The Issue The issue is whether Petitioner's bid was responsive to the Department of Health and Rehabilitative Services' Invitation to Bid 590:2248 for lease space in Lake County, Florida.
Findings Of Fact Department of Health and Rehabilitative Services issued its Invitation to Bid (ITB) No. 590:2248 for lease space in Lake County, Florida. The ITB contained bidder specifications, evaluation criteria and documentation requirements. Petitioner Kevin T. Roberts submitted a bid within the time limits of the ITB. Petitioner Roberts attended a pre-bid conference conducted by HRS. In its ITB, HRS reserved the right to reject any and all bids. The ITB required that the bid must show control of the property by the owner of record, a lease with documentation, an option to purchase with documentation, or an option to lease with authority to sublease with documentation. The ITB required that the successful bidder enter into a lease with HRS on the lease form attached to the ITB as Attachment E (Joint Exhibit 1). This lease form required exclusive-use parking spaces. The ITB required a minimum of 300 parking spaces. Petitioner was present at the pre-bid conference where the exclusive nature of parking spaces required by the bid was discussed. Petitioner's bid contains 30 exclusive-use parking spaces. The site plan of the Lake Hills Shopping Center submitted with Roberts' bid shows a total of 378 parking spaces for the entire shopping center. Approximately one-half of the space in the center is included in the bid proposal. The available parking spaces are insufficient to meet the minimum requirements of the ITB. The shopping center involved in the bid proposal has approximately 40,000 square feet of lease space which was not included in the bid proposal. Diamondhead Partnership is a partnership under the laws of the State of Florida, and Kevin T. Roberts and Thomas E. Smith are the general partners of the partnership. Diamondhead Partnership holds an option to lease and authority to sublease 45,000 square feet of the commercial space located in the Lake Hills Shopping Center. Kevin T. Roberts submitted a bid proposal in his individual name for 45,000 square feet of commercial space located in the Lake Hills Shopping Center in Eustis, Lake County, Florida. The documentation to show control of the property filed by Roberts with his bid contained a copy of Diamondhead Partnership's lease option. Thomas E. Smith, the other general partner in Diamondhead Partnership, submitted a bid proposal in his individual name for the same 45,000 square feet of commercial space located in the Lake Hills Shopping Center in Eustis, Lake County, Florida, and relied on the same copy of Diamondhead Partnership's lease option. Kevin T. Roberts does not have control of the property that is the subject of his bid proposal. The ITB requires that the name of the entity submitting the bid be identified and, if a partnership, that the name of the partnership be typed or stamped on the bid. Further, Roberts used his personal social security number on his bid and not the partnership's tax ID number. The ITB requires the social security number or tax ID number of the entity submitting the bid. Diamondhead Partnership, the entity with control of the property, did not file a bid in this case.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Health and Rehabilitative Services enter a Final Order rejecting the bid of Kevin T. Roberts as nonresponsive to ITB 590:2248. DONE and ENTERED this 28th day of January, 1991, in Tallahassee, Florida. DIANE K. KIESLING 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 28th day of January, 1991. APPENDIX TO RECOMMENDED ORDER The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on the proposed findings of fact submitted in this case. Specific Rulings on Proposed Findings of Fact Submitted by Respondent, Department of Health and Rehabilitative Services Each of the following proposed findings of fact is adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 1(1); 3-17(2-16); and 19(19) Proposed findings of fact 2 and 18 are irrelevant. COPIES FURNISHED: Frances S. Childers, Assistant Counsel HRS District 3 Legal Office 1000 N.E. 16th Avenue Gainesville, FL 32609 Joe A. McClain, Attorney at Law McClain, Dwyer & Sestak, P.A. Post Office Box 4 402 East Church Avenue Dade City, FL 33526 Sam Power, Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Linda K. Harris Acting General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
The Issue Whether the Petitioner, Willis Phillips, may challenge the specifications of the invitation to bid at issue in this proceeding? Whether the Petitioner has standing to challenge the Department of Health and Rehabilitative Services' proposed award of lease number 590:2166 to the Intervenor, Rutherford Rentals, Inc.?
Findings Of Fact The Department issued an Invitation to Bid for Existing Facilities, lease number 590:2166 (hereinafter referred to as the "ITB"), seeking to rent office space in Madison, Florida. Responses to the ITB were to be filed with the Department by 2:00 p.m., March 6, 1990. Included as part of the ITB was a map of the City of Madison (hereinafter referred to as the "Map"). Joint Exhibit 1. On page 1, paragraph 3, of the Bid Submittal Form which was included as part of the ITB it was indicated that "[s]pace to be located in Madison, Florida within boundaries depicted in the attached map (Attachment B.) Bidder to mark location of site on map Attachment B." The ITB referred to the Map as a "Map showing bid zone boundaries." See page 4 of the ITB. The Map was labeled as "Attachment B" and included the following language at the bottom of the Map: "WITHIN CITY LIMITS WITH EXCEPTIONS OF UNDESIRABLE LOCATIONS AS INDICATED." The Map included two areas within the City of Madison which were cross- hatched. At the bottom of the Map the word "UNDESIRABLE" had been written in black. This word only appears below the larger of the two cross-hatched areas. The Department intended to exclude any office space located within both of the cross-hatched areas on the Map. The Petitioner spoke by telephone with Robert Smith, a Facilities Services Managers Assistant for the Department, prior to submitting a response to the ITB. The Petitioner initiated the conversation. Based upon this conversation, the Petitioner was aware that property located within either of the cross-hatched areas on the Map was excluded from consideration under the ITB. The property which the Petitioner intended to offer to the Department in response to the ITB is located in the smallest of the two cross-hatched areas on the Map. The Petitioner was informed by Mr. Smith that the property located within the smaller cross-hatched area was excluded as undesirable. Mr. Smith informed the Petitioner that he could not submit a response to the ITB offering to rent property located in the small cross-hatched area. The exclusion from consideration of property located in the areas within the City of Madison which were located in the two cross-hatched areas of the Map could have been more clearly designated. The Department's designation of the excluded areas, however, was not ambiguous. It was clear that the Petitioner's property was located in an excluded portion of the City of Madison and that the Petitioner was aware of the exclusion of his property. Despite the Petitioner's knowledged that his property was located within an excluded area, the Petitioner submitted a response dated March 6, 1990, to the ITB proposing property located in the smaller cross-hatched area. In the Petitioner's response to the ITB he did not indicate the location of his property on the Map. Instead, the Petitioner submitted a different map of a portion of the City of Madison which included his property. Rules 10-13.006 and 10-13.007, Florida Administrative Code, require that protests of the bid specifications of the Department must be filed within 72 hours of receipt of notice of the bid specifications. The ITB did not indicate that persons adversely affected by the ITB could challenge the specifications of the ITB or that any such challenge had to be filed within 72 hours of receipt of notice of the ITB. The following statement appears of the last page of the Bid Submittal Form included with the ITB and submitted by the Petitioner: I hereby certify as owner, officer, or authorized agent that I have read the Invitation to Bid Package and all its attachments, and agree to abide by all requirements and conditions contained therein. . . . This certification was signed by the Petitioner. The Department decided to award the lease to the Intervenor. The Department determined that the Petitioner's bid should be rejected because the proposed property was located in an excluded area. The Petitioner filed a Formal Protest and Petition for Formal Administrative Hearing on April 23, 1990, with the Department. The Petitioner challenged the Department's proposed award of the lease to the Intervenor and asserted that he was the lowest and best bidder. The Petitioner did not challenge the specifications of the ITB. The Department filed a Motion to Dismiss on Mazy 4, 1990. The Petitioner filed a Motion for Leave to File Amended Petition and an Amended Formal Protest and Petition for Formal Administrative Hearing on May 14, 1990. For the first time, the Petitioner challenged the specifications of the ITB.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order granting the Department's Motion to Dismiss and dismissing with prejudice the Formal Protest and Petition for Formal Administrative Hearing filed by the Petitioner. DONE and ENTERED this 12th day of July, 1990, in Tallahassee, Florida. LARRY J. SARTIN 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 12th day of July, 1990. APPENDIX The Petitioner and the Department have submitted proposed findings of fact. It has been noted below which proposed findings of fact have been generally accepted and the paragraph number(s) in the Recommended Order where they have been accepted, if any. Those proposed findings of fact which have been rejected and the reason for their rejection have also been noted. The Petitioner's Proposed Findings of Fact Proposed Finding Paragraph Number in Recommended Order of Fact Number of Acceptance or Reason for Rejection 1-2 See 9. 3-5 Not supported by the weight of the evidence. 6 6-7. 7 and 11 Not relevant. 8-10 and 12-15 These proposed findings are consistent with Ms. Goodman's testimony. Ms. Goodman's opinions, however, are not supported by the weight of the evidence. Although this proposed finding of fact is generally true, the weight of the evidence failed to prove that the Petitioner was not aware that both cross-hatched areas were excluded areas. See 9. The Department's Proposed Findings of Fact Proposed Finding Paragraph Number in Recommended Order of Fact Number of Acceptance or Reason for Rejection 1 1. 2 2 and hereby accepted. 3 5-8. 4 7. 5 6. 6 12. 7 9. 8 13 and 17. 9 4. 10 12. 11 17. 12 15. 13 16. 14 18 and hereby accepted. 15 20. 21 and hereby accepted. 22 and hereby accepted. Hereby accepted. Cumulative. Hereby accepted. Copies Furnished To: John C. Pelham, Esquire Gary Walker, Esquire Post Office Box 13527 Tallahassee, Florida 32317-3527 John L. Pearce, Esquire District Legal Counsel Department of Health and Rehabilitative Services 2639 North Monroe Street Tallahassee, Florida 32303-2949 Clay A. Schnitker, Esquire Post Office Drawer 652 Madison, Florida 32340 Sam Power, Agency Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0500
