Findings Of Fact Respondent, Florida Department of Transportation (DOT), is required by state and federal law to ensure that 10 percent of state and federal funds available for construction, design and consulting service-contracts be provided as an opportunity to small business concerns owned and controlled by socially and economically disadvantaged individuals (DBE). DBE contract goals are established by DOT for each construction contract. Every bidder must submit a form to DOT which either documents compliance with the DBE contract goal or, if compliance is not met, must provide sufficient information to demonstrate that good faith efforts were made by the bidder to meet the goal. Prior to June 1984, DOT's practice allowed contractors ten days after the bid letting to correct their DBE forms or to submit their good faith effort documentation. However, effective May 23, 1984, DOT adopted Rule 14- 78.03(2)(b), F.A.C., which provides in pertinent part: 4. For all contracts for which DBE . . . contract goals have been established, each bidder shall meet or exceed or demonstrate that it could not meet, despite its good faith efforts, the contract goals set by the Department. The DBE . . . participation information shall be submitted with the contractor's bid proposal. Award of the contract shall be conditioned upon submission of the DBE . . . participation information with the bid proposal and upon satisfaction of the contract goals or, if the goals are not met, upon demonstrating that good faith efforts were made to meet the goals. Failure to satisfy these requirements shall result in a contractor's bid being deemed nonresponsive and the bid being rejected. (Emphasis supplied.) In August 1984, subsequent to the adoption of Rule 14.78.03(2)(b)4., F.A.C., DOT sent a "Notice to All Contractors" which advised . . . all submittals for evaluating Good Faith Efforts in meeting DBE/WBE goals must be submitted with the bid proposal in order to be considered for award of the contract. Failure to submit the Good Faith Effort documentation with the bid may result in rejection of the bid. Petitioner, Wiley N. Jackson Company, acknowledges receipt of the "Notice to All Contractors." By notice dated August 30, 1984, contractors were advised that sealed bids would be received until 10:30 a.m., September 26, 1984, on various road projects. The bid documents advised that the DBE goal for Job Number 89095-3411 was 10 percent. The specifications for Job Number 89095-3411 contain extensive provisions with regard to compliance with the DBE contract goals. Among these provisions is the following language contained in Section 2-5.3.2. For all contracts for which DBE and/or WBE contract goals have been established, each contractor shall meet or exceed or demonstrate that it could not meet, despite its good faith efforts, the contract goals set by the Department. The DBE and WBE participation information shall be submitted with the Contractor's bid proposal. Award of the Contract shall be conditioned upon submission of the DBE and WBE participation information with the bid proposal and upon satisfaction of the contract goals, or, if the goals are not met, upon demonstrating that good faith efforts were made to meet the goals. The Contractor's bid submission shall include the following information (Submitted on Form No. 141-12 - DBE/WBE Utilization Form No. 1): The names and addresses of certified DBE and WBE firms that will participate in the contract. Only DBEs and WBEs certified by the Department at the time the bid is submitted may be counted toward DBE and WBE goals. A description of the work each named DBE and WBE firm will perform. The dollar amount of participation by each named DBE and WBE firm. If the DBE or WBE goal is not met, sufficient information to demonstrate that the Contractor made good faith efforts to meet the goals. (Emphasis supplied.) The specifications list, as grounds for disqualification of bidders, failure to satisfy the requirements of Section 2-5.3. Further, Section 2-5.3.3 of the specifications advised bidders that: In evaluating a contractor's good faith efforts, the Department will consider: Whether the Contractor, at least seven days prior to the letting, provided written notice by certified mail, return receipt requested, or hand delivery, with receipt, to all certified DBEs and WBEs which perform the type of work which the Contractor intends to subcontract, advising the DBEs and WBEs (a) of the specific work the Contractor intends to subcontract; (b) that their interest in the contract is being solicited; and (c) how to obtain information about and review and inspect the contract plans and specifications. Whether the Contractor selected economically feasible portions of the work to be performed by DBEs and WBEs, including where appropriate, breaking down contracts or combining elements of work into economically feasible units. The ability of a contractor to perform the work with its own work force will not in itself excuse a contractor's failure to meet contract goals. Whether the Contractor provided interested DBEs or WBEs assistance in reviewing the contract plans and specifications. Whether the DBE or WBE goal was met by other bidders. Whether the Contractor submits all quotations received from DBEs or WBEs, and for those quotations not accepted, an explanation of why the DBE or WBE will not be used during the course of the contract. Receipt of a lower quotation from a non-DBE or non-WBE will not in itself excuse a contractor's failure to meet contract goals; provided however, a contractor's good faith efforts obligation does not require a contractor to accept a quotation from a DBE or WBE which exceeds the lowest quotation received from any subcontractor by more than one percent. Whether the Contractor assisted interested DBEs and WBEs in obtaining any required bonding, lines of credit, or insurance. Whether the Contractor elected to subcontract types of work that match the capabilities of solicited DBEs or WBEs. Whether the Contractor's efforts were merely pro forma and given all relevant circumstances, could not reasonably be expected to produce sufficient DBE and WBE participation to meet the goals. Whether the Contractor has on other contracts within the past six months utilized DBEs and WBEs. The above list is not intended to be exclusive or exhaustive and the Department will look not only at the different kinds of efforts that the Contractor has made but also the quality, quantity and intensity of these efforts. Sections 2-5.3.2 and 2-5.3.3 are drawn directly and literally from Rule 14-78.03(2)(b). Consequently, all bidders were apprised by rule and bid specifications that if the DBE contract goal could not be met, sufficient information had to be submitted with their bid to demonstrate their good faith efforts to meet the goal, and the criteria that would be utilized to evaluate their efforts. On September 26, 1984, Petitioner submitted the low bid in the amount of $7,688,271.91 for Job Number 89095-3411. Attached to the bid was Form 141-12 - DBE/WBE Utilization Form No. 1, indicating that Petitioner's proposed utilization of DBEs was 0.2 percent of the total contract amount; $15,385 on a total bid of $7,688,271.91. Accompanying Petitioner's bid was a handwritten letter which stated: Gentlemen: To demonstrate good faith effort prior to the bid date for this project, we submitted seventy-three registered letters to prospective D.B.E. Subcontractors. On the major items we propose to sublet, comparative D.B.E. and non-D.B.E. quotations were received as follows: Box Culvert - J. E. Hill (D.B.E.) - 505,762.00 Shelton & Son - 369,092.00 Difference - $136,670.00 Fencing - Mikell (D.B.E.) - 55,727.00 Cyclone - 46,833.00 Difference - $ 8,894.00 Grassing - Mikell (D.B.E.) - 91,919.00 Agricultural Land - 63,198.00 Difference - $28.721.00 In view of the above, we are unable to meet the D.B.E. Goal and, at the same time, submit a realistic and competitive bid. Copies of pertinent quotations are attached and copies of D.B.E. solicitations (registered letters) and responses are available for your review. Quotations reflecting one unaccepted DBE proposal, and one accepted non-DBE proposal, in each of three areas--concrete, fencing and grassing--were attached to the letter. In each instance the DBE proposal exceeded the non-DBE proposal by more than one percent. No other documentation was submitted with Petitioner's bid to demonstrate its good faith efforts to meet the DBE contract goal. Respondent, Dickerson Florida, Inc. (Dickerson), was the second low bidder with a bid of $7,926,819.49. Dickerson's bid reflected a DBE participation of 10.8 percent. Upon the closure of bidding, Petitioner's bid was submitted to the Good Faith Effort Committee at DOT to evaluate the information contained in the bid to determine whether Petitioner's documentation evidenced a good faith effort to meet the DBE goal. That committee found Petitioner's bid documentation failed to demonstrate a good faith effort to meet the DBE goal, and recommended that Petitioner's bid be declared non-responsive and be rejected. DOT declared Petitioner's bid non-responsive and rejected its bid. DOT proposed awarding the contract to Dickerson. Petitioner's bid documentation failed to demonstrate a good faith effort to meet the DBE contract goals. The documentation failed to demonstrate that: (1) Petitioner, at least seven days prior to letting, had provided written notice to all certified DBEs, or, of what the DBEs had been informed, (2) Petitioner had selected economically feasible portions of the work to be performed by DBEs, (3) Petitioner had provided interested DBEs with assistance in reviewing the contract plans and specifications, and (4) Petitioner had selected for subcontract types of work that matched the capabilities of the solicited DBEs. Further, Petitioner's documentation did not include all quotations received from DBEs. Job Number 89095-3411 included several categories of work: box culverts, signs, landscaping, guardrail, fencing, traffic striping, trucking, paving, grading and miscellaneous concrete. The bid documentation submitted by Petitioner did not indicate the items it attempted to subcontract, nor what efforts, if any, it had expended to solicit DBE participation beyond "a letter" it had mailed, at an indeterminate date, to some 73 unidentified "prospective DBE subcontractors." Facially, Petitioner's documentation evidenced a pro forma effort. Subsequent to the bid closing, Petitioner forwarded to DOT copies of the 73 letters it had mailed to "prospective DBE subcontractors," together with the certified mail return receipts. Petitioner was in possession of these documents prior to the close of bidding, and could have submitted them with its bid. DOT's Good Faith Effort Committee declined to consider Petitioner's postbid submission. The committee interpreted Rule 14-78.03, F.A.C., to require the DBE participation information be submitted with the bid proposal, and to preclude consideration of postbid submissions. DOT has at all times acted consistently with this interpretation.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a Final Order be entered by the Department of Transportation rejecting the bid submitted by Petitioner, Wiley N. Jackson Company, on State Project No. 89095-3411, Martin County, Florida, and awarding the contract to Respondent, Dickerson Florida, Inc. DONE and ENTERED this 31st day of May, 1985, at Tallahassee, Florida. WILLIAM J. KENDRICK Hearing Officer Division of Administrative Hearings Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904)488-9675 FILED with the Clerk of the Division of Administrative Hearings this 31st day of May, 1985. COPIES FURNISHED: David T. Knight, Esquire Shackleford, Farrior, Stallings and Evans, P.A. Post Office Box 3324 Tampa, Florida 33601 Larry D. Scott; Esquire Department of Transportation Haydon Burns Building, M.S. 58 Tallahassee, Florida 32301-8064 Robert M. Ervin, Esquire Thomas M. Ervin, Jr., Esquire Ervin, Varn, Jacobs, Odom & Kitchen Post Office Drawer 1170 Tallahassee, Florida 32302 Paul A. Pappas, Secretary Department of Transportation Haydon Burns Building Tallahassee, Florida 32301
The Issue The issue is whether Respondent violated Subsections 489.129(1)(g), (i), (j), and (m), Florida Statutes (2001), by allegedly engaging in financial mismanagement, abandoning a construction project, engaging in misconduct or being incompetent, and failing to disclose the rights of the consumer in a contract. (Statutory references are to Florida Statutes (2001).)
