFP. Thus, the proposal was nonresponsive in this material respect.

   
   

6. According to its proposal, AMP did not intend to maintain an office/center in the greater Orlando area. Rather, it proposed that:

   
   

   as an alternative to staffing an office in Orlando, AMP proposes to conduct regular monthly meetings in Orlando with the Division and key AMP project staff, typically the doctorate level Program Director and a Test Development Specialist. AMP will bring its portable computer equipment, and paper and computer files of the draft test and the item banks to these meetings. Any changes to examinations, as required by the Division, can then be immediately made in the draft tests and reviewed by the Division. It is AMP's opinion that this procedure will provide the Division with the direct responsiveness desired, and ensure efficient communication between the Division and the key project staff, without information being filtered through a lesser qualified individual in a satellite office. Additional urgent concerns can be discussed using the telephone or FAX equipment with the Program Director. (page 272, petitioner's exhibit 1)

   
   

   By filing this response, AMP contravened the material requirement in paragraph

   23 of Article III that it maintain an office/center in the greater Orlando area.

   
   

7. In response to the material requirement that it "furnish to each candidate an unofficial grade report at the examination site at no additional cost to the candidate according to specifications approved by the Department", AMP responded that it would:

   
   

   train the Department's test administration personnel to use this equipment to this end

   . . . . AMP's cost proposal is based on using the Department's personnel. If this is not possible, an additional per candidate fee will be determined based on using AMP personnel.

   
   

   Thus, AMP's response unilaterally modified the RFP requirement that AMP personnel rather than DPR personnel perform the task of providing unofficial grade reports at the examination site. Moreover, AMP's proposal did not state what its price per candidate would be if DPR enforced the RFP requirement.

   Under AMP's proposal, it calculated a cost of 20 cents per candidate for providing this service assuming DPR personnel were used. This was $2.27 less per candidate than the charge given by PTS ($2.47). Thus, AMP gained an economic advantage by its failure to provide on-site grading with its own personnel. Accordingly, this portion of the proposal was nonresponsive.

8. The proposal of PTS was responsive to the RFP in all respects. This finding was not contradicted by DPR. It is noteworthy that two potential vendors, H. H. Block & Associates, Inc., a Gainesville, Florida firm, and Psychological Services, Inc., a firm located in Glendale, California, both advised DPR in writing that because of the requirement in the RFP that the successful vendor locate a center/office in the greater Orlando area, they would not be filing a proposal. The latter two vendors were obviously prejudiced by DPR's failure to advise them that it did not intend to enforce the requirement in paragraph 23 of Article III. This failure by DPR to enforce the provision also gave AMP an economic advantage over other vendors since AMP did not have to incur the costs of operating an Orlando office.

   
   

   1. The Evaluation Process

      
      

9. The committee selected to evaluate the proposals was made up of six individuals appointed by the Secretary of DPR. It met in Tallahassee on September 30, 1991, to evaluate the proposals. The committee was chaired by Ella D. Hall, a DPR psychometrician. In accordance with the instructions in the RFP, the committee reviewed only the technical aspects of the proposals and did not review the cost data.

   
   

10. Article IX of the RFP outlined the responsibilities of the evaluation committee and the procedure for evaluating proposals. Among other things, the committee was assigned the responsibility to:

    
    

    first determine if all required documents are included, that the proposal format is followed, and that all responses to the request's responsibilities of the provider are properly addressed. The cost data will not be reviewed as part of the technical evaluation.

    
    

11. The committee utilized both a scoring guide and an evaluation guide in arriving at its recommendation. A total of 300 possible points were to be given to a vendor, of which 226 were related to technical matters. As noted above, the committee did not consider cost in its evaluation.

    
    

12. Contrary to Article IX of the RFP, the committee did not initially determine whether the proposals were responsive. More specifically, the committee did not "first determine if all required documents (were) included, that the proposal format (was) followed, and that all responses to the request's responsibilities of the provider (were) properly addressed." According to the committee's chairperson, the committee was never told to determine if the proposals were responsive before evaluating them on their merits. Indeed, the chairperson assumed, albeit incorrectly, that someone else had previously evaluated the proposals in terms of responsiveness. As it turned out, none of the proposals were evaluated for responsiveness prior to or during the committee evaluation process.