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 issue in this proceeding is whether the Respondent, the Department of Insurance, acted illegally, arbitrarily, fraudulently, or dishonestly in rejecting all bids for lease #460:0119 and not awarding subject lease to Petitioner.
Findings Of Fact The Department of Insurance established a requirement to lease 5371 square feet of office space in Daytona Beach, Florida, and a "Request for Space Need" was approved by the Department of Management Services on February 11, 1998. The Department of Insurance subsequently issued a Request for Proposal (RFP) for lease #460:0119 (Respondent's Exhibit 1). A non-mandatory pre-bid conference was held on June 1, 1998, in Daytona Beach and two prospective bidders, Petitioner and Nova Village Market partnership attended. The RFP provided that proposals which did not meet all mandatory requirements of the RFP would be rejected as non- responsive. The RFP provided for evaluation criteria are awards factors. The awards factors totaled 100 points with no minimum point total required. Ten of the points were allotted for moving costs defined as the costs of relocating communications, networks, furniture and other equipment. This factor gave the current landlord an automatic 10-point advantage since there would be no relocation costs. Moving costs provisions tend to discourage the presentation of bids because the bidders have to overcome an automatic 10-point advantage provided the current landlord. The RFP also provided that all proposals could be rejected, however, such "rejection shall not be arbitrary, but be based on strong justification." None of the conditions of the RFP were questioned or challenged by interested parties. Two responses were received by the Department of Insurance in response to the RFP and these were opened in Respondent's Tallahassee office on July 8, 1998, by Mr. Kip Wells of the Department. One was received from the current landlord, Nova Village Partnership, hereafter Nova, and the other from the Petitioner. The Nova proposal was deemed non-responsive. Neither Nova nor Petitioner contested the determination that Nova's proposal was non-responsive. Only one responsive proposal, the Petitioner's proposal, remained. On July 9, 1998, the Department representative, Mr. Kip Wells, called Petitioner to schedule an appointment for 9:00 a.m., on July 10, 1998, to visit and evaluate the proposed facility. No persons from the Department appeared at the scheduled appointment. At 10:45 a.m., on July 10, 1998, Kip Wells called Petitioner to say that since Petitioner's proposal was the only responsive proposal received, and that "all bids" were being rejected. Mr. Wells testified at hearing. His reason for rejecting the remaining bid was: When I saw that it was obvious the current landlord was not going to be very cooperative, I decided that one choice was not enough. If we were going to have to make a move, we needed more than one thing to choose from. So, I immediately - - since I had already set up with local people in Daytona to tell them that I was coming down to evaluate the bids, I sent them an E-mail and told them that I would not be meeting the following day to evaluate the bids. Mr. Wells decided to reissue the RFP without any moving costs criteria, and redistribute those 10 points among the other award factors. Petitioner filed a Notice of Intent to Protest and then a Formal Protest, both in a timely fashion. There is no state policy prohibiting the award of a lease to a sole bidder on a RFP. The "Leasing Policy" of the Department of Insurance states that "The Lease Administrator, with assistance from the Division employees, will establish bid or quote specifications. These specifications will include special needs for the Division(s) as well as the evaluation criteria upon which to evaluate the proposals." Neither the Department's Lease Policy (Petitioner Exhibit 3) nor the State's Real Property Leasing Manual (Petitioner's Exhibit 4) give the Lease Administrator the authority to reject or evaluate bid responses. Neither does he have a vote in the bid evaluation process. His responsibility is to coordinate the process. Randall Baker, Manager of Private Sector Leasing of the Bureau of Property Management of the Department of Management Services (hereinafter DMS), testified. The DMS prepares a manual as a guideline for user agencies to assist in the leasing of property. The DMS manual is not binding on agencies and DMS has no review oversight; however, their comments on agencies' leases are reviewed by the state auditing authorities and failure to follow the guidelines can result in audit criticism. Baker confirmed that the agency's written procedures as outlined in the RFP were consistent with the DMS guidelines. The DMS manual states as follows regarding the receipt of only one responsive proposal: When only one responsive proposal is received it may be considered and accepted providing the following conditions are documented: Adequate competition was solicited. The rate is within established rental rate guidelines. The proposal meets stated requirements. The proposal was processed as though other proposals were received. The Petitioner's bid was responsive to the RFP and the lease rate bid by the Petitioner was less than the average rate for state leases in the Daytona area and less than the amount budgeted by the Department for this lease. The lease rate by the Petitioner was reasonably priced and competitive. Although the agency failed to complete the process as envisioned, see paragraph 20 below, this was in no way the fault of Petitioner. The Department's leasing policy requires that the lowest and best response to an RFP be determined through cost analysis and evaluation by an evaluation committee. Mr. Wells did not forward Petitioner's bid to or discuss with the evaluation committee Petitioner's bid, but unilaterally rejected it. It was clear from Mr. Wells' testimony that this was his individual decision and was based upon his personal belief that it was the best thing to do.1 At hearing, the stated justification for rejecting "all bids" was that it gave the Department the opportunity to delete the requirement of moving costs from the awards factors; however, the evidence does not indicate that the moving cost provision result in non-competitive bids. The sole responsive bidder was within the local lease price range and within budget. Neither the Respondent nor DMS has established a policy prohibiting the acceptance of a sole responsive bid if there is competition solicited. The Department of Insurance has accepted a sole bid on at least one project in the past. There was no evidence that the RFP was not an open and fair competition. The evidence shows that it was properly advertised, that all conditions were known, and that all interested parties had an equal opportunity to participate. In sum, there was adequate competition in submitting the bids. Mr. Baker testified regarding the policy of DMS. The DMS policy is that if there is one responsive bidder, there has been competitive bidding. The RFP provides that the Respondent may reject all bids if it has strong justification. See paragraph 5 above. Mr. Baker also provided examples of "strong justification for rejecting proposals." His examples include facilities which are proposed outside the required geographic area, prices considerably in excess of state guidelines and agency budgets, specification changes due to modification of the agency's program requirements, and "intervening external forces." No evidence establishing a strong justification for rejecting the Petitioner's bid was presented. Without completing the process and evaluating the Petitioner's bid, the agency never considered whether the bid was in the state's best interest. However, this was not the fault of the Respondent, and the agency's failure to follow its procedures should not inure to its benefits. Further, Because there was no minimum score required on the evaluation criteria of the RFP, there is no need to evaluate Petitioner's proposal because it is the only responsive proposal. For all the reasons stated above, the rejection of Petitioner's bid was contrary to the terms of the RFP, contrary to state policy, and arbitrary.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is, RECOMMENDED: That a Final Order be entered which finds that: Respondent's actions in rejecting Petitioner's responsive bid were arbitrary; The Respondent did not follow the requirements set forth in the Department of Insurance Leasing Policy, nor the Department of Management Services Real Property Leasing Manual, or the Request for Proposal itself; That no adverse interest to the State or the Department would have occurred had Petitioner's responsive bid been accepted; and therefore, Petitioner's claim shall be upheld as the lowest cost and best proposal for RFP #460:0119, and that the Department of Insurance shall award Petitioner Lease #460:0119. DONE AND ENTERED this 30th day of October, 1998, 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 Filed with the Clerk of the Division of Administrative Hearings this 30th day of October, 1998.