Findings Of Fact On July 18, 1984, the Construction Industry Licensing Board (the Board) licensed Respondent as a Florida State Certified General Contractor pursuant to license number CG C028520. Respondent registered with the Board as doing business in the name of "Midgett Development Inc." (Midgett Development). Respondent conducted business as Midgett Development in 2001. In 2001, Respondent also conducted business as a licensed real estate broker through Sundial Group Enterprises, Inc. (Sundial). On February 20, 2001, Respondent executed a contract with Ms. Linda Luck (Luck) requiring Midgett Development to build a residential home on a vacant lot located at 1510 Northeast 11th Street, Cape Coral, Florida, that Sundial was to purchase from a third party (the contract). The contract identifies Midgett Development as the contractor and Sundial as the purchaser of the lot. The contract violates Subsection 489.129(1)(i). The contract does not contain a written statement explaining the consumer rights to which Luck is entitled under the Construction Industry Recovery Fund. The contract requires the contractor to use its best efforts to deliver the completed residence "on or about 120 days" from the start of construction. The start of construction is defined as the day footings are poured; or the day rough plumbing is begun if the contractor uses monolithic footings and slab. The contract provides that time is of the essence. The contract price is $70,000.00 and pays the cost of purchasing the lot and the cost of constructing the residence. The contract requires Luck to pay $20,000 at the signing of the contract and an additional $50,000 at the closing for the purchase of the lot. Luck paid Midgett Development the total contract price on February 20, 2001. Luck issued two separate checks to Midgett Development for $20,000 and $50,000. Each check is dated February 20, 2001. Sundial closed on the purchase of the lot and deducted a buyer's real estate commission from the closing proceeds. Sundial or Respondent took title to the lot. Respondent testified that he did not apply for the building permit until he had clear title to the lot. The closing date for the lot acquisition is not in evidence. Respondent and Midgett Development failed to begin construction of the residence within 90 days of the date of the contract within the meaning of Section 489.129(1)(j). Respondent applied for a building permit from the City of Cape Coral, Florida (Cape Coral) on January 10, 2002, approximately 324 days after executing the contract. Respondent provided no credible and persuasive explanation for his delay in applying for a permit. On direct examination, Respondent testified that he expended $19,000 of the $70,000 shortly after he executed the contract, in relevant part, to purchase the lot. Respondent later testified that he did not apply for a building permit before January 10, 2002, because he did not have clear title to the lot before that date. Respondent's testimony is not supported by other evidence and is neither credible nor persuasive. Cape Coral issued a building permit for the residence on March 11, 2002, approximately 394 days after Respondent executed the contract. By May 2002, approximately 80 days after receiving the building permit, no evidence of construction activity could be observed on the lot. By July 30, 2002, approximately 533 days after executing the contract, Respondent and Midgett Development "began construction," as that phrase is defined in the contract. On July 30, 2002, Cape Coral issued favorable foundation and plumbing inspections. Respondent and Midgett Development abandoned the construction project while each was under contract as a contractor within the meaning of Subsection 489.129(1)(j). Assuming arguendo that Respondent and Midgett Development had legitimate reasons for not beginning construction prior to July 30, 2002, Respondent and Midgett Development abandoned the construction project on October 30, 2002, approximately 90 days after July 30, 2002, without just cause, and without notice to Luck. After July 30, 2002, Respondent and Midgett Development did not engage in any further construction activity, and Cape Coral rescinded the inspection approval. When Respondent and Midgett Development abandoned the construction project, they committed mismanagement and misconduct in the practice of contracting within the meaning of Subsection 489.129(1)(g)2. At the time Respondent and Midgett Development abandoned the project, the percentage of completion was less than the percentage of the total contract price paid by Luck. Respondent and Midgett Development caused financial harm to Luck. As of the date of hearing, Respondent and Midgett Development had not completed the project and had not refunded any of the money paid to them. Respondent provided no credible and persuasive explanation for the failure to either construct the residence or refund the money paid by Luck. Respondent's testimony that Luck requested Respondent to stop construction is not supported by other evidence, including Luck's testimony. Luck's testimony is credible and persuasive. If it were found that Luck asked Respondent not to complete construction, the purported request is not material to this proceeding. Respondent began construction on July 30, 2002. Respondent testified that Luck asked Respondent on April 1, 3, and 12, 2003, not to complete construction. Respondent had ample time between July 30, 2002, and April 1, 2003, to complete construction. He also had ample time between February 20, 2001, and July 30, 2003, to complete construction. Respondent and Midgett Development misallocated funds entrusted to them by Luck within the meaning of Subsection 489.129(1)(m). Neither Respondent nor Midgett Development has reimbursed Luck or paid restitution to her. Between November 15, 2002, and August 18, 2003, Respondent paid approximately $13,074 to third parties for living expenses incurred by Luck, including rent, utilities, and similar expenses. Those amounts do not constitute restitution or reimbursement of part of the $70,000 paid by Luck for the construction of her residence. Luck paid Respondent $70,000 to build a house and not to pay her living expenses. Luck is a single parent and would have been evicted and "out on the street" unless Respondent paid her living expenses. Luck was unable to pay her living expenses because Respondent had $70,000 of Luck's money. The payments made by Respondent may, or may not, be treated by the circuit court as a set off against a judgment obtained by Luck in circuit court. That determination, however, is beyond the scope of this proceeding. Respondent testified that he spent another $19,000 for Luck. However, Respondent expended most of that sum purchasing a lot owned either by Sundial or Midgett Development, earning a commission for Sundial, and constructing some improvements on the lot. None of that money is restitution or reimbursement to Luck. Petitioner previously disciplined Respondent for violations of Chapter 489 in Department of Business and Professional Regulation Case Numbers 200003354 and 200108551. Petitioner conducted each matter as an informal hearing before the agency. In the former case, Petitioner and Respondent entered into a written Stipulation on October 29, 2001. Respondent agreed to satisfy a civil judgment against him but neither admitted nor denied the allegations against him. In the latter case, Petitioner entered a default judgment against Respondent on March 4, 2003, for failure to satisfy another civil judgment against Respondent and placed Respondent on probation for two years. Petitioner has incurred investigative costs in the instant proceeding that exclude costs associated with the time expended by attorneys for Petitioner (investigative costs). The total investigative costs incurred by Petitioner are $1,429.61.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Petitioner enter a Final Order finding that Respondent and Midgett Development are guilty of the violations alleged in the Administrative Complaint; revoking the license and registration of Respondent and Midgett Development; imposing an administrative fine of $5,000; and ordering Respondent and Midgett Development to make full restitution to Luck and to pay investigative costs in the amount of $1,429.61. DONE AND ENTERED this 28th day of October, 2003, in Tallahassee, Leon County, Florida. S DANIEL MANRY 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 28th day of October, 2003. COPIES FURNISHED: Kimberly Clark Menchion, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 Darrin R. Schutt, Esquire Seeman & Schutt, P.A. 1105 Cape Coral Parkway, East Suite C Cape Coral, Florida 33904 Nancy P. Campiglia, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202 Tim Vaccaro, Executive Director Construction Industry Licensing Board Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue The issues in this proceeding are whether Gilbert’s bid proposal was responsive to the Department of Transportation’s bid proposal, and whether the Department of Transportation (Department) erred in accepting the bid of Gilbert. State alleged that Gilbert failed to comply with the DBE bid information submittal requirements of Rule 14-78.003(2)(b)3.a., Florida Administrative Code, in filing the DBE forms for the project.
