The Issue The issue for determination is whether Respondent acted fraudulently, arbitrarily, illegally, or dishonestly in selecting Intervenor as the lowest bidder for a contract to supply the state with lamps valued at $3,692,499.
Findings Of Fact The Parties Respondent is the state agency responsible for soliciting bids to establish a contract for the purchase of large lamps by state agencies and other eligible users. Petitioner is a Florida corporation and the incumbent vendor under similar contracts for the preceding 10 years. Petitioner does not manufacture lamps. Petitioner sells lamps manufactured by Osram-Sylvania ("Sylvania"). Intervenor is an Ohio corporation doing business in Florida. Intervenor manufactures the lamps it sells. The ITB On March 15, 1996, Respondent issued Invitation To Bid Number 39-285- 400-H, Lamps, Large, Photo and STTV (the "ITB"). The purpose of the ITB is to establish a 24 month contract for the purchase of Large Lamps (fluorescent, incandescent, etc.), Photo Lamps (audio visual, projection, flash), and Studio, Theatre, Television, and Video Lamps ("STTV") by state agencies and other eligible users. The contract runs from July 10, 1996, through July 9, 1998. The ITB estimates the contract price at $3,692,499. The ITB contains General and Special Conditions. General Conditions are set forth in 30 numbered paragraphs and elsewhere in DMS Form PUR 7027. Special Conditions are set forth in various unnumbered paragraphs in the ITB. General Conditions Paragraphs 5, 11, and 24 of the General Conditions are at issue in this proceeding. The terms of each paragraph are: 5. ADDITIONAL TERMS AND CONDITIONS: No additional terms and conditions included with the bid response shall be evaluated or considered and any and all such additional terms and conditions shall have no force and effect and are inapplicable to this bid. If submitted either purposely through intent or design or inadvertently appearing separately in transmittal letters, specifications, literature, price lists, or warranties, it is understood and agreed the general and special conditions in this bid solicitation are the only conditions applicable to this bid and the bidder's authorized signature affixed to the bidder's acknowledgment form attests to this. 11. QUALITY ASSURANCE: The contractor, during the contract term, upon mutual agree- ment with the Division of Purchasing, will provide reasonable travel and lodging accommodations for one (1) to three (3) government employees to perform an on-site inspection of the manufacturing process(es) and review of the manufacturer's product quality control(s) and total quality manage- ment program(s). The contractor will reim- burse the State for actual transportation cost, per diem and incidental expenses as provided in Section 112.061, F.S. It is the State's desire that the contractor provide demonstration of quality control for improvement rather than post production detection. 24. FACILITIES: The State reserves the right to inspect the bidder's facilities at any reasonable time with prior notice. Included Items Special Conditions in the ITB require bidders to submit prices for "Item 1" and "Item 2" lamps ("included items"). 1/ Item 1 lamps consist of Group 1 and 2 lamps. Group 1 lamps are Large Lamps such as fluorescent, incandescent, quartz, mercury vapor, metal halide, and high-pressure sodium lamps. Group 2 lamps are Photo Lamps such as audio visual, projection, flash, and STTV lamps. The total price for each group is multiplied by a weighted usage factor. The product calculated for Group 1 is added to the product calculated for Group 2 to determine the total price for Item 1 lamps. Item 2 consists of a category of lamps described as "T- 10 Lamps." The total price for Item 2 lamps is determined without application of the weighted usage factor used for Item 1 lamps. The total price for Item 2 lamps is a de minimis portion of the contract price. Special Conditions in the ITB require Respondent to award a single contract for included items to a single bidder. Special Conditions state that, "During the term of the contract established by this bid, all purchases of items will be made from the successful bidder." 2/ Excluded Items Special Conditions require that, "The bidder shall offer a fixed discount from retail prices on all excluded items." Excluded items include high technology lamps. The requirement for a fixed discount on excluded items is not considered in evaluating bid prices for included items. Rather, the requirement is intended to reduce the state's cost for both included and excluded items by assuring a meaningful discount on excluded items. Formatting Requirements Special Conditions prescribe the format in which bids must be submitted. Price lists and authorized dealers' lists are required to be submitted in hard copy and on computer diskette. The format prescribed for computer diskette includes requirements for font and graphics. The Special Conditions state that, "Failure to comply with this requirement will result in disqualification of your bid." The Bids The ITB prohibits the alteration of bids after they are opened. Respondent opened bids on April 10, 1996. Seven vendors submitted bids in response to the ITB. Included Items Four vendors, including Petitioner, submitted a bid for both Item 1 and Item 2 lamps. Intervenor and two other bidders did not submit a bid for Item 2 lamps. General Conditions Intervenor deleted paragraphs 11 and 24 of the General Conditions from its bid. At the direction of Intervenor's legal department in Cleveland, Ohio, Intervenor's regional sales manager struck through paragraphs 11 and 24 and initialed the deletions. The deletions are consistent with Intervenor's corporate policy. Intervenor routinely objects to contract provisions requiring inspection of Intervenor's facilities. Excluded Items Petitioner's bid includes a fixed discount of 44 percent on excluded items. Intervenor's bid includes a fixed discount of 0 percent. Formatting Requirements Intervenor included the information required by the ITB on the diskette it submitted with its bid. However, Intervenor supplied the information in Courier 12 characters per inch ("cpi") font, not the Courier 10 cpi font prescribed in the ITB. Proposed Agency Action Respondent determined that Intervenor's bid was responsive. The purchasing specialist for Respondent who reviewed each bid to determine if it was responsive failed to observe the deleted paragraphs in Intervenor's bid. The purchasing specialist forwarded those bids determined to be responsive to the purchasing analyst assigned by Respondent to: determine if the lamps offered in each bid met the specifications prescribed in the ITB; and evaluate bid prices. The purchasing analyst noted that paragraphs 11 and 24 were deleted from Intervenor's bid. The purchasing analyst and purchasing specialist conferred. They determined that paragraph 5 of the General Conditions cured Intervenor's deletions without further action. The purchasing analyst correctly determined: that lamps offered by Petitioner and Intervenor met ITB specifications; that Intervenor's bid is the lowest bid for Item 1 lamps; that Petitioner's bid is the second lowest such bid; and that Petitioner's bid is the lowest bid for Item 2 lamps. Petitioner's bid for Item 1 lamps is approximately five percent greater than Intervenor's bid. Respondent proposes to award one contract for Item 1 lamps to Intervenor. Respondent proposes to award a second contract for Item 2 lamps to Petitioner. At 4:00 p.m. on May 20, 1996, Respondent posted its intent to award the contract for Item 1 lamps to Intervenor. Petitioner timely filed its formal protest on June 3, 1996. Respondent did not award a contract for excluded items. Respondent's failure to award a contract for excluded items is not at issue in this proceeding. Arbitrary Respondent's proposed award of a contract to Intervenor for substantially all of the items included in the ITB is a decisive decision that Respondent made for reasons, and pursuant to procedures, not governed by any fixed rule or standard prescribed either in the ITB or outside the ITB. Respondent's proposed agency action is arbitrary. Excluded Items The requirement for bidders to offer a fixed discount on excluded items operates synergistically with the requirement for Respondent to award a single contract on included items to a single bidder. The combined action of the two requirements operating together has greater total effect than the effect that would be achieved by each requirement operating independently. The requirement for a fixed discount on excluded items, operating alone, may not induce a bidder who could receive a contract solely for Item 2 lamps to offer a discount that is as meaningful as the discount the bidder might offer if the bidder were assured of receiving a contract for Item 1 and 2 lamps upon selection as the lowest bidder. 3/ By assuring bidders that a single contract for Item 1 and 2 lamps will be awarded to a single bidder, the ITB creates an economic incentive for bidders to provide a meaningful discount on excluded items. Respondent frustrated the synergy intended by the ITB by applying the requirements for a fixed discount and for a single contract independently. Respondent penalized the bidder conforming to the requirement for a fixed discount on excluded items by awarding only a de minimis portion of the contract to the bidder. Respondent rewarded the bidder not conforming to the requirement for a fixed discount on excluded items by awarding substantially all of the contract to that bidder. If Respondent elects to purchase all excluded items from Petitioner, Respondent will have used the contract for Item 1 lamps to induce a meaningful discount from Petitioner without awarding Petitioner with the concomitant economic incentive intended by the ITB. Such a result frustrates the ITB's intent. Paragraph 5 Respondent's interpretation of paragraph 5 fails to explicate its proposed agency action. Respondent's interpretation of paragraph 5: leads to an absurd result; is inconsistent with the plain and ordinary meaning of the terms of the ITB; and is inconsistent with Respondent's actions. Respondent's interpretation imbues paragraph 5 with limitless curative powers. Respondent's interpretation empowers paragraph 5 to cure the deletion of all General Conditions in the ITB whether stricken by pen or excised with scissors. Respondent's interpretation of paragraph 5 would transform a bid containing no General Conditions into a responsive bid. Respondent's interpretation of paragraph 5 is inconsistent with the plain and ordinary meaning of its terms. Paragraph 5 operates to cure "additional" terms. It does not operate to restore deleted terms. Respondent's interpretation of paragraph 5 is inconsistent with Respondent's actions. Respondent did not rely on paragraph 5 to cure Intervenor's deletions without further action. Respondent took further action to cure the deletions. Further Action On the morning of May 20, 1996, the purchasing analyst for Respondent telephoned Intervenor's regional sales manager. The purchasing analyst demanded that Intervenor accept the conditions Intervenor had deleted from its bid by submitting a letter of acceptance before the bid tabulations were posted at 4:00 p.m. on the same day. The regional sales manager contacted Intervenor's corporate headquarters in Cleveland, Ohio. Intervenor authorized the regional sales manager to accept the deleted paragraphs. By letter faxed to Respondent at approximately 3:20 p.m. on May 20, 1996, Intervenor accepted the paragraphs it had previously deleted. The letter stated that, "GE Lighting [will accept] the Contract Conditions noted in Paragraphs 11 and 24 of the Lamp Quotation." [emphasis not supplied] At 4:00 p.m. on May 20, 1996, Respondent posted the bid tabulation form. The bid tabulation form stated that the "award is contingent upon General Electric's acceptance of all the terms in conditions (sic)" in the ITB. Respondent argues that the purchasing analyst who contacted Intervenor on the morning of May 20, 1996, exceeded her authority. Respondent characterizes the word "contingent" in the bid tabulation form as "poorly written" and a "bad word." Agency Construction Of ITB Terms Respondent construes terms in the ITB in a manner that is inconsistent with their plain and ordinary meaning. The ITB requires that, "The bidder [shall] offer a fixed discount from retail price list on all excluded items." [emphasis supplied] Respondent interprets the quoted provision as meaning the bidder may offer such a fixed discount if the bidder elects to do so. The purpose of the ITB is to establish "[a] 24 month contract" to supply large lamps to the state. [emphasis supplied] Respondent interprets the quoted provision as meaning that the purpose of the ITB is to establish two contracts. The ITB states that, "During the term of the contract established by this bid, all purchases of items [will] be made from [the] successful bidder." [emphasis supplied] Respondent interprets the quoted provision as meaning that purchases of some items will