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, the documentary evidence submitted and the entire record compiled herein, I hereby make the following findings of fact. In 1986 DHRS determined the need for a facility in Miami Beach in which to administer various programs, including but not limited to, economic services, food stamps, aged and elderly services and medicaid. In December of 1986 DHRS extended an invitation to bid (Lease No. 590:1802) to individuals or companies interested in providing the type of facility needed in Miami Beach. The Invitation to Bid and Bid Submittal Form for DHRS Lease No. 590:1802 stated that DHRS was seeking approximately 19,198 net rentable square feet of office space to lease within the City of Miami Beach. DHRS desired a ten year lease with a three year option, occupancy by November 1, 1987. January 20, 1987 was established as the bid closing date. The Invitation to Bid and Bid Submittal Form provided in relevant part as follows: Requirements for Bidders to Submit Bids. Control of Property - To submit a responsive bid a prospective lessor must meet one of the following qualifications: Be the owner of record of the facility. Be the lessee of the space to be proposed and present with bid, a copy of lease with documentation of authorization to sublease the facility. * * * (d) Submit documentation of an option to lease the facility with an authori- zation to inturn, sublease. * * * Existing Tenants If the offered space or any portion there- of will be covered by an active lease(s) at the stated availability date, written documentation by the tenant indicating acknowledgment of the bid and ability to vacate premises by the proposed date must be included with the proposal. * * * 14. Parking For this facility the department has determined that a minimum of 120 parking spaces are required to meet its needs. This parking is to be under the control of the bidder, off street, suitably paved and lined. * * * A minimum of 6 spaces of the 120 re- quired must meet the requirements of the Standards for Special Facilities for Physically Disabled, Chapter 13D-1, Florida Administrative Code. 28. Miscellaneous Requirements * * * (8) Bidders must have appropriate and pertinent zoning approval by bid opening date and this must be documented by the City of Miami Beach and such proof must be included as part of the bid submittal form. * * * Attachments Required to be Submitted with Bid Submittal for Existing Building * * * Floor Plan Site Layout * * * Documentation showing bidder as controller of property, if not owner of record. * * * Documented zoning approval from City of Miami Beach. * * * Definition of Terms * * * Existing Building - To be considered as existing, the entire space being bid must be dry and capable of being physically measured to determine net rentable square footage... * * * Evaluation of Bids 1. Bids received are first evaluated to determine technical responsiveness. This includes submittal on bid submittal form, inclusion of required information and date, bid signed and notarized. Non-responsive bids will be withdrawn from further con- sideration. * * * In response to the invitation to bid, four bidders, Procacci, Causeway, Alton Road and Rae Lin Realty (Rae Lin) timely submitted bids to DHRS. After bid openings, DHRS reviewed each bid and prepared an initial comparative synopsis. Upon initial review DHRS determined that Alton Road submitted the only responsive bid. Thereafter, DHRS allowed the three other bidders the opportunity to clarify certain "questionable" parts of their bids in an effort to determine if the bids were in fact non-responsive. After an evaluation of the bid proposals plus the information gathered in the "clarification process," DHRS concluded that the bids of Procacci, Causeway and Rae Lin were non-responsive and that the only responsive bid was that of Alton Road. Procacci's bid was found non-responsive due to an insufficient amount of net square footage and lack of control of parking spaces. Thirteen of the parking spaces offered by Procacci were municipal parking spaces with annual reservations. DHRS allowed Procacci the opportunity to re-measure and possibly re-adjust the square footage submitted in its bid. DHRS also allowed Procacci the opportunity to clarify its control over the municipal parking spaces. Procacci was unable to demonstrate that it could provide the minimum square footage required and could not provide any assurance or documentation that the City of Miami Beach would guarantee the municipal spaces for the full 10 year term of the lease. Procacci's proposal was non-responsive to the invitation to bid. Causeway's bid was found non-responsive because of lack of sufficient net square footage. Causeway was allowed the opportunity to submit floor plans adjusting and clarifying the net square footage contained in its proposal but failed to demonstrate that its proposal would provide the square footage required. Causeway's proposal was non-responsive to the invitation to bid. Rae Lin's bid was found non-responsive because of failure to submit the required zoning approval documentation for the existing building with its bid. Rae Lin was not allowed to clarify this aspect of its bid because zoning approval documentation for the existing building was required to be submitted by the bid opening date. Rae Lin's proposal was non- responsive to the invitation to bid. Alton Road's bid was responsive on its face at the time of bid opening. However, during the initial evaluation process, it was brought to the attention of DHRS that Alton Road might not have actual control over some of its proposed parking spaces. Alton Road was allowed the opportunity to clarify its ability to provide the parking spaces proposed in its bid package. Alton Road was able to demonstrate that it had control over at least 120 parking spaces as called for in the invitation to bid. DHRS found Alton Road's bid responsive in all other respects and gave notice to all bidders of its intent to award the lease to Alton Road, the lowest responsive bidder. Procacci and Causeway submitted timely formal written protests contending that Alton Road's bid is non-responsive. PARKING Alton Road's proposed facility was acquired pursuant to a lease with Potamkin Chevrolet, owner of the property. The lease between Alton Road and Potamkin guaranteed to Alton Road a minimum of one hundred and twenty parking spaces and, if necessary, exclusive right to other parking spaces on property in the proximate vicinity. After bid opening, DHRS was informed by Causeway that two of the parking spaces which Alton Road included in its bid proposal were leased by Potamkin to Causeway and not to Alton Road. During the clarification/evaluation process, Alton Road disputed Causeway's claim and also demonstrated that it's proposal could provide at least 120 parking spaces even if the two parking spaces in question were excluded. In addition, Potamkin owned much of the adjacent property and was bound by its lease with Alton Road to provide 120 exclusive parking spaces. The lease specifically provided that exclusive right to additional parking spaces on property located in the proximate vicinity would be provided if necessary. A portion of Alton Road's proposed parking spaces were being leased by Potamkin to an existing tenant, Miami Beach Wrecker and Towing Services, Inc., at the time of the bid submission. However, there was no evidence that any portion of the property offered by Alton Road would be covered by an active lease of Miami Beach Wrecker or any other tenant on the required availability date of November 1, 1987. The bid submittal form requires that at least six (6) of the one hundred and twenty parking spaces comply with the requirements of the Standards for Special Facilities for the Physically Disabled, Chapter 13D-I, Florida Administrative Code. A complete reading of the bid submittal form in light of Chapter 13D-I, Florida Administrative Code indicates that the invitation to bid contemplated that renovations would be necessary to comply with the handicapped parking specifications and that there was no requirement that the renovations or modifications be completed at the time of bid submission. Alton Road's bid proposal provided for the required six (6) physically handicapped parking spaces. A complete reading of the bid submittal form indicates that bidders were required to include zoning approval for the existing building with their packages but were not required to submit documentation regarding parking space zoning. This interpretation of the bid submittal form's requirements is further supported by the fact that none of the four bidders included documentation as to parking space zoning with their bid proposals and there was no evidence that such a requirement was ever applied to other DHRS bid projects. In its bid proposal, Alton Road submitted one hundred and twenty parking spaces under its control, off-street, suitably paved and lined as required in the invitation to bid. CONTROL OF THE PROPERTY Alton Road's proposed facility was acquired pursuant to a lease between Alton Road and Potamkin Chevrolet. The lease contains a 19 page addendum. Both the lease and addendum are signed by the vice-president of finance of Potamkin Chevrolet. The lease and addendum were executed on January 17, 1987. All signatures on the final page of the addendum are witnessed. The lease specifically states that the addendum is "attached hereto" and "made a part hereof." The bid submitted by Alton Road was responsive to the Invitation to Bid for DHRS Lease Number 590:1802.