The Issue Whether Petitioner has established, by a preponderance of the evidence, that Respondent improperly evaluated the bids submitted in response to an Invitation to Bid (ITB) on Lease No. 590:2251. Whether Petitioner has established, by a preponderance of the evidence, that under the facts and circumstances of this case, Lease No. 590:2251 should be awarded to Petitioner.
Findings Of Fact Background HRS advertised an Invitation to Bid (ITB) on Lease Number 590:2251 on September 24, 1990 and October 1, 1990. The ITB was for approximately 37,888 square feet of existing office space for the HRS Office of Disability Determinations (ODD). The lease is for a term of five years, commencing on April 1, 1991. The ODD is presently, and was at the time of the bid submittal, housed in Petitioner's facility, the City Centre Building (City Centre) at 227 North Bronough Street, Tallahassee, Florida. The current agreement between HRS and the Petitioner involves two separate leases due to expire on March 31, 1991. The ODD has been housed in City Centre for approximately four and one-half years. HRS is combining the space now under two leases into one lease. Lease NO. 590:2251 is to house three program offices for the ODD: Central Area I, Central Area III, and the Tallahassee area. Prior to the bid being advertised, Charles Phillips, Director of the ODD, did not want to exercise the option to renew the HRS leases for space in City Centre. The Evaluation Committee HRS formed an Evaluation Committee to evaluate bids received in response to the ITB. Members of the committee were Bill Odom, Lucretia Young, Karen Gunter, and Dorea Sowinski. Ms. Sowinski served as the chairperson of the committee. All members of the Evaluation Committee were aware of concerns Mr. Phillips had with the City Centre prior to beginning the process evaluating the bids at issue in this case. Bill Odom, Lucretia Young and Karen Gunter are ODD area program administrators for the Tallahassee Area, Central Area I, and Central Area III, respectively. Dorea Sowinski is the Operations Management Consultant for the ODD and, as such, she handles purchasing and leasing for ODD. HRS held a pre-bid conference on October 5, 1990. Before the pre-bid conference, Linda Treml, the bid officer, and Dorea Sowinski discussed who would be on the Evaluation Committee. At the pre-bid conference, Ms. Treml identified the members of the Evaluation Committee. Voting was not discussed at the pre-bid conference. The ITB After the pre-bid conference, Linda Treml and Dorea Sowinski made changes to the ITB and issued the ITB to prospective bidders. The HRS manual on procurement of leased space, HRSM 70- 1, lists bid evaluation criteria that can be used. The evaluation criteria which can be used includes relocation costs. Relocation costs were not included among the criteria in the ITB. The failure to include relocation costs in the criteria for the evaluations of this bid in no way prejudiced the interests of the Intervenor. Any competitive advantage which may have been conferred as a result of this omission benefits the Intervenor. The Bid Opening HRS received two bids in response to the ITB. The Petitioner's bid offered space in City Centre. The only other bid was from Intervenor (Devoe Moore). Devoe Moore's bid offered space at the Fort Knox Center, 2729 Fort Knox Road, Tallahassee, Florida. The bids were opened on November 2, 1990. Petitioner's bid offered space at a lower rental rate for each of the five years of the lease term. Petitioner's bid was the low bid. Both bids were responsive. The bid officer, Linda Treml, was not present at the bid opening due to a family emergency. In Ms. Treml's absence, her supervisor, Ken McLane, conducted the bid opening. Mr. McLane does not normally attend bid openings. Instructions to the Evaluation Committee Before the Evaluation Committee met to evaluate the bids, Mr. McLane gave the committee instructions. Mr. McLane specifically instructed the Evaluation Committee that the chairperson would not evaluate the bids and would not vote. Ms. Sowinski questioned Mr. McLane regarding his instruction that the chairperson not vote at the time his instructions were given. Ms. Sowinski objected to not voting on the basis that, as committee chairperson on prior evaluation committees, she had always voted. In reply to Ms. Sowinski's questions, Mr. McLane indicated that in case of a tie in the number of points awarded each bidder, the chairperson would be the deciding vote. At the final hearing in this case, Mr. McLane testified that this was the only time he had instructed an evaluation committee chairperson not to evaluate bids and that the instructions he gave this Evaluation Committee in this regard were a mistake on his part. Mr. McLane testified that he was aware of no authority on which he based his decision that the chairperson would not participate in the evaluation. The other three members of the Evaluation Committee understood throughout the process that Ms. Sowinski would not vote unless there was a tie. The Original Bid Evaluations On November 15, 1990, three members of the Evaluation Committee filled out an evaluation sheet on each of the bids, assigning certain points to each of the evaluation criteria. As part of the evaluation process, the three members of the committee who had been instructed to evaluate the bids did so secretly and without consultation with other committee members regarding points assigned. The three voting members gave their evaluations to Ms. Sowinski, the committee chairperson. Ms. Sowinski saw the points that all the other Evaluation Committee members assigned to the various criteria for each building reflected in the bids. On November 15, 1990, Ms. Sowinski totalled the points assigned on each evaluation sheet and announced that the City Centre Building had received the most points. When the evaluation sheets of each of the three committee members who voted on November 15, 1990 were tallied, City Centre had 252 points and the Devoe Moore property (Fort Knox Center) had 245.6 points. More points meant a better bid. The Evaluation Committee was never reconvened. No testimony in the final hearing in this case indicates that any irregularity which may have occurred during the evaluation of the bids and assignment of points by Odom, Young, and Gunter had any material affect on the outcome or resulted in any prejudice to HRS or the Intervenor.1 The Phillips Memorandum Dorea Sowinski advised Charles Phillips, Director of ODD, of the result of the three member committee evaluation. Ms. Sowinski also showed Mr. Phillips a draft of her memorandum which stated that the Evaluation Committee recommended that the lease be awarded to the City Centre Building. After consulting HRS staff in facilities services, Ms. Sowinski suggested that Charles Phillips write a memo. Mr. Phillips wrote a memorandum to Ms. Sowinski dated November 16, 1990. This memo expressed Mr. Phillips' thoughts and comments regarding the City Centre Building and expressed his wishes that the memo be included in the recommendation. Details of the substance of Mr. Phillips' memo are further discussed (infra). The Submission of the Original Recommendation Ms. Sowinski wrote a memorandum dated November 19, 1990, to Ken McLane, recommending that the bid be awarded to Petitioner and that the ODD offices of HRS remain in the City Centre Building. Ms. Sowinski attached Mr. Phillips' November 16, 1990 memorandum and the evaluation sheets of the three other members of the Evaluation Committee to her memo. This accomplished the forwarding of the Evaluation Committee recommendation. The Change in Evaluation Procedure Ms. Treml returned to work on November 19, 1990, and reviewed the bid package for the lease at issue. Ms. Treml testified that she noted that only three members of the committee evaluated the bids and called Dorea Sowinski. Ms. Sowinski informed Ms. Treml that Mr. McLane had instructed her not to vote. Ms. Treml then set up a meeting with Mr. McLane. It was Ms. Treml's view that not allowing the chairperson of the Evaluation Committee to vote contradicted the HRS lease manual. Ms. Treml's view regarding the contradiction stems from her reading of HRS Manual 70-1 on page 5-18, which states: When all committee members have individually evaluated each proposal the entire evaluation committee will meet to review the individual evaluations and jointly develop a committee recommendation of the lowest and best bid based on the overall scores. The provision of HRS Manual 70-1 in question does not contain the word "vote" (although under the evaluation procedure in this case, the application of evaluation criteria and assignment of points amounts to a "vote"). The provision does not mention chairperson or the role of such a person. A specific finding is made that the material aspects of this provision of HRS Manual 70-1 which are important to resolving the disputed facts in this case are that committee members independently evaluate prior to the meeting of the entire committee and prior to the development of a committee recommendation. During her meeting with Mr. McLane, Ms. Treml expressed concern to Mr. McLane that evaluation committee chairpersons consistently voted and that she needed the evaluations of all committee members in order to complete the process. During this meeting, Mr. McLane and Ms. Treml decided to send the evaluations back and to request that Ms. Sowinski conduct an evaluation. The Second Evaluation On November 27, 1990, Dorea Sowinski filled out an evaluation sheet like the ones the other members of the Evaluation Committee filled out on November 15, 1990. Ms. Sowinski filled out her evaluation sheet after having seen how many points each previous evaluator had assigned to each bidder for each of the criteria. Ms. Sowinski testified that she left the evaluations of the other committee members at her office while she conducted her evaluations at her home. She testified that she had not looked at the other evaluations since the date she tallied them and that she did not remember what the totals those evaluations were. Ms. Sowinski also testified that she did not know the difference between the points already assigned and did not know what it would take to shift the vote from City Centre to Fort Knox. To the extent that the testimony regarding Ms. Sowinski's recollection of the original bid evaluations is offered to establish Ms. Sowinski's independence in conducting this evaluation, the testimony is not convincing. Careful consideration of the facts and circumstances established in this case results in a specific finding that Ms. Sowinski's evaluation of the bids was not independent. Ms. Sowinski prepared an evaluation total cover sheet for the original three evaluations when she forwarded the evaluation favoring City Centre. She testified that she no longer has the evaluation sheet from the first (three person) evaluation and believes she "put it in the recycle bin." The evaluations cover sheet which Ms. Sowinski recycled contained a specific listing of the points given each criteria based on the evaluations of the other three committee members. At the time she prepared her evaluation sheet, Ms. Sowinski was aware of the November 16th Phillips' memo and was aware that Mr. Phillips did not want to stay in City Centre. In substance, the Phillips memorandum expresses his concerns regarding the high crime rate and problems with transients in the area of the City Centre Building. In addition, the memo outlines problems with the past history of building management at City Centre and states that, since "the owners of the City Centre have filed Chapter 11 bankruptcy," Mr. Phillips does not believe there will be an improvement in maintenance. The memo also mentions Mr. Phillips' concerns regarding structural problems with the building and its parking garage. Ms. Sowinski's evaluation of the City Centre Building is the only evaluation in this case which mentions "Chapter 11 bankruptcy." The evaluation sheet that Ms. Sowinski filled out changed the total points for each building to 327 for City Centre and 329.8 points for Fort Knox. A memorandum from Dorea Sowinski to Linda Treml dated November 30, 1990, recommended the Fort Knox property for the lease award. Ms. Sowinski did not reconvene the Evaluation Committee to consider anything further regarding the bids before issuing the November 30, 1990 memorandum with the recommendation reversing the prior recommendation submitted on November 19, 1990. On December 13, 1990, Ken McLane signed letters for Linda Treml to both bidders advising that HRS intended to award Lease No. 590:2251 to Devoe Moore for the Fort Knox property. In consideration of all the facts and circumstances in this case, the actions of HRS in changing the original bid evaluations by instructing Ms. Sowinski to conduct an after the fact evaluation amounts to a failure to adhere to the evaluation criteria that it created thereby undermining the integrity of the bid process. The actions of HRS in this regard were arbitrary and capricious. The actions of HRS in allowing the original bid recommendation to be reversed based upon the tainted evaluations conducted by Ms. Sowinski amounts to a discriminatory standard of review of the bids. The action of HRS in this regard was also arbitrary and capricious. The Testimony of Petitioner's Expert At the final hearing in this case, Petitioner offered the testimony of Mary Goodman, Chief of the Bureau of Property Management of the Florida Department of General Services (DGS). DGS is responsible for promulgating rules for evaluating bids for leases such as the one at issue in this proceeding. Section 255.249(2)(b), Florida Statutes (1990 Supp.). Ms. Goodman has been the Bureau Chief of the DGS Bureau of Property for over nineteen years and has been involved in State property management for over thirty years. Ms. Goodman is the only witness in this proceeding offered as qualified to provide opinions regarding State procurement of leased space and the appropriate procedures to be followed in such procurement. Based upon her qualifications, Ms. Goodman was accepted as an expert witness and her testimony is relied upon as helpful in making findings of fact 44 through 62 in this Recommended Order. When evaluating bids in the public procurement process, agencies should form an evaluation committee, and members of that committee should evaluate proposals received independently. The term "individually," as used in the HRS Manual 70- 1 at pages 5-18, is synonymous with "independently." In the public procurement process, the requirement that evaluations of bids be performed independently means that the committee chair or a bid officer instructs the committee as to their responsibilities and provides the committee with evaluation criteria and with instructions as to assignment of points. Each committee member then assigns points as set forth in the criteria without consulting with other members. In this manner each committee member obtains the total points assigned each responsive bid. Ms. Goodman knows of nothing that would authorize the chairperson or any member of an evaluation committee to fill out an evaluation form after seeing the evaluation forms filled out by other members. To do so would not amount to an "independent evaluation" and would violate State policy because the requirement of independence would not be met. Ms. Goodman is aware of no policy manual, rule, or statute that would prohibit the chairperson of an evaluation committee from acting as bid officer and refraining from voting when other members vote. Typically in the public procurement process, an evaluation committee consists of three members with a committee chair as a nonvoter and guider. If three members of an evaluation committee make an evaluation, and a fourth member is asked to also make an evaluation, if the fourth member has previously had access to the other three evaluations and knows what such evaluations contain, the fourth member cannot make an independent, unbiased and unprejudiced evaluation. The results of an evaluation committee's voting is called a recommendation because of the organizational structure within a department. In most state agencies, there is an oversight person who looks at the committee recommendation to determine that the committee did in fact make an independent evaluation and that the recommendation complies with applicable statutes and rules. Even though a reviewing authority may override the committee recommendation, such authority must stay within the bid criteria. Once instructions have been given to an evaluation committee and action has been taken pursuant to such instructions, a change or rescission of previous instructions should be based on just cause; reasons that are not arbitrary, capricious, prejudiced or biased. Based upon the assumption that "the chairperson has always voted," no sufficient good reason or justification exists to warrant a change in instructions to allow a committee chairperson to vote after the committee has been instructed that the chair would not vote, and the committee has done its job and forwarded its recommendation based upon the prior instructions. The purpose in providing in the rules that an evaluation committee be formed to evaluate bids is to make evaluations impartial, unbiased, and to provide integrity in the process of public procurement of leased space. Normally, the evaluation committee recommendation is followed by the agency head. Under the facts proved in this proceeding, the change in instructions previously given the Evaluation Committee occurred after the committee had completed its evaluation and submitted its recommendation based on the prior instructions. The rescission of the prior instruction on voting by the chairperson resulted in the fourth committee member evaluating the bids and scoring_ criteria points after that member had reviewed the other evaluations, tallied the original evaluations points and prepared the original recommendation. The resulting second and different recommendation changed the results of the process such that the low bidder, originally awarded the most points by the committee, lost the bid recommendation because the scoring change resulted in a different point total. The procedure thus applied in this case was arbitrary and capricious. In the bid evaluation process in this case, relocation costs, the financial condition of the bidders, and structural engineering analysis were not included in the criteria for evaluating responsive bids. None of the evaluation criteria in the ITB for this bid pertain to or encompass past performance by a bidder. Typically, State agencies do not include past performance in bid evaluation criteria and, if such criteria was included, the ITB should require every bidder to provide documentation of past performance in any leased space offered and some criteria should be established by which the submission could be evaluated.2 None of the evaluation criteria in the ITB for this bid would allow an evaluation committee to consider Chapter 11 status in a bankruptcy proceeding. The State of Florida has had a number of leases where lessors have gone into bankruptcy, mortgage foreclosures and some instances where Savings and Loans have taken over and then gone defunct. The State has leased from receivers, including receivers in-bankruptcy. Absent a specific statement in the ITB that no bid would be received or considered from a property owner involved in reorganization proceedings, the agency should not take such matters into consideration in evaluating bids. Structural condition of the building may be considered under "physical characteristics" in the evaluation criteria but where, as in this case, the lease agreement requires any facility being offered to be kept in compliance with all existing building codes, it should be assumed that all bids declared responsive meet that requirement. Under the evaluation criteria established by HRS in this case, it is not permissible to consider the area of town the building is in as long as the building is within geographic boundaries established in the ITB. The Sowinski Evaluation of the City Centre Building Ms. Sowinski attached a typed sheet to the evaluation sheet which she filled out for her evaluation of City Centre. This attachment explains her evaluation and assignment of points. The written instructions to the Evaluation Committee require such an explanation of points in two areas of Item 2 in the evaluation criteria, both relating to the location of the space bid. (Pet. Composite Dep. Ex. 20) The Evaluation Criteria score sheet was used by all committee members including Ms. Sowinski. The portions of the score sheet at issue in this proceeding are under item 2(a) and (c). Item 2(a) calls for an evaluation of "The effect of environmental factors, including the physical characteristics of the building and the area surrounding it, on operations planned for the requested space." Ms. Sowinski deducted six of a possible twelve points under item 2(a). Ms. Sowinski indicates in her explanation under Item 2(a) that she deducted points for building location for the following reasons: City Centre is located in one of the highest rated crime areas of Tallahassee. (Ms. Sowinski also outlines problems with harassment by transients, car burglary and vandalism in and around the building.) The past performance of building management. (Problems listed include poor response to tenant needs in the past.) As part of her Item 2(a) explanation, Ms. Sowinski also states that the building owners are in "Chapter 11 bankruptcy" and that she questions the owners' financial resources to maintain the building. Ms. Sowinski testified that she did not deduct points for this; however, on the basis of the evaluation sheet there is no way to make an objective distinction in this regard. Ms. Sowinski attaches an engineering report from April 1990 to her explanation. This report addresses structural problems. As part of her Item 2(a) explanation, Ms. Sowinski also notes such problems are being corrected. Item 2(c) on the Evaluation Criteria