be made from one successful bidder and that purchases of other items will be made from a second successful bidder. The ITB states that the contract "[shall] be made statewide on an all or none basis" to the responsive bidder who satisfies the conjunctive requirements for: "[the] lowest "Award Figure Item (1; [and] lowest Award figure for Item (2." [emphasis supplied] Respondent interprets the quoted provision as meaning that separate contracts may be made statewide on less than an all or none basis to separate responsive bidders who satisfy the disjunctive requirements for either the lowest bid for Item 1 lamps or the lowest bid for Item 2 lamps, or both. The ITB requires offers to be submitted for all items listed within a group for a bid to qualify for evaluation. Respondent interprets the requirement as meaning that a bidder who does not qualify for evaluation for all of the groups in the contract nevertheless qualifies for evaluation for the contract. Finally, the ITB states that failure to comply with the formatting requirements for the diskette "[will] result in disqualification of your bid." [emphasis supplied] Respondent interprets the quoted language to mean that failure to comply with prescribed formatting requirements may result in disqualification of a bid. The interpretations of the quoted terms proposed by Respondent, individually and collectively, frustrate the purpose of the ITB. They also ignore material requirements of the ITB. Material Deviation Respondent deviated from the rule or standard fixed in the ITB in several respects. First, Respondent altered the bid evaluation procedure prescribed in the ITB. Second, Respondent ignored the requirement to award a single contract to a single bidder. Third, Respondent ignored the requirement that bidders provide a fixed discount on excluded items. Fourth, Respondent ignored the requirement to comply with the formatting requirements prescribed in the ITB. Each deviation from the rule or standard fixed in the ITB is a material deviation. Each deviation gives Intervenor a benefit not enjoyed by other bidders. Each deviation affects the contract price and adversely impacts the interests of Respondent. 4/ 5.5(a) Benefit Not Enjoyed By Others Intervenor enjoyed a benefit not enjoyed by other bidders. Intervenor obtained a competitive advantage and a palpable economic benefit. Respondent altered the bid evaluation procedure prescribed in the ITB. On the morning of May 20, 1996, Respondent disclosed the bid tabulations to Intervenor alone, 5/ gave Intervenor an opportunity that lasted most of the business day to determine whether it would elect to escape responsibility for its original bid, allowed Intervenor to cure the defects in its bid, accepted Intervenor's altered bid, and conditioned the bid tabulations on Intervenor's altered bid. Respondent used a bid evaluation procedure that is not prescribed in the ITB and did not allow other bidders to participate in such a procedure. 6/ In effect, Respondent rejected Intervenor's initial bid, with paragraphs 11 and 24 deleted, and made a counter offer to Intervenor to accept a bid with paragraphs 11 and 24 restored. Intervenor accepted Respondent's counter offer. Respondent excluded other bidders from that process. Respondent gave Intervenor an opportunity to determine whether it would elect: to escape responsibility for its original bid by declining Respondent's counter offer; or to perform in accordance with an altered bid by restoring paragraphs 11 and 24. A bidder able to elect not to perform in accordance with its bid has a substantial competitive advantage over other bidders unable to escape responsibility for their bids. 7/ Respondent awarded substantially all of the contract to Intervenor even though Intervenor failed to provide a meaningful discount on excluded items. Respondent provided Intervenor with a palpable economic benefit. 5.5(b) Bid Price And Adverse Impact On The State Respondent did not award a contract for excluded items. Respondent's proposed agency action allows Respondent to purchase excluded items from either Intervenor or Petitioner. If Respondent were to purchase all of the excluded items it needs from Intervenor, Respondent could pay substantially more for excluded items than Respondent would save from the five percent price advantage in Intervenor's bid for Item 1 lamps. In such a case, Respondent's proposed agency action would effectively increase costs to the state that are inherent, but not stated, in the ITB. 8/ Conversion of incorrectly formatted data to the required font shifts prices to incorrect columns and causes other problems in accessing information in the diskette. Such problems can not be rectified easily but require substantial time and effort. Responsive Bidder Respondent did not award the contract intended by the ITB to the lowest responsive bid. Although Intervenor's bid is the lowest bid for Item 1 lamps, it is not the lowest responsive bid for Item 1 and 2 lamps. Petitioner's bid is the lowest responsive bid for Item 1 and 2 lamps. 9/ Respondent is statutorily required to award the contract to the lowest responsive bidder. 10/ Illegal Intervenor's bid is not responsive within the meaning of Sections 287.012(17), Florida Statutes (1995). 11/ It does not conform in all material respects to the ITB. Intervenor's unaltered bid deletes paragraphs 11 and 24. It does not include a fixed discount on excluded items, does not include a bid for Item 2 lamps, and does not conform to the formatting requirements in the ITB. Section 287.057 requires Respondent to award the contract to the bidder who submits the lowest responsive bid. Respondent has no authority either: to consider bids that are not responsive; or to award the contract to a bidder other than the lowest responsive bidder. Respondent's attempt to engage in either activity is ultra vires and illegal. Minor Irregularities The ITB encourages, but does require, bidders to include quantity discounts for Item 1 and 2 lamps. Petitioner's bid does not include quantity discounts. Petitioner's bid does not fail to conform to material requirements in the ITB. Petitioner does not manufacture Item 1 and 2 lamps. Sylvania manufactures the lamps Petitioner sells. Petitioner has no legal right to require Sylvania to allow inspection of its facilities pursuant to paragraph 11 of the General Conditions. Petitioner's ability to provide the requisite inspections requires the cooperation of Sylvania. Petitioner's bid requires payment by the state within 30 days of an invoice. Section 215.422 and the ITB provide that Respondent has 40 days to issue warrants in payment of contract debts and that interest does not accrue until after 40 days. The defects in Petitioner's bid are minor irregularities within the meaning of Florida Administrative Code Rule 60A-1.001(16). 12/ They neither affect the bid price, give Petitioner a competitive advantage, nor adversely impact Respondent's interests. Petitioner has the practical ability to arrange inspection's of Sylvania's facilities. Petitioner is legally responsible for failing to do so. Respondent's employees have never visited Sylvania's facilities during the 10 years in which Petitioner has been the contract vendor to the state. The requirement for payment within 30 days does not obviate the provisions of Section 215.422. Private contracts can not alter mutually exclusive statutory provisions.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a Final Order granting Petitioner's protest of Respondent's proposed agency action. RECOMMENDED this 26th day of September, 1996, in Tallahassee, Florida. DANIEL S. MANRY, 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 26th day of September, 1996.
Findings Of Fact After its initial review of the bids, Respondent determined that Petitioner was the apparent low bidder, with a total bid of $344,971.53. Subsequently, however, it found an inconsistency in one of Petitioner's item prices and recomputed the subtotal which had the effect of increasing Petitioner's bid to $346,851.53. As a result of this recomputation, Intervenor became the apparent low bidder with its bid of $346,371.06. Respondent discovered that Intervenor had also made a similar error in one of its item prices which, had the subtotal been recalculated, would have increased Intervenor's bid by over $12,000. However, Respondent waived the error and allowed Intervenor's bid to stand. Respondent's bid forms specify various quantities of material required. Each quantity listed is followed by three columns which the bidder must complete. The first column is the unit bid in words (e.g. five dollars and no cents). The second column is the unit bid in numbers (e.g. $5.00). The final column, referred to as the "extension" is the total bid on the item in numbers (e.g. 30 units required times $5.00 per unit equals $150.00) Respondent's item number 10275 specified 1,890 construction signs. Petitioner entered one dollar and fifty cents in the unit bid (words) column, followed by $1.50 in the unit bid (numbers) column. Petitioner's extension column entry was $945.00. Respondent determined that 1,890 signs times one dollar and fifty cents each totalled $2,835.00, rather than $945.00, and raised Petitioner's bid accordingly. Respondent's item number 285710367 specified 7,070 square yards of material. Intervenor entered twelve dollars and no cents in the unit bid (words) column followed by $12.00 and $10.25 in the unit bid (numbers) column. A black line was drawn through the number $12.00, but was not initialed. Intervenor's extension column entry was $72,467.50. Here, Respondent determined that the $10.25 unit price should be permitted since 7,070 square yards times $10.25 did, if fact, equal the stated extension price. Using red ink, Respondent drew a second line through the number $12.00, and initialed this change. Respondent also drew lines through the words twelve (dollars) and no (cents), and wrote the words ten (dollars) and twenty-five (cents) and initialed this correction. Respondent's published policy on bid procedures is contained in its Standard Specifications Manual. Section 3-1 provides in part: In the event of any discrepancy in the three entries for the price for any item. the unit price as shown in words shall govern unless the extension and the unit price shown in figures are in agreement with each other, in which case they shall govern over the unit price shown in words. Respondent applied the above procedure to reject Petitioner's extension price on the signs since it did not agree with the unit price in figures or in words. Respondent applied the above procedure to accept Intervenor's extension price on the material since the $10.25 unit price in figures agreed with the extension. Acceptance of the $10.25 unit price figure (rather than the other entry of $12.00) was essential since no attempt had been made to change the twelve dollar unit price in words. Respondent's policy on bid procedures as set forth in its Standards Specification manual requires initialling of all changes made by the bidder. Section 2-5.1 provides in part: In case a change is made in a word or figure after it has been written in ink or typewritten, the bidder shall write his initials by the change. Intervenor failed to initial the change in its unit price figure. However, Respondent did not consider this to be a significant error and accepted the uninitialed change. Respondent's Standards Specifications Manual, Section 3-1, provides in part: Until the actual award of the contract, however, the right will be reserved to reject any or all proposals and to waive technical errors as may be deemed best for the interest of the State. This policy permits Respondent to reject either or both of these bids because of the errors discussed herein. Conversely, Respondent could consider either or both errors to be merely technical errors and waive them. Respondent's testimony and documentary evidence demonstrated that it does not enforce the policy requiring initialling of corrections. Additionally, Respondent's evidence established that it rigorously applies the procedure in Section 3-1 requiring the unit price in words to prevail where there are discrepancies except when the unit price in numbers and the extension agree. Respondent argues that the unit price figure is critical since the State may wish to order more of a given item and would not want to be bound by an erroneously high unit price. However, a stated unit price would not be binding where there is an error. Rather, the presumably correct extension price could be divided by the bid quantity to determine the correct unit price. The primary purpose of the policy which requires agreement of numbers and initialling of corrections is the prevention of conspiracy between bidders and State employees to alter bids. A further policy consideration, which is the stated basis for waiver of technical errors, is the furtherance of State interest. See Section 3-1, quoted above. In this regard, it should be noted that since Petitioner's original bid is the lowest, acceptance thereof would be in the interest of the State.