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, RECOMMENDED that Department of Health and Rehabilitative Services project lease number 590:1802 be awarded to Alton Road Six Corporation. DONE and ORDERED this 15th day of July, 1987 in Tallahassee, Leon County, Florida. W. MATTHEW STEVENSON Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 15th day of July, 1987. APPENDIX TO RECOMMENDED ORDER, CASE NO. 87-1849BID & 87-1850BID 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. Rulings on Proposed Findings of Fact Submitted by the Petitioner (Procacci) Adopted in Finding of Fact 4. Adopted in substance in Finding of Fact 5. Adopted in substance in Finding of Fact 5. Adopted in Findings of Fact 6, 7 and 8. Adopted in substance in Finding of Fact 6. Adopted in substance in Finding of Fact 7. Adopted in substance in Finding of Fact 8. Adopted in substance in Finding of Fact 9. Adopted in substance in Finding of Fact 10. Rejected as subordinate and/or unnecessary. Adopted in Finding of Fact 10. Adopted in substance in Finding of Fact 2. Rejected as misleading and not supported by the weight of the evidence. Rejected as a recitation of testimony and/or misleading. 15. Rejected as a recitation of testimony/evidence and/or misleading. Rejected as a recitation of testimony and/or misleading. Rejected as a recitation of testimony and/or subordinate. Rejected as subordinate and/or unnecessary. Rejected as misleading and/or subordinate. Rejected as not supported by the weight of the evidence. Rejected as misleading, subordinate and/or not supported by the weight of the evidence. Rejected as contrary to the weight of the evidence and/or misleading. Although Procacci was not afforded the opportunity to substitute other parking for the thirteen (13) municipal parking spaces included in its proposal, Procacci was provided the opportunity to demonstrate to DHRS that the municipal parking spaces would be guaranteed by the City of Miami Beach for the entire term of the lease. This, Procacci failed to do. Rejected as contrary to the weight of the evidence. Rulings on Proposed Findings of Fact Submitted by the Petitioner (Causeway) (a) Rejected as contrary to the weight of the evidence. Rejected as contrary to the weight of the evidence. Rulings on Joint Proposed Findings of Fact Submitted by the Respondents and Intervenor Adopted in Finding of Fact 4. Adopted in substance in Finding of Fact 5. Adopted in substance in Finding of Fact 5. Adopted in Findings of Fact 6, 7 and 8. Adopted in Finding of Fact 6. Adopted in Finding of Fact 7. Adopted in Finding of Fact 8. Adopted in Findings of Fact 6, 7, 8 and 9. Adopted in Findings of Fact 6, 7 and 8. Rejected as subordinate and/or unnecessary. Rejected as subordinate and/or unnecessary. Adopted in Finding of Fact 9. Adopted in Finding of Fact 10. Rejected as subordinate and/or unnecessary. Adopted in substance in Finding of Fact 10. Adopted in substance in Finding of Fact 2. Adopted in Findings of Fact 3 and 15. Adopted in Findings of Fact 3 and 15. Partially adopted in Finding of Fact 15, matters not contained therein are rejected as subordinate. Adopted in substance in Finding of Fact 15. Adopted in Finding of Fact 3. Rejected as subordinate and/or unnecessary. Adopted in Finding of Fact 3. Adopted in Finding of Fact 16. Adopted in Finding of Fact 17. Adopted in Finding of Fact 12. Adopted in substance in Finding of Fact 12. Addressed in Conclusions of Law section. Adopted in Finding of Fact 13. Adopted in substance in Finding of Fact 13. Adopted in substance in Finding of Fact 17. Adopted in substance in Finding of Fact 18. Adopted in substance in Finding of Fact 18. Addressed in Conclusions of Law section. Adopted in substance in Finding of Fact 6. Adopted in Finding of Fact 3 and 36. Adopted in Finding of Fact 3 and 36. Adopted in substance in Finding of Fact 14. Adopted in Finding of Fact 9 and 19. Addressed in Conclusions of Law section. COPIES FURNISHED: M. Carmen Dominguez, Esquire Robert Rich 401 North West Second Avenue Causeway Properties, Inc. Suite 790 160 Sunny Isles Blvd. Miami, Florida 33128 North Miami, Florida 33160 Louisa P. Maurer Pedro Munilla, Esquire Acting Administrator 1401 South West First Street HRS District XI Suite 210 401 North West Second Avenue Miami, Florida 33135 Room 939 Miami, Florida 33128 Gregory L. Coler Secretary Thomas Hinners Department of Health Procacci Real Estate and Rehabilitative Services Management Co. Ltd. 1323 Winewood Blvd. 3200 North Federal Highway Tallahassee, Florida 32399-0700 Suite 221-A Boca Raton, Florida 33431 John Miller, Esquire Acting General Counsel Pablo I. Lopez Department of Health and Facilities Service Mgr. Rehabilitative Services Suite 950 1323 Winewood Blvd. 401 North West Second Avenue Tallahassee, Florida 32399-0700 Miami, Florida 33138 Sam Power Department of Health and Rehabilitative Services 1323 Winewood Blvd. Tallahassee, Florida 32399-0700
Findings Of Fact At all times material hereto, Respondent has been a licensed real estate salesman with license number 0364554. On or about August 13, 1982, Richard J. and Gav Greco entered into a lease purchase agreement with James C. and Phyllis Waid for residential property located at 1685 Markham Woods Road, Longwood, Florida. The purchase price of the Waid property was $190,000 towards which the Grecos made a $10,000 non-refundable deposit and agreed to pay a monthly rental of $1000. On or about November 14, 1982, the Grecos executed an Agreement with Respondent and his wife by which the Grecos assigned all rights and privileges relating to the lease and purchase of the residence at 1685 Markham Woods Road to the Alvarados. The consideration to be given for this Agreement was a payment of $10,000 by the Alvarados to the Grecos, with $5000 payable upon signing of the Agreement and $5000 payable within six months. The Alvarados, as assignees, agreed to abide by all provisions of the lease purchase agreement and were to make their first $1000 monthly lease payment to the Waids on December 4, 1982. Respondent gave Richard J. Greco a check in the amount of $5000 dated November 14, 1982 and requested that he hold the check for a couple of days before depositing it. Greco complied with the request, but was advised on December 3, 1982 that Respondent's $5000 check had been returned unused by Respondent's bank due to the fact that Respondent's account had been closed. Respondent has never paid the Grecos any part of the $10,000 due them under the assignment executed November 14, 1982. Respondent made no monthly lease payments on the property to the Waids. By letter dated February 25, 1983, James C. Waid notified the Grecos and the Alvarados that the lease purchase agreement was in default and that the $10,000 deposit paid by the Grecos was being forfeited because the rent was in arrears. The Grecos paid the Waids an additional $4000 on March 1, 1983, which represented the unpaid lease payments, for a general release from all obligations under the lease purchase agreement. Respondent and his wife executed a promissory note on March 1, 1983 whereby they agreed to pay the Grecos $10,000 on or before March 16, 1983, but no payments have ever been made pursuant to this promissory note. The Grecos brought suit against Respondent and his wife for damages arising out of this transaction, and obtained a Final Judgment on June 30, 1983 in Case No. 83-1191-CA-03-P, Circuit Court in and for Seminole County, in the amount of $15,101.28. The Grecos have not been able to execute this Final Judgment and therefore no payments on this judgment have been made to them by the Respondent or his wife. At the time of this transaction, the Alvarados were family friends of the Grecos. Richard J. Greco entered into this transaction with Respondent primarily because of the personal acquaintance and not because Respondent was a licensed real estate salesman. However, Greco knew that Respondent was licensed and therefore assumed that he was a man of integrity who would deal fairly with him in this real estate transaction.