Findings Of Fact State and Gilbert, among other prequalified bidders, submitted timely bids for State Project No. 86075-3423/03175- 3426, which involves the replacement of toll plazas on State Road 93 (also known as Alligator Alley) in Collier and Broward Counties. The project has been referred to in this proceeding as “the Alligator Alley project.” (Agreed Facts) The Department has adopted Rule Chapter 14-78, F.A.C., to govern utilization of DBE’s on state and federally funded construction projects. The specifications for the Alligator Alley project also include Special Provisions for Disadvantaged Business Enterprises, which incorporate many of the requirements of Rule 14-78.003, Florida Administrative Code. Consistent with Chapter 14-78, Florida Administrative Code, and the Special Provisions, the Department assigned Disadvantaged Business Enterprise (DBE) goals to the Alligator Alley project requiring bidders to subcontract 4% of the work to black DBE’s and 8% of the work to non-minority women DBE’s. (Agreed Facts) State and Gilbert submitted their sealed bid packages to the Department before the advertised deadline for bids, 10:30 a.m. on August 28, 1996. A Department review of the amounts bid showed that Gilbert was the apparent low bidder, submitting a bid totaling $9,153,215.07, while State was the apparent second-low bidder, submitted a bid totaling $9,566,051.25. (Agreed Facts) Consistent with Rule 14-78.003(2)(b)3., Florida Administrative Code, and the bid specifications, bidders were permitted to submit DBE Utilization Summary Forms and DBE Utilization Forms within 72 hours after submittal of their bid packages. State and Gilbert timely submitted DBE Utilization Summary Forms, showing the total amount committed to be subcontracted to DBE’s in order to meet each of the DBE goals set for the contract. The two companies also timely submitted DBE Utilization Forms that purported to commit each bidder to subcontract with DBE’s in amounts that totaled those shown in the DBE Utilization Summary Forms. (Agreed Facts) Gilbert’s DBE Utilization Summary Form stated that Gilbert would subcontract $369,000 (or 4% of its total bid) to black DBE’s and $734,600 (or 8% of its total bid) to non-minority women DBE’s. State’s DBE Utilization Summary Form stated that State would subcontract $400,000 (or 4% of its total bid) to black DBE’s and $800,000 (or 8% of its total bid) to non-minority women DBE’s. (Agreed Facts) The Special Provisions of the bid specifications that address the DBE Forms provide as follows: The contractor’s submission shall include the following information (submitted on Form Nos. 275-020-003 Utilization Summary and 275-020- 004 Utilization Form): The names, addresses of certified DBE firms that will participate in the contract. Only DBEs certified by the Department at the time of the bid may be counted toward DBE goals. A description of the work each named DBE firm will perform. The dollar amount of participation by each named DBE firm. If the DBE goal is not met, sufficient information to demonstrate that the contractor made good faith efforts to meet the goals. (Agreed Facts) [Emphasis Supplied] Gilbert submitted DBE Utilization Forms for each of its DBEs stating the DBE’s name, address, telephone number, the signature of the DBE or authorized individual. Gilbert submitted a DBE form for Alco Trucking, a firm owned by a Black male, which stated the value of the subcontracting work to be done as $369,000 without reduction or qualification, and stated regarding the work to be done as follows: Item No. Description of Work (Note if item qualifies for supplier) Various Hauling, aggregates, fill, on site trucking Gilbert submitted a DBE form for Swiftline Trucking, a firm owned by a non-minority female, which stated the value of the subcontracting work to be done as $82,200, without reduction or qualification, and stated regarding the work to be done as follows: Item No. Description of Work (Note if item qualifies for supplier) Various Hauling, aggregates, fill, on site trucking Gilbert submitted a DBE form for Jayalden Enterprises, a firm owned by a non-minority female, which stated the value of the subcontracting work to be done as $264,000, without reduction or qualification, and stated regarding the work to be done as follows: Item No. Description of Work (Note if item qualifies for supplier) 735-74-A Toll Plaza (Partial) 735-74-B Toll Plaza (Partial) Gilbert submitted a DBE form for Precision Contracting, a firm owned by a non-minority female, which stated the value of the subcontracting work to be done as $305,000, without reduction or qualification, and stated regarding the work to be done as follows: Item No. Description of Work (Note if item qualifies for supplier) 544-75-5 Impact Attenuator Vehicular (Partial) 102-1-A MOT (Partial) On each DBE form, Gilbert filled in the line for an “amount to be paid to DBE Subcontractor” and the total committed “toward the DBE goal,” but did not fill in the line for “Amount to be paid to DBE Supplier.” (Agreed Facts) State submitted DBE Utilization Forms for each of its DBEs stating the DBE’s name, address, telephone number, the signature of the DBE or authorized individual. State submitted a DBE form for Metro Engineering Constractors, Inc., a Black owned business, which stated the value of the subcontracting work to be done as $400,000 without reduction or qualification, and stated as follows: Item No. Description of Work (Note if item qualifies for supplier) 120-6 Embankment and 285-701 Limerock Base and Haul & Supply Materials 285-709 Limerock Base and Earthwork State submitted a DBE form for Freedom Pipeline Corporation, a non-minority female owned business, which stated the value of the subcontracting work to be done as $800,000 without reduction or qualification, and stated as follows: Item No. Description of Work (Note if item qualifies for supplier) 121-70 Flowable Fill 400-1-2 Class I Concrete Endwalls through Storm Drainage 514-71-3 Plastic Filter Baric (Riprap) and 1513120-118 Pipe Ductile Iron Pusyh on Joint 8” and 415-1-3 Reinforcing Steel Retaining Walls Retaining Walls and 635-1-11 Pull & Junction Boxes through Sewer & Water 1648100-7 Misc Water Fixt Blow Off Assy 285-701 Limerock Base and Haul & Supply Materials 285-709 Limerock Base and Earthwork State indicated on its DBE forms that both contractors were suppliers of materials and indicated that the total amount of the contract in both cases was to go to the DBE contractor. The Department’s Minority Programs Office is responsible for the implementation of the Department’s DBE program and reviews the DBE Utilization Forms submitted with bids. Kenneth Sweet, who is employed in the Minority Programs Office, had responsibility for reviewing Gilbert’s DBE Utilization Forms and determined that they complied with Rule 14-78.003(2)(b)3.a., Florida Administrative Code, and the Special Provisions of the bid specifications addressing DBE’s. The Department did not contact Gilbert or any of the DBE’s listed on Gilbert’s forms to confirm or obtain clarification of the information stated thereon. (Agreed Facts) The Department posted the bid tabulations for the Alligator Alley project, showing an award to Gilbert as the lowest responsive bidder. State filed its Notice of Protest with the Department’s Clerk of Agency Proceedings on September 23, 1996, 1996, and filed its Formal Protest on October 2, 1996. After this matter was referred to the Division, Gilbert filed its Petition to Intervene on October 22, 1996, which was granted on October 25, 1996. (Agreed Facts) It was stipulated that all of the DBE’s reflected in the DBE Utilization Forms submitted by Gilbert and State were certified DBE’s. (Agreed Facts) Gilbert’s DBE Utilization Forms were submitted to the Minority Programs Office within 72 hours after the project letting and the forms were signed by DBE representatives. The Department is dependent upon the accuracy of the information provided by the bidders to assess DBE participation. Gilbert and one of its DBE’s did not have the identical understanding of the exact scope of the work to be performed by the DBE which might impact how much of the value of the contract would be credited for DBE participation; however, there is no evidence of collusion or fraud in any of the quotes. The Department credits 60% of the value of a contract when the DBE contractor is a supplier of materials, and 100% of the value of the contract when the DBE Contractor furnishes and installs the materials designated as furnish and install items in the specifications. The toll booths and attenuators were not furnish and install items. Gilbert included 100% of the value of the contracts with Alco, Swiftline, Precision and Jayalden as DBE participation. The Department accepted Gilbert’s representations as presented in its DBE forms without questioning what services were being performed or provided by these DBE Contractors. Ken Sweet of the Department’s DBE programs office testified. The Department's justification for not examining the DBE proposals more closely was that the Department requires the prime contractor to adhere to the amount of the DBE work as presented in the forms. While this may be sufficient to maintain the integrity of the DBE program, it is insufficient review to insure that the contractor has complied with the rules for crediting DBE participation and to insure the competitiveness of the bid process. Although Gilbert asserted at hearing that its subcontractors, Swiftline and Alco, would be supplying and placing the materials, it did not so state in its forms. The forms for Alco and Swiftline said, "hauling, aggregates, fill, and on site trucking." There was no basis for the Department to conclude that the contractors were supplying and placing the materials. Further, there was no evidence that Alco and Swiftline were "regular dealers" in fill or aggregates, or identification of their sources of aggregate and fill. Gilbert indicated no item numbers with regard to Alco and Swiftline. If item numbers had been provided, the status of the work as furnish and install items could have been determined. Only two verb forms were used in the "Description of Work" portion of form: “hauling” and “trucking”. Petitioner showed that the value of the contract exceeded the reasonable value of the trucking and hauling to be done on the project. At hearing, Gilbert asserted that Swiftline and Alco were suppliers. This evidence may not be considered. The Department should have limited Gilbert's DBE credit to the value of the hauling and trucking. This was the only work described in the DBE utilization forms. Although the value of the trucking and hauling alone was not proven, it obviously was less than the full contract amount. Gilbert had stated the DBE participation amounts at the minimum required amount. Any reduction of amount