score sheets calls for an evaluation of the "Character of adjacent properties compatible with office use." Ms. Sowinski deducted four out of eight possible points under Item 2(c). In her explanation of points deducted under Item 2(c), Ms. Sowinski states that the deductions are based on the fact that the bus station is located across the street, there is a Salvation Army housing unit nearby and that these factors contribute to the transient problems in the area. The written instructions to the Evaluation Committee note that scoring pursuant to Item 2, "Location," is subjective. Therefore, evaluators are instructed to provide an explanation less than the maximum points are given for each weighting factor in that category. In assigning evaluation criteria points under Item 2(a), the evaluator's consideration of "physical characteristics of the building and area surrounding it" is limited to factors which have an effect on the operations planned for the requested space. If an evaluator assigned less than the maximum available points under Item 2(a) to a building based upon "crime rate" and/or "problems with transients" in the area of the building, then the evaluator, pursuant to the written instructions, must explain how such factors have or would have a negative effect on the operation of the ODD. Ms. Sowinski's explanation under Item 2 (a) fails to provide sufficient information in this regard to reasonably justify the deduction of six out of a possible twelve points that were available to City Centre in this category. Under the facts and circumstances of this case, such action was unreasonable.3 Pursuant to the wording of Item 2(c), evaluators are limited to considerations of how the "character of adjacent properties" might not be "compatible with office use" when assigning less than the maximum points allowable in this category. If an evaluator assigned less than the maximum available points under Item 2(c) to a building based upon such factors as the proximity of a bus station and/or a "Salvation Army housing unit," then, based upon the written instructions given, the evaluator must explain how such factors are incompatible with office use. Ms. Sowinski's explanation, which states that the bus station and housing units "account for a large portion of the transient population, which is a direct cause for many of the problems in the area" does not sufficiently explain how the character of these adjacent properties are so incompatible with ODD "office use" as to warrant the deduction of four out of a possible eight points that were available to City Centre. Under the facts and circumstances of this case, such action was unreasonable. Ms. Sowinski's evaluation of the City Centre bid was not reasonably based on the evaluation criteria HRS established. Therefore, even if Ms. Sowinski's evaluation of these bids was not tainted, her evaluation of the City Centre bid was materially improper. De novo Application of Evaluation Criteria to These Bids Item 1 (Associated Fiscal Costs) is, as noted in the written instructions to the Evaluation Committee, objectively based upon present value methodology computations. All bid evaluations in the record are consistent. In each evaluation, City Centre, the low bidder, receives the maximum of 40 points and Fort Knox receives 36.2. Points awarded pursuant to Item 1 on the Evaluation Sheet are not at issue. Therefore, in a de novo evaluation, City Centre is awarded 40 points and Fort Knox receives 36.2 points under Item 1. The Evaluation Criteria Score Sheet lists Item 3(a) as "Facility, Susceptibility of the design of the space offered to efficient layout and good utilization, which will be determined by evaluation committee." As noted in the written instructions to the committee, this item is subjective and an explanation of the assignment of fewer than allowed points is required. Item 3(a) is not at issue, and the maximum 13 points are awarded each building for the purpose of the de novo evaluation. The remainder of Item 3 is not in issue and is objective. All evaluations in the record award 6 points to City Centre and 8 points to Fort Knox. In the de novo evaluations, the same approach is taken. The application criteria in dispute in this case are those listed on the Evaluation Criteria Score Sheets under Item 2, Location, specifically 2(a) "The effect of environmental factors, including the physical characteristics of the building and the area surrounding it, on operations planned for the requested space" and 2(c) "Character of adjacent properties compatible with office use." Based upon the facts proved in this case, an independent review of the evaluation criteria and other appropriate exhibits, both the City Centre and Fort Knox buildings should receive the maximum allowed points in Items 2(a) and 2 (c). Therefore, each building is awarded twelve points in Item 2(a) and eight points in Item 2(c). The application of a de novo evaluation of the bids in this case, as described above, results in total scores of 87 for City Centre and 85.2 for Fort Knox. No party in this case, to and including the final hearing has contended that the votes of Mr. Odom, Ms. Young or Ms. Gunter were affected by any irregularity or argued that these evaluations should be discarded or ignored. None of the parties make such a contention in their proposed recommended orders and made no proposed findings of fact in this regard.4 Petitioner has proved, by a preponderance of the evidence, that the original recommendation, based upon the evaluation by Mr. Odom, Ms. Young and Ms. Gunter was in material compliance with the ITB as well as applicable statutes and rules. Petitioner is therefore entitled to the award of Lease NO. 590:2251 as provided in the original Evaluation Committee Recommendation. A de novo evaluation of the bids in this case proves, by a preponderance of the evidence, that Petitioner submitted the lowest and best bid. Petitioner is entitled to the award of Lease No. 590:2251 as provided in the original Evaluation Committee order.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, and the evidence of record, it is RECOMMENDED: That Respondent HRS enter a Final Order awarding Lease No. 590:2251 to Petitioner. It is further RECOMMENDED that Respondent return the cash bond posted by Petitioner pursuant to Section 255.25(3)(c), Florida Statutes. DONE and ORDERED this 21st day of March, 1991, in Tallahassee, Florida. JAMES W. YORK, 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 21st day of March, 1991.
The Issue Whether Respondent acted contrary to the agency's governing statutes, rules or policies, or the bid specifications in its proposed decision to award a contract to Intervenor Xerox Corporation pursuant to Request for Proposal ("RFP") No. 07-015- 040-RFP.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of the proceeding, the following findings of fact are made: On December 15, 2006, PCS issued the 2007 RFP, entitled "Copier Program--Request for Proposals." The 2007 RFP was intended to provide a comprehensive copier program for the entire Pinellas County School District from the award date of the bid, then anticipated to be February 20, 2007, through June 30, 2012. The purpose of the 2007 RFP was stated as follows in Section 3.1 of the General Information section: [PCS] requests proposals from experienced and qualified vendors to provide a comprehensive copier program countywide which fulfills the priorities and needs expressed by district focus groups. PCS wishes to partner with a qualified vendor who will continue to improve information sharing, right size number of assets, and reduce the number of device types while lowering the district's cost. Vendors may propose whatever program they feel best meets the district's needs and are not restricted in any way other than to meet the basic equipment specifications, terms and conditions outlined in this bid. . . . (Emphasis added) A statement of the 2007 RFP's "scope" set forth in the Special Conditions similarly provided: [PCS] requests proposals from experienced and qualified vendors to provide a comprehensive copier program countywide which fulfills the priorities and needs expressed by district focus groups. Vendors may propose whatever program they feel best meets these needs and a district evaluation committee made up of participants from the focus groups will evaluate proposals and make the selection it feels best meets these needs based upon a set of criteria published in this document. . . . [Emphasis added] The 2007 RFP provided for proposals to be received no later than January 18, 2007, at 3:00 p.m. The 2007 RFP contained General Terms and Conditions, setting forth the standard boilerplate terms common to all PCS procurements, and Section 1 of "Special Conditions" particular to this contract.1 These were followed by: Section 2, "Personnel Matrix"; Section 3, "General Information"; Section 4, "Program Specifications"; Section 5, "Equipment Specifications"; Section 6, "Cost Proposal"; and Section 7, "Contractor Response." PCS has adopted the General Terms and Conditions as rules, codified in Part A of the PCS Purchasing Handbook. Paragraph 1(g) of the General Terms and Conditions, "Freight Terms," provided: All items are to be bid FOB destination with all transportation charges prepaid and included in the bid prices and title transferring to the district at the time of delivery, unless otherwise stated in bid invitation. Any exceptions to these freight terms taken by the bidder must be clearly stated in the bidder's proposal. The purchasing department will evaluate any such exceptions and determine if the exception constitutes grounds for rejection of the bidder's proposal. [Emphasis added] Paragraph 3 of the General Terms and Conditions, "Acceptance and Withdrawal of Bids," provided: A bid (or amendment thereto) will not be accepted by the purchasing department after the time and date specified for the bid opening, nor may a bid (or amendment thereto) which has already been opened in public be withdrawn by the bidder for a period of sixty (60) calendar days after the bid opening date and time, unless authorized by the purchasing department. By written request to the purchasing department, the bidder may withdraw from the bid process and ask to have their sealed bid proposal returned at any time prior to the closing date and time for the receipt of bid proposals. Paragraph 14 of the General Terms and Conditions, "Variance to Bid Documents," provided: For the purpose of bid evaluation, bidders must clearly stipulate any or all variances to the bid documents or specifications, no matter how slight. If variations are not stated in the bidder's proposal, it shall be construed that the bid proposal submitted fully complies in every respect with our bid documents. Paragraph 30 of the General Terms and Conditions, "Errors and Omissions," provided: In the event an error or obvious omission is discovered in a bidder's proposal, either by the purchasing department or the bidder, the bidder may have the opportunity of withdrawing their bid, provided they can produce sufficient evidence to document that the error or omission was clerical in nature and unintentional . . . This privilege shall not extend to allowing a bidder to change any information contained in their bid proposal; however, in the event of a minor omission or oversight on the part of the bidder, the purchasing department (or designee) may request written clarification from a bidder in order to confirm the evaluator's interpretation of the bidder's response and to preclude the rejection of their bid, either in part or in whole. The purchasing department will have the authority to weigh the severity of the infraction and determine its acceptability. Paragraph 31 of the General Terms and Conditions, "Basis of Award of Bids," provides: "A Bidder who substitutes its standard terms and conditions for the district's, or who qualifies its bid in such a manner as to nullify or limit its liability to the district will be considered nonresponsive." The standard form cover sheet to both the 2006 and 2007 RFPs contained a "Note to Bidder" that stated: "A signed bid submitted to the School Board obligates the bidder to all terms, conditions and specifications stated in this bid document, unless exceptions are taken and clearly stated in the bidder's proposal." (Emphasis added) The Special Conditions of the 2007 RFP included a provision titled "Acceptance of Vendor Responses," which stated: "The purchasing department reserves the right to accept proposals from multiple vendors, and to accept or reject portions of a proposal based upon the information requested. Vendors may be excluded from further consideration for failure to fully comply with the requirements of this RFP solely at the purchasing department's discretion." (Emphasis added) The Special Conditions of the 2007 RFP also included a provision entitled "Integrity of Bid Documents," which stated: Bidders shall use the original Bid Proposal Forms provided by the Purchasing Department and enter information only in the spaces where a response is requested. Bidders may use an attachment as an addendum to the Bid Proposal form if sufficient space is not available on the original form for the bidder to enter a complete response. Any modifications or alterations to the original bid documents by the bidder, whether intentional or otherwise, will constitute grounds for rejection of a bid. Any such modifications or alterations that a bidder wishes to propose must be clearly stated in the bidder's proposal response and presented in the form of an addendum to the original bid documents. Both Xerox and IKON timely submitted proposals in response to the 2007 RFP. Evaluations of the responses to the RFP were based on a two-step procedure. First, a focus group of individuals from the Pinellas County School District would analyze the bids and award points based on the specifications and the Proposal Evaluation Form set forth in the RFP. The maximum award was 100 points, with 80 points constituting the threshold for further consideration. Second, those vendors which met the 80-point threshold would compete solely on price. Those bidders who did not score 80 points in the first stage would not have their price bids opened. By January 24, 2007, the focus group had finalized its evaluations, and the cost proposals were to be opened on January 26, 2007. Both IKON and Xerox scored above the 80 point level. IKON received a score of 87 points from the focus group and Xerox received a score of 81 points. Xerox's proposal included, among 15 unnumbered appendices, an appendix titled "Xerox Clarification Addendum to the RFP." This Addendum contained four "clarifications" of portions of the General Terms and Conditions, seven "clarifications" regarding the Program Specifications portion of the Special Conditions, and 12 items under the heading "Other Xerox Service Terms" that purported to set forth contractual provisions regarding service, personnel, risk of loss, limitations on liability, payment schedules, and other standard contract terms. PCS's purchasing department conducted a responsiveness review of the proposals prior to sending them to the focus group for substantive evaluation, but did not notice the Xerox Addendum. Mark Lindemann, the director of purchasing for PCS, testified that it is not customary for bidders to submit such an addendum, and, therefore, his staff was not looking for it when conducting their responsiveness review. On January 30, 2007, after the focus group had performed its evaluation of all the bids, and the cost proposals had been opened and the bid tabulations had been posted on the PCS website, Colin Castle of IKON brought to the attention of the PCS purchasing department the presence of the Xerox Addendum. Geri Pomerantz is the Xerox employee responsible for public sector solicitations in the Southeast United States. She is responsible for understanding the terms and conditions of a solicitation, for pricing the solution based on the customer's requirements, and for ensuring that Xerox submits a responsive proposal. Ms. Pomerantz signed and submitted Xerox's proposal in response to the 2007 RFP. Ms. Pomerantz believed that the Xerox Addendum complied with the "Integrity of Bid Documents" provision of the Special Conditions, quoted above. By submitting the Addendum, Xerox sought to clarify areas of the RFP, to explain how Xerox was meeting the requirements of the RFP, and to propose new items where Ms. Pomerantz believed the RFP was silent on important terms. Ms. Pomerantz testified that, to comply with the "Integrity of Bid Documents" provision, Xerox included the proposed clarifications in the body of its proposal, where that was possible, then further called them to the attention of PCS by placing them in the Addendum. Though unnumbered, the Xerox Addendum is clearly identified in the Table of Contents at the front of the Xerox proposal and on a separate tab on the side of the proposal. Xerox incorporated its clarifications in the body of its proposal in those places where the 2007 RFP requested a response from the vendor, i.e., Section 4, the Program Specifications portion and Section 5, the Equipment Specifications portion. Xerox incorporated clarifications to the following Program and Equipment Specifications: Section 4.3.1-–Equipment Build Status; Sections 4.3.4, 5.3.2 and 5.3.13 –-Price Offering; Sections 4.7.4 and 4.7.5-–Inspection and Acceptance; Section 4.10.2-–Response Time; Section 4.10.3-– Uptime; Section 4.10.4--Electronic Meter Reads; and Section 4.17–-Insurance Specifications for Contractors. The General Terms and Conditions did not call for a vendor response, and Xerox's clarifications or proposed modifications to those were made only in the Addendum. The introduction to the Xerox Addendum provides as follows: We have reviewed your Invitation to Bid ("Bid")[2] for a Copier Program, and have prepared a proposal that we believe addresses your requirements. However, some of the Board's requirements require that we make some limited clarifications to the terms and conditions included in your Bid. These clarifications are set forth below and are part of our Proposal. In addition, we have included some additional terms and conditions, which are also included as part of our Proposal. Should there be a conflict between the terms and conditions of the various documents the order of precedence will be this Addendum, followed by your Bid. Please note that if any of the terms or clarifications are inconsistent with Florida law or otherwise unacceptable to you, Xerox agrees to negotiate a reasonable alternative that is acceptable to both parties. Our team is also prepared to discuss the Xerox Proposal in greater detail and, if required, adjust our offering based on your final requirements, which may include a modification to our proposed equipment, support services, terms and conditions, and/or price offering. The Xerox Addendum expressly proposed clarifications or modifications to four provisions of the General Terms and Conditions. Paragraph 1(g), set forth in full above, contains PCS's standard freight terms and describes the process by which a vendor may take exception to those terms: exceptions must be clearly stated in the proposal, and the purchasing department will determine whether the exceptions constitute grounds for rejecting the vendor's proposal. The Xerox Addendum proposed to transfer to PCS the cost of any "non-standard delivery or removal expenses, such as additional costs where additional time or resources are required to disassemble equipment due to lack of adequate facility access, or the need to use stair creepers or cranes to deliver equipment to upper floors of buildings.3 Ms. Pomerantz justified this variance by asserting that the 2007 RFP was silent regarding the issue of "non- standard delivery", and that Xerox was merely offering a clarifying solution to this problem. Mr. Lindemann believed this clarification to be salutary, based on disputes PCS has had with its current vendor, IKON, regarding unusual delivery issues. Paragraph 1(g) of the General Terms and Conditions specifically allowed the vendor to propose exceptions to the standard freight terms, provided those exceptions were clearly stated and the vendor understood that its exceptions could be grounds for rejection of its proposal. Thus, it is found that the Xerox Addendum did not materially deviate from the provisions of the RFP as to this variance. The Xerox Addendum also proposed modification of paragraph 11 of the General Terms and Conditions, which states that PCS has "sole and exclusive property" rights to any discovery, invention or work product produced under the contract. Xerox proposed that any work developed under this contract would be of a generic nature and would remain the sole property of Xerox. Mr. Lindemann reasonably opined that this was not a material deviation because there was no intellectual property involved in this RFP. The Xerox Addendum did not materially deviate from the provisions of the RFP as to this variance. The Xerox Addendum proposed modification of paragraph 41 of the General Terms and Conditions. Paragraph 41 provided that unless otherwise specified in the Special Conditions, all items requested "must be new, the latest model manufactured, first quality, carry the manufacturer's standard warranty and be equal to or exceed the specifications" listed in the RFP. In this instance, the Special Conditions did provide otherwise. Section 4.3.1 of the Program Specifications provided, in relevant part, that vendors "may propose all used, all new or a combination of new and used equipment, but all equipment must meet the minimum standards outlined later in this section. To assure ease of operation for end users, if used equipment is proposed it should all be of the same brand and model within any given Group of copiers, within any given facility." The Xerox Addendum simply provided clarification regarding the company's terminology for its equipment. The equipment provided by Xerox would be either "Newly Manufactured," "Factory Produced New Models," or "Remanufactured," internal Xerox distinctions regarding the use of new, reconditioned or recycled components, and Xerox disclaimed any intent to use reconditioned, recycled, refurbished or used equipment as defined by industry standard. In this instance, Xerox submitted a clarification that did not deviate from or attempt to modify the Program Specifications. The Xerox Addendum proposed modification of paragraph 44 of the General Terms and Conditions, the limitation of liability provision, which provided: The bidder guarantees to save [PCS], its agents and employees, harmless from liability of any nature or kind for use of any copyrighted or non-copyrighted materials, secret process, patented or unpatented inventions, articles or appliances, furnished or used in performance of the contract for which the contractor is not the patentee, assignee or licensee. The Xerox Addendum to paragraph 44 provided as follows: Xerox agrees that it will indemnify the Board from all copyright and patent information that is included in Xerox- branded equipment/software. However, Xerox will not indemnify the Board, its directors, officers, employees, volunteers, and agent [sic] for any patent infringement caused by complying with the Board's requirement to use, or the Board's use of, the Xerox- branded/supplied equipment with equipment or software not provided by Xerox. Mr. Lindemann testified that this modification of the limitation of liability provision would most likely require PCS to purchase additional contingent liability insurance, which would be a cost essentially passed on from Xerox to PCS. It is found that the Xerox Addendum materially deviated from the provisions of the RFP as to this variance. The Xerox Addendum proposed a second limitation of liability provision in the section titled "Other Xerox Service Terms," which was essentially a list of standard terms and conditions that Xerox proposed to take precedence over similar provisions in the 2007 RFP. This second limitation of liability proposal provided as follows: Excluding personal injury (including death), property damage, and intellectual property indemnification on Xerox branded equipment, Xerox will not be liable to you for any direct damages in excess of $100,000 or the amounts you've paid to Xerox, whichever is greater. Neither party shall be liable to the other for any special, indirect, incidental, consequential or punitive damages arising out of or relating to this Agreement, whether the claim alleges tortious conduct (including negligence) or any other legal theory. Any action you take against Xerox must be commenced within two (2) years after the event that caused it. Ms. Pomerantz testified that when she read the RFP she focused on the indemnification language in paragraph 44 of the General Terms and Conditions regarding copyright and patent issues. She thought the RFP was silent on broader indemnification issues, and she sought to clarify it with this proposed language. Mr. Lindemann testified that the $100,000 limitation of liability could result in costs to PCS in the event of a judgment against PCS and might require the purchase of additional liability insurance. Mr. Lindemann believed this proposed limitation on liability was a material deviation and formed the basis for his request to Xerox to withdraw the Addendum. Paragraph 31 of the Standard Terms and Conditions states: "A Bidder who substitutes its standard terms and conditions for the district's, or who qualifies its bid in such a manner as to nullify or limit its liability to the district will be considered nonresponsive." (Emphasis added) It is found that the Xerox Addendum materially deviated from the provisions of the RFP as to this variance. 34. Sections 4.3.4, 5.3.2, and 5.3.13 of the Program/Equipment Specifications related to the vendors' cost proposals provide: 4.3.4 Whatever type of pricing methodology is proposed, it shall include all costs associated with the administration of the service, including, but not limited to: all imaging devices, any peripheral equipment (file servers, etc.), delivery, removal, installation, training, dedicated technician(s), all supplies needed to operate the imaging devices except paper, delivery of supplies and removal of the equipment upon termination of this contract. * * * 5.3.2 Pricing should include all costs associated with the administration of the service, including, but not limited to all imaging devices, delivery, removal, installation, training, certified technicians and all supplies except paper needed to operate the imaging devices. * * * 5.3.13 Pricing must include all costs associated with the administration of the service, including, but not limited to all copier devices, delivery, removal, installation, training, certified technician(s), all supplies except paper, end-user training and semi-annual customer satisfaction surveys. The three quoted provisions state that price proposals must include all costs associated with the administration of the service in question, except for paper, delivery of supplies, removal of equipment upon contract termination, end user training, and customer satisfaction surveys. The Xerox Addendum sets forth a monthly minimum and cost-per-copy charge that would cover standard equipment, supplies, maintenance, delivery and removal, installation and user training, but would require PCS to pay for "optional accessories," "non-standard operating supplies," "excess rigging" needed due to inadequate site access or the need to use stair creepers or cranes to install or remove equipment,4 overtime service coverage, and expenses associated with site preparation. The Xerox Addendum attempted to vary the quoted Special Conditions that require the vendor's price to include all costs associated with delivery, removal, and installation and, thus, materially deviated from the provisions of the RFP. Sections 4.7.4 and 4.7.5 of the Program Specifications required the vendor to "provide and pay for all material, labor, tools, transportation and handling, and other facilities necessary for the furnishing, delivery, assembly plus inspection before, during and after installation of all items specified herein." The Xerox Addendum to Sections 4.7.4 and 4.7.5 attempted to limit Xerox's obligation to inspect the devices by stating that they are "deemed accepted" upon installation unless PCS specifically requires an inspection. It is found that the Xerox Addendum materially deviated from the provisions of the RFP as to this variance. Section 4.17.1 of the Program Specifications required acceptance testing for each imaging device and accessory, including a period of four consecutive business days, each containing seven hours of operational use time, in which the equipment maintains a 95 percent level of performance. The Xerox Addendum to Section 4.17.1 attempted to limit Xerox's obligation to inspect the devices by stating that they are "deemed accepted" upon installation unless PCS specifically requires an inspection. It is found that the Xerox Addendum materially deviated from the provisions of the RFP as to this variance. Section 4.10.2 of the Program Specifications provided requirements regarding service calls and response times. This condition defines "response time" as the interim between the user's call to the repair office and the appearance of a certified technician on-site who is prepared to effect repairs. Section 4.10.2 provides that the response time cannot exceed four hours. PCS would have the option of charging the contractor $50.00 per failure to meet this four-hour response time requirement. The Xerox Addendum proposed that service response times be averaged quarterly according to a formula by which "target response time" would be divided by "average service response time," which is measured by dividing the sum of all service call response times during the quarter by the total number of service calls. Xerox proposed that the $50.00 charge be imposed based upon Xerox's failure to meet "the 90-day 4 hour average unit response time commitment." IKON also proposed to calculate the response time using a quarterly average, providing for an average response time "of 2 to 6 hours for all customer service calls located within 30 miles of an IKON service center, and 4 to 8 hours for all customer service calls located 30 miles or more from an IKON service center." IKON's proposal did not clearly state how far IKON's nearest service center is located from any Pinellas County school site. Another section of IKON's proposal discusses the company's recent consolidation of its "customer care centers," which "provide direct customer support" and house "the field service call center and inside sales function for a geographical region," into four central locations, the closest to Pinellas County being in Atlanta, Georgia. In this instance, both Xerox and IKON have proposed material deviations from the RFP requirement. Section 4.10.2 of the Special Conditions set forth a simple response time requirement that PCS itself could monitor and enforce without input from the vendor. Both Xerox and IKON attempted to substitute complex formulas arriving at quarterly averages for response time. IKON's proposal further attempted to make its compliance with the four hour response time requirement contingent upon the location of IKON's service centers. Section 4.10.3 of the Special Conditions requires a guaranteed uptime of 95 percent per machine for any 90-day period, and further requires that machines failing to maintain 95 percent uptime must be removed and replaced with an identical or comparable model at no cost to PCS. The Xerox Addendum announced an uptime objective of maintaining an average 95 percent equipment uptime performance based on a three-month rolling average, a variation in the wording of Section 4.10.3 that does not materially change the RFP requirement. Xerox also offered slight variations in the definition of "downtime" that are in the nature of clarifications rather than amendments to Section 4.10.3. The Xerox Addendum also contained 12 "Other Xerox Service Terms," essentially Xerox's standard terms and conditions dealing with service guarantees, personnel, substitution of equipment or software, risk of loss for equipment, treatment of confidential information, compliance with laws, vendor liability for customer-supplied items, the limitation of liability provision discussed above, force majeure, payment upon 45 days of invoice, breach of contract and remedies thereto, and a procedure for amendment of the contract. The 2007 RFP's General Terms and Conditions contain requirements for breach of contract, limitation of liability, standards of conduct for vendor personnel, and equipment substitution. Thus, the Xerox Addendum violated the following language in paragraph 31 of the Standard Terms and Conditions: "A Bidder who substitutes its standard terms and conditions for the district's, or who qualifies its bid in such a manner as to nullify or limit its liability to the district will be considered nonresponsive." In summary, the Xerox Addendum materially deviated from the requirements of the 2007 RFP in the following ways: it varied from the limitation of liability requirements of paragraph 44 of the General Terms and Conditions; it offered a cost proposal that was not all-inclusive, in contravention of Sections 4.3.4, 5.3.2, and 5.3.13 of the Program Specifications; it attempted to limit inspections after installation and acceptance testing, in contravention of Sections 4.7.4, 4.7.5, and 4.17.1 of the Special Conditions; it varied from the response time requirements of Section 4.10.2 of the Special Conditions; and it attempted to substitute several of Xerox's standard terms and conditions for those of PCS, in violation of paragraph 31 of the General Terms and Conditions. After learning of the Xerox Addendum from Mr. Castle on January 30, 2007, PCS reviewed the Addendum and concluded that it included material deviations to the terms and conditions of the RFP solicitation and that either the Addendum or Xerox's bid must be withdrawn. Negotiations commenced between PCS and Xerox. On February 2, 2007, Xerox offered PCS a revised Addendum. PCS rejected the revised Addendum and informed Xerox that the Addendum must be withdrawn in its entirety. On February 5, 2007, Xerox notified PCS by letter that it was withdrawing the Addendum from its proposal. Also on February 5, 2007, PCS posted its notice of intent to award the contract to Xerox. IKON's protest complained that Xerox's letter did not accomplish a complete withdrawal of the deviations included in the Xerox Addendum, because many of those deviations remained in the main body of the Xerox proposal. As noted above, Xerox incorporated its clarifications in the main body of its proposal in those places where the 2007 RFP requested a response from the vendor. These clarifications were included in Section 7.1.4 of the Xerox proposal, "Proposed Work Plan, Transition Plan." When Xerox withdrew its Addendum, it did not also submit a revised proposal that deleted the Addendum provisions from those places where they had been incorporated into the main body of the proposal. Nevertheless, both Xerox and PCS understood that withdrawal of the Addendum accomplished the complete withdrawal of the materials included in the Addendum, including where they were incorporated into the main body of the Xerox proposal. This understanding was reasonable under the circumstances. However, IKON raises a related objection that is more pertinent. Xerox was allowed to withdraw its Addendum, and then was awarded the contract. Thus, the winning proposal is different than the proposal that was reviewed and scored by the PCS focus group. IKON argues that it is very likely that Xerox would not have passed the 80-point threshold without the Addendum provisions that were incorporated into the main body of the proposal. Mr. Lindemann of PCS believed that Xerox's score would probably have been higher without the Addendum provisions. The salient point is that both sides are free to speculate about what the score of the winning bid might have been, because PCS proposes to award a contract on a proposal that was never reviewed or scored in the manner prescribed by the 2007 RFP. PCS argues that the withdrawal of the Xerox Addendum was entirely in keeping with the RFP, citing paragraph 3 of the General Terms and Conditions, quoted in full above and relevant portion of which provides: A bid (or amendment thereto) will not be accepted by the purchasing department after the time and date specified for the bid opening, nor may a bid (or amendment thereto) which has already been opened in public be withdrawn by the bidder for a period of sixty (60) calendar days after the bid opening date and time, unless authorized by the purchasing department. [Emphasis added] PCS contends that the emphasized language grants the purchasing department authority to allow a bidder to withdraw a portion of its bid after the bids have been opened. This is correct, if the portion in question is a timely submitted amendment to the original bid.5 In their arguments, both PCS and Xerox equate the terms "amendment" and "addendum," and assume that the Xerox Addendum could be withdrawn as an "amendment" to the Xerox proposal. However, the Xerox Addendum was not an amendment to the Xerox proposal; it was an integral part of that proposal. The Addendum did not amend anything contained in the Xerox proposal; rather, it attempted to "amend" the terms of the RFP. The underscored portion of paragraph 3 anticipates the late withdrawal of an entire bid or an amendment to a bid, not a wholesale grant of authority to the purchasing department to allow a bidder to save a nonresponsive proposal by withdrawing the objectionable provisions. PCS argues that Xerox was given no economic or competitive advantage in being allowed to submit and then withdraw its Addendum. Ms. Pomerantz testified that none of the items in the Addendum would have affected the price bid by Xerox, because they were essentially items of overhead that Xerox cannot "cost out" to include in a price proposal. However, the testimony by Mr. Lindemann convincingly made the point that some of the variations from RFP terms offered by Xerox would affect PCS's costs regardless of their impact on Xerox's price proposal. Passing on costs to the agency that have been absorbed by IKON and the other vendors in their proposals works to Xerox's economic advantage and to the detriment of PCS. Xerox had an obvious competitive advantage in being granted the opportunity to amend its proposal after the substantive proposals were opened and evaluated and the price proposals had been opened and posted. Xerox was also granted the option, afforded to no other bidder, of simply declining to withdraw its Addendum and thereby walking away from the procurement after submitting a proposal that, under the terms of the RFP, is supposed to bind the vendor for a period of 90 days. Subsection 120.57(3)(f), Florida Statutes, provides, in relevant part: In a protest to an invitation to bid or request for proposals procurement, no submissions made after the bid or proposal opening which amend or supplement the bid or proposal shall be considered. . . . The PCS rules and RFP provisions, correctly understood, do not contravene this statutory requirement. They grant the purchasing department the flexibility to allow a bidder, under special circumstances, to withdraw from a given procurement after submitting a bid, and they allow PCS to waive slight variations or minor irregularities in a bid. To the extent that PCS interprets its rules and RFP to allow Xerox to substantially amend its proposal after the opening,6 as occurred in this procurement, then PCS has violated its governing statutes in a fashion that is clearly erroneous, contrary to competition, arbitrary, or capricious. PCS argues that even if the Xerox Addendum contained material deviations, the RFP and PCS's rule permitted bidders to submit addenda with material deviations. PCS based this argument on that portion of Section 3.1 of the Special Conditions stating that bidders "may propose whatever program they feel best meets the district's needs and are not restricted in any way other than to meet the basic equipment specifications, terms and conditions outlined in this bid." When read within the context of the Special Conditions in their entirety, this language clearly contemplates allowing the vendors to offer creative solutions within their field of substantive expertise, i.e., the establishment of a comprehensive copier program countywide. It was rational for the drafters of the RFP to assume that a company such as Xerox enters the process in possession of more knowledge and experience in the field of copier installation, service, and repair than the school district possesses. PCS conducted focus groups to determine the top priorities of the school personnel who use the copiers and presented the bidders with specifications broad enough to allow maximum flexibility in crafting proposals responsive to the listed priorities. However, there are rarely "creative solutions" to boilerplate RFP terms such as shipping, limitation of liability, the requirement that cost proposals be all-inclusive, inspection of equipment prior to acceptance, and response time for repairs. These are areas in which the purchasing department of PCS may be presumed to have at least as much expertise as Xerox or IKON. Variations from the RFP's requirements proposed by a bidder regarding these items are likely to be self-serving efforts to protect the bidder's interests or pass on costs to the agency. Paragraph 31 of the General Terms and Conditions recognizes this reality by stating that a bidder that substitutes its standard terms and conditions for those of PCS will be considered nonresponsive.7 PCS is correct that the "Integrity of Bid Documents" paragraph of Section 1 of the Special Conditions of the 2007 RFP allows bidders to submit addenda that clearly state "modifications or alterations that a bidder wishes to propose." However, contrary to PCS's treatment of Xerox in this procurement, the RFP does not state that the bidder may propose modifications of the RFP terms without risk.8 The cited paragraph clearly warns bidders that proposed modifications or alterations constitute grounds for rejection of a bid. The paragraph does not, and under Subsection 120.57(3)(f), Florida Statutes (2006), could not, state that bidders will be given the opportunity to withdraw those portions of their proposals deemed nonresponsive after bid opening. PCS also emphasizes the first sentence of the "Acceptance of Vendor Responses" paragraph of the Special Conditions: "The purchasing department reserves the right to accept proposals from multiple vendors, and to accept or reject portions of a proposal based upon the information requested." However, the next sentence of that paragraph states that the remedy is not after-the-fact withdrawal of the rejected portion of the proposal, but rejection of the proposal: "Vendors may be excluded from further consideration for failure to fully comply with the requirements of this RFP solely at the purchasing department's discretion." Both PCS and Xerox raised the issue of the 2006 RFP in an effort to show that IKON was now attacking a process from which it earlier benefited. In the 2006 procurement, IKON was allowed to withdraw portions of an addendum after a competitor filed a protest. PCS ultimately rejected all of the 2006 Proposals because of confusion on the part of the bidders, partly related to the fact that IKON was allowed to withdraw its addendum but a competitor was not given the same opportunity. PCS then issued the 2007 RFP in December 2006 to procure the same copy services sought by the 2006 RFP. The 2006 RFP is relevant only to show that PCS has allowed the withdrawal of amendments in at least one previous procurement, a moot point because PCS has freely stated its position that it has the authority to reject an addendum without rejecting the entire proposal. Xerox's original proposal, including the Addendum, was nonresponsive