Recommendation Based on the foregoing, it is RECOMMENDED: That Respondent enter a Final Order rejecting existing bids and reissuing its bid proposal. DONE and ENTERED this 16th day of February, 1984, in Tallahassee, Florida. R. T. CARPENTER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 16th day of February, 1984. COPIES FURNISHED: Carl R. Pennington, Jr., Esquire 325 John Knox Road, Suite L-101 Tallahassee, Florida 32303 Mark A. Linsky, Esquire Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32301 Ronald W. Brooks, Esquire 863 West Park Avenue Tallahassee, Florida 32301 Paul Pappas, Secretary Department of Transportation Haydon Burns Building Tallahassee, Florida 32301 =================================================================
The Issue The issue in this case is whether the Respondent, the Department of Transportation (DOT), arbitrarily refused to accept the low bid submitted by the Petitioner, Quinn Construction, Inc. (Quinn), and Bay Machine, Inc., for State Project No. 15200-3902.
Findings Of Fact On or about December 7, 1994, the Petitioner, Quinn Construction, Inc. (Quinn), submitted a $1,695,534.84 bid on behalf of Quinn and Bay Machine, Inc., in response to a November, 1994, Department of Transportation (DOT) solicitation for bids on State Project No. 15200-3902. State Project No. 15200-3902 was essentially the same project for which the DOT previously solicited bids on or about July 1, 1994. The earlier solicitation for bids was cancelled when all bids were rejected, and the bid solicitation process was reinitiated. All bidders were required to furnish a bid guaranty, and the parties stipulate that any bid not accompanied by a bid guaranty would be declared nonresponsive. Attached to the Quinn/Bay Machine bid was a Bid or Proposal Bond on DOT Form 375-020-09. There was only one bridge rehabilitation project for Pinellas County among the projects for which the DOT was opening bids on December 7, 1994, and the bid bond was attached to the bid proposal of Quinn and Bay Machine for State Project No. 15200-3902. Utilizing the DOT form, the Quinn bid bond described the proposal being bonded as being "for constructing or otherwise improving a road(s) and/or bridge(s) or building(s) in Pinellas County; particularly known as Bayway 7918 Bridge Rehab." The part of the form calling for identification of the "Project No." was left blank. The bid bond was executed by James M. Moore as attorney- in-fact for North American Specialty Insurance Company. In addition to calling for the "Project No." in DOT Bid or Proposal Bond Form 375-020-09, the DOT routinely furnishes all bidders a Bidder's Checklist which reminds bidders to use the form and to identify the project on the form by county, by the federal aid number(s), if applicable, and by the State Project Job Number. Although the Bidder's Checklist was not in the bid package received by Quinn in connection with the November, 1994, solicitation for bids, Quinn received a Bidder's Checklist for the July, 1994, solicitation for bids on the same project and for many other previous bid solicitations. In prior bid proposal submissions, including the bid proposal submitted for the same project in August, 1994, Quinn had its surety use the "Project No." to identify the project on the bid bond. The attorney-in-fact for the bond company testified that the number 7918 on the bond was a typographical error. He testified that he thought 798 was the number that was supposed to be on the bond to identify the project. The WPI No. for the project was 7116982. The applicable State Road number was 679. The applicable bridge number was 150049. Although DOT Bid or Proposal Bond on DOT Form 375-020-09 called for identification of the "Project No.," DOT would have accepted a bid bond that identified the project by any of these numbers or by the official name of the bridge, if any. The bridge in question has no official name. It was not even proven that the bridge is commonly known as the Bayway 7918 Bridge, or even as the Bayway Bridge. The bridge in question is part of the Pinellas Bayway, which is a system of roads, causeways and bridges connecting St. Petersburg and St. Petersburg Beach and several small keys in Boca Ciega Bay. There are two state roads on the Pinellas Bayway: State Road 682, which connects State Road 699 to the west on St. Petersburg Beach to Interstate 275 to the east in St. Petersburg; and State Road 679, which intersects State Road 682 and runs south through Tierra Verde into Fort DeSoto Park on Mullet Key. Both 682 and 679 have combination fixed-span and bascule (draw) bridges. The bridge in question is on 679. When the DOT opened the bid of Quinn and Bay Machine, the incorrect identification of the project on the bid bond was noticed, and the question was referred to the Technical Review Committee. During its meeting on December 21, 1994, the Technical Review Committee sought the advice of its legal counsel and was advised that the bond probably would not be enforceable due to the inaccurate identification of the project to which it pertained. Based in part on the advice of counsel, the Technical Review Committee voted unanimously to recommend to the DOT Contract Awards Committee that the bid proposal be rejected as being non-responsive because of the bid bond. On December 23, 1994, the Contract Awards Committee met and voted unanimously to reject the bid proposal as being non-responsive because of the bid bond. Instead, the Committee accepted the bid proposal of M & J Construction Company of Pinellas County, Inc. (M & J). It was not arbitrary for the DOT to conclude that the Quinn bid bond was, or might well have been, unenforceable due to the inaccurate identification of the project to which it pertained. The DOT did not even consider whether the Quinn bid bond also may have been invalid and unenforceable because it named just Quinn as the principal, instead of both Quinn and Bay Machine, the actual entity that was prequalified to bid on the project and the actual entity bidding on the project. It also was not arbitrary for the DOT to conclude that submitting an unenforceable bid bond is not a minor irregularity. If a successful bidder does not enter into a contract, the project would be delayed while it is being rebid. The delay itself would result in a monetary loss. In addition, rebidding the project would result in additional costs to the DOT. Submitting an unenforceable bid bond could give a bidder the competitive advantage of feeling able to escape from having to contract and perform in accordance with a low bid, if advantageous to the bidder, without being liable under the bid bond.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Transportation enter a final order dismissing the Petitioner's bid protest and awarding State Project No. 15200-3902 to M & J Construction Company of Pinellas County, Inc. RECOMMENDED this 26th day of April, 1995, in Tallahassee, Florida. J. LAWRENCE JOHNSTON 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 26th day of April, 1995. APPENDIX TO RECOMMENDED ORDER, CASE NO. 95-0564BID To comply with the requirements of Section 120.59(2), Fla. Stat. (1993), the following rulings are made on the parties' proposed findings of fact: Petitioner's Proposed Findings of Fact. (It appears that the Petitioner's proposed findings of fact are found at pages 2-5 of its Proposed Findings of Fact and Conclusions of Law. For purposes of these rulings, the unnumbered paragraphs on those pages are assigned consecutive numbers.) Rejected in part. (Joint Exhibit 2 refers to State Road 679, not the project, as having the "Local Name: Pinellas Bayway." Joint Exhibit 5 also only refers to State Road 679, not the project, by the name "Pinellas Bayway." Only the front covers of the technical specs refer to the "Pinellas Bayway Bridge." The other pages refer to the "Pinellas Bayway," and all of the pages also include the State Project Number.) Otherwise, accepted and incorporated to the extent not subordinate or unnecessary. First sentence, accepted and incorporated to the extent not subordinate or unnecessary. Second and last sentences, rejected as not proven. Rejected in part as argument and in part as not proven. Last sentence accepted, but ambiguous and not legally significant, subordinate and unnecessary, whether DOT could "tie" the bid bond to the bid. Penultimate sentence, rejected in part as not proven (that Exhibit 4 "identified the project as the Pinellas Bayway"); otherwise, accepted and incorporated to the extent not subordinate or unnecessary. The rest is accepted and incorporated to the extent not subordinate or unnecessary. First sentence, rejected as not proven. (The evidence was clear that the DOT form requires a state project number and that the Bidder's Checklist provided to bidders by the DOT reminds bidders to use the form and identify the project by county, federal aid number(s), if applicable, and State Project Job Number.) Second sentence, subordinate and cumulative. Rejected as conclusion of law. Last sentence rejected as not proven that North American identified the project or that it used the local name of the bridge. The rest is rejected as not proven because the evidence was clear that the DOT form requires a state project number and that the Bidder's Checklist provided to bidders by the DOT reminds bidders to use the form and identify the project by county, federal aid number(s), if applicable, and State Project Job Number.) Accepted but subordinate and unnecessary. Rejected as not proven that DOT was arbitrary. The rest is subordinate, in part cumulative and in part argument. Subordinate, cumulative and argument. Rejected in part as conclusion of law, in part as argument and in part as not proven. Respondent's and Intervenor's Proposed Findings of Fact. All of the DOT's and the Intervenor's proposed findings of fact are accepted and are incorporated to the extent not subordinate or unnecessary or argument. COPIES FURNISHED: Suzanne Quinn, Esquire 1321 77th Street East Palmetto, Florida 34221 Thomas H. Duffy, Esquire Department of Transportation 605 Suwannee Street Tallahassee, Florida 32399-0450 Joseph G. Thresher, Esquire One Mack Center 501 E. Kennedy Bouelvard, Suite 725 Tampa, Florida 33602 Ben G. Watts Secretary Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450 Thornton J. Williams, Esquire General Counsel Department of Transportation 562 Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450