creditable to a Black minority contractor would have placed Gilbert below the four percent goal stated in the specifications. The Department credited Gilbert with 100% of the value of the contract with Jayalden towards DBE participation. The DBE Utilization Form for Jayalden does not indicate Jayalden is a supplier or regular dealer. The form does not state Jayalden would install the toll booths. A contractor may obtain 100 percent credit for DBE participation for materials provided by a DBE manufacturer, a DBE regular dealer or a DBE who furnishes and installs items designated furnish and install items in the specifications. The Department knew there were only two approved manufacturers of toll booths. Jayalden was not one of the manufacturers. Neither of the manufacturers were DBE certified. Gilbert's DBE forms did not identify Jayalden as a "regular dealer," and the toll booths were not designated furnish and install items in the specifications The Department must approve additional items as furnish and install items if not designated in the specifications. The Department did not add the toll booths as furnish and install items. The evidence shows that the manufacturer offered to provide the toll booths and install the toll booths for $75,000 each. Jayalden agreed to acquire, ship and install the booths for $76,000 each. A question arises regarding the commercially useful function Jayalden was performing if the manufacturer would furnish and install the nine booths for $75,000 each. In response to the question regarding the commercially useful function Jayalden performed, evidence was presented that Jayalden assumed responsibility for this acquisition and installation of the booths and Jayalden relieved the contractor of "managing" that part of the project. The rules required the Department's approval of the commission or fee paid for management services of this type. The rules do not permit credit for DBE participation of the value of the toll booths. This would reduce the credit for minority non- Black participation by Jayalden from $684,000 to $9,000, less than the required non-Black minority DBE participation. The evidence regarding Precision established Precision was a regular dealer in traffic control devices, and contracted to supply, service and install these devices on the project. The DBE Utilization Form for Precision indicates the Item No. and indicates "Impact Attentuator Vehicular (Partial)" and "MOT (Partial)". Precision's form provided sufficient data to justify being given 100% credit. Gilbert's other DBE forms did not present any special condition warranting increasing DBE credit. The DBE Utilization Forms as submitted by Gilbert failed to mention or identify any special conditions or circumstances affecting the amount of credit Gilbert received for DBE participation. The facts submitted at hearing reveal that at least one special condition or circumstance was applicable to each subcontractor in order to justify crediting Gilbert with 100% of the value of the contract with the DBE toward DBE participation. With exception of Precision, the information was provided only after the bid opening and improperly supplemented the original proposal. The Department had previously approved DBE Utilization Forms providing the same type of information as contained on Gilbert’s DBE Utilization Forms. Had the Department reviewed the proposals as required, Gilbert would have been determined not to have met the DBE specifications. Gilbert did not justify its failure to meet the DBE participation because it facially had met the DBE criteria under the Department's existing policies. In contrast, the DBE form submitted by State for Metro indicates the items numbers involved, and that Metro will “Haul & supply materials and earthwork.” Similarly, the work to be performed by Freedom Pipeline was clearly identified and sufficient information provided to advise the Department of any special conditions affecting the credit to be awarded for DBE participation. One can readily ascertain that the subcontractor is a hauler, supplier and installer of the limestone, and that the contractor should receive 100% credit for minority participation of the contract's value. State was able to meet the DBE participation specification.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is, RECOMMENDED: That the Department enter its Final Order finding that Gilbert was non-responsive; however, because Gilbert followed the existing policies of the Department which were erroneous, it is recommended that the Department reject all bids and republish the invitation to bid to afford interested contractors an opportunity to file new proposals. DONE and ENTERED this 3rd day of February, 1997, in Tallahassee, Florida. STEPHEN F. DEAN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of February, 1997.
The Issue At issue in this proceeding is whether Respondent failed to abide by the coverage requirements of the Workers' Compensation Law, Chapter 440, Florida Statutes (2002), by not obtaining workers' compensation insurance for her employees; and whether Petitioner properly assessed a penalty against Respondent pursuant to Section 440.107, Florida Statutes (2002).
Findings Of Fact Based upon observation of the witnesses and their demeanor while testifying; documentary materials received in evidence; stipulations by the parties; evidentiary rulings made pursuant to Section 120.57, Florida Statutes (2003); and the record evidence submitted, the following relevant and material finding of facts are made: The Department is the state agency responsible for enforcing the requirement of the Workers' Compensation Law that employers secure the payment of workers' compensation for their employees. § 440.107, Fla. Stat. (2002).1 On August 8, 2003, Respondent was a sole proprietor in the construction industry by framing single-family homes. On that day, Respondent was the sub-contractor under contract with Marco Raffaele, general contractor, providing workers on a single-family home(s) located on Navigation Drive in the Panther Trace subdivision, Riverview, Florida. It is the responsibility of the Respondent/employer to secure and maintain workers' compensation coverage for each employee. During the early morning hours of August 8, 2003, Donald Lott, the Department's workers' compensation compliance investigator, was in the Panther Trace subdivision checking on site workers for potential violations of the workers' compensation statute. While driving down Navigation Drive in the Panther Trace subdivision, Mr. Lott approached two houses under construction. There he checked the construction workers on site and found them in compliance with the workers' compensation statute. Mr. Lott recognized several of the six men working on the third house under construction next door and went over to investigate workers' compensation coverage for the workers.2 At the third house Mr. Lott interviewed Darren McCarty, Henry Keithler, and Mike Sabin, all of whom acknowledged that they worked for Respondent, d/b/a Riopelle Construction. Mr. Lott ascertained through Southeast Leasing Company (Southeast Leasing) that three of the six workers, Messrs. Keithler, Sabin, and McCarthy were listed on Southeast Leasing Company's payroll through a valid employee lease agreement with Respondent as of August 8, 2003. The completed employee lease agreement provided for Southeast Leasing Company to provide workers' compensation coverage for only those employees whose names, dates of birth, and social security numbers are contained in the contractual agreement by which Southeast Leasing leased those named employees to the employing entity, Respondent, d/b/a Riopelle Construction. Mr. Lott talked with the other three workers on site, Ramos Artistes, Ryan Willis, and Robert Stinchcomb. Each worker acknowledged working for (as an employee) Respondent on August 8, 2003, in the Panther Trace subdivision. In reply to his faxed inquiry to Southeast Leasing regarding the workers' compensation coverage status for Messrs. Artistes, Willis, and Stinchcomb, Southeast Leasing confirmed to Mr. Lott that on August 8, 2003, Southeast Leasing did not have a completed employee leasing contractual agreement with Respondent for Messrs. Artistes, Willis or Stinchcomb. Southeast Leasing did not provide workers' compensation coverage for Messrs. Artistes, Willis or Stinchcomb on August 8, 2003.3 Southeast Leasing is an "employee" leasing company and is the "employer" of "leased employees." As such, Southeast Leasing is responsible for providing workers' compensation coverage for its "leased employees" only. Southeast Leasing, through its account representative, Dianne Dunphy, input employment applications into their system on the day such application(s) are received from employers seeking to lease employees. Southeast Leasing did not have employment applications in their system nor did they have a completed contractual employment leasing agreement and, therefore, did not have workers' compensation coverage for Messrs. Artistes and Willis at or before 12:08 p.m. on August 8, 2003. After obtaining his supervisor's authorization, Mr. Lott served a Stop Work and Penalty Assessment Order against Respondent on August 8, 2003, at 12:08 p.m., requiring the cessation of all business activities and assessing a penalty of $100, required by Subsection 440.107(5), Florida Statutes, and a penalty of $1,000, as required by Subsection 440.107(7), Florida Statutes, the minimum penalty under the statute. On August 12, 2003, the Department served a Corrected Stop Work and Penalty Assessment Order containing one change, corrected federal identification number for Respondent's business, Riopelle Construction. Mr. Stinchcomb, the third worker on the construction job site when Mr. Lott made his initial inquiry, was cutting wood. On August 8, 2003, at or before 12:00 p.m., Mr. Stinchcomb was not on the Southeast Leasing payroll as a leased employee covered for workers' compensation; he did not have individual workers' compensation coverage; and he did not have a workers' compensation exemption. On that day and at that time, Mr. Stinchcomb worked as an employee of Riopelle Construction and was paid hourly by Riopelle Construction payroll check(s). Respondent's contention that Mr. Stinchcomb, when he was working on the construction job site between the hours of 8:00 a.m. and 1:00 p.m. on August 8, 2003, was an independent contractor fails for the lack of substantial and competent evidence in support thereof. On August 8, 2003, the Department, through Mr. Lott, served an administrative request for business records on Respondent. Respondent failed and refused to respond to the business record request. An Order requiring Respondent to respond to Petitioner's discovery demands was entered on December 1, 2003, and Respondent failed to comply