for the reasons set forth above. PCS's effort to save Xerox's low bid by allowing it to withdraw the Addendum violated Subsection 120.57(3)(f), Florida Statutes (2006), as well as the terms of the RFP. The remaining question is whether IKON's proposal was responsive and may therefore be awarded the contract. As already found above, IKON's proposal materially deviated from Section 4.10.2 of the Special Conditions by substituting a complex formula for the simple response time requirement of the RFP and by making compliance with the four- hour response time requirement contingent upon the location of IKON's service centers.9 Section 7.1.3 of the Contractor Response portion of the 2007 RFP, "Proposed Models and Equipment Configurations," provides the following: The respondent must provide a comprehensive description of its proposed standard models and equipment configurations for each of the various grade levels (elementary, middle, high school). Consideration should be given to the stated needs of the focus groups (Section 3), particularly "ease of operation", "accessibility" to machines and "reliability". Vendors should provide detailed, technical product literature for each piece of equipment proposed including all options. The respondent should also describe what flexibility will be allowed for adding or deleting equipment as program needs change and how that will effect the amount billed according to the cost proposal plan proposed. [Emphasis added] Section 7.1.7 of the Special Conditions, "Cost Proposal," provides the following: Respondent must include a complete, detailed cost proposal which encompasses all costs associated with the proposed program. The cost proposal must allow for flexibility to add or delete equipment as program needs change. The district will not entertain any proposals to purchase or lease any equipment. [Emphasis added] IKON's proposal contained the following paragraph within its response to Section 7.1.3 of the Special Conditions: As requested by PCS in Section 7.1.7 of the Invitation to Bid, IKON's cost proposal allows for flexibility. IKON will permit PCS to add or delete equipment as PCS' needs change by permitting PCS to upgrade or downgrade equipment at the beginning or at the end of its fiscal year. Under this program, PCS may replace upgraded or downgraded equipment with additional equipment that addresses PCS' needs. Specifically, IKON will permit PCS to identify up to [three] percent of the overall equipment fleet value procured by PCS from IKON, including models and specifications that are representative of the entire fleet population, as flexible equipment that may be upgraded or downgraded at the beginning or at the end of the fiscal year, while all other equipment may be canceled only in the event of a non- appropriation or termination for cause. The flexible equipment may also be relocated or otherwise used to facilitate a rightsizing program, as directed by PCS. PCS may utilize this flexibility program in its own discretion. In no event shall either party be liable to the other party for any indirect, special or consequential damages. Xerox contends that by limiting PCS to a three percent change in the overall equipment fleet value, IKON's proposal materially deviates from Sections 7.1.3 and 7.1.7 of the Special Conditions, which required that PCS have the flexibility to increase or decrease the size of the copier fleet to meet its needs. However, Section 7.1.3 did not prescribe the amount of "flexibility" required in the vendors' bids; rather, it expressly requested the vendors to "describe what flexibility will be allowed for adding or deleting equipment." IKON's bid described the allowed flexibility as three percent of the overall equipment fleet value and was thus responsive on its face. The evidence presented at hearing was insufficient to determine whether a three percent limit would be so restrictive of PCS's needs to add or delete equipment as to render IKON's proposal nonresponsive. More problematic is the last sentence of the quoted paragraph: "In no event shall either party be liable to the other party for any indirect, special or consequential damages." Xerox cogently argues that if its own proposed limitation of liability is a material deviation, then this similar limitation of liability included in the IKON bid must also be found a material deviation. IKON responds that it is clear from the context that this limitation of liability provision, unlike that in Xerox's proposal, applies only to Section 7.1.3. For this reason, IKON contends, PCS determined that IKON's bid was responsive. IKON argues that its own limitation of liability provision is implicated only in the event that PCS requires additional equipment and that it does not limit any direct liability of IKON to PCS and concerns only a distinct class of damages: indirect, special or consequential damages. The position of the quoted sentence, at the end of the final paragraph of IKON's response to Section 7.1.3 of the Special Conditions, supports IKON's contention that the limitation of liability applies only to that section. However, the wording of the sentence ("In no event . . .") indicates a broader intended application. IKON also failed to explain why the requirement of additional equipment, and only the requirement of additional equipment, raised concerns within IKON that indirect, special or consequential damages might be claimed by either party to the contract. At best, this provision is ambiguous in the scope of its application and, in any event, seeks to limit the liability of IKON beyond the limits provided by the RFP. If Xerox's limitations of liability constitute material deviations, then so must IKON's. IKON's proposal thus contains two material deviations from the RFP, one regarding response time and one regarding limitations of liability. IKON's proposal is nonresponsive.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is RECOMMENDED that PCS enter a final order that (a) declares Xerox's bid to be materially nonresponsive and, accordingly, rescinds the proposed award to Xerox; and (b) declares IKON's bid to be materially nonresponsive and, accordingly, rejects the same. Because the choice of remedies for invalid procurement actions is ultimately within the agency's discretion, the undersigned declines to make a recommendation as to whether PCS should award the contract to the next-lowest responsive bidder or reject all bids and start over. DONE AND ORDERED this 10th day of May, 2007, in Tallahassee, Leon County, Florida. S LAWRENCE P. STEVENSON 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 10th day of May, 2007.
The Issue The issue in this case is whether Respondent should award a contract to Intervenor to provide physical and occupational therapy services to approximately 1,300 exceptional education students who qualify for such services in 77 public schools in Brevard County, Florida.
Findings Of Fact Intervenor is the incumbent contractor for physical and occupational therapy services provided to Respondent. Intervenor has provided such services to Respondent for approximately six years. On February 24, 1999, Respondent issued its request for proposals ("RFP") for occupational and physical therapy services. The RFP consists of eight unnumbered pages. Ten companies responded to the RFP. However, only the proposals of Petitioner and Intervenor are at issue in this proceeding. A four-member evaluation committee ranked each proposal on the basis of six categories. The six categories were: experience; qualification; recruiting ability; location of office; and responsiveness. The evaluation committee also considered the hourly rate and mileage to be charged by each proposer. The evaluation committee met as a body. Each member of the committee then returned to his or her respective office to complete a scoring sheet. The scoring sheet listed each proposer's name in a column down the left side of the sheet and the six categories for evaluation from left to right across the top of the sheet. A column down the right side of each sheet listed the hourly rate to be charged by the proposer identified in the column down the left side of the sheet. The RFP does not prescribe a scoring formula to be used in completing the scoring sheets. In relevant part, the RFP merely states: . . . The Selection Committee shall rank the firms in order of preference and will submit its recommendation to the Superintendent for his consideration. The [Board] will bear responsibility for the selection of the Contractor and will decide which bid [sic] is most appropriate for Brevard schools and their students. The Superintendent will recommend a therapy service provider which will be presented to the . . . Board for approval at a regular or special Board meeting. RFP at unnumbered page 8. All four members of the evaluation committee ranked Intervenor's proposal first and Petitioner's proposal second. However, the hourly rate in Petitioner's proposal was the lowest of all proposers, at $34.75, and $4.25 less than the $39 hourly rate quoted in the proposal submitted by Intervenor. The proposal submitted by Intervenor charged mileage in addition to the hourly rate while the hourly rate quoted by Petitioner included mileage. Before May 11, 1999, when the Board selected Intervenor as the proposer, the evaluation committee met. The committee asked Respondent's buyer assigned to the contract if the committee was required to recommend the proposal with the lowest price. The buyer advised the committee that the contract was for professional services and did not require the committee to recommend the lowest-priced proposal. The committee determined that Ms. Eva Lewis, one of its members and the Director of Program Support for Exceptional Student Education in Brevard County, should telephone Intervenor and ask if Intervenor would match Petitioner's price. Ms. Lewis telephoned Mr. Rick McCrary, the manager for Intervenor, and asked if Intervenor would accept the contract price of $34.75. After consultation with his superiors, Mr. McCrary agreed to the straight-rate price of $34.75. On May 11, 1999, Ms. Lewis presented the recommendation of the evaluation committee to the Board. The Board asked Ms. Lewis if Intervenor's price was the lowest price. Ms. Lewis disclosed that the evaluation committee preferred the proposal submitted by Intervenor, asked Intervenor to lower its price to meet that of Petitioner, and that Intervenor agreed to do so. The Board voted unanimously to select Intervenor as the proposer to be awarded the contract. The parties directed most of their efforts in this proceeding to the issues of whether competitive bidding requirements apply to the proposed agency action and whether the scoring formula used to rank the proposers complied with those requirements. Petitioner asserts that the selection of Intervenor by the Board violates the competitive bidding provisions in Section 120.57(3), Florida Statutes (1997). (All chapter and section references are to Florida Statutes (1997) unless otherwise stated). Intervenor and Respondent contend that Section 120.57(1), rather than Section 120.57(3), controls the Board's selection of Intervenor for the contract. Although the document used by Respondent to obtain proposals from vendors describes itself as an RFP and describes the responses as either proposals or bids, Respondent and Intervenor suggest that the document is not an RFP but merely a "solicitation." Respondent and Intervenor further argue: . . . that the . . . Board . . . did not attempt to comply with the requirements for competitive procurement under Section 120.57(3) or Chapter 287. . . . And . . . that the . . . Board was never required to comply with those statutes. . . . these are contracts for professional, educational and health services, contracts uniquely and specifically exempted from [the] competitive bid procurement process. Transcript ("TR") at 40. It is not necessary to reach the issue of whether Section 120.57(1) or the competitive procurement provisions in Section 120.57(3) and Chapter 287 control Respondent's selection of Intervenor as the proposer to be awarded the contract. In either event, the proposed agency action is contrary to the specifications in the RFP. Assuming arguendo that Section 120.57(3) and Chapter 287 do not apply to the contract at issue in this proceeding, Respondent failed to comply with RFP specifications. As Intervenor and Respondent point out in their joint PRO, Section F.8. of the RFP states: The . . . Board . . . and the selected proposer will negotiate a contract as to terms and conditions for submission to the . . . Board for consideration and approval. In the event an agreement cannot be reached with the selected proposer in a timely manner, then the . . . Board reserves the right to select an alternative proposer. (emphasis supplied) Intervenor and Respondent are also correct that the phrase "negotiate a contract as to terms and conditions" includes terms and conditions such as the contract price. Contrary to the provisions of Section F.8., the Board did not first select a proposer at its meeting on May 11, 1999, and then negotiate a contract price with the selected proposer. Rather, the evaluation committee negotiated a contract price with Intervenor before May 11, 1999, and the Board then selected Intervenor as the successful proposer. The evaluation committee is not the Board and does not have authority to act on behalf of the Board. As the RFP states, the evaluation committee has authority only to: . . . rank the firms in order of preference and . . . submit its recommendation to the Superintendent for his consideration. The [Board] will bear responsibility for the selection of the Contractor and will decide which bid [sic] is most appropriate for Brevard schools and their students. The Superintendent will recommend a therapy service provider which will be presented to the . . . Board for approval at a regular or special Board meeting. RFP at unnumbered page 8. The last sentence in Section F.8. makes clear that the right to select a proposer is the sole province of the Board and not the evaluation committee. Even if one were to ignore the legal distinctions between the evaluation committee and the Board and the authority of each, the RFP specifications fail to provide adequate notice to potential proposers of the true purpose for the RFP. As Respondent and Intervenor state in their joint PRO: . . . the . . . Board used the proposals it received to test the market for physical and occupational therapy services in Brevard County. The . . . Board then used the information it developed from the proposals as negotiating leverage to obtain a price concession from its incumbent contractor. The . . . Board's negotiation tactics permitted it to secure the superior vendor at the price of an inferior vendor. PRO at 33. The RFP fails to disclose that Respondent intended to use potential proposers to obtain negotiating leverage with the incumbent contractor. The failure of the RFP to disclose its purpose violates fundamental principles of due process, adequate notice, and fairness to potential proposers. It creates a gap between what agency staff knew of the Respondent's intent for the RFP and what potential proposers could know from reading the specifications in the RFP. The failure of the RFP to disclose its true purpose suggests that its authors recognized the chilling effect such a disclosure would have had on the response of potential proposers. The lack of responses from potential proposers, in turn, would have frustrated Respondent's intent to "secure the superior vendor at the price of an inferior vendor." Assuming arguendo that Section 120.57(3) controls the contract award at issue in this proceeding, Respondent's proposed agency action violates relevant provisions in Section 120.57(3)(f). In relevant part, Section 120.57(3)(f) provides: In a competitive procurement contest, other than a rejection of all bids, the Administrative Law Judge shall conduct a de novo proceeding to determine whether the agency’s proposed action is contrary to the agency’s governing statutes, the agency’s rules, or policies, or the bid or proposal specifications. The standard of proof for such proceedings shall be whether the proposed agency action was clearly erroneous, contrary to competition, or arbitrary, or capricious. . . . (emphasis supplied) As previously found, the proposed award of the contract to Intervenor is contrary to the RFP specifications, including specifications for the evaluation and selection process described in paragraphs 7 and 17, supra. The proposed agency action is clearly erroneous within the meaning of Section 120.57(3)(f). It violates fundamental notions of due process, adequate notice, and a level playing field for all proposers. All of the proposers who were induced by the terms of the RFP to expend the time, energy, and expense required to prepare and submit proposals were entitled to rely in good faith on the specifications in the RFP and to require Respondent to adhere to its own specifications. The proposed agency action is also contrary to competition within the meaning of Section 120.57(3)(f). The economic incentive to respond to an RFP would likely diminish over time if the proposed agency action were to persist. Potential proposers would eventually recognize the RFP process as a device intended to reduce the contract price of the incumbent provider rather than as a bona fide business opportunity for potential proposers to gain new market share. Such an economic environment would not likely induce potential proposers to incur the time and expense necessary to prepare and submit proposals. The pool of potential proposers would shrink, and Respondent would lose negotiating leverage with the incumbent vendor. The likely result would be an erosion of negotiating leverage and an accretion in costs.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a Final Order finding that the selection of Intervenor for the contract award is contrary to the RFP specifications and contrary to competition. DONE AND ENTERED this 3rd day of September, 1999, in Tallahassee, Leon County, Florida. 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 3rd day of September, 1999. COPIES FURNISHED: Dr. David Sawyer, Superintendent Brevard County School Board 2700 Judge Fran Jamieson Way Viera, Florida 32940-6699 Harold Bistline, Esquire Stromire, Bistline, Miniclier, Miniclier and Griffith 1970 Michigan Avenue, Building E Cocoa, Florida 32922 Jonathan Sjostram, Esquire Steel Hector and Davis, LLP 215 South Monroe Street, Suite 601 Tallahassee, Florida 32301 Edward J. Kinberg, Esquire Edward J. Kinberg, P.A. 2101 South Waverly Place Suite 200E Melbourne, Florida 32901
Findings Of Fact Respondent invited bid proposals for a "collocated service center" in Manatee County, providing approximately 25,500 square feet of office space. The invitation sought a "turnkey lease" for an initial period of 15 years and permitted the bidder a choice of providing "full services" (option 1) or "full services without electrical" (option 2). Petitioner submitted his bid under option 2, while the successful bidder, Dr. Kenneth R. McGurn, selected option 1. Their bid proposals, along with others not relevant here, were forwarded to a bid review committee. Committee members were generally knowledgeable as to Respondent's operations and bid evaluation procedures, but were given no specific instructions on how to conduct their evaluations. Each of the four committee members evaluated the bids and assigned points in 12 separate categories. The evaluation criteria to be utilized were set forth in the bid proposal (page 12, Joint Exhibits 3 and 4). The greatest weight was to be given in category number 1, "Rental rate including projected operating expenses to be paid by lessee." The testimony of the bid evaluation committee members established that McGurn, rather than Petitioner, was the successful bidder primarily because his proposal included electrical service. The committee members did not individually or collectively seek assistance in projecting future electrical costs when making their determination as to the award of points in bid category number 1. Rather, they used their own judgment and experience to estimate possible costs and award rental and service expense points accordingly. Three of the four evaluators generally felt that known electrical costs were preferable to unknown costs for budget purposes even though Petitioners's proposal may ultimately have been less expensive. Site characteristics were factors in several of the categories for which points were to be assigned. Committee members visited the proposed sites and rated Petitioner's site somewhat higher than McGurn's. Proper zoning of the site was not included in the bid criteria. 1/ Petitioner's site is properly zoned while McGurn's is not. McGurn's potential difficulties in obtaining a zoning change and with utility service to his site led him to inquire of Respondent whether he would be permitted to change sites if he received the contract award. Respondent advised him that he could do so if there was a persuasive reason for the change. Petitioner obtained an option on the site he proposed to utilize and renewed it for 30 days when Respondent did not act on its bid within the announced period. 2/ This extension cost Petitioner the forfeiture of his $2,000 deposit but did not carry him through to the actual bid award date, November 4, 1982. Respondent's memorandum (Petitioner's Exhibit 2) dated September 14, 1982, indicates that Respondent had already decided to award the contract to McGurn by that date. Had Petitioner been advised of this decision, he could have saved the $2,000 expended to extend his option. During the period prior to the official announcement of bid award, McGurn became aware that he was the probable successful bidder and acquired Petitioner's site after the latter's renewal option expired. McGurn obtained this property for the purpose of substituting it for his proposed site after he received the contract. He has not yet requested site substitution.