Findings Of Fact On or about December 29, 1981, the College solicited sealed bids for construction of alterations and additions to the Technical and Gymnasium Buildings located on its campus in Madison, Florida. In response, seven general contractors submitted bids. (P-1, P-2, P-3.) Bids were publicly opened on February 9, 1982. Griffin Construction, with a bid of $536,575, was the apparent low bidder; the second lowest bidder was Long Contractors, with a bid of $539,512. (Testimony of Griffin, Sims, Rutherford; P-3, P-4, P-5.) After the low bid was identified, Tom McClanahan, representing Long Contractors, asked that the subcontractor list accompanying the low bid be opened. Griffin Construction's subcontractor list was then opened. McClanahan asked if the license and charter numbers of the subcontractors were listed. 2/ Upon learning that these numbers were not included on Griffin Construction's subcontractor list, McClanahan protested. (Testimony of Sims, Rutherford, Griffin.) At its February 15, 1982, meeting, the College District Board of Trustees ("Board") rejected the low bid of Griffin Construction on the sole ground that the omission of subcontractor license and charter numbers constituted a failure to comply with the conditions of the bid documents. 3/ The Board then voted to award the contract to Long Contractors, the second lowest bidder, on the ground that it was the lowest bid conforming to the bid documents. In so doing, the Board followed the College president's recommendation--a recommendation based on his belief that the non-complying bid must be rejected, that it did not involve a matter of Board discretion. (Testimony of Sims, Rutherford, Griffin; Stipulation of Parties; P-41.) The bid specifications contain instructions to bidders requiring "each Bidder . . . [to] submit with his proposal a list of the subcontractors who will perform the work . . . as indicated by the `List of Subcontractors' form." (P-1, P-2.) The instructions further provide: The applicable subcontractor license registration or certification number must be noted on the bid opposite his name, and in the event that the subcontractor is a corporation, his State Corporate Charter number shall also be noted. If the subcontractor is an out of state firm, their Charter number with the Secretary of State to do business in the State of Florida should also be noted. The "Listing of Subcontractors" form provided with the specifications contains column headings for the names and addresses of the subcontractors but does not contain a separate heading for the requested license or corporate charter numbers. 4/ The form states that the subcontractor list "is an integral part of the bid." (P-1, P-2.) The bid instructions further require bidders to evaluate and determine the qualifications of their listed subcontractors. The bidder shall have determined to his own complete satisfaction that a listed subcontractor has been successfully engaged in this particular type of business for a reasonable length of time, has successfully completed installations comparable to that which is required by this agreement and is qualified both technically and financially to perform that pertinent phase of the work for which he is listed. (P-1, P-2.) The bid documents expressly reserve to the College the right "to reject any or all bids, and to waive informalities." (P-1 P-2.) No bidder correctly listed the required license and corporate charter numbers on its "Listing of Subcontractors" form. Griffin Construction. Griffin failed to include any license or corporate charter numbers. However, by subsequent letters dated February 9 and February 18, 1982, and at hearing, it supplied the required subcontractor license and charter numbers. Long Contractors. Long listed for its roofing subcontractor a sheet metal registration number, not the required roofing license number. [A sheet metal registration does not qualify a contractor for roofing work. See, 489.105, 489.113, Fla. Stat. (1981).] For its electrical subcontractor, Long omitted the prefix, "ER" from the listed number. For its plumbing subcontractor, Long listed a mechanical registration number instead of the required plumbing certification or registration number. [A mechanical registration does not qualify a contractor to perform plumbing work. See, 489.105, 489.113, supra.] Of the four areas requiring state licenses--roofing, heating and air conditioning, electrical, and plumbing--Long listed correctly only the registration number for its heating and air conditioning subcontractor. Long incorrectly listed No. FO6962 as the corporate number of Gandy Enterprises, its painting subcontractor. This is the number of a related corporation, Industrial Coatings, Inc. Remaining Bidders. Of the five other general contractors submitting bids, two-- Richard Walker Construction Company and GRC Contracting, Inc.--omitted all subcontractor license and charter numbers. The other three bidders failed to completely list all the required numbers. (Testimony of Rutherford; P-11, P-12, P-13, P-14, P-15, P-16, P-17, P-34, P-37, R-1, R-5.) The project architect testified that the submittal of incorrect or incomplete subcontractor license and charter numbers was a deficiency which a bidder should be allowed to cure after bid opening. But the failure to submit any required "number" was a deficiency which, in his opinion, could not be similarly corrected. He failed, however, to supply a reasonable basis for drawing such a distinction. Therefore, his opinion on this question is given little weight. 5/ (Testimony of Rutherford.) Subcontractor license and charter numbers are readily obtainable and can be verified by contacting the pertinent state agency--the Florida Department of Professional Regulation, Construction Industry Licensing Board, or the Florida Department of State. (Testimony of Griffin, Rutherford; P-32, P-33, P- 34, P-35, P-36, P-37.) The project architect, William Rutherford, routinely requires the listing of subcontractor license and charter numbers on bids for public construction projects. The main purpose it serves is that it would enable him to identify the listed contractor, since sometimes subcontractors have similar business names. Although if he was uncertain about the qualifications of a subcontractor, he would ordinarily question the general contractor. (Testimony of Rutherford.) Although Mr. Rutherford has customarily required the listing of subcontractor "numbers" on public projects, he has never made any use of those numbers in the past. (Testimony of Rutherford.) The general contractor who is awarded the contract is responsible to Mr. Rutherford and the College for construction of the project in accordance with the bid specifications. If, after bid opening, a listed subcontractor is unable to perform, Mr. Rutherford would ordinarily arrange for substitution of a new subcontractor acceptable to the general contractor and owner. (Testimony of Rutherford.) Griffin Construction's failure to list the license and charter numbers of its listed subcontractors, and its subsequent curing of that failure, did not affect the amount of its bid 6/ by giving it an advantage or benefit not enjoyed by other bidders. The bid omission did not allow Griffin Construction the opportunity to change any material element of its bid after bid opening. The inclusion or exclusion of subcontractor "numbers" at bid opening does not affect the ability of a contractors to obtain the required bond, the quality of bidding general contractors, the quality of listed subcontractors, the quality of work performed, or any material feature of the competitive bidding process. (Testimony of Griffin, Rutherford.)
Recommendation Based on the foregoing, it is RECOMMENDED: That the construction contract in question be awarded to Vick Griffin Construction Company, the lowest responsible bidder. DONE AND RECOMMENDED this 29th day of April, 1982, in Tallahassee, Florida. R. L. CALEEN, JR. Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 29th day of April, 1982.
The Issue The issue for consideration in this case is whether the Department of Transportation's (hereinafter "Department") declaration that the bid of Ranger Construction, Inc. (hereinafter ("Ranger") was materially irregular and therefore unresponsive to an invitation to bid on contracts in highway construction projects 93110-3539, 3543, 3525, on State Road 80, (Avenue E), in West Palm Beach, Florida.