    
    

13. Through its chairperson, the committee issued a written report on October 9, 1991, recommending that AMP be awarded the contract. Although the committee considered the responses by AMP and PTS to be almost equal in terms of technical ratings, it gave a slight edge to AMP's proposal in the cost rating and recommended that AMP be awarded the contract. NAI was a very distant third in the evaluation process. Because of the committee's report, and AMP's announcement on October 16, 1991, as discussed below, that its price per

    candidate scheduled but not examined would be zero, the Commission voted 4-3 to endorse the committee's recommendation. The Secretary received the proposals in that posture.

    
    

    1. Events Occurring After the Committee Evaluation

       
       

14. On October 4, 1991, or before the contract was awarded but after the committee evaluation was completed, AMP's president, Steven K. Bryant, sent a letter to the Secretary of DPR. The letter was received by DPR on October 9, 1991, and a copy of same has been received in evidence as petitioner's exhibit

1. It provides in relevant part as follows: Dear Secretary Stuart:

   At the request of Lou Ritter, I am writing to you due to our concerns about the opportunity for our company to fairly compete for testing services business in your state. The recent rebidding of the Florida Cosmetology and Real Estate Programs have generated some serious questions in my mind as to whether or not it is in our interest to continue to respond to Florida RFPs. I hope you will investigate the following concerns and use the power of your office to correct these circumstances:

   1. The second RFP regarding real estate was clearly written to ensure that the current vendor retains the contract. The requirement that the vendor have an office in Orlando staffed by an individual whose only job would be to serve as a liaison with the Real Estate Commission makes it basically impossible for any organization based outside of the state of Florida to compete with the current vendor.

      An organization such as ours cannot afford to put a doctorate level individual in an office in Florida to be at the beck and call of the Real Estate Commission to answer examination development questions and economically survive. At best, we could put a clerical person in an office in Orlando who would be unable to answer any of the Commission's test development concerns. In our response to the RFP, we indicated that we would not establish an Orlando office, but would provide a doctoral level measurement expert and a test development specialist to meet once a month with the Real Estate Commission to revise the real estate examinations to their specifications using very highly qualified individuals.

   2. The second real estate RFP also requires that the examination booklets be printed and shipped to Florida examination centers within a seven day time frame, after the

examinations are reviewed by the Real Estate Commission. This item was clearly written

for the current vendor, which is basically photocopying examination materials as soon as the Commission provides approval on examination copy. There is no real reason why the examinations could not be reviewed and approved by the state to allow a longer time frame for printing, so that higher quality offset printed examination booklets could be prepared and shipped to Florida by a vendor residing out of state. In fact, we could provide several months of examinations in advance for the Commission's approval and avoid the crisis mode of printing which a seven day turnaround would cause. Although, we could provide the seven day turnaround through the use of overnight air carriers and the like, clearly the Real Estate Commission had in mind the current vendor when making this unreasonable requirement.

* * *

The letter also carries a handwritten note by the Secretary in the upper right hand corner which reads "Discussed with Lou Ritter/Steve Bryant - file 10/21". According to the Secretary, Ritter (a former Secretary of DPR) is now a consultant for AMP. The Secretary acknowledged that he spoke with Ritter and Bryant concerning the letter and advised them the agency was proceeding with the RFP. The Secretary's assertion that he followed up on the letter only to the extent that he wanted to ascertain if AMP had been unfairly penalized in the evaluation process was not contradicted.

1. On October 16, 1991, Bryant sent a second letter on behalf of AMP to the Secretary of DPR. It read as follows:

   
   

   Dear Secretary Stuart:

   
   

   This is to confirm our telephone discussion regarding our price proposal for RFP #92-002 (sic) for Real Estate Examination Services. Since the RFP calls for AMP to provide examination booklets to the test centers the department administers, it was our intention to charge the state $9.80 per candidate tested, based on the number of answer sheets actually scored by AMP. Thus, there would not be a charge for candidates who do not appear for testing.