with the order. On December 8, 2003, Respondent responded that "every effort would be made to provide the requested documents by the end of the day" to Petitioner. Respondent provided no reliable evidence and Mr. Stinchcomb was not called to testify in support of Respondent's contention that Mr. Stinchcomb was an independent contractor as he worked on the site on August 8, 2003. Respondent's evidence, both testamentary and documentary, offered to prove that Mr. Stinchcomb was an independent contractor on the date in question failed to satisfy the elements required in Subsection 440.02(15)(d)1, Florida Statutes. Subsection 440.02(15)(c), Florida Statutes, in pertinent part provides that: "[f]or purposes of this chapter, an independent contractor is an employee unless he or she meets all of the conditions set forth in subparagraph(d)(1)." Subsection 440.02(15)(d)(1) provides that an "employee" does not include an independent contractor if: The independent contractor maintains a separate business with his or her own work facility, truck, equipment, materials, or similar accommodations; The independent contractor holds or has applied for a federal employer identification number, unless the independent contractor is a sole proprietor who is not required to obtain a federal employer identification number under state or federal requirements; The independent contractor performs or agrees to perform specific services or work for specific amounts of money and controls the means of performing the services or work; The independent contractor incurs the principal expenses related to the service or work that he or she performs or agrees to perform; The independent contractor is responsible for the satisfactory completion of work or services that he or she performs or agrees to perform and is or could be held liable for a failure to complete the work or services; The independent contractor receives compensation for work or services performed for a commission or on a per-job or competitive-bid basis and not on any other basis; The independent contractor may realize a profit or suffer a loss in connection with performing work or services; The independent contractor has continuing or recurring business liabilities or obligations; and The success or failure of the independent contractor's business depends on the relationship of business receipts to expenditures. The testimony of Respondent and the testimony of her husband, Edward Riopelle, was riddled with inconsistencies, contradictions, and incorrect dates and was so confusing as to render such testimony unreliable. Based upon this finding, Respondent failed to present evidence sufficient to satisfy the requirement of Subsection 440.02(15)(d)1, Florida Statutes, and failed to demonstrate that on August 8, 2003, Mr. Stinchcomb was an independent contractor. Petitioner proved by a preponderance of the evidence that on August 8, 2003, Mr. Stinchcomb, while working on the single-family construction site on Navigation Drive in the Panther Trace subdivision was an employee of Respondent and was not an independent contractor. Petitioner proved by a preponderance of the evidence that Mr. Stinchcomb did not have workers' compensation coverage on August 8, 2003. On August 8, 2003, Mr. Willis was a laborer on the single-family construction site on Navigation Drive in the Panther Trace subdivision as an employee of Respondent, who paid him $7.00 per hour. Mr. Willis was not listed on the employee list maintained by Southeast Leasing, recording those employees leased to Respondent. Mr. Willis did not have independent workers' compensation coverage on August 8, 2003. Mr. Willis had neither workers' compensation coverage nor a workers' compensation exemption on August 8, 2003. Petitioner proved by a preponderance of the evidence that Mr. Willis did not have workers' compensation coverage on August 8, 2003. On August 8, 2003, Mr. Artises was a laborer on the single-family construction site on Navigation Drive in the Panther Trace subdivision and was an employee of Respondent. Mr. Artises had been in the employment of Respondent for approximately one week before the stop work order. Mr. Artises did not have independent workers' compensation coverage on August 8, 2003. Mr. Artises did not have a workers' compensation coverage exemption on August 8, 2003. Petitioner proved by a preponderance of the evidence that Mr. Aristes did not have workers' compensation coverage on August 8, 2003.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleading and arguments of the parties, it is, therefore, RECOMMENDED that a final order be entered by the Department of Financial Services, Division of Workers' Compensation, affirming and adopting the Corrected Stop Work and Penalty Assessment Order dated August 12, 2003. DONE AND ENTERED this 29th day of March, 2004, in Tallahassee, Leon County, Florida. S FRED L. BUCKINE 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 29th day of March, 2004.
Findings Of Fact The Florida Department of Transportation (DOT) is required by state and federal law to ensure that a certain percentage of funds available for construction, design and consulting service contracts be provided as opportunity for utilization by small business concerns owned and controlled by socially and economically disadvantaged individuals (DBEs). DBE contract goals are established by the DOT for each construction contract. Every bidder must submit a form to the DOT which either documents compliance with the DBE contract goal or, if compliance is not met, must provide sufficient information to demonstrate that good faith efforts were made by the bidder to meet the goal. Prior to June of 1984, it was the practice of the DOT to allow contractors ten days after the bid letting to correct their DBE forms or to submit their good faith effort documentation. After holding numerous workshops throughout the State, the DOT amended its rules relating to participation by disadvantaged business entities. As pertinent to this proceeding, the amendment requires that all DBE documentation be submitted at the time of the submission of the bid proposal. Bidders are notified that: ".... Failure to satisfy these requirements shall result in a contractor's bid being deemed nonresponsive and the bid being rejected." Rule 14-78.03(2)(b)4, Florida Administrative Code. This rule became effective on May 23, 1984. All prequalified bidders were mailed a copy of the rule amendments prior to their effective date. Petitioner received a copy of the new rule prior to May 23, 1984. By notice dated June 28, 1984, contractors were advised that sealed bids would be received on July 25, 1984, on various road projects. The bid documents advised that the DBE goal for Project Number 50020-3516 was 10 percent. Form 932-10 entitled "Disadvantaged/Women Business Enterprise Utilization Affirmative Action Certification" advised bidders that Form 1 is required to accompany the bid documents. The specifications for Job Number 50020-3516 contain extensive provisions with regard to compliance with the DBE contract goals. Among these provisions is the following language contained in Section 2-5.3.2: "... Award of the Contract shall be conditioned upon submission of the DBE and WBE participa- tion information with the bid proposal and upon satisfaction of the contract goals or, if the goals are not met, upon demonstrating that good faith efforts were made to meet the goals." (Emphasis added.) The specifications lists as grounds for disqualification of bidders "failure to satisfy the requirements of 2-5.3." On July 25, 1984, Petitioner submitted a bid in the amount of 8171,370.51 for Job Number 50020-3516. Attached to the bid was Form 932-10 and Form No. 1, the latter indicating that petitioner's proposed utilization of DBEs was 7.6 percent of the total contract amount. While noting that two other DBEs were contacted without success, petitioner provided no further documentation regarding its good faith efforts to comply with the 10 percent contract goal. Three contractors submitted bids on this project. The next lowest bidder was Baxter Asphalt & Concrete, Inc., which submitted a bid of $191,540.92 and demonstrated compliance with the DBE contract goal. The third bidder, Capital Asphalt, Inc., submitted a bid of $204,651.35, fell below the 10 percent DBE contract goal and, like the petitioner, failed to demonstrate that it made a good faith effort to comply. The DOT engineer's estimate on this project was approximately $147,000.00. By notice dated August 17, 1984, the DOT advised that all bids received on Job Number 50020-3516 had been rejected. Two reasons were given for the rejection: that "the low bidder failed to meet DBE Contract Requirements" and that "awarding to the second low bidder is not in the best interest of the State." During June, July, and August following the adoption of the new rules regarding DBE requirements, it was the general policy of the DOT Awards Committee to reject all bids on a project if the low bidder failed to meet DBE requirements and there was more than a one percent difference between the first and second low bids. Beginning in September or October, 1984, this policy was changed to one of awarding to the second or third most responsible bidder as long as the bid was within the State estimate. Consequently, the DOT has now determined to award this challenged bid to Baxter Asphalt & Concrete, Inc. In another bid letting occurring on May 30, 1984, on Project Number 55160-3517, petitioner failed to submit with its bid proposal the forms for demonstrating compliance with the DBE requirements. By letter dated May 30, 1984, and received on June 4, 1984, petitioner was advised to forward, without delay, the necessary Form No. 1. The Form returned by petitioner showed 8 percent DBE participation. Since the contract goal was 10 percent, petitioner was afforded another opportunity to comply, did comply and receive approval on June 11, 1984, and was later advised that yet another DBE form needed to be completed. On July 17, 1984, petitioner received a letter from the DOT advising that the contract had been awarded to petitioner as of July 16, 1984. For all bid lettings occurring since June or thereafter, the DOT has rejected bids from contractors who have not submitted evidence with their bid proposal of either DBE compliance or a good faith effort to comply. New forms have been utilized to require such submittals with the bid proposal and removing the prior 10 day grace period language. Also, on August 22, 1984, the DOT sent a "Notice to All Contractors" that: "... all submittals for evaluating Good Faith Efforts in meeting DBE/WBE goals must be submitted with the bid proposal in order to be considered for award of the contract. Failure to submit the Good Faith Effort documentation with the bid may result in rejection of the bid."