Findings Of Fact On December 4, 1991, both Petitioner, Ranger, and Intervenor, Community, submitted bids for job numbers 93110-3539, 93110-3542, and 93110-3525, for a construction project on State Road 80, (Avenue E), in Palm Beach County. Petitioner's bid was in the total amount of $2,554,390.37, and Intervenor's was in the total amount of $2,557,071.42. On the basis of those figures, Petitioner was the apparent low bidder. Bid specifications incorporated in all this agency's bids indicate that a bid may be rejected for irregularities. The term, "material" is not used in that specification. When bids are opened, agency procurement officials look at each bid to insure that any award is based on balanced bids containing all appropriate signatures and other requirements, and in the event of an irregularity, a decision is made on the question of whether any irregularity is material in that specific contract. This decision, made by the Awards Committee, is whether the irregularity is material enough to declare the questioned bid unresponsive and award the contract to the next lower bidder. When bids are first opened at the Department auditorium, they are checked to see if the bid bond or a cash or cash equivalent alternative is present. Then the figures are read off and recorded. The bids are then taken back to the contracts office and safeguarded until the minority business enterprise office looks at them. When this is done, the bids are then passed out to the checkers for examination. This more detailed review of the bids submitted revealed that Ranger's bid bond form, though attested to by the corporate secretary, and executed by George H. Friedlander, Agent for the bonding company, United States Fidelity and Guaranty Company, did not bear the signature of either Ranger's president or vice president. This is considered by Department representatives as being a requirement of a responsive bid. Community's bid bond was properly signed and attested to, and bore the signature of the agent for Reliant Insurance Company, the surety. Community failed to put the company name on the certificate of non- collusion, but in light of the fact that the certificate was signed by the president and was attached to other Community documents, it was identifiable as a part of that bid. In addition, further review of Ranger's bid revealed that on item 630-1- 12 of the computerized price breakdown, certain conduit was listed with a unit price of $621.00 per linear foot. The computer disc furnished to the bidders by the Department, which was used to compute the pricing breakout, reflected 38 linear feet of this conduit would be required. The price of $621.00 per foot on the bid form was in error, however. It should have been $6.21 per linear foot. The error occurred when Ranger's representative punched in the typographically incorrect figure, a clearly clerical error, at the time the bid forms were being completed. This was done, according to Mr. Slade, Ranger's vice president and the person responsible for the bid preparation, in the press of last minute preparation in a motel room in Tallahassee, under less than optimum circumstances. Notwithstanding the fact that this was a clerical error which was not caught by any Ranger official on review of its bid prior to submittal, Department officials considered the use of that large figure made Ranger's bid "unbalanced." This defect, plus the failure of the bid bond to be signed by Ranger's president or vice-president, were both considered to be material deviations by the members of the Department's technical review committee which, based on those deviations, recommended to the Department's Contract Award Committee that Ranger's bid be declared unresponsive. This was notwithstanding the fact that even with the incorrect pricing for the amount of the conduit stated on the Department's discs, Ranger's bid was still low. It must be noted, however, that the 38 linear foot quantity of conduit listed in the Department's discs was an incorrect amount. The project plans, furnished to all bidders prior to the bid process, reflected, in the breakdown of specifications, that the correct amount was 97 linear feet of conduit required. When Ranger's incorrect price of $621.00 per foot was applied to the actual footage required, the result was a bid figure for Ranger which was substantially higher than that submitted by Community and, therefore, caused a reversal in the order of the bidders. The Department applies a deviation standard of 7% to flag bids for more careful scrutiny. Here, the $621.00 item price was clearly in excess of that standard. As will be seen below, Ranger was not the only party to make a mistake in this procurement. The Department's discs erroneously reflected the quantity of conduit required at 38 feet when the actual amount called for was 97 feet. There is a difference, however, between the Department changing its specifications, as would be the case here, and the bidder correcting a unit price after opening. The Department can but the bidder can't. The bid documents, furnished to each prospective bidder, reserve the Department's right to make changes. Though the evidence indicates that it was not unknown in the past for Department officials to call a bidder for clarification of an unclear point in its bid, prior to bid award in this case, even though the pricing of the conduit was, at a figure almost 100 times the average/estimate of $7.30 per foot, no call was made to Ranger by any Department official to insure that the stated figure was the intended figure for inclusion. Mr. Griner, upon inquiry by the Hearing Officer, indicated that though while not usual, such an intentional inflation was not unknown to happen in bidding on Department contracts. No specific cases were cited, however. The evidence also indicates that this particular item was not the only item the Department considered to be unbalanced. There were three others in Ranger's bid, but this one was the only one which was felt to be inappropriate. By the same token, Community's bid also contained several items considered to be unbalanced, but they were not considered to be in the disqualifying category that the conduit price in Ranger's bid was in. Unbalanced bids are considered bad by the Department because, if successful, they allow the contractor to recoup or receive a larger portion of the contract price at the beginning of the contract term thereby making it less disadvantageous for him to walk away from the contract and making agency control over the contractor more difficult. Here, Mr. Slade unequivocally denies it was Ranger's intention to unbalance its contract for any purpose and claims it was no more than a clerical error in inserting the decimal point in the unit price when entered into the computer which resulted in the error. He claims that if he had been contacted by the Department when the obvious error was discovered, as he asserts, has been done in the past, he would have corrected it. It is clear that while query calls may have been made by the Department to bidders in the past, they were of a nature which did not affect the price of the contract. Ranger never received any notice from the Department about any problem with its bid. The first information Mr. Slade had of any problem with Ranger's bid came when his estimator made a routine call to the Department and was told of the problem with the unbalance. Thereafter Mr. Slade spoke with Mr. Newell to determine what route the subsequent proceedings would take. The Department contends, through the testimony of Mr. Newell and Mr. Griner, that it is Department policy to consider the failure to have a required signature on a relevant document to be grounds for declaring a bid non- responsive. Their testimony further reflects, however, that while the recommendations of the Technical Review Committee, (TRC), and the Contract Award Committee, (CAC), are uniformly to that effect, the Department Secretary has, on occasion, rejected such a recommendation and awarded a contract to a bidder whose bid did not contain a "required" signature. Consequently, it cannot be said to be Department policy to reject all bids containing an unsigned document since the Secretary, who as the agency head, sets agency policy, has acted inconsistent with such a "policy." Further, Mr. Morefield indicated that the Awards Committee could waive a failure of signature if it felt to do so was appropriate. To the best of his knowledge, however, that has not been done on this type of contract documents.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that the Department of Transportation enter a Final Order in this case dismissing the protest of Ranger Construction Industries, Inc., in regard to project Nos. 93110- 3539, 3543, and 3525 in West Palm Beach, Florida. RECOMMENDED in Tallahassee, Florida this 20th day of April, 1992. ARNOLD H. POLLOCK 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 20th day of April, 1992. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 92-1538 BID The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties to this case. FOR THE PETITIONER: I 1. - 5. Accepted and incorporated herein. II 1. - 6. Accepted and incorporated herein. & 8. Accepted and incorporated herein. Rejected as contra to the evidence. Accepted and incorporated herein. & 12. Accepted. 13. & 14. Accepted and incorporated herein. - 23. Accepted and incorporated herein. Accepted. - 31. Accepted. 32. - 41. Accepted and incorporated herein. 42. - 44. Accepted and incorporated herein. 45. - 48. Accepted and incorporated herein. 49. & 50. Accepted. - 53. Accepted. Accepted and incorporated herein. Accepted. Accepted and incorporated herein. Accepted. Rejected as not supported by the evidence. - 61. Accepted. & 63. Accepted. Accepted. & 66. Accepted. 67. & 68. Accepted. 69. Accepted to the extend that the correction is of mathematical calculations of the bid price - not corrections of pricing elements. 70. Accepted. 71. & 72. Accepted. 73. Accepted as a probability 74. Accepted. 75. & 76. Accepted. 77. Accepted. 78. Accepted. 79. Accepted and incorporated herein. 80. Accepted as to the Bond defect; rejected as to the pricing error. FOR THE RESPONDENT AND INTERVENOR: 1. & 2. Accepted and incorporated herein. - 6. Accepted and incorporated herein. Accepted. Accepted. Accepted and incorporated herein. 10. & 11. Accepted. 12. - 14. Accepted. 15. Accepted and incorporated herein. 16. - 19. Accepted and incorporated herein. 20. - 22. Accepted. 23. - 26. Accepted and incorporated herein. 27. - 30. Accepted. 31. - 33. Accepted and incorporated herein. 34. & 35. Accepted and incorporated herein. Not a Finding of Fact but a summary of testimony. & 38. Accepted. Irrelevant and not related to basis for denial. - 42. Accepted and incorporated herein. & 44. Accepted and incorporated herein. First and Second sentences accepted. Balance accepted and incorporated herein. & 47. Accepted and incorporated herein. 48. Accepted and incorporated herein. COPIES FURNISHED: Susan P. Stephens, Esquire Department of Transportation 605 Suwannee Street, MS 58 Tallahassee, Florida 32399-0450 Douglas S. Roberts, Esquire 123 S. Calhoun Street Tallahassee, Florida 32314 Mary M. Piccard, Esquire 1004 DeSoto Park Drive Tallahassee, Florida 32302-0589 Ben G. Watts Secretary Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450 Thornton J. Williams General Counsel Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450