   
   

   Thank you for the opportunity to provide this information. Please let me know if there are any other questions.

   
   

   The above letter was solicted by the Secretary after he and Bryant spoke by telephone on or about October 15, 1991. The purpose of the letter was to allow AMP to clarify and amend its proposal which failed to include a cost for candidates who were scheduled to take the examination but did not appear. In contrast, neither PTS nor NAI were offered the opportunity to clarify or change their proposals after being filed. Thus, AMP was allowed to correct a material

   deviation from the terms of the RFP thereby giving it an advantage over its competitors. The contract was thereafter awarded to AMP on or about October 24, 1991.

   
   

   1. Summary of Errors in the RFP Process

   
   

2. By failing to file evidence that it was a "legal entity", failing to file a cost per candidate scheduled but not examined, and submitting a price per candidate based on nine cost components rather than the prescribed eight, AMP failed to follow the proposal format required of all vendors by Article VIII.

   
   

3. AMP's proposal was materially nonresponsive in four respects. First, it failed to differentiate between costs incurred for candidates examined and candidates who were scheduled but did not appear. Second, it utilized nine cost components in developing the cost per candidate scheduled instead of the eight components specified by the RFP. Third, in declining to establish an office in the greater Orlando area, AMP deviated from a material requirement. Fourth, contrary to the RFP, AMP proposed that DPR personnel rather than its own personnel provide unofficial grade reports to candidates at the examination sites. If this was unsatisfactory to DPR, AMP proposed to assess DPR an unspecified charge for providing this service.

   
   

4. By waiving the enforcement of a material requirement (paragraph 23, Article III) after the proposals had been filed and evaluated, DPR gave a competitive advantage to AMP not enjoyed by other vendors. Further, by allowing AMP to correct a material variance from the RFP on October 16, 1991, as to the price charged for candidates scheduled but who did not take the examination, DPR gave a competitive advantage to AMP not enjoyed by other vendors.

   
   

5. Collectively, these considerations support a finding that (a) the proposal submitted by AMP was materially nonresponsive and should be rejected, and (b) DPR created unfair competition and favoritism by waiving material requirements and allowing AMP to amend its proposal after being filed and evaluated.

   
   

   CONCLUSIONS OF LAW

   
   

6. The Division of Administrative Hearings has jurisdiction of the subject matter and the parties hereto pursuant to Subsection 120.57(1), Florida Statutes (1989).

   
   

7. As the party challenging the award of the contract, PTS must prove by a preponderance of the evidence that DPR's action was improper. Cf. Capeletti Bros., Inc. v. State, Department of General Services, 432 So.2d 1359, 1363-64 (Fla. 1st DCA 1983) (no error in requiring challenging party in bid proceeding to bear burden of proving agency action incorrect).

   
   

8. As a general rule, the scope of inquiry in a bid proceeding is limited to determining "whether the agency acted fraudulently, arbitrarily, illegally, or dishonestly." Department of Transportation v. Groves-Watkins Constructors,

   530 So.2d 912, 914 (Fla. 1988). See also, City of Cape Coral v. Water Services of America, Inc., 567 So.2d 510, 513 (Fla. 2d DCA 1990). Although the Groves- Watkins case involved the review of a final agency order rejecting all bids, and not, as here, the award of a contract to the apparent successful vendor, the same standard applies in both types of proceedings. Scientific Games, Inc. v. Dittler Brothers, Inc., 586 So.2d 1128, 1131 (Fla. 1st DCA 1991). Thus, the undersigned is required to honor the rule that a public body has "wide

   discretion" in the bidding process and its decision, when based on an honest exercise of the discretion, should not be overturned "even if it may appear erroneous and even if reasonable persons may disagree." Id. at 1131.

   Notwithstanding this broad grant of discretionary power, the acceptance of a proposal which is not materially responsive to the RFP would be unlawful, and therefore arbitrary, and the agency does not have the discretion to do so.