Recommendation Based upon the foregoing, it is recommended that a Final order be issued suspending Respondent's license for a Period of one (1) Year. DONE and ENTERED this 26th day of August, 1985, in Tallahassee, Florida. DONALD D. CONN, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Fl. 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 26th day of August, 1985. COPIES FURNISHED: Susan Hartmann, Esquire Department of Professional Regulation Division of Real Estate 400 W. Robinson St. Orlando, Fl. 32802 Ignacio J. Alvarado 5166 Glasgow Avenue Orlando, Fl. 32819 Harold Huff Executive Director Division of Real Estate 400 W. Robinson Street Orlando, Fl. 32802 Salvatore A. Carpino General Counsel Department of Professional Regulation 130 N. Monroe St. Tallahassee, Fl. 32301 Fred Roche, Secretary Department of Professional Regulation 130 N. Monroe St. Tallahassee, Fl. 32301
Findings Of Fact During March 1988, the Respondent issued an Invitation to Bid by which it sought to lease 17,973 net usable square feet of office space to be located within a specified geographic area in Tampa, Florida, under a nine year lease with two additional three year option periods. This Invitation to Bid is referred to as Lease Number 590:1927. Three bids were received in response to the Invitation to Bid, and they were opened on May 13, 1988. Bids were received from the Petitioner, 8900 Centre, Ltd., and the Allen Morris Management Company. All bidders were determined to be responsive to the Invitation to Bid. Despite the fact that petitioner submitted the lowest bid, Respondent notified Petitioner by letter dated June 10, 1988, of its intent to award Lease Number 590:1927 to 8900 Centre, Ltd., as the lowest and best bidder. Petitioner has timely filed its protest seeking review of that decision. It is undisputed that Petitioner submitted the lowest bid. For the first year of the lease, Petitioner bid $7.85 per square foot, while 8900 Centre bid $7.95 per square foot. Thereafter, Petitioner proposed a yearly increase of 50 cents per square foot, reaching $11.85 per square foot in the ninth year of the lease, while 8900 Centre proposed annual increases of approximately 75 cents, reaching $14.00 per square foot in the ninth year. This equates to an actual dollar difference over the nine year term of approximately 185,000. However, using a present value methodology and a present value discount rate of 8.81 percent referred to on page 17 of the bid submittal form, the present value difference in these two bids is approximately $1,000 per month, which would result in a present value difference between Petitioner and 8900 Centre of approximately $108,000 over the nine year period. Neither the Invitation to Bid, bid specifications, nor the actual bids were offered into evidence. One page of the bid submittal form, designated as page 17 of 18, was offered and received in evidence. This portion of the bid submittal form states that the "successful bid will be that one determined to be the lowest and best." It also sets forth evaluation criteria, and assigns weights to each criteria. The evaluation criteria include associated fiscal costs (35 points), location (40 points) and facility factors (25 points) . A synopsis of bids was also offered and received in evidence showing the points awarded to each bidder by the Respondent's bid evaluation committed. Out of a possible 100 points, 8900 Centre received 95.17 points, while Petitioner received 82.25 points and the Allen Morris Management Company received 70.67 points. Petitioner asserts that the members of the evaluation committee were not qualified or knowledgeable in basic construction, design and engineering principles, and therefore could not competently evaluate the bids submitted. However, Petitioner did not offer competent substantial evidence to support this contention. Only the chairperson of the committee, Susan Jennings, was called to testify, and she appeared thoroughly knowledgeable in the bid process, the needs of the agency, the bid requirements and the representations made to the committee members by each bidder, including Petitioner, when the committee made its site visit to each location. Since the actual Invitation to Bid, bid specifications, and evidence about the other committee members were not introduced, it is not possible to know what the specific duties of the committee were, how they were to carry out their duties their qualifications and training, and whether they failed to competently carry out these duties, as alleged by Petitioner. Despite Petitioner's lower bid, Respondent awarded this lease to 8900 Centre, Ltd., based upon the evaluation committee's determination assigning 8900 Centre the highest number of evaluation points. Out of a possible 35 points for fiscal costs, Petitioner received 34 and 8900 Centre received 31.5. Thus, Petitioner's status as low bidder is reflected in the points awarded by the committee. Since neither the bid invitation or specifications were introduced, no finding can be made as to whether the difference between these two bidders comports with any instructions or directions provided by the agency to potential bidders, or whether this difference of 2.5 points on this criteria reasonably reflects and accounts for the dollar difference in these two bids. Petitioner received 34.75 points out of a possible 40 points on the general evaluation criteria "location," while 8900 Centre received the full 40 points. Within this criteria, there were three subcategories, and on the first two subcategories (central area and public transportation) there was an insignificant difference of less than one-half point between Petitioner and 8900 Centre. The major difference between these two bidders which accounts for their significant difference on the location criteria, was in the subcategory of environmental factors, in which Petitioner received 15.17 points and 8900 Centre received the full 20 points. Petitioner did not present competent substantial evidence to discredit or refute the committee's evaluation in the subcategory of environmental factors. To the contrary, the only testimony from a committee member was that of Susan Jennings, and according to her, Petitioner failed to explain the availability of individual air conditioning and heating controls, or the possibility of separate program entrances, which could be made available under its bid. Although Petitioner sought to explain at hearing that these desires of the agency could be accommodated in its bid, there is no evidence that such an explanation was provided in its bid or during the bid process when the evaluation committee visited the Petitioner's site. The committee was aware, however, that 8900 Centre would provide individual heating and air conditioning controls, as well as separate outside entrances for the three programs which would occupy the leased space. Additionally, the committee was concerned, according to Jennings, that parking areas at Petitioner's facility were more remote and removed from the building entrance than at 8900 Centre, and were somewhat obscured by trees and shrubbery, thereby presenting a potential safety concern for employees working after dark. Finally, every employee would either have a window or window access at 8900 Centre, while it was not explained that Petitioner's site would offer a similar feature. Thus, Petitioner failed to establish that the evaluation committee erred in assigning a significantly greater number of points for environmental factors to 8900 Centre than to Petitioner. The evidence reflects a reasonable basis for this difference. The other significant difference between these two bidders was in the subcategory for layout and utilization under the evaluation criteria "facility." Petitioner received 13.67 points while 8900 Centre received a full 20 points. Jennings explained that the separate outside entrances leading directly into the three programs that would occupy this space was preferred to a single reception area for all three programs. Petitioner offered the single reception area in its bid and site visit presentation, while 8900 Centre made it clear that each program would have its own entrance. Since these programs do not have a receptionist position, and none wanted to give up a secretarial position to serve as receptionist for all three programs, the committee did not consider the single reception area entrance to be desirable. Additionally, Petitioner's facility was a two-story building, while 8900 Centre is a single story facility. Jennings explained that the committee considered a ground level facility to be preferable to a two story building, particularly since the Medicaid program was to occupy the major portion of this space. The Medicaid program would have to be split up at Petitioner's facility, either in two separate buildings or on two levels of the same building, while at 8900 Centre, Medicaid could be accommodated in one, single story building, with the other two programs in a second, single story building. Finally, parking at 8900 Centre was directly next to, and outside the entrance of the building, while Petitioner offered to make assigned spaces available in a general parking area which serves its entire 100,000 square foot complex. The parking offered by Petitioner is more remote than that offered by 8900 Centre, and would be less secure at night due to a greater distance from the building entrances and the parking lot. Thus, Petitioner failed to establish that the committee erred in assigning a significantly greater number of points for layout and utilization to 8900 Centre than to Petitioner. There is a reasonable basis for this difference, according to the evidence in the record.