Recommendation Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that a Final Order be entered rejecting as non-responsive the bid submitted by petitioner on Job Number 50020-3516, and awarding the contract to Baxter's Asphalt & Concrete, Inc. Respectfully submitted and entered this 27th day of February, 1985, in Tallahassee, Florida. DIANE D. TREMOR 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 27th day of February, 1985. COPIES FURNISHED: Michael P. Bist, Esquire 300 Lewis State Bank Building Tallahassee, Florida 32301 Larry D. Scott, Esquire Haydon Burns Building, MS-58 Tallahassee, Florida 32301-8064 Frank A. Baker, Esquire 204 Market Street Marianna, Florida 32446 Paul Pappas, Secretary Department of Transportation Haydon Burns Building Tallahassee, Florida 32301
The Issue Whether the Respondent, Miami-Dade Community College, has adopted a statement of agency policy in violation of Florida law.
Findings Of Fact Prior to August 2, 2002, the Respondent employed the Petitioner, Lonny Ohlfest. At the time of his termination, the Petitioner filed a request for a due process hearing with the Respondent to challenge his termination from employment. The Petitioner challenged the basis for his termination as he wanted to clear his name regarding some unflattering allegations but, equally important, he wanted to keep his job with MDC. The Respondent denied the Petitioner's request for an administrative hearing and found that the Petitioner was not entitled to a hearing. More specifically, the Respondent concluded that since the Petitioner did not have a contract of employment he was not entitled to an administrative hearing. The Petitioner disputed the Respondent's claim and argued that he did have a contract, that he had a reasonable expectation that his employment would continue, and that the Respondent unlawfully refused to afford him regress through the administrative process. When the Petitioner's appeal of his request for an administrative hearing failed, he filed the instant case to challenge the Respondent's policy of not referring administrative cases for formal hearing. The delays in the appeal process explain and support the Petitioner's delay in filing the instant challenge to the agency's alleged rule. To understand the historical perspective of this case, the following findings are made pertinent to the Petitioner's employment with the Respondent: The Petitioner began employment with the MDC on or about April 4, 2001. He was hired as a part-time, hourly worker within the school of allied health technologies. The position he assumed was funded and operated within the "Health Careers Opportunities Program" or HCOP. The HCOP was funded by a federal grant. The monies coming from the grant were renewable each year and ran concurrent with the school's fiscal year (July 1-June 30). All employees paid through the HCOP grant were considered "temporary" as the grant monies were necessary to assure continued employment. In January 2002 the Petitioner was given a full-time position within the HCOP. He was designated "Program Leader/Student Services" for the upcoming summer bridge program. At all times material to this case, all parties knew that absent federal funding the HCOP would not continue to operate. Moreover, the Petitioner knew, or should have known, that his employment with the Respondent would run only until June 30, 2002. Thereafter, it was expected that if and when the federal funding came through, the HCOP employees (including the Petitioner) would continue to work within the scope of the program. At the end of the summer program in 2001, the HCOP employees took leave until the school year started and the funding of the program was assured. Accordingly, after the summer bridge program was completed, the Petitioner expected to be on leave during the summer of 2002 until called back to work. Instead, the Respondent terminated the Petitioner from employment. The 2002 summer bridge program had not finished well for the Petitioner. Amid allegations of sexual harassment (unsubstantiated and not at issue in this proceeding) the Petitioner's working relationship within the HCOP floundered. The Petitioner was aghast that unsubstantiated claims had been reported, he wanted the accusations resolved, he wanted his name cleared, and he was disappointed by the process that failed to timely and fully resolve the issues. When the Petitioner left the campus for what he believed would be the break (similar to the one they had taken the prior year), he was uncertain as to his employment status. In fact, when he left the campus he cleaned out his desk and returned his keys. Nevertheless, on July 26, 2002, Dr. Miller directed the Petitioner to present for work on July 29, 2002. He did not do so. On July 29, 2002, the Petitioner's immediate supervisor directed him to appear for work on July 30, 2002. He did not do so. In fact, the Petitioner did not return to the office until July 31, 2002. The Petitioner did not understand that his attendance was mandatory for the two days that he did not appear for work. When the Petitioner did check in with the HCOP office on the 31st he came to understand the gravity of the situation. As a result of the absences, the Respondent cited the Petitioner with insubordination and terminated his employment with MDC. The Petitioner timely challenged the termination but the Respondent ruled he was not entitled to an administrative review of the decision. The Petitioner filed for, and received, unemployment compensation. The termination was not justified by the standards applicable to that forum. The rules governing unemployment compensation do not, however, govern the administrative process regarding whether or not one's employment constitutes a property interest that is protected by law. Upon receipt of the Petitioner's petition seeking an administrative review, the Respondent declined to afford the Petitioner with a hearing. The Respondent does not forward petitions filed by non- contract employees when such individuals seek to challenge their termination of employment. The Respondent maintains that, as a matter of law, they are not required to forward such petitions for formal review. The Respondent does not have a written rule or policy stating that non-contract employees are not entitled to administrative review when their employment is terminated. Conversely, the Respondent does not have a written rule or policy stating that non-contract employees are entitled to an administrative review when their employment is terminated. The Petitioner was not a full-time, contract employee of the Respondent. The Respondent's policy affords full-time contractual personnel a right to an administrative hearing pursuant to Chapter 120, Florida Statutes.