Recommendation Based on the foregoing, it is RECOMMENDED: That the Respondent enter a Final Order setting aside the award of the subject contract and reissuing its bid proposal. DONE and ENTERED this 12th day of May, 1983, in Tallahassee, Florida. R. T. CARPENTER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 12th day of May, 1983.
The Issue Whether the bids of Unisys and NCR were responsive to the Invitation to
Findings Of Fact Overview Invitation to Bid VH-2 (ITB) sought bids for full service hardware maintenance for approximately 3,500 computer terminals, printers, microcomputers and associated components and peripheral devices, located throughout the state. Upon acceptance of the lowest responsive bid, the State would enter into a six- month contract, renewable for two twelve-month periods. HRS officials considered whether to acquire the services through a Request for Proposal process or through an Invitation to Bid. The decision was made to pursue an ITB. The ITB was prepared by Harriet Parker, who, at the time, was the administrator of the HRS Data Center in Jacksonville, Florida. Ms. Parker's employment with HRS ended after the bidder's conference and after she had answered bidder's questions which came in after the bidder's conference. Ms. Parker was not employed by HRS when the bids received in response to the ITB were received. HRS issued the ITB on January 22, 1988. After a bidder's conference was held, HRS, on March 1 and 9, 1988, issued addenda to the ITB, which contained changes to the ITB. Additionally, the addendum issued on March 1, 1988 contained written responses to questions submitted by potential bidders. The ITB and addenda were reviewed by the Information Technology Resource Procurement Advisory Council. Five companies submitted bids: RAM Systems, Inc., Data Access Systems, Inc., Instrument Control Services, Inc., NCR, and Unisys. The bid of RAM Systems, Inc. was rejected as untimely. The remaining four bids were timely filed. Ms. Parker appointed three HRS employees to serve on the bid evaluation committee which reviewed the bids received in response to the ITB. The three employees were: Vincent C. Messina, a Data Communications Specialist III, James R. Hall, a Data Processing Manager II, and Hilda Fowler Moore, an administrative assistant. All three committee members were employees at the HRS Data Center in Jacksonville, Florida. At its first meeting, the committee reviewed the four bids to determine if they were in the format requested in the ITB. This review was solely as to form, instead of content. After the meeting, each committee member prepared cost extension sheets for each bid, in accordance with the method set forth in the ITB, to determine which bidder was the lowest. At the next meeting, the committee members compared the cost extension sheets each had prepared. While there were differences between them, each member had the bids ranked in the same order. The committee determined that Data Access Systems, Inc. was the lowest bidder, NCR the next lowest, then Unisys and, finally, Instrument Control Services, Inc. After further review, the bid of Data Access Systems, Inc. was rejected as nonresponsive. The committee then decided to concentrate their review on the bids of NCR, now the lowest bidder, and Unisys, now the second lowest bidder. The bid of Instrument Control Services, Inc. was laid aside, since it was the high bidder. After reviewing the content of the NCR and Unisys bids, the committee determined that both bids were responsive. Since NCR was the lowest bidder, the committee decided NCR should be awarded the bid. The Notice of Intent to award the bid was posted on April 5, 1988. Unisys timely filed its notice of intent to protest, and its formal written protest and request for a hearing. Review Standards Used by Committee The committee was not given any direction on how to evaluate the bids, and no instructions on how to determine a bid was responsive. The committee members never discussed the meaning of the terms "minor irregularity or "material deviation" and were never told the meaning of these terms. Finally, the committee members neither sought nor received legal advice on how to evaluate certain provisions contained in the bids. Mr. Messina interpreted his role on the committee to be to compare the items in each bid with the ITB. Reviewed his role as determining whether the wording of the bid would be sufficient to supply the State with a viable service agreement. His determination of whether a bid was responsive was not based on a word for word comparison of the bid with the ITB, but on an overall impression of what each bid contained. Mr. Hall reviewed the bids to make sure that each bidder was meeting what the ITB required. His main focus in reviewing each bid was whether the wording of the bid gave that bidder an advantage over another bidder. At the time of reviewing the bids, Ms. Fowler Moore's understanding of what constituted a "material deviation" was that it would be a major change which would affect an issue or an item in some way. She understood a "minor irregularity" to be a lesser difference. The committee as a group believed that there would be further review of their decision and that some differences between the bids and the ITB would be worked out later by others. The committee members did not think that their decision would be the final decision. The ITB, General Provisions The ITB, including attachments and the two addenda consisted of over 150 pages. The ITB contained a number of mandatory requirements. The ITB explained these as follows: MANDATORY REQUIREMENTS Introduction The State has established certain requirements with respect to bids to be submitted by bidders. The use of "shall", "must" or "will" (except to indicate simple futurity) in this Invitation To Bid indicates a requirement or condition from which a material deviation may not be waived by the State. A deviation is material if, in the State's sole discretion, the deficient response is not in substantial accord with this (sic) Invitation To Bid requirements, provides an advantage to one bidder over other bidders, has a potential significant effect on the quantity or quality of items bid, or on the cost to the State. Material deviations cannot be waived. The words "should" or "may" in this Invitation To Bid indicate desirable attributes or conditions, but are permissive in nature. Deviation from, or omission of, such a desirable feature, will not in itself cause rejection of a bid. (Emphasis in original) On page 5, the ITB provided that "any Bid which fails to meet the mandatory requirements stated in this Invitation to Bid shall be rejected." On page 1, the ITB provided that "Bids containing terms and conditions conflicting with those contained in the invitation to bid shall be rejected. On page 6, the ITB, in describing the format to be used, provided that "there is no intent to limit the content of the Bid. Additional information deemed appropriate by the bidder should be included." The addendum issued on March 1, 1988, contained the following: Q. Can a bid contain options that HRS will consider, providing all mandatories are met? If all mandatories are met, bidder may submit options for HRS consideration. These need to be clearly identified in a separate section of the bid. The bid price should not be based on HRS acceptance of options. The ITB contained the standard language that "Any questions concerning conditions and specifications shall be directed in writing . . . for receipt no later than ten (10) days prior to the bid opening," and gave bidders the opportunity to dispute the reasonableness, necessity and competitiveness of the terms and conditions of the ITB. On page 3, the ITB provided: Contractual Mandatories A bidder's response to this Invitation To Bid shall be considered as the bidder's formal offer. The signing of the contract by the Department shall constitute the Department's written acceptance of the successful Bid and a copy of the signed contract shall be forwarded to the successful bidder. The contract for services required by this Invitation To Bid is contained herein. The contract included in the -ITB incorporated and made part of the contract both the ITB and the successful bidder's bid. Comparison of the NCR Bid with the ITB The NCR bid contained numerous changes to the provisions of the ITB. These changes are set forth below. Supplemental Bid Sheets Pages 146 and 147 of the ITB consisted of a form which each bidder was to complete and return as part of its bid. The form stated that "each designated paragraph in this Invitation to Bid must be addressed. The bidder must initial the designated item indicating concurrence." The form set forth 47 items. The layout of the form, showing the first two items for illustration purposes, was as follows: TITLE RESPONSE INITIALS Introduction Understood and Agreed Mandatory Requirements Understood and Agreed The NCR bid contained initials in the appropriate place for all items. On thirteen of the items, NCR's bid contained the words "as per Bidder's Proposal" typed under the words "Understood and Agreed" as shown in the following example: TITLE RESPONSE INITIALS Introduction Understood and Agreed as per Bidder's Proposal Mandatory Requirements Understood and Agreed as per Bidder's Proposal The words inserted by NCR related to the items in the line directly above the inserted words. The committee members interpreted the insertion of the words "as per Bidder's Proposal" in different ways. Mr. Messina interpreted it to mean that NCR was agreeing to the terms of the ITB and was offering the State something better and different which the State could accept or reject. He thought the differences would be worked out later; that the differences were more a "legal matter" than something the committee could solve. Mr. Hall interpreted it to mean that NCR agreed to the provisions of the ITB as some of the provisions had been changed by NCR. Ms. Fowler Moore interpreted it to mean that the items for which "as per Bidder's Proposal" was added were qualified and the ones where nothing was added were not qualified. Limitation of Remedies The addendum issued on March 1, 1988 contained two new pages which became part of the contract section of the ITB. These new pages were numbered 23A and 23B. In its bid, NCR changed the wording of page 23A. The relevant portions of page 23A of the NCR response are set forth below: Limitation of Remedies Contractor's entire liability and the State's exclusive remedy shall be as follows: In all situations involving performance or non-performance of machines or programming maintained or serviced [furnished] under this Agreement, the State's remedy is (1) the adjustment or repair of the machine or replacement of its parts by Contractor, or, at Contractor's option, replacement of the machine [or correction of programming] errors, or (b) if, after repeated efforts, Contractor is unable to install the machine or a replacement machine, model upgrade or feature in good working order, or to restore it to good working order, or to make programming operate, [all as warranted,] the State shall be entitled to recover actual damages to the limits set forth in this Section. * * * Contractor's liability for damages to the State for any cause whatsoever, and regardless of the form of action, whether in contractor or in tort including negligence, shall be limited to the greater of $100,000 or the actual amount laid by the State to the Contractor for the services provided under this Agreement [appropriate price stated herein for the specific machines that caused the damages or] that are the subject matter of or are directly related to the cause of action.... Contractor shall hold and save the State harmless for any and all suits and judgements against the State for personal injury or damage to real or personal property up to the value of the Agreement at the time this Agreement is terminated caused by Contractor's tortious conduct in the performance of this Agreement.... (Underlined words were added by NCR, brackets indicate words NCR struck through). The committee members felt that these changes either were necessary, enhanced the language in the ITB, or would not have much of an effect on the contract. From a legal standpoint, however, the committee was not sure what the changes meant. The committee members felt that they were not qualified to determine whether the changes constituted a material deviation and believed that decision would be made by someone else after the committee was finished. The changes made by NCR to the first paragraph help to clarify the document to meet the provisions of the ITB. The ITB was not for the purchase of machines or programming, but for the servicing of hardware. The changes made to the second paragraph enhance HRS's position and help to clarify the language. HRS's position is enhanced because under the ITB language the limitation would have been the greater of $100,000 or $0 since the ITB did not contain prices for specific machines. Again, the stricken language would apply to a purchase agreement and not to a service contract. The change to the third paragraph has the effect of nullifying the hold harmless clause, since "the value of the Agreement at the time this Agreement is terminated" is zero. Bid Bond On page 3, the ITB required bidders to submit a bid bond or bid guarantee in the amount of $10,000. If the successful bidder failed to execute a contract within ten days after notification of award, the bid guarantee was to be forfeited to the State. The bid bond submitted by NCR contained the following language: NOW, THEREFORE, the condition of the obligation is such that, if the said principal shall be awarded the said contracts and shall within (*) days after receiving notice of the award enter into a contract. . . *to be negotiated between said principal and said obligee. Since NCR's bid bond left the period of time within which to enter into a contract to be negotiated, the bid bond was not in compliance with the ITB's requirements. Invoicing On page 21, the ITB set forth certain requirements for invoices. One of the requirements was that "the invoice will include a detail list of costs for parts replaced listed on each malfunction incident report." This information was important to Ms. Parker in order for HRS to know what it was paying for, even though the contract price included both parts and labor. NCR's bid had the quoted language stricken through. On page 12, the ITB required that "Invoices for payment must be submitted to the State monthly, with at least the same level of detail found in Attachment A." Page 13 of NCR's bid, under the caption "Invoices," stated that "NCR agrees to conform with the existing payment plans as established in previous agreements between NCR and the State of Florida Comptroller's Office." The committee members did not think that the requirement that the invoice contain the cost of replacement parts was important. They assumed that they would not receive this information from the winning bidder, since they were not receiving it from the existing contractor. The committee members did not know what the previous agreements were between NCR and the Comptroller's Office. The committee assumed that NCR's response would be sufficient to meet HRS's needs. Configurations The addendum issued on March 1, 1988, contained a new page 26 for the ITB, which contained the following language: Full service maintenance for microcomputers will include the following configuration: Up to 768KB RAM plus up to one memory expansion card, up to two 5 1/4 inch 360KB or up to two 1.2MB floppy disk drives, up to 20MB hard disk, enhanced graphics capability, monochrome or color monitor, and an ICC card if required for network communications. This full service maintenance configuration was developed to include features that are basic to microcomputers connected to the HRS Data Communications Network and are, therefore, the maintenance responsibility of the Data Center. Machine features that are not included in this configuration are not covered by the maintenance contract resulting from this ITB. Enhancements that may be on a microcomputer covered by the maintenance contract but would not themselves be covered include, but are not limited to: local area network (LAN) cards, 40MB hard disk, 3 1/2 inch floppy disk drive and Bernoulli Boxes. Maintenance of these enhanced features are the responsibility of the user. (emphasis added) NCR, in listing its price for servicing certain equipment, assumed configurations that are less than those stated in the ITB. For example, NCR did not include hard disks in its configuration for some equipment. Hard disk drives are some of the more expensive items to repair and replace in computers. The committee members did not compare the configurations in the NCR bid with those in the ITB. Therefore, they did not take into account the differences between the two in determining that the NCR bid was responsive. Termination of the Contract Page 11 of the ITB provided that: The State reserves the right to cancel maintenance coverage for any single piece of equipment or any number of pieces of equipment or the entire contract upon thirty (30) days written notice to the Contractor. NCR in its bid provided that: Withdraw/Termination Neither party shall be deemed to be in default of this agreement, or of any contract entered into pursuant to it unless, as a condition precedent thereto, the other party shall have first given written notice describing with reasonable detail the condition which it perceives to be a default as outlined in Attachment D and the Bidder's Proposal, and within sixty (60) days following receipt thereof, the party receiving such notice shall have failed or refused to correct such condition. Both parties shall make all reasonable efforts to correct any problems which may lead to termination of the agreement. The evaluation committee noticed this difference, and felt that this was an area to be looked at by other persons who would do a final review. Engineering Changes The ITB, on pages 12 and 13 stated that: Cost of maintenance shall include installation of all announced engineering changes applicable to any piece of equipment covered by this contract. All engineering changes which the manufacturer considers mandatory or engineering changes which the manufacturer or the Contractor considers necessary for safety reasons must be installed as soon as possible. Contractor shall notify the State in writing of all mandatory and safety related engineering changes. Engineering changes which the manufacturer recommends but which are neither mandatory nor for safety reasons must be installed within a reasonable period of time after the Contractor has notified the State of such changes and the State has authorized the installation of such changes . . . It is the Contractor's responsibility to determine what engineering changes are available, whether they are mandatory changes, safety changes, or other changes. Furthermore, it is the Contractor's responsibility to initiate the installation of all such changes. (emphasis added) Page 9 of NCR's bid provided that: Engineering Changes should a reliability modification released from an OEM be deemed necessary by NCR, the modification