Recommendation Based upon the foregoing, it is recommended that Respondent enter a Final Order dismissing Petitioner's protest to Lease Number 590:1927. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 9th day of December 1988. DONALD D. CONN Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1050 Filed with the Clerk of the Division of Administrative Hearings this 9th day of December 1988. APPENDIX (DOAH Case Number 88-3765 BID) Rulings on Petitioner's Proposed Findings of Fact: Adopted, in part, in Finding of Fact 1, but Rejected in Finding of Fact 10, and otherwise as not based on competent substantial evidence in the record. Adopted in Finding of Fact 5. 3-5. Adopted in Finding of Fact 4, but Rejected in 7. 6-7. Rejected in Finding of Fact 8. Rejected in Finding of Fact 10, and otherwise as not based on competent substantial evidence in the record. Rejected in Findings of Fact 9 and 10, and otherwise as not based on competent substantial evidence. Rulings on the Respondent's Proposed Findings of Fact: Adopted in part in Finding of Fact 1, but otherwise rejected as not based on competent substantial evidence. Adopted in Finding of Fact 4. 3-4. Adopted in part in Findings of Fact 5 and 6, but otherwise rejected as not based on competent substantial evidence in the record of this case. Adopted In Findings of Fact 5, 7-10. Adopted in Finding of Fact 5. Adopted in Finding of Fact 7. Adopted in Finding of Fact 8. Rejected as irrelevant and unnecessary since the point difference in this subcategory is insignificant. Adopted in Finding of Fact 9. 11-12. Adopted in Finding of fact 10. COPIES FURNISHED: Michael V. Giordano, Esquire 7821 North Dale Mabry Suite 100 Tampa, Florida 33614 Jack Farley, Esquire W. T. Edwards Facility 4000 West Buffalo Fifth Floor, Room 520 Tampa, Florida 33614 Sam Power, Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Gregory Coler, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 John Miller, General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
The Issue The issue in this case is whether Respondent, the Department of Children and Families, properly rejected all bids received on an Invitation to Bid on Proposed Lease No. 590:2622.
Findings Of Fact The Existing Lease and the Decision to Look for New Space. District 7 of the Respondent, the Department of Children and Families (at all times relevant to this proceeding, the Department of Children and Families was known as the Department of Health and Rehabilitative Services)(hereinafter referred to as the “District”), leases approximately 26,955 spare feet of office space located in Palm Bay, Brevard County, Florida. The space is used as a client service center. Pursuant to the District’s current lease, the lease will expire on April 30, 1997. The current lease (hereinafter referred to as the “Existing Lease”) was still in effect at the time of the formal hearing of this matter. The Existing Lease also provides for a five-year renewal. For the first two years of the renewal period, the Existing Lease provides for a rental rate of $11.50 per square foot. For the third and fourth years of the renewal the rate is $11.75 and for the last year, $12.00. In June of 1995, the District submitted a Letter of Agency Staffing (hereinafter referred to as a “LAS”) and a Request for Prior Approval of Space Need (hereinafter referred to as a “RSN”), to the Department of Management Services. Pursuant to the LAS and RSN, the District sought approval from the Department of Management Services to seek a new lease of 26,872 square feet of office space in Palm Bay. The reasons given for seeking approval of a new lease set out in the RSN were as follows: New Service Center in Brevard County(Palm Bay Area). The existing lease is up! 4/30/97. The current space does not adequately provide for : (1) Secured storage, visitation areas, and case file storage. The June of 1995, RSN was approved. The District, however, did not immediately seek the approved space. The evidence failed to prove why. In July of 1996 the District submitted another Request for Space Need (hereinafter referred to as the “Second RSN”). The same amount of space was sought and the same justification for seeking new space was described in the Second RSN. The Second RSN was approved by the Department of Management Services on or about July 8, 1996. The RSN and the Second RSN were prepared by Jim Birch. Mr. Birch is the District’s Facilities Services Manager. The reason for seeking a new lease set out in the RSN and the Second RSN was provided to Mr. Birch by Bill Rawlings and Philip Penley. Mr. Penley is the District’s Sub-District Administrator for Brevard County. Mr. Rawlings is the Program Administrator for Brevard County. The Existing Lease was first entered into in 1977. The amount of space leased has increased over the years and is located in more than one building. Mr. Penley decided to request approval to seek new space in the hopes that the client service center in Palm Bay could be moved under one roof and in the hopes that more ideal space could be obtained. The representation in the RSN and the Second RSN that the existing space “does not adequately provide for: (1) Secured storage, visitation areas, and case file storage” is misleading and incorrect. The programs located in the existing space in Palm Bay can, in fact, be carried out without relocating. The Invitation to Bid. The District released an Invitation to Bid (hereinafter referred to as the “ITB”), between July 16 and July 19, 1996. The ITB provided that the “Project Contact Person” was Mr. Birch. The ITB sought bids on proposed lease number 590:2622, for approximately 26,872 square feet of office space in an existing building. The ITB sought office space in Palm Bay. The building was to be used as the District’s client service center. The term of the lease was to be ten years with five one-year optional renewal periods. The ITB scheduled a pre-bid meeting for August 8, 1996. Attendance at the meeting was not mandatory. The ITB specified, however, that “information and explanations provided at this meeting must be complied with by the bidder ” A representative of Petitioner, Executive Ventures (hereinafter referred to as “Executive”), attended the pre-bid meeting on August 8, 1996. During that meeting, the lessor under the Existing Lease asked questions about the renewal terms of the Existing Lease. Executive’s representative informed Executive of the discussions soon after the meeting. Executive was, therefore, aware of the existence of the Existing Lease and the fact that it could be renewed prior to submitting a bid in response to the ITB. The ITB provided that bids could be submitted at any time up to 10:00 a.m., September 12, 1996. Bids were to be opened at the close of the bidding period. The ITB provided that all bids received were to be evaluated first for technical responsiveness. Nonresponsive bids were to be withdrawn from further consideration. Responsive bids were to be presented to a bid evaluation committee “for comparison and formulation of a recommendation for award.” The ITB informed potential bidders that the District reserved the right to reject all bids received in response to the ITB. The first page of the ITB provides that “[t]he Florida Department of [Children and Families] reserves the right to reject any and all bids and award to the bid judged to be in the best interest of the state.” At page A1-5-8 of the ITB the following is provided concerning the rejection of bids: ITB. REJECTION OF BIDS 1. The department reserves the right to reject any and all bids when such rejection is in the interest of the State of Florida. Such rejection shall not be arbitrary, but be based on strong justification which shall be communicated to each rejected bidder by certified mail. [Emphasis in original]. . . . . Bids Submitted in Response to the ITB. A total of four bids were submitted in response to the The bids were opened on September 12, 1996. A bid tabulation sheet was prepared by Mr. Birch. The annual rental rates per square foot for the ten years of the lease were included on the tabulation as required by the ITB. Pursuant to the ITB, no other information was provided at the time the bids were opened and tabulated Executive submitted one of the four bids. Executive’s bid consisted of 90 to 100 pages. Executive expended a good deal of effort and incurred expenses in the amount of approximately $17,000.00 in preparing its bid. The suggestion that Executive incurred unnecessary expenses is not supported by the weight of the evidence. The rental rates per square foot bid by Executive for the term of the proposed leased are as follows: Year Rate 1 $14.56 2 15.00 3 15.53 4 16.08 5 16.73 6 17.40 7 18.10 8 19.01 9 19.96 10 20.96 The District’s Decision to Reject All Bids. Mr. Birch had expected to receive rental rate bids in the range of $12.00 to $13.00. Mr. Birch’s expectation was based upon what he had been told to expect by John Stewart and Mr. Penley. Mr. Stewart is the District’s General Service Manager. Upon tabulating the bids, Mr. Birch discovered that the bids were higher than expected. He realized that the bids were $3.00 per square foot higher than the Existing Lease. Mr. Birch contacted Mr. Stewart and informed him of the difference in rates. Mr. Stewart informed Mr. Penley of the rates that had been bid. Mr. Penley informed Mr. Stewart that the bid rates were too high. Mr. Stewart then informed Sid McAlister, the