Findings Of Fact Department of Transportation (DOT) Project #02000-3608 is a federal aid highway project requiring the replacement of a bridge on Kings Bay Drive over a canal near the Crystal River in Citrus County, Florida. The bridge is currently closed due to hurricane damage. The bid specifications were published, and a bid submittal deadline of March 28, 1990, was established. The bid specifications included a disadvantaged business enterprise (DBE) goal of 10%, and hiring goals of 6.9% female and 17.1% minority. The bid specifications also included the following special provisions related to DBE: PREPARATION OF PROPOSALS * * * 2-5.3.2 Submittals for Contracts with Goals: For all contracts for which DBE contract goals have been established, each contractor shall meet or exceed or demonstrate that it could not meet, despite its good faith efforts, the contract goals set by the Department. The DBE participation information shall be submitted with the Contractor's bid proposal. Award of the Contract shall be conditioned upon submission of the DBE participation information with the bid proposal and upon satisfaction of the contract goals or, if the goals are not met, upon demonstrating that good faith efforts were made to meet the goals. The Contractor's bid submission shall include the following information (Submitted on Forms Nos. 275-020-002-DBE Utilization Affirmative Action Certification, 275-020-003-DBE Utilization Summary and 275-020-004-DBE Utilization Form): The names and addresses of certified DBE firms that will participate in the contract. Only DBEs certified by the Department at the time the bid is submitted may be counted toward DBE goals. A description of the work each named DBE firm will perform. The dollar amount of participation by each named DBE firm. If the DBE goal is not met, sufficient information to demonstrate that the contractor made good faith efforts to meet the goals. * * * DISQUALIFICATION OF BIDDERS ARTICLE 2-11 (Page 11) is expanded as follows: (h) Failure to satisfy the requirements of 2-5.3. * * * (Petitioner's exhibit #2, emphasis added) DBE goals for projects to be bid are established at DOT by a committee which includes a representative from the agency's Bureau of Minority Programs. From a list of individual bid items, the committee determines which items are normally subcontracted. Those items are totalled to achieve a percentage of the job. The Bureau of Minority Programs then reviews the list to determine the number of DBEs, from the agency directory, which would be available to perform the subcontracted work in the relevant geographical area. The Bureau of Minority Programs then makes its recommendation to the goals-setting committee. For example, if 40% of the job would normally be subcontracted and DBEs were available to perform 50% of that work, the goal could be set at 20%. In practice, the goals are not set so high, and the most common goal is 10%, as that is the overall goal of the DOT. Goals vary, depending on the type of work, the location and the availability of DBEs. Hiring goals are also established for each project, but in contrast to the DBE goals, they are not considered in the award of a bid. Four firms responded to the bid advertisement for Project Number 02000- 3608. The Cone Corporation was the low bidder at $588,793.45. Cone Constructors, Inc. bid $629,736.85. Piling and Structures, Inc. bid $700,436.53; and Leware Construction Company bid $733,333.33. The Cone Corporation bid included DBE utilization forms indicating that $56,000.00 would be subcontracted to H.S. Thompson Construction Company for concrete and rebar work. This amounts to approximately 9.5% of its bid. The Cone Corporation did not submit any statement with its bid package as to how good faith efforts were made to comply with the DBE goal. A good faith effort committee of the department met to review the bids, and determined that it could not evaluate the Cone Corporation's good faith efforts because no information was provided. Cone Constructor, Inc., the next lowest bidder, provided a $70,000.00 subcontract with a DBE firm, D.A.B. Constructors, Inc., for various work items related to the project. This amounts to approximately 11% of its bid, and meets the specified 10% goal. Piling and Structures, Inc., provided for six DBE subcontractors for a total of $56,000.00, or approximately 8% of its bid; and Leware Construction Company, the highest bidder, provided for four DBE subcontractors, for a total of $76,887.45, or approximately 10.5% of its bid. Thus, two bidders met the specified DBE goal, and two did not. The good faith efforts committee recommended that Cone Corporation's bid be declared nonresponsive because the DBE goal was not achieved and documentation of good faith effort was not submitted. The committee noted that DBE utilization forms submitted by other bidders indicated that there were other DBE subcontractors available for work on the project. Bob Graham is vice-president of the Cone Corporation and has worked for the firm for ten years. He is responsible for the day to day management of the firm, and he prepared the project bid. Bob Graham concedes that the DBE subcontract in his bid does not meet the 10% goal. He solicited and received other DBE subcontract quotations, but rejected them as being higher than non-DBE quotations. Only one DBE subcontractor responded lowest in an area of work and Graham submitted that firm, H.S. Thompson, as part of his bid. Bob Graham also admits that he did not submit any good faith documentation with his bid to demonstrate that an effort was made to meet the DBE goal. Bids are commonly compiled at the last minute, with the bidders assembling various quotations and putting together final numbers to meet the bid deadline. Graham simply did not have time to add the good faith effort documentation. He made a considered business decision to reject all but one DBE subcontractor, in favor of being able to submit a lower bid. He knew at the time that his bid was submitted that the DBE goal was not met. His bid was approximately $41,000.00 lower than the next lowest bid. For an additional $2,800.00 he could have met the 10% goal. This, of course, was apparent only after the bids were opened.
Recommendation Based on the foregoing, it is hereby, RECOMMENDED That a Final Order be entered, dismissing the protest of Petitioner, the Cone Corporation. DONE AND RECOMMENDED this 9th day of July, 1990, in Tallahassee, Leon County, Florida. 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 9th day of July, 1990. COPIES FURNISHED: W. Crit Smith, Esquire SMITH AND THOMPSON, P.A. 1530 Metropolitan Blvd. Tallahassee, FL 32308 John H. Beck, Esquire 1020 East Park Avenue Tallahassee, FL 32301 Paul J. Martin, Esquire and Susan P. Stephens, Esquire Department of Transportation Haydon Burns Building, M.S. #58 605 Suwannee Street Tallahassee, FL 32399-0450 Ben G. Watts, Secretary Attn: Eleanor F. Turner, M.S. #58 Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, FL 32399-0450 Thornton J. Williams, General Counsel Department of Transportation 562 Haydon Burns Building 605 Suwannee Street Tallahassee, FL 32399-0450 =================================================================
The Issue The issue in this case is whether the Department of Transportation (DOT) acted correctly in deeming the bid of Petitioner White Construction Co., Inc. (White), to be nonresponsive for failure to meet the Disadvantaged Business Enterprise (DBE) goal for Project No. 220517-1-52-01 (the project) and whether the proposed award to Intervenor Mitchell Brothers, Inc. (Mitchell) is in accordance with governing rules and statutes or is arbitrary, capricious, or contrary to competition.
Findings Of Fact The project is for work in Wakulla County. The deadline for submission of bids was June 17, 1998. White and Mitchell bid on the Project. Upon the opening of the bids on or about June 17, 1998, White was the apparent low bidder at $4,140,400.14, and Mitchell was the apparent second low bidder at $5,237,848.89. Pursuant to Rule 14-78, Florida Administrative Code, bidders have three days after bid opening in which to submit detailed information regarding compliance with the project’s DBE requirements. The requirements of this project were that eight percent of the contract work be performed by DBEs. With the bid itself, a bidder only needs to submit a DBE summary, noting whether it will meet the DOT established goal of eight percent. Within the three day period, White submitted DBE utilization forms, one of which listed HSD as one of its DBEs, for work in the amount of $55,326.36. Mitchell submitted the required forms, showing compliance with the DBE goals. The DOT publishes a DBE directory for each bidding cycle. The directory indicates the bidding cycle to which it is to be applied. If a company is not listed in the directory, a contractor is on notice that such company is not a certified DBE. White is an experienced bidder and contractor with the Department of Transportation. The bid and the DBE submission in this case were prepared by a White estimator who had been an estimator for many years. White’s estimator admitted that, while he usually reviewed the DBE directory prior to submission of bids, he failed to do so in this case. White received a copy of the DBE directory for the June Letting, but did not consult it to confirm that HSD was listed. While White has substituted DBE subcontractors on jobs after performance has begun where the DBE cannot complete the work for which it was hired, White has never substituted a DBE subcontractor prior to the performance of the contract or changed subcontractors on its bid after the bid opening because a subcontractor it listed for purposes of meeting the DBE goal was not DBE certified. White, as a common practice, keeps a supply of HSD forms in its office for use in submitting the DBE Utilization Form that indicates White will meet the DBE goal for a particular project. White did not contact HSD or any of the DBEs it listed on the DBE Utilization Form and DBE Utilization Summary Form to confirm that they were DBE certified for the June Letting. White is aware that subcontractors may lose their DBE certification or not apply for recertification. White is also aware that it should not use subcontractors for purposes of meeting the DBE goal that are not listed in the DBE directory unless one calls the Minority Programs Office and confirm directly that a particular company which is not listed is DBE certified for that letting cycle. HSD was not aware that White listed it on the DBE Utilization Form submitted with White’s bid. For White, that is not an uncommon practice. Neither DOT or HSD are depicted by the evidence of having misled White into believing that HSD was a qualified DBE. It is the bidder’s (White) responsibility to verify whether a DBE is authorized for use on a particular project. White personnel did not do this and the applicable DBE directory clearly did not have HSD listed. HSD was not a qualified DBE at the time of the bid letting or proposed bid award. HSD sent a quote for work on the project to Mitchell and White. The quote sent to Mitchell contains a letter in which HSD notes that the company . . . is not listed in the DBE Directory for the June Letting. Unfortunately this means you will not be able to utilize Highway Safety Devices for DBE Goals for the June Letting. At the final hearing, a