Findings Of Fact Pursuant to Section 287.042(2), Florida Statutes, the Department of Management Services (DMS), lets various Invitations to Bid (ITB) for the benefit of state agencies, cities, counties and other local government agencies so that these entities may purchase a variety of goods and services. On August 24, 1993, DMS issued Invitation To Bid #28-070-700-P. The bid was one of 225 Invitations to Bid issued by DMS in 1993. The bid was for the purchase of medium and heavy trucks. The bid which is the subject of this case involves truck #150. The truck #150 bid has thirteen pages with forty- seven options plus base truck bid blanks. General Condition 1 of the Invitation to Bid requires that "all corrections made by bidder to his price must be initialed." Other documents provided by the Department to interested bidders as part of the bid package reiterate the requirement that all price changes must be initialed. These documents include the "Checklist," a document entitled "Common Problems That Result in Bid Being Rejected" and the document entitled "Medium and Heavy Trucks Index." The requirement in General Condition I of the Invitation to Bid, that all price changes must be initialed, contains no printed exceptions with respect to "nonpreselected" options. The purpose of the requirements of General Condition 1 of the Invitation to Bid is to protect both the State of Florida as well as competing vendors. The reason for the requirement that all price changes or alterations be initialed by the vendor is to protect both the State of Florida against a successful bidder later inserting higher option prices and charging the state agencies those prices, and the vendor against the State later inserting lower prices and attempting to hold the vendor to those prices. General Condition 13 of the bid document states: LEGAL REQUIREMENTS: Applicable provisions of Federal, State and Local law and all ordinances, rules, and regulations shall govern development, submittal and evaluation of all bids received in response hereto and shall govern any and all claims and disputes which may arise between persons(s) submitting a bid response hereto and the State of Florida, by and through its officers, employees and authorized representatives, or any other person, natural or otherwise; and lack of knowledge by any bidder shall not constitute a cognizable defense against the legal effect thereof. . . (Emphasis added.) General Condition 13 incorporates Rule 60A-1.001(3), Florida Administrative Code, which permits the State to waive minor irregularities in the conformance of a bid proposal to the formal bid requirements. The lowest bidder is determined by two factors. The first factor is the price for the base truck. The base truck is the minimum truck which can be ordered in this contract with no options. It is basically a chassis with an engine. The second factor involves additions to the truck called preselected options or predetermined options. All of the other options for the particular vehicle are deemed nonpreselected options. Preselected options are generally the most frequently ordered additions to the base truck along with some other less frequently ordered options. The preselected options can vary from bid to bid; however, DMS always determines the preselected options before opening the bids. The price of any option cannot exceed retail price. There is, therefore, a ceiling for the prices of preselected and nonpreselected options. The preselected options are not announced until after the bid is posted to prevent dishonestly low prices on preselected options and to promote competitive prices throughout the contract document. The bidders therefore do not know which options are preselected when they are composing their bids. There is nothing to be gained by a bidder loading a particular option with a high markup, because the bidder cannot guarantee that the option will not be preselected. The bid evaluation price is the base truck price plus the price of the combined chosen preselected options. DMS received numerous bids on the ITB, including a bid from Petitioner and Intervenor. Atlantic Ford bid a combined price of $38,737.00, and was the apparent low bidder; Duval Ford bid a combined price of $39,944.00 and was the apparent second low bidder. Upon receipt of the bids from the bidders, the bids were held in a locked room until the bid opening. After the bid opening, the purchasing specialist assigned to this bid reviewed each bid for conformity to the general non-technical specifications. Only the Bureau of Procurement is responsible for the nontechnical review although other Bureaus or Divisions may review and have input into the review process. However, these other Divisions' input is not binding. In the nontechnical review the purchasing specialist reviewed each bid's signatures, whether or not the bid was signed in ink, and numerous other requirements. The purchasing specialist also reviewed the bids to determine if all base bid blanks and price blanks for preselected options were filled in and that no corrections were made to those prices without a bidder's initials acknowledging the change. The bids which failed to meet the general conditions of the bid for base bid items and preselected options were rejected as nonresponsive bids. After the initial nontechnical review, the bids were sent to the Division of Motor Vehicles and Watercraft for a technical evaluation. However, since each bid document contains bids for several trucks, there may be a mixture of responsive and nonresponsive bids for various trucks in the same document and the Division of Motor Vehicles and Watercraft may receive responsive and nonresponsive bids for technical review. John Bevins of the Division of Motor Vehicles and Watercraft reviewed the technical parts of the bid. This information included manufacturer's codes for options and base truck features as well as the manufacturer's retail price which no bidder can exceed. After John Bevins completed his review, he filled out a bid rejection recommendation form. John Bevins chose to include nontechnical items in his recommendation, although this was beyond the scope of his review. Mr. Bevins indicated on his bid evaluation form that Atlantic Ford failed to initial a typewritten correction on option 8206 of truck 150. Mr. Bevins returned the reviewed bids to the purchasing specialist along with his recommendation that Atlantic Ford's bid was not responsive since it failed to initial the typewritten correction on option 8206. The purchasing specialist discussed the failure of Atlantic Ford to initial the typewritten correction on option 8206 with H. P. Barker, Jr., the Bureau Chief of Procurement. H. P. Barker, Jr. has the final authority within the Bureau of Procurement to decide if a bid is responsive. He is the customary agency decision-maker on these matters. After careful consideration and discussion, H. P. Barker, Jr., determined that the failure of Atlantic Ford to initial the typewritten correction on a credit is a minor irregularity according to the Department's purchasing rules, since option 8206 was a nonpreselected option and did not effect the total bid price for determining the lowest bidder. Barker's decision was based on the State's interest in obtaining trucks at the lowest price, thereby obtaining the most goods per contracting dollar. Duval Ford conceded that the typewritten correction was faint and does not appear on photocopies of the bid. Barker testified that DMS accepts photocopies of bids. If Atlantic Ford had submitted a photocopy of its bid, as it could have legally done, then the typewritten correction would probably not have been noted by the Department or the other bidders. Barker also testified that bids are not rejected if nonpreselected option blanks are not filled in. Dealers can choose not to offer all nonpreselected options. Finally, in this case option 8206 was a credit. Even if a purchaser under the contract orders option 8206, it will pay six dollars ($6.00) less for the overall truck from Atlantic Ford than if the truck was ordered from Duval Ford. Duval Ford offered evidence from 1991, that DMS had rejected a bid of another dealer for failure to initial a price change on a nonpreselected option. However, Nelson Easom, Duval Ford's manager had not been able to discover any similar rejections in the subsequent two years. Barker testified that the policy regarding noninitialed nonpreselected options changed three years ago. DMS then decided to treat them as minor irregularities. The policy change was based on the public policy to award the lowest bid whenever possible and to prevent minor deviations in bids from causing the state to pay higher prices for goods and services. Moreover, the evidence did not show any abuse of the bid process which would occur should price changes not be initialed. The alleged "protection" afforded to bidders by requiring every change to be initialed is at best tenuous since any fraudulent price changes could easily be recognized by the party against whom the change was made. Given these facts, this case over initials appears to be much ado about nothing, and the failure of Atlantic Ford to initial its price change on a nonpreselected option is a minor irregularity and waiveable by DMS. DMS therefore did not act in an arbitrary and capricious manner by waiving the irregularity and awarding the bid to Atlantic Ford.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent issue a Final Order in this case dismissing Petitioner's formal protest and awarding the contract for the Project to Atlantic Ford. DONE AND ENTERED this 15th day of March, 1994, in Tallahassee, Florida. DIANE CLEAVINGER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 15th day of March, 1994. APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-6790BID The facts contained in paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 16, 17, 18, and 19, of Respondent's Proposed Findings of Fact are adopted in substance insofar as material. Paragraphs 15 of Respondent's Proposed Findings of Fact was legal argument. The facts contained in paragraphs 1, 2, 3, 4, 10, 13, 17, 18, 21 and 24 of the Petitioner's Proposed Findings of Fact are adopted in substance insofar as material. The facts contained in paragraphs 11 of Petitioner's Proposed Findings of Fact were immaterial. The facts contained in paragraphs 5, 6, 7, 8, 9, 12, 14, 15, 16, 19 and 20 of Petitioner's Proposed Findings of Fact are subordinate. 9. The facts contained in paragraphs 22 and 23 of Petitioner's Proposed Findings of Fact were not shown by the evidence. COPIES FURNISHED: Charles Cook Howell, III Howell, O'Neal & Johnson Suite 1100 Jacksonville, Florida 32202 Cindy Horne Office of the General Counsel Department of Management Services Knight Building, Suite 309 2737 Centerview Drive Tallahassee, Florida 32399-0950 Kerri L. Barsh Attorney at Law Greenberg Traurig et al. 1221 Brickell Avenue Miami, FL 33131 Paul A. Rowell, Esquire General Counsel Department of Management Services 312 Knight Building 2737 Centerview Drive Tallahassee, FL 32399-0950 William H. Lindner Secretary Knight Building, Suite 307 Koger Executive Center 2737 Centerview Drive Tallahassee, FL 32399-0950
Findings Of Fact At all times relevant hereto Hossein Afghani, Respondent, was licensed as a real estate salesman in Florida and was working for Century 21/Bill Nye Realty in Zephyrhills, Florida. Since receiving his real estate license, Respondent has been involved in approximately 40 sales of residential property. Other than the accusations made in these proceedings, no other charges of impropriety involving a real estate transaction have been made against Respondent. Prior to the filing of the complaint which led to these proceedings, Respondent was the most productive salesman in the Bill Nye realty office. Mohamid Ali Iranmanesh was interested in purchasing a foreclosed residence from HUD and was referred to Respondent. Respondent showed Iranmanesh several properties and submitted bids for Iranmanesh on two of these properties. On neither was Iranmanesh the successful bidder. Iranmanesh saw a house on Perez Street in Tampa which was being offered for bids by HUD and was shown the house by the lady who was showing the house to another client. He liked the house and contacted Respondent who prepared a bid offer for $67,000 to be submitted to HUD. At Iranmanesh's insistence, when the bid offer was prepared, the commission was placed at 2% or $1340. Iranmanesh gave Respondent a check for $2000 as downpayment. On the sale of repossessed homes by HUD, a commission of up to 6% of the bid price will be paid by HUD. This commission does not affect the bid price in determining the successful bidder for the property. After preparing the bid offer and leaving Iranmanesh, Respondent concluded that the commission was inadequate and telephoned Iranmanesh to tell him he would not submit the bid offer with that commission and requested Iranmanesh's concurrence to up the commission $1000 to $2340. Although Iranmanesh denies he was ever asked by Respondent for permission to increase the commission to $2340, it is concluded that Iranmanesh agreed to this change in the commission. This conclusion is influenced by the following: The change would not affect the bid price or cost the bidder any money; Respondent's roommate testified to a telephone call between Respondent and Iranmanesh just before the bid submission, in which a change in the commission was discussed; Iranmanesh was satisfied with the contract until he learned the next highest bid was $60,000, $7,000 less than the bid Iranmanesh submitted; and, Iranmanesh agreed to the deletion of item 11 on the offer at the same time the commission was changed by Respondent. When Respondent telephoned Iranmanesh about the change in the commission, the latter also agreed that Respondent could delete item 11 which related to a forfeiture of the deposit if the buyer defaulted. Iranmanesh recalls authorizing this change in the bid offer. When Iranmanesh was advised his was the successful bid for the property, he inquired about the next highest bid and learned that bid was $60,000. He then tried to negotiate with HUD for the lower sum, but was unsuccessful. Iranmanesh then noted a change in the commission which had not been initialed by him and asserted the bid he had submitted had been changed without his consent and claimed the right to rescind the bid. A personal dispute had arisen between Respondent and Iranmanesh, and during these proceedings the latter attempted to assume the role of prosecutor and evinced a keen interest in punishing Respondent.
The Issue The central issue in this case is whether the bid for the Department of Health and Rehabilitative Services Lease No. 590:1871 to provide office space in Dade County, Florida, should be awarded to either Petitioner or Intervenor.