Deputy District Administrator, and Paul Sneed. Mr. McAlister and Mr. Sneed told Mr. Stewart that the rates bid were excessive. Mr. Stewart subsequently directed Mr. Birch to notify the bidders that all bids were being rejected. Had the bids received in response to the ITB been accepted, the District would have been required to pay an additional approximately $80,000.00 in rent during the first year of the lease. The amount of rent required in the second year would be in excess of $80,000.00. The decision to reject all bids was based upon a realization of the impact the rates contained in the bids would have on the District’s budget if the lowest bid were accepted in relation to the impact on the District’s budget of the rates of the Existing Lease. The District realized that the increase in rent would have a substantial negative impact on its budget. It was also suggested that the impact on the District’s budget as a result of the newly enacted Federal “Welfare Reform Act” was also considered. In particular, the impact of the Welfare Reform Act’s “Work and Gaining Economic Self Sufficiency” or “WAGES” program was considered. The Welfare Reform Act and, consequently WAGES, was signed into law in August of 1996. WAGES was effective October 1, 1996. Among other things, WAGES establishes time limits for the District’s clients' receipt of cash benefits. It also results in the integration of programs of the District and the Department of Labor. This integration of programs will have impacts on the District’s space needs, staffing levels and the ability to pay rental rates in the future. Mr. Penley was aware of WAGES. It was suggested that at the time the ITB was issued little was known about the impact on the District that WAGES would have and that it was not until the bids were received that Mr. Penley had sufficient information concerning WAGES to be concerned about the impact of WAGES on the District’s budget. The weight of the evidence in this case failed to prove that when the decision of the District to reject all bids was made that the decision was based upon WAGES. While the impact of WAGES was of greater concern at the time of the formal hearing, the evidence failed to prove that the District’s concern about WAGES as explained at the formal hearing was taken into account at the time the bids were rejected. Notice of the District’s Decision to Reject All Bids. On September 13, 1996, the day after the bids were opened, the District sent a letter to Executive and the other bidders informing them of the decision to reject all bids: This is to give notice that in the best interest of the State of Florida and the Department of [Children and Families], that any and all bids are hereby rejected. The letter was signed by Mr. Birch. The letter informing Executive of the decision was sent by certified mail. “Strong justification” for the rejection was not “communicated to each rejected bidder by certified mail.” After receiving the September 13, 1996 rejection letter, Executive was informed during a telephone call with Mr. Birch that all bids had been rejected due to excessive rental rates and budgetary constraints. The District failed to comply with the requirement of the ITB that it inform bidders by certified mail of the reason why it rejected all bids. The appropriate remedy for this error, however, would not be to require that the District now evaluate the bids. The appropriate remedy for the error would be to require that the District send out a corrected notice by certified mail containing the explanation of the reasons for rejecting the bids required by the ITB. This remedy would only be appropriate, however, if Executive had sought such a remedy AND the evidence had proved that Executive had been prejudiced by the failure to provide the explanation of the District’s justification for rejecting all bids contemplated by the ITB. Evidence to support such a finding was not presented. In fact, the evidence proved that Executive was not prejudiced by the District’s error. Executive was given additional information concerning the bid rejection during a telephone conversation and it had an opportunity to explore the reasons for the rejection through discovery prior to the formal hearing of this case. Executive, therefore, had the opportunity to determine the specific justification for the rejection in preparation for the hearing on this matter. Zone Rates. The Department of Management Services establishes maximum rental rates which agencies can agree to pay without obtaining approval of the Department of Management Services. The rates are established for geographic zones on what is referred to as a “Zone Rate Schedule”. Zone Rate Schedules may be obtained from the Department of Management Services or other agencies by potential bidders. At all times relevant to this proceeding Executive was aware of the Zone Rate Schedule applicable to Palm Bay. Rental rates which do not exceed the zone rate by more than 10% may be accepted by an agency without further approval from the Department of Management Services. Any rate in excess of 10% over the zone rate must be approved by the Department of Management Services before an agency may accept it. The rental rates submitted by Executive in response to the ITB exceeded the zone rate but not by more than 10%. Individuals involved with the District’s decision in this matter either were not aware of the Zone Rate Schedule or gave it no consideration in deciding to reject all bids. The evidence also failed to prove that agreeing to pay a rate included on a Zone Rate Schedule for which approval from the Department of Management Services need not be obtained is necessarily in the “best interest of the state”. Additionally, the evidence failed to prove that the District did not have a reasonable basis for rejecting all bids despite the fact that the rates bid by Executive were within the Zone Rate Schedule plus 10%. Executive’s Challenge. Executive filed a Protest dated September 25, 1996, challenging as arbitrary the Department’s decision to reject all bids. In its Protest Executive alleged the following “facts” in support of its argument that the District’s rejection of all bids was arbitrary: The District failed to “communicate to each rejected bidder any justification whatsoever for rejecting any and all bids.” The District had decided to “reject any and all bids if the bid rental per square foot exceeded the rental they were paying under their present Lease, since such Lease had an option to renew for an additional five years. The present Lease renewal failed to comply with the requirements and specifications set forth in the Invitation to Bid.” The District, “at all times, knew that if such bids exceeded the square foot rental of the present Lease, that they intended to reject all bids and renew the existing Lease, although the existing Lease failed to meet the bid specifications.” The District “violated the competitive bidding procedure by failing to include in their Invitation to Bid a provision that any bid exceeding a specific dollar amount per square foot would be rejected in favor of the existing Lease. ” Although the evidence proved the first fact cited in finding of fact 51, that fact does not support a conclusion that the District’s decision was arbitrary. As to the other facts alleged by Executive in its Protest cited in finding of fact 53, the evidence simply failed to prove those alleged facts. At hearing, Executive presented the testimony of Mary Goodman, a consultant and former Chief of the Bureau of Property Management, Department of Management Services. Ms. Goodman was accepted as an expert witness. Ms. Goodman opined that the District’s actions in this matter were arbitrary. Ms. Goodman’s opinion was based in part on her conclusion that the submittal of the RSN and the Second RSN constituted a “determination by the Department to not renew the existing lease.” The evidence failed to support this contention. Executive has failed to cite any provision of Florida law which supports this contention. Ms. Goodman also based her opinion on the assumption that the District had established a rental rate cap which it failed to inform prospective bidders of. The evidence failed to support this assumption. Ms. Goodman also based her opinion on the fact that the bid submitted by Executive was within the Zone Rate Schedule for the area. The evidence in this case failed to prove that the fact that the bids were within 10% of the Zone Rate Schedule rates means that the decision to reject bids that would have cost the District approximately $80,000.00 the first year in additional rent was arbitrary because the rental bids did not require approval of the Department of Management Services. Executive has cited no provision of Florida law that requires agencies to accept bids simple because they do not require approval from the Department of Management Services. Ms. Goodman also based her opinion on her conclusion that the District should have known of its budgetary constraints before issuance of the ITB. Ms. Goodman, however, acknowledged that she knew nothing specifically about the District’s budget. Finally, Ms. Goodman based her opinion on the District’s failure to provide the notice of the District’s reason for rejecting the bids required by the ITB. As discussed, supra, the evidence failed to support this conclusion. The evidence failed to prove that Executive filed the action for an improper purpose.