   Accordingly, the principal inquiry in this proceeding is whether AMP's proposal was responsive in all material respects. If it was not, AMP's proposal should be rejected.

   
   

9. By a preponderance of the evidence, PTS has established that AMP's proposal in response to RFP 91-002 was materially nonresponsive. In addition, the agency created unfair competition or favoritism by waiving material requirements in the RFP and allowing AMP to amend its proposal after all proposals had been filed and evaluated. Since the acceptance of a materially nonresponsive proposal was unlawful and thus arbitrary, the proposal submitted by AMP should be rejected and the contract awarded to one of the other vendors who filed a response. Dr. C. J. Courtney v. Department of Health and Rehabilitative Services, 581 So.2d 621, 623 (Fla. 5th DCA 1991)(it is not a function of the hearing officer to reweigh the award factors and recommend the award of the contract to a particular vendor).

RECOMMENDATION

Based on the foregoing findings of facts and conclusions of law, it is,

RECOMMENDED that a final order be entered by respondent rejecting the proposal filed by Applied Measurement Professionals, Inc. in response to RFP 91- 002 and awarding the contract to one of the other vendors who filed a response.

DONE and ENTERED this 3rd day of January, 1992, in Tallahassee, Florida.

DONALD R. ALEXANDER

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 3rd day of January, 1992.

APPENDIX

Petitioner:

1. Partially adopted in finding of fact 1.

2. Partially adopted in findings of fact 11, 12, 13 and 22.

3. Partially adopted in findings of fact 6 and 7.

4. Partially adopted in finding of fact 7.

5. Partially adopted in findings of fact 2, 3 and 4.

6. Partially adopted in finding of fact 24.

7. Partially adopted in findings of fact 10 and 14.

8. Partially adopted in findings of fact 7, 11, 17, 19 and 29.

9. Partially adopted in findings of fact 11, 18 and 29.

10. Partially adopted in findings of fact 12, 15, 28 and 29.

11. Partially adopted in findings of fact 13, 16, 28 and 29.

Respondent:*

1. Partially adopted in finding of fact 1. 2-3. Partially adopted in finding of fact 22.

1. Partially adopted in findings of fact 1, 20 and 24.

2. Partially adopted in finding of fact 24.

3. Partially adopted in finding of fact 13.

6a. Partially adopted in findings of fact 3, 15 and 19. 6b. Rejected as being contrary to the evidence.

6c. Partially adopted in finding of fact 16. 7-8. Partially adopted in finding of fact 24. 9-10. Partially adopted in finding of fact 26.

1. Partially adopted in findings of fact 10 and 14.

2. Partially adopted in finding of fact 16.

3. Partially adopted in finding of fact 17. The second sentence is specifically rejected as being contrary to the evidence.

4. Partially adopted in finding of fact 16.

5. Partially adopted in finding of fact 11.

6. Partially adopted in finding of fact 18.

7. Rejected as being unnecessary.

* Respondent's proposed findings of fact included numbers 4, 5, 6, 4, 5, 6. Therefore, the second set of findings numbered 4, 5 and 6 have been renumbered 6a, 6b and 6c for purposes of this Appendix.

Note - Where a proposed finding has been partially adopted, the remainder has been rejected as being irrelevant, unnecessary, subordinate, not supported by the evidence, redundant, or a conclusion of law.

COPIES FURNISHED:

Joseph W. Lawrence, II, Esquire Post Office Box 1116

Fort Lauderdale, FL 33302

Vytas J. Urba, Esquire

1940 North Monroe Street, Suite 60

Tallahassee, FL 32399-0792

George Stuart, Secretary Department of Professional

Regulation

1940 North Monroe Street Tallahassee, FL 32399-0750

Jack L. McRay, Esquire

1940 North Monroe Street, Suite 60

Tallahassee, FL 32399-0792

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period within which top submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.

Docket for Case No: 91-007429BID

Orders for Case No: 91-007429BID