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 Petitioner, Robert Litowitz (hereinafter "Litowitz"), in response to an invitation to bid advertised by the Department of Health and Rehabilitative Services (hereinafter "HRS"), timely filed a bid submittal form offering to lease real property located at 11401 SW 40th Street (also known as Bird Road), Miami, Florida. This lease was to be for a five-year term with two one-year renewal options. The net square footage for the lease required by HRS was 14,781 + 3 percent with the geographical boundary designated by the invitation to bid being described as follows: All bid should be for existing office space located within the following boundaries: On the North, S.W., 48th Street. On the South, S. W., 88th Street. On the East, Palmetto Expressway, and on the West, S.W., 117th Street. This description contained an error in that the western boundary line should have been 117th Avenue not 117th Street. This minor discrepancy was noted at both of two pre-bid conferences conducted by HRS. The Intervenor, James C. Colross (hereinafter "Colross"), also timely filed a bid submittal form offering to lease real property described as Building "B," 9495 Sunset Drive (Southwest 72nd Street), Miami, Florida. Prior to the bid opening date, February 17, 1987, employees of HRS conducted two pre-bid conferences. At these conferences the bid package was reviewed and explained to all potential bidders present. Litowitz attended the pre-bid conference held the last week in January 1987. At this pre-bid conference Litowitz received the bid package and advised employees of HRS that he would be submitting property located on Bird Road for consideration for lease No. 590:1871. Linda Treml was the HRS employee who served as the contact person for the bid for Lease No. 590:1871. Ms. Treml conducted the pre-bid conferences and answered questions from potential bidders regarding the bid submittal forms. Several months earlier, perhaps during the summer 1986, Litowitz had met with Linda Treml regarding the possible lease of the Bird Road site, Ms. Treml had advised Litowitz that, at that time, HRS was not looking for space but that Litowitz would be added to their mailing list for future bid opportunities. Ms. Treml toured the Bird Road property with Litowitz as a courtesy visit for his inquiry. The bid submittal form for Lease No. 590:1871 required the proposed space be in an existing building. "Existing" was defined to specify the entire space to be dry and capable of being physically measured to determine net rentable square footage. Both the Colross and the Litowitz properties met this definition for an existing building at the time of the bid submittals. The bid submittal form for Lease No. 590:1871 required a minimum of 90 parking spaces to include a minimum of 80 full size spaces and 4 spaces meeting the Standards For Special Facilities For Physically Disabled found in Chapter 130-1, Florida Administrative Code. The required parking spaces did not have to be reserved for the exclusive use of HRS. Colross offered 62 exclusive spaces on site with 50 additional exclusive parking spaces located one block from the proposed facility. The Colross site plan for Building B (the bid property) established over 90 non-exclusive parking spaces available on site. The Litowitz property also had 90-plus non-exclusive parking spaces on site. HRS requested a clarification for the 50 exclusive spaces offered off-site by Colross. The verbal clarification was reduced to writing to confirm such spaces, if needed, would be at no cost to HRS. This written confirmation was not issued until March 31, 1987. HRS established a bid evaluation team to review the bids submitted for Lease No. 590:1871. This team, comprised of Janet Robinson, Dorea Sowinski, and Grace 0abolish, visited both the Litowitz and Colross properties. Subsequent to the site tours, they met in a conference room at Janet Robinson's office to discuss the bid evaluation process. This team was to make a recommendation as to which bid was the lowest and best. The recommendation was to be made based upon the evaluation criteria set forth in the bid submittal form. No other criteria were to be employed by the evaluation team. HRS has no guidelines which specified how each team member is to apply the evaluation criteria. The team recommendation would then be reviewed by George Smith and his superiors. Linda Treml advised the evaluation team not to consider the Litowitz property because it was outside the geographical boundary established by the invitation to-bid. The Litowitz property located on Bird Road is, in fact, outside of the advertised boundaries. The bid advertisement required the property to be considered for Lease No. 590:1871 to be within the stated geographical area. HRS did not, by act or omission, encourage Litowitz to prepare and submit a bid for a property known to be outside the defined boundary. HRS did not advise Litowitz that a property outside of the defined boundary would be disqualified. The bid evaluation criteria assigned a weighing value of 10 percent to the proximity of the offered space in the central or preferred area of the map boundaries. Litowitz mistakenly concluded that even though his property was not within the boundaries that he would lose only the 10 percent weighing factor when his property would be evaluated. HRS did not, by act or omission, affirm this erroneous interpretation. Because the Litowitz property was not within the defined geographical boundary, HRS disqualified the Litowitz bid. Accordingly, the Colross bid was the only bid left for consideration and was selected for Lease No. 590:1871. The interested parties were notified of this selection on or about March 19, 1987. The Colross bid included a higher rental fee than the Litowitz bid. HRS rejected a third bid for Lease No. 590:1871 submitted by Brookhill Capital Resources (hereinafter "Brookhill") since it was missing certain documents which had to be submitted by the time of the bid opening. The Brookhill bid included a lower rental fee than the Litowitz bid. The Brookhill property was within the advertised boundary. HRS selected the Colross property and deemed it the lowest and best bid since the Litowitz and Brookhill properties had to be disqualified. Members of the bid evaluation team preferred the Colross property for Lease No. 590:1871. HRS did not waive the boundary requirement for Lease No. 590:1871. Employees of HRS completed a bid synopsis which listed data on all three bidders for lease no. 590:1871 even though two of the bidders, Litowitz and Brookhill, had been disqualified, HRS reserved the right to reject any and all bids when such rejection would be in the interest of the State of Florida. Janet Robinson as the managing administrator of the disability determination office set the geographical boundaries for the invitation to bid. The boundaries were established in consideration of the needs and desires of the employees of the disability determination office.
The Issue The issues in this case are whether the Department of Transportation ("Department") erred by considering Willeby Construction, Inc. ("Willeby") a qualified bidder; whether the requirement to submit a bid bond or certified funds check or draft (hereafter "security on the bid") with the bid was a material requirement; whether the Department erred in treating Willeby’s failure to include security on the bid with its bid proposal as a minor, and, thereby, an irregularity which could be waived; and whether said decision of the Department was contrary to the terms of the bid, contrary to law, or arbitrary and capricious.
Findings Of Fact On November 14, 2000, the Department issued a bid solicitation notice for Financial Project No. 40509417201/Contract No. E3A78, a contract for routine mowing of grassed and vegetated roadside areas and litter removal from within the Department’s highway right-of-way in Gadsden and Leon Counties. The invitation to bid stated: In a letter dated November 17, 2000 from Richard Norris of the Department District Contracts Office to all prospective bidders, the Department reiterated the bid bond requirement stating "[i]f your bid is over $150,000, a Bid Bond of 5 percent of the bid amount is required and must be attached to your bid proposal. Failure to submit this with your bid will result in your bid being rejected." (Emphasis is in original.) The invitation to bid further stated: BID OR PROPOSAL BOND (If bid is over $150,000): Must be completely executed if bid is over $150,000. This 5 percent bid bond is required and must be included in your bid package. If bid is less than $150,000 no bid bond shall be necessary, however, the successful bidder shall be required to obtain a performance bond upon execution of the contract. The purpose of the requirement for security on the bid is to compensate the Department for damages in the event the low bidder fails to enter into the contract. The Department received bid proposals from six firms in response to its bid solicitation by the due date of December 7, 2000. The lowest bidder for Contract No. E3A78 was Willeby. Willeby submitted a business check drawn on Willeby’s business account no. 02-140168-01 with Farmers & Merchants Bank. This was an unsecured, personal check. At the time the bids were opened, Willeby’s Account No. 02-140168-01 contained insufficient funds to cover the check Willeby submitted as its bid bond in the amount of $11,996.52 for Contract No. E3A78. Willeby failed to submit the required security on the bid in the form of a cashier’s check, bank money order, bank draft of any national or state bank, or surety bond, payable to the State of Florida, Department of Transportation as required by the solicitation. The Petitioner, Phoenix, was the second lowest bidder. Phoenix submitted a bid bond equal to 5 percent of its total bid with its bid package. Phoenix fully complied with all the requirements of the invitation to bid. Bids for Contract No. E3A78 were opened on Thursday December 7, 2000. At that time, the Department's personnel discovered that Willeby had failed to submit security on bid as required by the terms of the bid solicitation. On December 15, 2000, eight days after the Department discovered that Willeby’s bid submittal was deficient, Starsky Harrell, the contract specialist with the District III office of the Department, telephoned W.J. Willeby, the president of Willeby Construction. Harrell informed Mr. Willeby that Willeby’s bid was non-conforming, and gave Willeby the opportunity to cure its non-responsive bid by submitting a check for certified funds or a bid bond as required by the bid solicitation. Willeby, at this point, had the opportunity to cure the defect or refuse to cure the defect, thereby, negating his bid. This gave Willeby an advantage not enjoyed by the other bidders. Willeby chose to cure its non-responsive bid, and submitted a certified check as its security on the bid. Willeby, thereafter, entered into the contract with the Department on Monday, December 18, 2000, eleven days after the bids were opened. The Department posted its intent to award Contract No. E3A78 on December 21, 2000, indicating its intent to award the contract to Willeby Construction. Phoenix timely filed this formal protest in opposition to the award of Contract No. E3A78 as contrary to Section 120.57(3)(f), Florida Statutes (2000). Regarding the requirements for security on the bid required in the solicitation for the bid and accompanying materials, Richard Norris, the contracts administrator, made the decision to emphasize the language by having it in bold-face type and underlined. His purpose for underlining and placing in bold-face type this language was to "put some accent on it, to make it stand out." A basic tenet of competitive procurement is to protect the integrity of the bidding process and ensure open and fair competition. A responsive bid is one which meets all the requirements of the proposal documents. Mr. Willeby has entered bids on Department contracts seventeen times in the past. Willeby is an experienced participant in the bid process. A bidder who has the option of taking a contract or not taking a contract after the bidder knows what the other bids are on a project has a competitive advantage over other bidders. If the bidder has bid too close to the profit margin, the bidder can refuse to cure the bid defect and avoid performance on the unprofitable contract. It is not only less expensive for a person to submit a personal check for security on a bid, but a stop payment order can be issued on a personal check. The bid bond posted by the Petitioner cost $800.00. This amount is not refundable. However, the proposal provides alternatives to a bid bond to establish security on the bid; therefore, paying the cost of the bond is not a competitive disadvantage. It is noted that a personal check is not among the alternatives, and the bid proposal's provisions for bid security specifically provide that checks or drafts for less than 5 percent of the bid amount will invalidate the bid. The only checks or drafts permitted under the terms of the bid proposal are those checks secured by the banking institution's funds and not subject to stop payment orders of the person in whose behalf the check is issued. It is consistent with the stated terms of invalidation, that, in addition to an insufficient amount, that an instrument not meeting the stated terms of the provision would also invalidate the bid. If being a dollar short on the secured amount is disqualifying, being short the entire amount in secured funds would be similarly disqualifying. Evidence was received regarding whether Willeby was a qualified bidder. This information related to the nature and amount of the equipment which Willeby had, and its financial ability to obtain additional equipment. Although Willeby did not have some of the equipment necessary to handle this job and its other contract obligations, he had ordered this equipment and his bank indicated that it would loan him the money. It was not developed whether the bank's willingness was dependent upon the pendency of the challenged contract award, and it is concluded that Willeby is a qualified bidder.