witness for White asserted that White did not receive the explanatory letter received by Mitchell. Such assertion cannot be credited in view of the demeanor of the witness when testifying. Subsequent to the final hearing in this matter, White submitted information indicating that HSD had received certification as a DBE, effective October 26, 1998. However, White’s submission does not change the fact that HSD was not certified at the time of the bid letting or opening in this matter. White’s bid was evaluated by DOT’s GFEC to determine whether or not White met the DBE goal or provided a good faith effort evaluation for the Project. DOT interprets Rule 14-78.003(2)(b)5, Florida Administrative Code, as not permitting the substitution of a certified DBE for HSD, a circumstance that would have permitted White to meet the DBE goal for the Project. DOT’s Minority Programs Office does the initial evaluation of the DBE portion of the goal. If the goal has not been met, the bid will be reviewed by the GFEC. The GFEC makes a recommendation to the TRC, and the dollar amount of the bid is not a factor considered by the GFEC. The TRC will take into consideration the bid price in its evaluation. The GFEC reviews the bid package by going through every criteria set forth in Rule 14-78.003(2)(b)3,b, Florida Administrative Code, to see if there are any circumstances that would credit the prime contractor in meeting the DBE goal. The GFEC’s evaluation of White’s bid was to determine if the information submitted by White indicated whether good faith efforts were made to meet the DBE goal, not whether White could change HSD for a certified DBE. The GFEC reviewed White’s bid for compliance with the DBE goal and to determine if good faith efforts were made to meet the goal. White did not meet the DBE goal or submit documentation of its good faith effort to do so. The GFEC recommended to the TRC to deem White nonresponsive. The TRC reviewed the GFEC report and accepted the recommendation to deem White nonresponsive. The GFEC determined that Mitchell, however, did meet the DBE goal for the Project. The TRC determined that Mitchell’s bid was within the automatic award criteria and recommended Mitchell be awarded the contract. The TRC recommended to the CAC that White be deemed nonresponsive and award the contract to Mitchell. The review of White’s bid to determine whether it met the DBE goal by the GFEC, the TRC and the CAC were done in accordance with the governing statutes, rules and DOT policy and procedures. Although substitution of DBEs in the performance of a contract after bid-letting is permitted by DOT, the total amount of the bid submitted by a contractor is affected by the bids it receives from DBEs. White selected HSD, without confirming its present status at the time, because White had used this presumed DBE on previous occasions to obtain the best deal for White. White also asserted that, as it may change DBEs after a contract is awarded, the failure to submit a correct DBE is not a material error. However, a contractor may not change DBEs without good cause, such as its inability to perform the work, pursuant to Rule 14-78, Florida Administrative Code. That there is a procedure available after the contract is awarded does not affect the materiality of the failure to submit a qualified DBE in the first instance. If the DOT believes the responsive bids which it receives are too high, it can reject all bids. The bid submitted by Mitchell, at $5,237,848.89, was within the automatic award criteria. DOT’s decision to reject White’s bid for failure to comply with the DBE requirements is consistent with its practice and past policy. The use of an unqualified DBE is a material variation in a bid, as it may impact the price. DOT’s decision to reject White’s bid as non-responsive was not contrary to statute, rule, or policy, or the bid specifications. White did not show that DOT’s action was clearly erroneous, contrary to competition, arbitrary, or capricious.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Respondent, the Department of Transportation, enter a final order awarding the contract on State Project Nos. 220517-1-52-01 and 220511-1-52-01 to Intervenor, Mitchell Brothers, Inc. DONE AND ENTERED this 16th day of November, 1998, in Tallahassee, Leon County, Florida. DON W. DAVIS 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 Filed with the Clerk of the Division of Administrative Hearings this 16th day of November, 1998. COPIES FURNISHED Mary M. Piccard, Esquire Vezina, Lawrence and Piscitelli, P.A. 318 North Calhoun Street Tallahassee, Florida 32301 Brian McGrail, Esquire Department of Transportation Haydon Burns Building 605 Suwannee Street, Mail Station 58 Tallahassee, Florida 32399-0450 Donna H. Stinson, Esquire Broad and Cassel 215 South Monroe Street, Suite 400 Tallahassee, Florida 32302 James C. Myers, Agency Clerk Department of Transportation Haydon Burns Building 605 Suwannee Street, Mail Station 58 Tallahassee, Florida 32399-0450 Pamela Leslie, General Counsel Department of Transportation Haydon Burns Building 605 Suwannee Street, Mail Station 58 Tallahassee, Florida 32399-0450
Findings Of Fact Respondent is a registered residential contractor, having been issued license number RR 0032366. On March 29, 1979, Respondent, doing business as Bert Kinast Construction Co., entered into a contract with Gary and Harriet Nelson to construct a residence for the sum of $65,122. On April 15, 1979, Respondent signed an affidavit stating that all bills for materials and labor performed as of that date for the construction of the Nelson residence had been paid. Respondent signed the affidavit for the express purpose of obtaining a draw payment for construction performed and, as a result of the affidavit, did receive a draw payment of $9,765.30. At the time Respondent signed the affidavit, Panama Machinery & Supply Co. was owed $193.98 for material furnished to Respondent for the construction of the Nelson residence. On June 4, 1979, Respondent signed an affidavit stating that all bills for materials and labor performed as of that date for the construction of the Nelson residence had been paid. Respondent signed the affidavit for the purpose of receiving a draw payment for construction performed and, as a result of the affidavit, did receive a draw payment of $22,792.70. At the time Respondent signed the affidavit, he owed Panama Machinery & Supply Co. $1,249.94. During August, 1979, Respondent signed an affidavit stating that all bills for materials and labor performed for the construction of the Nelson residence had been paid. At the time Respondent signed the affidavit, certain materialman and subcontractors who furnished labor and material for the Nelson construction project were not paid, to wit: Panama Machinery & Supply Co., Coastal Insulation, West Florida Natural Gas Company, Culligan Water Services, Inc., Dixie Window Co. and Rachel's Lighting & Home Accessories. Respondent violated Section 1115.7 of the 1979 Edition of the Standard Building Code by not providing adequate head room in the stairwell at the Nelson residence. On or about August 3, 1979, Respondent entered into a contract with John C. and Barbara L. McHaffie to construct a residence for the sum of $105,475. On or about October 11, 1979, Respondent endorsed an instrument, specifically a check, acknowledging that all bills for labor and materials furnished for the McHaffie residence had been paid in full. Respondent endorsed the check to obtain payment for construction he had performed to that date. At the time Respondent signed the check containing that acknowledgment, certain material-men and subcontractors were unpaid, to wit: Buckley's Plumbing, Moore Concrete Products, William Smith and Panama Machinery & Supply Co. On or about November 20, 1979, Respondent endorsed an instrument, specifically a check, acknowledging that all bills for labor and materials furnished for the McHaffie residence had been paid in full. Also on November 20, 1979, Respondent signed an affidavit entitled "Partial Release of Lien on Progress Payment," stating that all bills for labor and materials furnished for the construction of the McHaffie residence were paid in full. Respondent endorsed the check and signed the affidavit in order to obtain a construction draw and did, as a result, obtain the construction draw for labor and materials used in the construction of the McHaffie residence. At the time that Respondent endorsed the check and signed the affidavit, certain materialmen and subcontractors were not paid, to wit: Parker Heating & Cooling, Culligan Water Services, Inc. , Moore Concrete Products, Overhead Door Company of Panama City, Inc., Coastal Insulation, Panama Machinery & Supply Co., G & H Building Materials and William Smith. Respondent received $50,937.50 which was to be used by Respondent to pay for materials and/or labor provided by various materialmen and/or subcontractors for the construction of the McHaffie residence. Certain materialmen and/or subcontractors were not paid from the monies received by Respondent for that purpose, to wit: Parker Heating & Cooling, Culligan Water Services, Inc., Buckley's Plumbing, Moore Concrete Products, Overhead Door Company of Panama City, Inc., Coastal Insulation, Hodges Lumber, Panama Machinery & Supply Co., G & H Building Materials and William Smith. On August 17, 1979, Respondent obtained permit number 5260 from Bay County, Florida, to perform the McHaffie construction. Respondent represented on the application for the above-referenced permit that his estimate of the building costs for the McHaffie residence was $57,250. Since the contract for the McHaffie residence was for $105,475, the price of the building permit would have been nearly $160 more since Bay County charges $3 permit cost per every $1,000 construction cost. During his construction of the McHaffie residence, Respondent violated Sections 1603 and 1706.8(1) of the 1979 Edition of the Standard Building Code in that the concrete floor in some areas was less than three and a half inches thick and caulking or flashing was not installed around the sliding glass doors. On or about November 25, 1981, Respondent was convicted of passing a worthless check, in violation of Section 832.05, Florida Statutes. Respondent's worthless check was given by Respondent to West Building Materials on or about March 25, 1981, as payment for building materials.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding the Respondent guilty of the allegations contained within the Administrative Complaint, suspending Respondent's license as a registered residential contractor; for a period of three years, imposing an administrative fine against Respondent in the amount of $1,000 and placing Respondent on probation for three years upon reinstatement of his license, with the terms and conditions thereof to be set by the Board. DONE and RECOMMENDED this 8th day of March, 1983, in Tallahassee, Leon County, Florida. LINDA M. RIGOT, 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 8th day of March, 1983. COPIES FURNISHED: John O. Williams, Esquire J. K. Linnan, Executive Director 547 North Monroe Street, Construction Industry Licensing Suite 204 Board Tallahassee, Florida 32301 Post Office Box 2 Jacksonville, Florida 32201 Mr. Berthold Kinast 1244 Airport Road Panama City, Florida 32401 Frederick Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