will be performed during the prime shift of maintenance at no additional charge to the State of Florida. The original equipment manufacturers with whom NCR has agreements are responsible for providing notification to NCR on any engineering changes. NCR will make HRS aware of engineering changes when the necessary. information becomes available to NCR. (emphasis added) The committee assumed that if a manufacturer considered an engineering change to be mandatory, NCR would deem it to be necessary and would make this change. Therefore, the committee determined that the NCR language was responsive and would result in the State receiving the service it expected. Malfunction Incident Reports Page 10 of the ITB required that the winning bidder furnish HRS with a written--malfunction incident report upon completion of each maintenance call. The ITB went on to describe ten items which had to be included in the reports. Page 12 of the NCR bid provided the following: Reports NCR has the ability to provide monthly service reports to HRS which summarize the maintenance activity of the account. Such records may include a listing of all equipment covered in the maintenance agreement accompanied by the dates of service calls, number of service calls received per equipment type, description of problem and solution, and the time spent for repair. NCR maintains a comprehensive equipment history file to meet your reporting needs. Reporting procedures will be jointly defined by NCR and HRS. (emphasis added) One member of the evaluation committee did not consider the reports to be an important item. Another member of the committee assumed that HRS would get the information it needed from the reporting procedures to be jointly defined by NCR and HRS once the contract was awarded. Additional Equipment Page 11 of the ITB required that the contractor would be responsible for maintaining all the equipment owned by the State which is of the type set forth in the ITB, regardless of whether the specific piece of equipment is listed in the ITB or subsequently purchased. Equipment of a type not described in the ITB is not part of the agreement. NCR's bid is consistent with this requirement. Also, NCR's bid gives HRS the option of adding equipment of a type not described in the ITB, after NCR evaluates the equipment and agrees to accept it. Principal Period of Maintenance Page 9 of the ITB provided that the "Principal period of maintenance shall be at least from 8:00 a.m. to 5:00 p.m., local time at each site, Monday to Friday, exclusive of holidays observed by the Department." Also, page 17 of the ITB provided that, "Principal Period of Maintenance (PPM)" shall be defined as at least nine consecutive hours per day (usually between the hours of 8:00 a.m. and 5:00 p.m.; local time at the site) as selected by the State, Monday through Friday, excluding holidays observed at the site." Finally, page 19 of the ITB contained language similar to the language in page 9 of the ITB. In the industry, "principal period of maintenance is that period of time during which a customer is buying services, including parts and labor, at a flat rate under a contract with the service provider. Page 8 of NCR's bid provided that "NCR's Principal Period of Maintenance (PPM) is Monday through Friday, 8:00 a.m. to 5:00 p.m., including a one hour meal period." NCR's bid did not change the language contained in page 19 of the ITB, noted above, which became part of its bid. Finally, in its Attachment to the contract provided in the ITB, NCR's bid stated that "the 'Principal Period of Maintenance' shall be defined as Monday through Friday, 8:00 a.m. to 5:00 p.m., exclusive of a one hour meal period, excluding holidays." The evaluation committee discussed the differences in the language between the NCR bid and the ITB dealing with principal period of maintenance and decided that the NCR bid was responsive. Response Time, Loaner Equipment and Penalties Page 9 of the ITB required the following: 5. Contractor must provide on site response within four (4) hours in metro areas and six (6) hours in all other areas at a 95 percent response level. Metro and non-metro locations are listed in Attachment B. If the response level falls below ninety-five percent (95 percent) overall for the State on a monthly basis, the Contractor will forfeit ten percent (10 percent) of the monthly maintenance cost per unit for each incident in the month of the occurrence. 7. The Contractor will have the equipment repaired and accepted by HRS Data Center staff or the Contractor will install an equivalent substitute device within six (6) hours after the maintenance begins. Maintenance begins when the Contractor arrives at the site and takes control of the equipment. If the equipment is not repaired or the Contractor does not install equivalent working equipment, the Contractor shall forfeit ten percent (10 percent) of the monthly maintenance cost per unit for each incident in the month of the occurrence. The NCR bid, on pages 8-9, provided the following: Response Time A firm commitment to response time and a stringent set of escalation procedures will be an integral part of NCR's service program for HRS. NCR has a commitment to arriving on-site within four (4) business hours of receipt of call during NCR's Principal Period of Maintenance, for equipment located within metropolitan areas. For non- metropolitan equipment sites, the average response commitment is six (6) hours. NCR understands the State of Florida's objectives to make system availability as high as possible, and we have an internal commitment to help the State meet the goal. Should NCR fail to meet its response and escalation standards as outlined herein, NCR will entertain future negotiations relative to credits and penalties. Because of NCR's response time, repair and escalation procedures, NCR generally does not provide loaner equipment. (emphasis added) The NCR bid then continues, on pages 10-12, under the heading "Escalation/Problem Resolution," to explain the procedures NCR personnel will follow when a machine cannot be restored to good operating condition within set periods of time. The evaluation committee interpreted NCR's bid to mean that NCR would respond within six (6) hours in the non-metro areas, even though the NCR bid stated that "the average response commitment is six (6) hours." The evaluation committee believed that the ten percent (10 percent) penalties set forth in the ITB were irrelevant and not necessary, since the penalties were too low. Therefore, the committee felt that NCR's proposal to negotiate a system of penalties and credits made sense. The committee also believed that, under NCR's escalation procedures, coupled with the statement on page 8 of the NCR bid that "Periodically, a whole unit swap philosophy may be utilized to maximize system uptime," the machines would be fixed within six (6) hours or an equivalent working device (loaner) would be installed. Probationary Period Evaluation Page 145 of the ITB set forth the evaluation criteria which HRS would use to evaluate the contractor's performance during the initial 6-month term of the contract. NCR's bid added language to five of the criteria, as follows: Is the response level of ninety-five (95 percent) maintained consistently each month in all major areas of the State? On the average. Are adequate spare parts available for equipment repair within six (6) hours? Spare carts are generally available within six (6) hours; maximum of twenty- four (24) hours. Is an equivalent substitute device installed if parts are not available or if repair is expected to require more than six (6) hours? Compliance in the following manner: NCR's repair and escalation procedures may result in utilizing a substitute device to maximize system uptime. Are the changes in priorities easily accomplished? As stated, not a quantifiable standard; would prefer substitute language. Are malfunction incident reports received on a timely basis? Compliance defined in Reporting section of Bidder's Proposal. (Underlined words were added by NCR) The committee noted that the NCR bid contained changes to the evaluation language. Implementation of Contract The NCR bid, in Appendix C, contained an implementation schedule calling for service to certain equipment to begin five weeks after the contract was awarded and to the remainder of the equipment nine weeks after the contract was awarded. The ITB, while not explicitly stating when the new contractor was to begin services, appears to contemplate that full service would begin immediately, since it provides for HRS to begin paying maintenance charges on the effective date of the contract. Under the terms of the ITB, the effective date of the contract would be no later than ten days after the award was posted. One member of the evaluation committee, Mr. Hall, believed the new contractor would begin service immediately, which to him meant within a month after the award was made. Execution of Contract The ITB contemplated that the successful bidder execute the contract provided in the ITB within ten days of notification of the award. The NCR bid provided that "Upon mutual agreement of the terms and conditions between our organizations, NCR agrees to execute a contract within ten (10) days." Also, the implementation schedule set forth in Appendix C of the NCR bid provided for the contract to be negotiated and executed between the second and fifth week after notification of the award. Assignment of Contract Page 22 of the ITB provided that "This Agreement is not assignable without the prior written consent of the Customer. Any attempt to assign any of the rights, duties or obligation of this Agreement without such consent is void. In its bid, NCR struck through the word "Customer" and inserted the word "parties." Site Rules and Regulations Page 23 of the ITB stated that: The Contractor shall use its best efforts to assure that its employees and agents, while on the State's premises, shall comply with the State's site rules and regulations. The NCR bid in its attachment to the contract, under the heading "The Rules and Regulations," provided that "Execution of a contract by NCR is contingent upon NCR's review of the State's site rule and regulations." REVIEW OF THE UNISYS BID As stated earlier, the Unisys bid was found to be responsive by the evaluation committee. Unisys agreed to all the performance mandatories of the ITB. The Unisys bid did not contain any deviations from the ITB and was consistent with all the terms and conditions of the ITB. Bid?
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that HRS issue a final order finding NCR's bid to be nonresponsive and awarding the contract under the Bid No. VH-2 to Unisys. DONE and ENTERED 26th day of July, 1988, in Tallahassee, Florida. JOSE A. DIEZ-ARGUELLES 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 26th day of July, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 88-22525Bid The parties submitted proposed findings of fact which are addressed below. Paragraph numbers in the Recommended Order are referred to as "RO " UNISYS' Proposed Findings of Fact Proposed Finding of Fact Number Ruling and RO Paragraph 1.-14. Accepted. 15.-18. Accepted as set forth in RO34. Accepted. Rejected as a conclusion. But see Conclusions of Law section of this Order. 21.-45. Accepted. 46. Rejected as irrelevant. 47.-52. Accepted. 53. Accepted. See Conclusions of Law section of this Order. 54.-58. Accepted. 59. Accepted except for last two phrases which are rejected. The evidence is inconclusive on whether NCR would have an advantage over other bidders and whether the price of the contract was affected by this provision. 60.-63. Accepted. 64.-65. Rejected. The evidence is inconclusive as to the effect the NOR bid's language would have. See Conclusions of Law section of this Order. 66.-69. Accepted. Rejected. Since, there is no way of knowing the result of the negotiations, one cannot determine if this would result in an unfair advantage or would have an economic impact. Rejected. Delay can occur in any contract. Under the ITB, undue delay would be penalized. 72.-75. Accepted. Rejected as irrelevant. Rejected as irrelevant. The statement may be true, but that is not the situation here. 78.-79. Accepted. 80. First phrase, rejected. NCR did not agree to anything. Second phrase, accepted. 81.-83. Accepted. 84. Rejected as a conclusion and an assumption, since no one knows what the jointly defined procedures would be. 85.-86. Accepted. Accepted as what the committee felt. However, the provisions of the NCR bid dealing with additional equipment are consistent with the ITB. Rejected as contrary to facts found. 89.-90. Accepted. Accepted. See Conclusions of Law section of this Order. Accepted. Accepted. See Conclusions of Law section of this Order. 94.-97. Accepted. 98. First two sentences accepted. Third sentence rejected; the evidence does not show what is included in the payment plans with the Comptroller. 99-102. Accepted. Rejected. The evidence is inconclusive on whether this item affected the price of the bid. Rejected as irrelevant. Rejected as irrelevant. Accepted. Rejected as not supported by the evidence. The NCR bid states that NCR would prefer substitute language. 108.-112. Accepted to the extent they restate the ITB and the NCR bid. However, the implicit conclusion that this is at variance with the ITB is rejected as not supported by competent evidence. 113.-119. Accepted. 120. The introductory paragraph is rejected as a conclusion of law. Subparagraphs A. through are accepted. HRS's Proposed Findings of Fact Proposed Finding of Fact Number Ruling and RO Paragraph 1.-7 Accepted Accepted. Accepted. True but unnecessary. Accepted generally. Accepted. Accepted generally. Accepted generally. Rejected as not supported by the weight of the evidence. First sentence accepted. Second sentence is true as to what the evaluation committee believed. However, the overall service to the State is affected by the NCR bid. True that this is what the evaluation committee determined, believed and concluded. However, the findings of fact made in this RO differ from what the evaluation committee believed. Rejected as contrary to the weight of the evidence. Rejected as contrary to the weight of the evidence. Rejected as contrary to the weight of the evidence. Rejected as contrary to the weight of the evidence. Rejected. While the cost of the services may be the same, less services are provided for in the NCR bid than are called for in the ITB. Rejected as contrary to the weight of the evidence. Rejected as contrary to the weight of the evidence. Rejected. HRS may wish to accept the NCR bid; if it does so, however, it will agree to a different agreement than called for in the ITB. There can be no meeting of the minds when items are left to be negotiated and where the evaluation committee members did cot understand all the provisions of the NCR bid. Rejected. See RO41. Rejected as irrelevant. See also Conclusions of Law. Rejected as irrelevant. Supported by competent evidence, but unnecessary to the decision reached. Also, the fact that this was the first ITB that Ms. Parker ever prepared does not mean that HRS can now disregard its mandatory provisions. Rejected as irrelevant. NCR's Proposed Findings of Fact Proposed Finding of Fact Number Ruling and RO Paragraph 1-6. Accepted Subparagraphs a) through s) are accurate representations of what the ITB contained. However, the first phrase to the effect that the ITB recognized and incorporated concepts of variability is rejected. The ITB was rigid and precise. Accepted. Accepted. Accepted. First sentence, true but irrelevant. Second sentence accepted. RO2. Third sentence, true but irrelevant. Fourth sentence rejected; the ITB is neither ambivalent nor flexible. Fifth sentence rejected as irrelevant and not supported by competent evidence. Accepted. Accepted. Supported by competent evidence but unnecessary to the decision reached. Supported by competent evidence but unnecessary to the decision reached. First two sentences rejected as contrary to the weight of the evidence. Third and fourth sentences rejected as argument and conclusions. First three sentences are accepted as what they are: the evaluation committee's views, beliefs and understandings. Fourth sentence is rejected. The ITB reserved the right "to reject any and all bids or waive any minor irregularity or technicality in bids received." It did not reserve the right to waive any proposed additions or changes which are unacceptable, regardless of how material they may be. Also, the ITB did not provide for further negotiations prior to contract finalization. Fourth sentence rejected; the evidence is inconclusive on what the NCR language means. Rest of paragraph accepted. First, second and fourth sentences accepted. Third sentence rejected as contrary to the weight of the evidence and the words of the ITB. Fifth sentence rejected as irrelevant; while the NCR proposal may be more beneficial to the State it is inconsistent with the ITB. First, second, fourth and seventh sentences accepted. Third sentence rejected as irrelevant. Fourth sentence accepted. Fifth sentence rejected as irrelevant; while NCR's view may be useful, the ITB did not contemplate it. Sixth sentence accepted, but this only refers to controlling and installing the engineering change and not to deciding whether the change should be made. First, and seventh sentences accepted. Second sentence rejected as irrelevant. Third through sixth sentences reflect what NCR proposed, but this is contrary to the requirements of the ITB. Seventh sentence rejected as argument. First three sentences accepted. Fourth sentence rejected as argument. First and second sentences accepted, noting that the four week training period ended eight weeks after the notice of award. Third sentence accepted, but ITB appeared to contemplate immediate service under the contract since it provided for payments to begin upon execution of the contract. Fourth sentence accepted, but the ITB language speaks to ongoing training of the contract and not training specific to this contract. Fifth sentence accepted. Sixth sentence accepted; however, it is unclear whether the ITB contemplated a nine week delay for full implementation of the contract. First, third and sixth sentences accepted. Second, fourth and fifth sentences rejected as contrary to the weight of the evidence. Last sentence rejected as not supported by the evidence. The evaluation team considered the malfunction incident reports unimportant and did not know what the existing payment plans with the Comptroller's office were; therefore, the committee could not know if these plans met HRS's needs. Rest of paragraph accepted, except to note that there is no evidence to show that the payment plans with the Comptroller's office would meet HRS needs, and that, while HRS may now decide that parts costs are not needed, this was a mandatory requirement of the ITB. Rejected as irrelevant. If NCR or any other bidder had a problem with the ITB they could have asked for clarification or could have challenged the ITB for restricting competition. Rejected as irrelevant. 