Recommendation Based upon the findings of fact and conclusions of law, it is RECOMMENDED: That the bid of Willeby Construction on Contract No. E3A78 be rejected, and the contract be awarded to the Petitioner. DONE AND ENTERED this 25th day of April, 2001, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 25th day of April, 2001. COPIES FURNISHED: Julius F. Parker, III, Esquire Pennington, Moore, Wilkinson, Bell & Dunbar, P.A. 215 South Monroe Street, Suite 200 Tallahassee, Florida 32301 Brian A. Crumbaker, Esquire Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450 James C. Myers, Clerk Department of Transportation Haydon Burns Building, Mail Station 58 605 Suwannee Street Tallahassee, Florida 32399-0450 Pamela Leslie, General Counsel Department of Transportation Haydon Burns Building, Mail Station 58 605 Suwannee Street Tallahassee, Florida 32399-0450
The Issue This case considers whether Petitioner's response to Invitation to Bid, No. 94-014, as revised, issued by the Respondent, is responsive to the terms of the Invitation to Bid. If Petitioner is found responsive, then the question is raised whether Petitioner has offered the lowest and best response to the invitation to bid.
Findings Of Fact On May 26, 1994, Respondent provided a memorandum to prospective vendors concerning Bid No. 94-014, as revised. This memorandum informed the prospective vendors that the new bid due date was June 6, 1994. The memorandum attached the bid instructions. Under general conditions to the invitation to bid the prospective vendors were reminded in Paragraph 7 that the Respondent could ". . . reject any or all bids or waive any minor irregularity or technicality in bids received." Under the heading "Special Provisions" prospective vendors were informed that "The charge per 1,000 for individual items under Exhibit A shall be the rates for the contract with the successful bidder." The prospective bidders were instructed as follows: REQUIRED ITEMS TO BE SUBMITTED WITH BID: The bidder must complete all required items below and submit as part of the bid package. Any bid in which these items are not used or in which these items are improperly executed, may be considered non-responsive and the bid may be subject to rejection. Among the items to be submitted with the bid was Exhibit A. The bidders were informed about the process of EVALUATION/AWARD. There it was stated: Bids will be evaluated and awarded on an all or none basis to one bidder. Award will be based on the total costs of four (4) theoretical jobs (See Exhibit B-Bid Total) requiring varying services and on the bidder's qualifications to best serve the Department's needs. The prospective bidders were then reminded a second time that: "THE DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION RESERVES THE RIGHT TO REJECT ANY AND ALL BIDS AND TO WAIVE ANY MINOR IRREGULARITIES IN BIDS RECEIVED." Within Exhibit A to the bid document was a category referred to as "Tabbing", calling for the charge per 1,000 for that service. Within Exhibit B under the fourth theoretical job was a requirement to quote the subtotal cost for 200,000 newsletter preparations to include "Tabbing." Three vendors submitted responses to the invitation to bid. Those responses were opened on June 6, 1994. The vendors who responded were Petitioner, Educational Clearinghouse, Inc. and Mail Masters of Tallahassee, Inc. In the subtotal for costs for 200,000 newsletter preparations, in activity four, concerning theoretical jobs, found within Petitioner's Exhibit B to the response to the invitation to bid, Petitioner made a mistake. It misplaced the decimal point and described the subtotal cost for 200,000 newsletter preparations as $73.80 instead of $7,380.00. Respondent characterized this as a typographical error or nominal mistake. In fact, this error constituted a minor irregularity which did not preclude the ability to understand Petitioner's response so that it might be compared to the responses by the competition. Petitioner made a second error. This error occurred when Petitioner failed to indicate the amount that it would charge per 1,000 for "Tabbing" within Exhibit A. Respondent did not consider this to be a minor irregularity and rejected Petitioner's bid as non-responsive for the failure to include a quotation for the charge per 1,000 for "Tabbing." This resulted in the intent to award the contract to Educational Clearinghouse, Inc. whose bid total for the four theoretical jobs under Exhibit B was $9,137.25 compared to Petitioner's bid total of $8,374.62. In preparing Exhibit B, activity four, Petitioner included a theoretical charge for "Tabbing" in the amount of $8.00 per 1,000. Petitioner contends that the $8.00 per 1,000 found within that entry may be correlated with the missing information concerning "Tabbing" in Exhibit A to its response to the invitation to bid. In the instructions to the vendors, Respondent has informed the vendors that the charge per thousand for individual items identified in Exhibit A constitutes the rate that the Respondent would expect to pay under a contract with the successful bidder. By contrast, the function of the information provided in Exhibit B is for purposes of awarding the contract based upon total costs of the four theoretical jobs and on the basis of the vendor's qualifications to best serve the Respondent's needs. Although not stated in the invitation to bid it can be inferred that similar references within Exhibits A and B, such as the reference to "Tabbing", calls for a comparable price to be set forth for the item in both Exhibit A and Exhibit B. Otherwise vendors would have the opportunity to quote low prices in completing Exhibit B as a means to win the cost comparison with their competitors for purposes of the award and then have the opportunity to charge higher costs per 1,000 as reflected in Exhibit A when establishing the charges for the contract with the Respondent following the competition contemplated in the comparison of the theoretical bid total under Exhibit B. Therefore, it would be reasonable for the Respondent to expect that the Petitioner would charge $8.00 per 1,000 for "Tabbing" under a contract between the Petitioner and Respondent based upon information that was set forth in the response to Exhibit B, activity four, "Tabbing." In summary, Petitioner's oversight in leaving out reference to the tabbing charge in Exhibit A does not affect the comparison of bid responses as contemplated by the instructions to the vendors, a function performed by comparing the respective Exhibits B. Otherwise, Respondent may gain the necessary understanding of Petitioner's charge per 1,000 for "Tabbing" as contemplated in instructions concerning Exhibit A as a means for entering into the contract. This understanding is achieved by transposing the $8.00 per 1,000 "Tabbing" quotation in Exhibit B to the "Tabbing" charge within Exhibit A as $8.00 per 1,000. With this adjustment, Modern Mailers, Inc. is the lowest responsive bidder and best able to serve Respondent's needs pertaining to Invitation to Bid No. 94-014, as revised.
Recommendation Based upon the findings of fact and the conclusions of law reached, it is, RECOMMENDED: That a final order be entered which finds that Petitioner is a "qualified" and "responsible" bidder who is the lowest and best responsive bidder to Invitation to Bid, No. 94-014, as revised and is entitled to the award of the contract contemplated by that invitation to bid. DONE and ENTERED this 8th day of September, 1994, in Tallahassee, Florida. CHARLES C. ADAMS 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 8th day of September, 1994. APPENDIX The following discussion is given concerning the proposed findings of fact of the Parties: Petitioner's Facts: Paragraph 1 is subordinate to facts found. Paragraph 2 is not necessary to the resolution of the dispute. Paragraphs 3 through 5 are subordinate to facts found. Paragraphs 6 and 7 are rejected to the extent that they are intended to establish an excuse for the Petitioner not providing information related to the cost for tabbing called for in Exhibit A in the invitation to bid. Paragraph 8 is subordinate to facts found. Paragraphs 9 through 12 are not necessary to the resolution of the dispute. Paragraph 13 is subordinate to facts found. Paragraph 14 is rejected to the extent that it suggests that Petitioner may amend its response to the invitation to bid to specifically set forth the amount attributable to the tabbing charges per 1,000 in Exhibit A. Nonetheless one may infer that the cost per 1,000 for tabbing is the same as is set forth in Exhibit B. Paragraphs 15 through 17 are subordinate to facts found. Paragraph 18 constitutes legal argument. Respondent's Facts: Paragraph 1 is subordinate to facts found. Paragraph 2 is contrary to facts found Paragraph 3 is rejected in fact and law. Paragraph 4 is rejected in the suggestion that the Petitioner does not have the ability to perform the contract. COPIES FURNISHED: Daniel W. Dobbins, Esquire Callahan & Dobbins 433 North Magnolia Drive Tallahassee, FL 32308 Vytas J. Urba, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, FL 32399-0792 Jack McRay, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, FL 32399-0792 George Stuart, Secretary Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, FL 32399-0792 Informational Copies: Ronald W. Brooks, Esquire Brooks and LeBoeuf, P.A. 863 East Park Avenue Tallahassee, FL 32301 Joan Reeves, Vice President Educational Clearinghouse Post Office Box 3951 Tallahassee, FL 32315