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 Children and Families dismissing the Protest filed by Executive Ventures. DONE and ORDERED this 30th day of April, 1997, in Tallahassee, Florida. LARRY J. SARTIN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 30th day of April, 1997. COPIES FURNISHED: Walter Smith, Esquire SMITH, GRIMSLEY, BAUMAN, PINKERTON, PETERMANN, SAXER, WELLS Post Office Box 2379 Fort Walton Beach, Florida 32549 Eric D. Dunlap Assistant District Legal Counsel Department of Children and Families 400 West Robinson Street Suite S-1106 Orlando, Florida 32801 Richard A. Doran General Counsel Department of Children & Families Building 2 Room 204 1317 Winewood Boulevard Tallahassee, Florida 32399-0700 Gregory D. Venz, Agency Clerk Department of Children & Families Building 2, Room 204 1317 Winewood Boulevard Tallahassee, Florida 32399-0700
The Issue Whether the decision to reject all bids for Lease No. 800:0187 is illegal, arbitrary, dishonest, or fraudulent under the provisions of Section 120.57(3), Florida Statutes, or violates the terms of the Request for Proposal.
Findings Of Fact Prior to May 17, 1999, the Department issued a RFP for office space seeking to lease approximately 14,420 contiguous square feet of space located in Broward County, Florida. This lease, designated 800:0187 in this record, was to run for a basic term of seven years with three two-year renewal options. The RFP specified the lessor was to provide full services and 60 parking spaces. In response to the RFP, the Petitioner, Sunrise, and Intervenor timely submitted proposals. The space proposed by Petitioner complied with the requirements of the RFP. Additionally, the Petitioner's submittal was well within the Department's acceptable rate range. On May 17, 1999, the Department issued an intended award to Sunrise for lease 800:0187. Sunrise was deemed the lowest responsive bidder. All objections to the award to Sunrise were resolved or withdrawn. For reasons not clearly documented in this record, the Department withdrew its decision to award the lease to Sunrise. The agency action, posted on June 12, 2000, some 13 months after the initial posting, stated Sunrise had not performed and recommended Lauderdale as the second-ranked entity that had responded to the RFP. Both Sunrise and the Intervenor timely filed protests to the proposed award to Lauderdale. The Petitioner filed motions with the Department to dismiss and intervene in those protests. As of the date of the final hearing in the instant case, the Department had not resolved or referred those protests to the Division of Administrative Hearings. Instead, on July 24, 2000, the Department issued a notice stating it would reject all bids for lease 800:0187 and rescind the award to Lauderdale. In reaching this decision, the Department stated it "cannot determine its space needs until after the pending Department reorganization is complete." If the Department was being "reorganized" such reorganization would have been known to the Department on June 12, 2000. No legislative or administrative action was taken to require reorganization between June 12, 2000 and July 24, 2000. The Department determined that its decision of July 24, 2000, rendered the June 12 award to Lauderdale moot. The Petitioner, Sunrise, and Intervenor challenged the agency's decision to reject all bids. Section M of the RFP provides, in pertinent part: The Department reserves the right to reject any and all proposals when such rejection is in the best interest of the State of Florida. Such rejection shall not be arbitrary, but be based on strong justification. (Emphasis in original omitted.) Subsequent to the protests of the rejection of all proposals, Perry Anderson, a regional administrator for the Department whose region encompasses Broward County, drafted a memorandum dated September 22, 2000, to address the number of leases and unit requirements for service areas of Broward County. The proposals set forth in the memorandum have not been resolved. As of the date of the hearing, the Department did not present any definitive statement as to its leasing needs for Broward County or how and why the submittals for lease 800:0187 could not address the agency's need. The Department has not presented documentation for any agency plan or statutory mandate to reorganize or decentralize the office space encompassed by lease 800:0187. If decentralization is required, the Department has presented no studies to determine the location, service areas, or numbers of clients for such offices. Studies for demographics, travel times, accessibility to public transportation, client case loads, or how reorganization would better address such issues have not been presented. Moreover, the Department has not demonstrated how decentralization would be inconsistent with the award of lease space as designated by lease 800:0187. The only justification for the rejection of all proposals for lease 800:0187 was the alleged reorganization of the Department. The Department presented no factual information as to how the "reorganization" related to an emerging philosophy supporting decentralization or improved services to the client population.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Juvenile Justice enter a final order rescinding its decision to reject all proposals for lease 800:0187. DONE AND ENTERED this 27th day of July, 2001, in Tallahassee, Leon County, Florida. ___________________________________ J. D. Parrish 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 27th day of July, 2001. COPIES FURNISHED: Brian D. Berkowitz, Esquire Scott Wright, Esquire Office of General Counsel Department of Juvenile Justice 2737 Centerview Drive Tallahassee, Florida 32399-3100 Robert A. Sweetapple, Esquire Sweetapple, Broeker & Varkas 165 East Boca Raton Road Boca Raton, Florida 33432 Daniel H. Thompson, Esquire Berger, Davis & Singerman 215 South Monroe Street Suite 705 Tallahassee, Florida 32301 A. Margaret Hesford, Esquire 5648 West Atlantic Boulevard Margate, Florida 33063 William G. Bankhead, Secretary Department of Juvenile Justice Knight Building 2737 Centerview Drive Tallahassee, Florida 32399-3100 Robert N. Sechen, General Counsel Department of Juvenile Justice Knight Building 2737 Centerview Drive Tallahassee, Florida 32399-3100