21.c. First and second sentences accepted. Third, fourth and fifth sentences irrelevant; NCR could have asked for clarification or challenged the ITB. Fourth sentence irrelevant. Sixth sentence rejected as irrelevant. Seventh sentence irrelevant and not supported by competent evidence; it is impossible to now determine what NCR would have bid. Accepted. Accepted. The first sentence being the one following the quoted material, which is accepted. First sentence rejected as being contrary to the weight of the evidence. Second sentence accepted. Third sentence rejected as irrelevant; this is the number of calls made in the past. Fourth and fifth sentences rejected as assumptions. Fifth sentence accepted. First, second and third sentences accepted. Fourth and fifth sentences rejected as irrelevant; while these statements may be true, the NCR bid's provisions conflict with the ITB. First sentence accepted. Rest of paragraph rejected as argument and conclusion. First and second sentences accepted. Third sentence rejected as irrelevant. Fourth sentence rejected; while the addendums issued to the ITB maintained February 8th as the last day for submissions and inquiries, the ITB's general conditions stated that inquiries could be sent in 10 days prior to bid opening. The limitation of remedies form was sent to bidders on March 1, 1988; bids were not due until March 29, 1988. Fifth through ninth sentences accepted. Tenth sentence rejected; the language in the NCR bid is clear and does limit NCR's liability. Eleventh and twelfth sentences rejected as irrelevant. Thirteenth sentence rejected; the NCR language does not refer to the value of the remaining contract but to the value at the time of termination, which is zero at all times. Rejected as not supported by competent evidence. The evidence is insufficient to determine whether the person was licensed at the time the bid bond was countersigned. Rejected as irrelevant. Rejected as a recitation of testimony. The evidence shows that Unisys agreed to the ITB provisions requiring a Jacksonville office. Rejected as irrelevant. Unisys agreed to the provisions of the ITB and will be penalized for failure to comply with them. Rejected as irrelevant. First sentence accepted. Second sentence rejected; this is clearly a proper option under the terms of the ITB. Rejected. See ruling on proposed finding of fact 21e. Rejected as irrelevant. COPIES FURNISHED: Edgar Lee Elzie, Jr., Esquire MacFarlane, Ferguson, Allison & Kelly 804 First Florida Bank Building Tallahassee, Florida 32301 Charles R. Holman, Jr., Esquire Unisys Corporation 4151 Ashford, Dunwoody Road, N.E. Atlanta, Georgia 30319 Elaine New, Esquire Assistant General Counsel, HRS 1323 Winewood Boulevard Building I, Room 407 Tallahassee, Florida 32399-0700 Gary P. Sams, Esquire Cheryl G. Stuart, Esquire Hopping Boyd Green & Sams Post Office Box 6526 Tallahassee, Florida 32314 Robert J. Beggs, Esquire NCR Corporation 1700 South Patterson Blvd. Dayton, Ohio 45479 Sam Power, Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 Gregory L. Coler, Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700 John Miller, Acting General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, Florida 32399-0700
Findings Of Fact Respondent provides services to the residents of Immokalee from office space which it is currently leasing from Sunburst. The lease of the present facilities expires on August 31, 1985. DHRS is in need of more office space than it currently fills in order to meet the growing demand for its services in the Immokalee area. Therefore, DHRS issued an invitation to bid, inviting interested persons to submit bids for its required office space. Three bidders responded: Badcock Furniture Corporation, Sunburst Urethane Systems, Inc., and Chuck Bundschu, Inc. Badcock Furniture Corporation is not a party to these proceedings in that it did not seek an administrative remedy under Section 120.53(5), Florida Statutes. The bid acquisition has been designated by DHRS as Lease No. 590:1590. DHRS formed a bid evaluation committee to evaluate the bids which were submitted. The committee, consisting of William Samford, Residential Service's Director for Development Services, Frank Last, Senior Human Services Program Manager for Economic Services, Frances H. Clendenin, Administrative Services Director, John S. Cato, General Services Manager, and Ed Gauthier, Human Services Program Administrator for the Immokalee programs, visited the three prospective bid sites and evaluated the bid proposals. Each member individually reviewed and rated the bids and recorded his or her ratings on a form entitled Evaluation Criteria (Award Factors). The individual ratings were admitted into evidence as HRS Exhibits 2, 3, 4, 5 and 6. After the individual review, the committee met together for purposes of reaching a consensus evaluation. Based on that consensus, the committee generated a memorandum to the Department of General Services outlining the twelve evaluation criteria used and the points awarded to each bidder. On or about March 7, 1984, DHRS published its notice of intent to award Lease No. 590:1590 to Chuck Bundschu, Inc., as the successful bidder. By stipulation, only four of the evaluation criteria are in dispute as to the points awarded to each bidder. Those criteria resulted in the following ratings: Criteria 1 - Rental rate including projected operating expenses to be paid by lessor. Out of a total rating of 30 points, Sunburst received 30 points because it had the lowest rental rate during the term of the lease and the option years. Chuck Bundschu, Inc., received 27 points based on a formula designed by the committee. Under the formula, the maximum of 30 points was awarded to the low bidder if that bid was below the rent that had been set as the area rate and the other bidders then received points based on a ratio between their bid and the low bidder. Criteria 2 - Conformance of space offered to the specific requirements contained in the invitation to bid. A total of 20 points was available to each bidder in this criteria. Sunburst received 18 points and Chuck Bundschu, Inc., received the entire 20 points. The basis for the lower point award to Sunburst was that some of the proposed office space was in a residential building and the second floor of the two-story building was being and would be used for migrant farm housing. The property of Chuck Bundschu, Inc., was totally suitable and was well located. Criteria 4 - Provision of the aggregate square footage in a single building. Proposal will be considered, but fewer points given, which offer the aggregate square footage in not more than two locations provided the facilities are immediately adjacent to or within 100 yards of each other. Both Sunburst and Chuck Bundschu, Inc. would provide space in not more than two locations. However, Sunburst's buildings did not have a covered walkway connecting the buildings and the Bundschu property did. Therefore, Sunburst received 8 points and Chuck Bundschu, Inc. received the maximum 10 points. Criteria 6 - The effect of environmental factors, including the physical characteristics of the building and the area surrounding it, on the efficient and economical conduct of Departmental operations planned for the requested space. Sunburst received two points and Bundschu received the maximum of five points because the characteristics of the neighborhood and the actual layout of the property was more conducive to the conduct of Departmental operations. Specifically, Sunburst's property had a congested parking lot where many people gathered including some undesirable persons. These people and their activities resulted in a higher crime rate in the area. Further, migrant housing would exist on the floor above the offices that would house valuable food stamps, thereby creating a security threat. Finally, a proposed additional parking site would result in cars traveling across a walkway where clients and employees might be injured. Bundschu's property had none of these drawbacks. The memorandum from the bid evaluation committee to the Department of General Services stated the committee's findings and point award totals for the twelve criteria. That memorandum indicated that Badcock Furniture Corporation received a total of 59 points, Sunburst received 79 points and Chuck Bundschu, Inc., received 93 points. It is undisputed that a clerical error occurred in the memorandum and the totals as reported were incorrect. At hearing, testimony was given that the corrected totals should have been 91 points for Sunburst and 95 points for Chuck Bundschu, Inc. However, even these totals do not agree with simple addition of the points as they are listed separately by criteria. It is found that the correct totals for the separate points awards as stated in the memorandum is 90 points for Sunburst and 95 points for Chuck Bundschu, Inc. Despite the discrepancy in the actual point totals is reported in the memorandum, a review of the individual evaluation forms shows that each evaluator independently awarded Sunburst fewer points than Bundschu. While there was contradictory evidence regarding the actual total points awarded and the method by which the consensus was reached, the clear and convincing evidence is that Bundschu was evaluated to be the best bidder by every evaluator and the evaluators properly applied the criteria. It is undisputed that the property offered by Chuck Bundschu, Inc., is on property partially zoned "VR", and before offices could go into the building, a provisional use variance must be approved by the Board of Zoning Appeals of Collier County. The bid evaluation committee did not consider zoning in evaluating the bids because zoning was not an element specified in the invitations to bid. The invitation to bid does not require the proposed site to be compatibly zoned in order for the bid to be valid and responsive. If the contract is awarded and the successful bidder fails to make the space available as agreed, whether because of zoning or otherwise, the successful bidder shall be liable to DHRS for liquidated damages for each day that the property is unavailable. Zoning is not an element to be considered in the award of the bid.
Recommendation Based upon the foregoing, it is RECOMMENDED that a final order be entered which awards the contract for Lease No. 590:1590 to Chuck Bundschu, Inc., as having submitted the lowest and best bid proposal. DONE and ORDERED this 26th day of July, 1984, in Tallahassee, Florida. DIANE K. KIESLING 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 26th day of July, 1984. COPIES FURNISHED: Robert M. Grguric, Esquire 900 Sixth Avenue South Suite 201 Naples, Florida 33940 Anthony N. DeLuccia, Esquire Post Office Box 06085 Fort Myers, Florida 33906
The Issue The issue is whether the proposed award of Invitation to Bid No. 06-DC-7727 to Communications Engineering Service Company is contrary to the Department of Correction’s governing statutes, rules, policies, or the specifications in the Invitation to Bid for the reasons alleged by Petitioner.
Findings Of Fact The Department issued ITB No. 06-DC-7727 on October 27, 2006. The purpose of the ITB was to solicit bids for maintenance and repair of radio equipment owned by the Department in each of its four regions. The original deadline for submitting bids in response to the ITB was November 30, 2006, but the deadline was extended to December 15, 2006, through an addendum to the ITB. First Communications, CES, and Motorola, Inc., submitted bids for Region I. Another company, Econo Communications, Inc. d/b/a Mobile Communications, also responded to the ITB, but it did not bid on Region I. It was stipulated that First Communications’ bid was responsive to the ITB. The Department determined that the bid submitted by Motorola was not responsive to the ITB. That determination was not challenged. The Department determined that the bid submitted by CES was responsive, despite the issues discussed below. CES was determined by the Department to be the lowest responsible bidder. The bid submitted by CES was $2,571 per month.1 First Communications was the next lowest bidder. Its bid was $3,408.85 per month,2 which is 32.6 percent higher than CES’s bid. Section 4.3.1 of the ITB states that “it is essential that bidders follow the format and instructions contained in the Bid Submission Requirements (Section 5 with particular emphasis on the Mandatory Responsiveness Requirements).” Section 5.1 of the ITB lists the “mandatory responsiveness requirements” for bids, and states that: The following terms, conditions or requirements must be met by the bidder to be considered responsive to the ITB. These responsiveness requirements are mandatory.Failure to meet these responsiveness requirements will cause rejection of a bid. Any bid rejected for failure to meet responsiveness requirements will not be further reviewed. (Emphasis in original). Nearly identical language is contained in Sections 1.7 and 4.3.6.1 of the ITB, and in the ITB Review Manual used by Department staff in reviewing the bids submitted in response to the ITB. Indeed, the ITB Review Manual refers to the mandatory responsiveness requirements as “fatal criteria.” The mandatory responsiveness requirement in the ITB that is most pertinent to this case is in Section 5.1.2,3 which states: It is mandatory that the bidder supply one original signed Bid and three (3) copies of the signed bid. . . . . (Emphasis in original). The bid package submitted by CES did not include the original signed bid. It only included the three copies of the signed bid. This omission was noted by Christina Espinosa, the procurement manager for the ITB who opened the bids on the afternoon of December 15, 2006. However, after Ms. Espinosa consulted with her supervisor and the Department’s legal staff, it was determined that the omission was not material and that CES should be given an opportunity to “cure” its failure to submit the original signed bid. As a result, Ms. Espinosa contacted CES and gave it 24 business hours to “cure” the deficiency. CES delivered the original signed bid to the Department on the morning of December 18, 2006, which is three days after the bid submittal deadline in the ITB, but within the 24-business hour deadline given by Ms. Espinosa.4 CES did not have a representative at the bid opening, and there is no evidence that CES knew it was the lowest bidder, either when Ms. Espinosa gave CES an opportunity to “cure” its failure to submit an original bid on December 15, 2006, or when it submitted the original bid on December 18, 2006. It is undisputed that the original signed bid submitted by CES on December 18, 2006, is identical in all respects to the three copies of the bid that were timely submitted by CES on December 15, 2006. Ms. Espinosa reviewed the bid submitted by CES despite its failure to include the original signed bid. According to ITB provisions referenced above, that omission should have resulted in the bid being rejected and not further reviewed. The CES bid included at least one other deviation from the specifications in the ITB. The bid stated in the “service delivery synopsis” that the turnaround time for the repair of fixed equipment would be 15 working days. A 15-day time period was referenced in the original ITB, but it was changed to eight days in an addendum. Ms. Espinosa contacted CES about this discrepancy, and on January 3, 2007, CES advised Ms. Espinosa by e-mail that it “acknowledges the change in repair times from 15 days to 8 days.” CES was not the only bidder that Ms. Espinosa contacted after the bids were opened to obtain clarification or information omitted from the bid. For example, she contacted First Communications to obtain copies of its articles of incorporation and business licenses that were not included in its bid; to get clarification regarding First Communications’ use of subcontractors; and to confirm that First Communications acknowledged the eight-day turnaround time for repair of fixed equipment since its bid did not contain a service delivery synopsis. Section 4.3.1 of the ITB authorizes the Department to “seek clarifications or request any information deemed necessary for proper review of submissions from any bidder deemed eligible for Contract award.” However, Section 4.3.1 also states that “no modifications by the bidder of submitted bids will be allowed.” The ITB authorizes the Department to waive minor irregularities and non-material deviations in bids, and on this issue, the ITB states: Rejection of Bids The Department shall reject any and all bids not meeting mandatory responsiveness requirements. In addition, the Department shall also reject any or all bids containing material deviations. The following definitions are to be utilized in making these determinations. Mandatory Responsiveness Requirements: Terms, conditions or requirements that must be met by the bidder to be responsive to this solicitation. These responsiveness requirements are mandatory. Failure to meet these responsiveness requirements will cause rejection of a bid. Any bid rejected for failure to meet mandatory responsiveness requirements will not be further reviewed. Material Deviations: The Department has established certain requirements with respect to bids to be submitted by the bidder. The use of shall, must or will (except to indicate simple futurity) in this ITB indicates a requirement or condition which may not be waived by the Department except where any deviation there from is not material. A deviation is material if, in the Department’s sole discretion, the deficient response is not in substantial accord with this ITB’s requirements, provides an advantage to one bidder over other bidders, or has a potentially significant effect on the quantity or quality of terms or services bid, or the prices submitted to the Department. Material deviations cannot be waived and shall be the basis for rejection of a bid. Minor Irregularities: A variation from the solicitation terms and conditions which does not affect the price proposed or give the bidder an advantage or benefit not enjoyed by the other bidders or does not adversely impact the interests of the Department. A minor irregularity will not result in a rejection of a bid. (All emphasis in original). The Department relies on these sections of the ITB as its authority to waive minor irregularities and non-material deviations in bids with respect to any provision of the ITB, including the mandatory responsiveness requirements. On January 4, 2007, the Department posted notice of its intent to award the contract for Region I to CES. In the same posting, the Department rejected all bids for the other three regions. The rejection of all bids for the other regions is not at issue in this case. First Communications timely filed a notice of protest and, then, a formal written protest challenging the intended award of the contract to CES. The Department provided notice of this proceeding to CES, as required by the Order of Pre-hearing Instructions. CES did not file a petition to intervene or otherwise seek to participate in this proceeding.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Department issue a final order dismissing First Communications’ protest. DONE AND ENTERED this 5th day of April, 2007, in Tallahassee, Leon County, Florida. S T. KENT WETHERELL, II 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 5th day of April, 2007.
Findings Of Fact On June 23, 1984 Respondent, Department of Transportation (DOT), gave notice to qualified contractors that it would receive sealed bids on the following project: BROWARD COUNTY; FEDERAL AID PROJECT NO. I-595-1(313)9 (JOB NO. 86095-3449) and STATE PROJECT JOB NO. 86095-6449, SR-862 (I-595) (Griffin Road Detour), From Southwest 48th Ave. to Seaboard Coast Line Railroad North of Hollywood. Work consists of Extra-Heavy Grading; Construct New Pav't. and a Section of Widening and Resurfacing Existing Pav't. with Alt. 12Z" Limerock Base or 11", 9" or 7Z" Asph. Base Cse. (Type 1, 2 or 3) and Type III Asph. Conc. Leveling and Overbuilding Cse. both with Type S Asph. Conc. Structural Cse. and Asph. Conc. Friction Cse. (FC-1, 2 or 4); Storm Sewer and Small Drainage Structures; Conc. Curb and Gutter, Curb, Traffic Separator and Sidewalk; Conc. Handrail (Barrier); Guardrail (Rdwy. and Shop Bent); Fencing; Plugging Water Wells; Floating Silt Barrier; Muck Blanket; Sheeting; Water and Sanitary Sewer Lines; Aluminum and Steel Pipe Handrail; Traffic Signals; Highway Lighting; Roadway Signs; Pav't. Markings (Ref. Pav't. Markers, Painted and Thermoplastic Striping); and Incidental Items. Length 2.712 Miles. (B.I. 4140875) (APPROX. 550 CALENDAR DAYS) ON-THE-JOB TRAINING WILL BE REQUIRED FOR THIS PROJECT D.B.E. GOAL 12.0 PERCENT. The project is commonly known as the "Griffin Road Project" and is the forerunner to the construction of 1-595 in Broward County, Florida. The project generally consists of widening Griffin Road from two to six lanes for 2.71 miles so that the Road can be used as a detour while I-595 is under construction. Such bids were to be filed no later than 10:30 a.m. on July 25, 1984. Pursuant to state law, DOT set a 12 percent goal on the project for disadvantaged business enterprises (DBE). 2/ This means that at least 12 percent of the total work performed by the successful bidder must be subcontracted out to firms owned and controlled by socially and economically disadvantaged individuals and who are certified by DOT as qualified DBE's. The DBE specifications were set forth on pages 90 and 91 of the Special Provisions in the bid specifications and provided as follows: 2-5.3.2 Submittals for Contracts with Goals: 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. 2-5.3.3 Submittals for Evaluating Good Faith Efforts; If the DBE or WBE goal is not met, sufficient information to demonstrate that the Contractor made good faith efforts to meet the goals shall be submitted. In accordance with the specifications, if a bidder cannot meet the DBE goal, it must submit with its bid proposal adequate documentation to prove that it made a "good faith effort" to fulfill the goal but was nonetheless unable to do so. A failure to meet the goal or to submit such documentation subjects the bidder to automatic disqualification and rejection. The bid specifications also defined the terms "socially and economically disadvantaged individuals," "disadvantaged business enterprise," and "woman business enterprise" on pages 93 and 94. All bidders were given copies of the bid specifications before they prepared their respective bids. In response to the notice, and as is pertinent here, Petitioners, Vito's Trucking and Excavating Company and Frank V. Louis Equipment Company (Vito), and Respondent-Intervenor, Triple R Paving, Inc. (Triple R), prepared and submitted bids on the project. 3/ Vito, which has its principal offices in Fort Myers, Florida, submitted a total bid of $6,458,918. Triple R, a firm located in Fort Lauderdale, Florida, submitted a bid in the amount of $6,557,913, or some $99,000 higher than the bid submitted by Vito. The DBE/WBE Utilization Form No. 1 submitted by Vito with its bid indicated the following firms would be used as DBE subcontractors on the project: Tate Transport & Equipment, Inc. $300,000 4.64 percent Battle Construction Company 370,000 5.70 Merl's Original Nursery 214,500 0.38 Advance Barricades & Signing, Inc. 91,500 1.42 These subcontract prices totaled 12.14 percent of Vito's total contract bid. On the DBE/WBE Utilization Form No. 1 submitted by Triple R, Community Asphalt Corporation (Community) was listed as being a subcontractor who would perform $800,000 of work, or 12.2 percent of its bid amount. Triple R also listed Advance Barricades & Signing, Inc. (Advance) as a subcontractor on the project, but the use of Advance was not necessary to achieve the 12 percent goal. On July 25, 1984 DOT opened the sealed bids and immediately began a review to determine if each bidder had complied with the 12 percent DBE goal. A review of Vito's bid revealed that Vito failed to meet the DBE requirements and that its bid was accordingly nonresponsive. The disqualification was required since Vito had allotted 1.42 percent of its work to Advance and Advance was not a certified DBE when the contract was let. This in turn reduced Vito's DBE percentage to 10.75, or below the 12 percent goal. Because of this, the bid of the next lowest bidder, Triple R, was accepted by the Department. A DOT bids award committee later voted 6-1 to reject Triple R's bid and relet the contract on the ground Triple R's bid exceeded Vito's by more than 1 percent. This decision was overruled by the Secretary of Transportation and Triple R was designated as the lowest and most responsive bidder on September 4, 1984. That prompted the instant proceeding. On the evening before the bids were to be filed with DOT (July 24, 1984), the estimator for Vito (Angelo Speno) went to Tallahassee where he received additional subcontractor quotes necessary to complete the firm's bid proposal form. Speno obtained a number of quotes from minority subcontractors desiring to work on the project. After receiving these quotes, and discussing the matter with Vito's president in Fort Lauderdale by telephone, Speno completed Vito's Utilization Form No. 1. Among those listed as a DBE was Advance Barricades and Signing, Inc. Advance is owned by four Caucasian women and is certified by DOT as a woman business enterprise (WBE). However, it is not certified as a DBE. Advance's estimator, Martin Yount, approached Speno on the evening of July 24 and gave a $91,500 quotation for providing "roadside signing" on the project. Yount also advised Speno that Advance was a "female- owned" organization, a certified BE, and that if the project had "female goals," this form would aid Vito in achieving that goal. Despite the bid specifications clearly distinguishing between a DBE and WOE, for some reason Speno did not distinguish between the two, and thinking that Advance was a male Hispanic organization, he used Advance to meet its DOE goal. Accordingly, Vito did not submit documentation to show it had made a good faith effort to utilize DOE firms on the project since it believed the 12 percent goal had been net. Because of this, DOT properly rejected its bid. Vito now contends that another certified subcontractor listed on its Utilization Form 1 (Tate Transport & Equipment, Inc.) will actually perform more work than is listed on the Form thereby increasing its total DOE percentage on the job to over 12 percent. However, since June, 1984 DOT rules have required that all DBE's be correctly listed at the time the bid is submitted. To permit amendments after the bid has been filed would encourage "bid shopping" and permit an apparent low bidder to evade the award of a contract if he saw fit to do so. Vito also contends Community is not a legitimate DOE even though certified by DOT. Accordingly, it asserts that Triple R likewise failed to meet the 12 percent DOE goal. In this regard, Vito has not initiated a proceeding challenging the certification, but relies instead solely upon a letter sent to DOT by Community on May 10, 1984 reflecting a change of ownership and control in the firm. But the letter in question merely reflects a change in officers and directors of the corporation, and no evidence was submitted to support the allegation that Community is no longer a DOE within the meaning of DOT rules. DOT has consistently treated compliance with the DOE rules as a material part of the competitive bidding process. It is DOT's policy and practice to reject a bid where the bidder fails to meet the DOE goals and fails to turn in a good faith package. Therefore, DOT's reserved right to waive technical errors in bid documents does not apply in the case at bar.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Petitioners' formal protest and petition for formal proceedings be DENIED, and that the contract for the Griffin Road project be awarded to Triple R Paving, Inc., which submitted the lowest responsible bid on said project. DONE and ORDERED this 14th day of December, 1984, in Tallahassee, Florida. DONALD R. ALEXANDER 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 14th day of December, 1984.
Findings Of Fact In February 1994 the School Board, by and through its design consultants, W. R. Frizzell Architects, Inc., and, more particularly, its project architect, Byron Tramonte, issued plans, specifications, and related contract documents associated with additions, remodeling, and reroofing of John F. Kennedy Middle School, Palm Beach County, Florida. At a pre-bid conference conducted at the project job site attended by representatives of the School Board, its consultants, as well as representatives of Petitioner, Respondent, and Intervenor, among others, Petitioner's Greg Hill questioned the sufficiency of the drawings with respect to the earth work requirements associated with Alternate 1. As a result of this inquiry, the owner's design consultant issued Addendum 2 (including an as-built drawing) dated February 23, 1994, which was ". . . made available for grading estimates." The drawing attached to Addendum 2 had two sets of elevation numbers on it. One set of elevation numbers were underlined. The clearest of the underlined numbers were difficult to read. Many of the underlined numbers were impossible to read. The other set of elevation numbers on the subject drawing were boxed. The boxed numbers were all clear and legible. In view of the purpose for which the drawing was attached to Addendum 2, the most logical interpretation of the drawing was that the boxed elevation figures represented the existing elevations. The drawing attached to Addendum 2 also included some circled handwritten information. In large letters the circled information read: "JFK MIDDLE SCHOOL AS BUILT EXIST. ELEV." Immediately below in smaller letters it read: "Note: The 2 softball fields were not constructed. 2/23/94." The circled handwritten information was to some extent ambiguous. But it was an ambiguity that could be resolved by careful site inspection. Careful site inspection would have revealed that the boxed numbers corresponded to existing site conditions and that the underlined numbers, to the extent they were legible, did not. Petitioner's Vice President Greg Hill was primarily responsible for the preparation of the portion of the Petitioner's bid relating to Alternate 1. Greg Hill visited the job site during the prebid conference and also visited the job site on one other occasion after receiving Addendum 2, but before submitting the Petitioner's bid. Greg Hill is an experienced estimator with respect to matters involving the type of work encompassed by Alternate 1. In spite of his experience and in spite of his two pre-bid site visits, Greg Hill misinterpreted the architect's intent and used the underlined elevations on the drawing attached to Addendum 2 as a basis for estimating portions of the work associated with Alternate 1. As a result of this mistake Greg Hill reached erroneous conclusions about the amount of fill that would be required and substantially overestimated the amount of fill. This mistake caused the Petitioner's bid for Alternate 1 to be somewhat higher than it would have been if Greg Hill had based his estimates on the boxed elevation numbers. A similar mistake was made by CSR Heavy Construction-North, Inc., a company that was seeking work as a subcontractor on Alternate 1. On the last day for submitting bids on the subject project, the Intervenor received an unsolicited bid from CSR Heavy Construction-North, Inc., to perform some or all of the work encompassed by Alternate 1. CSR's bid was much higher than the Intervenor's proposed bid for that work, which caused the Intervenor's President to become worried that perhaps he had misinterpreted the drawings attached to Addendum 2. Intervenor's President called the School Board Architect and asked for confirmation of his interpretation to the effect that the bidders should base their estimates on the boxed elevation numbers on the drawing attached to Addendum 2. The architect confirmed that the Intervenor's President had correctly interpreted the drawing. The architect did not call any other potential bidders to tell them they should use the boxed numbers because he thought it was obvious that all potential bidders should use the boxed numbers. The bids for the subject project were opened on March 3, 1994. The Petitioner was the apparent responsive low bidder for the base bid. The Intervenor was the apparent responsive low bidder taking together the base bid and the bids on Alternates 1 and 2. The School Board published notice of its intent to award a contract to the Intervenor for the base bid and Alternates 1 and 2. The Instructions To Bidders portion of the subject bid specifications included the following provisions: BIDDER'S REPRESENTATIONS: Each Bidder, by making his Bid, represents that he has read and understands the Bidding Documents. Each Bidder, by making his Bid, represents that he has visited the site and familiarized himself with the local conditions under which the Work is to be performed. BIDDING PROCEDURES: * * * 3.11 Familiarity with Laws: The Bidder is assumed to be familiar with all Federal, State and Local Laws, Ordinances, Rules and Regulations, that in any manner affect the Work. Public Contracting and Purchasing Process Florida Statute, Section 287.132-.133 (Public Entity Crimes) is applicable. Ignorance on the part of the Bidder will in no way relieve him from responsibility. * * * AWARD OF CONTRACT: The Contract, if awarded by the Owner, will be awarded to the lowest bona fide responsible Bidder; provided the Bid is reasonable and it is in the interest of the Owner to accept the Bid. The method of determining the lowest bona fide Bid from Bidders shall be the Base Bid price plus or minus Alternate Prices listed on the Bid Proposal Form which are accepted by the Owner. Alternates will be considered for acceptance by the Owner as set forth in the Alternate section of the Specifications, Division One-General Requirements, Section 01030-Alternates. * * * BID PROTEST PROCEDURES: * * * 10.02 The Bid Documents/"Advertisement tol Bid" will be posted in the office of thel Department of Capital Projects at the time of the solicitation to Contractors. Any person who is affected adversely with respect to the Bid Documents shall file a notice of protest in writing within seventy-two (72) hours after the receipt of the Bid Documents, and SHALL FILE A FORMAL WRITTEN PROTEST WITHIN TEN (10) DAYS AFTER THE DATE HE FILED THE NOTICE OF PROTEST. Failure to file a notice of protest or failure to file a formal written protest shall constitute a waiver of proceedings under Chapter 120. It is important to the proper functioning of the public works bidding process that all bidders be treated alike. To this end, important information furnished to one potential bidder should be furnished to all other potential bidders.
Recommendation On the basis of all of the foregoing, it is RECOMMENDED that the School Board enter a Final Order in this case dismissing the protest of the Petitioner and awarding a contract to the Intervenor for the base bid and Alternates 1 and 2. DONE AND ENTERED this 17th day of May 1994 in Tallahassee, Leon County, Florida. MICHAEL M. PARRISH 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 17th day of May 1994. APPENDIX The following rulings are the specific rulings on all proposed findings of fact submitted by all parties: Findings submitted by Petitioner. Paragraphs 1 through 5: Accepted in whole or in substance. Paragraph 6: Rejected as not completely accurate. The practices described are common, but not universal. Drawings usually have a legend to explain the difference between existing elevations and elevations to be achieved. Paragraph 7: The first sentence of this paragraph is rejected as contrary to the greater weight of the evidence. The remainder is accepted in substance. Paragraph 8: The first sentence of this paragraph is rejected as constituting subordinate and unnecessary details. The last sentence of this paragraph is rejected as constituting inferences or arguments not supported by the greater weight of the evidence. Paragraphs 9, 10, and 11: Accepted in substance, but with some modifications in the interest of clarity and accuracy. Paragraph 12: Rejected as contrary to the greater weight of the evidence. Paragraph 13: Accepted in part. Accepted that if the Petitioner had used the boxed elevation numbers, it's proposal on Alternate 1 would probably have been substantially lower. The remainder of this paragraph is rejected as speculation Paragraph 14: Rejected as not fully supported by competent substantial evidence and as, in any event, subordinate and unnecessary details. Paragraph 15: Rejected as constituting primarily argument, rather than proposed findings of fact. To the extent the material in this paragraph purports to be factual, it tends to be contrary to the greater weight of the evidence. The greater weight of the evidence is to the effect that there were no ambiguities in Addendum 2 that could not have been resolved by careful site inspection. Paragraph 16: Accepted in substance. Paragraph 17: Rejected as constituting subordinate and unnecessary details. Paragraph 18: Rejected as contrary to the greater weight of the evidence; careful site inspection would have confirmed that the boxed numbers represented the existing elevations. Paragraph 19: Accepted. Paragraph 20: Rejected as speculative and as not supported by persuasive competent substantial evidence. Paragraph 21: Rejected as constituting a proposed ultimate conclusion of law, rather than a proposed finding of fact, and as, in any event, a conclusion that is not warranted by the evidence. Findings submitted by Respondent. Paragraphs 1 through 8: Accepted in whole or in substance. Paragraph 9: Rejected as constituting subordinate and unnecessary details. Paragraph 10: Accepted in substance. Paragraph 11: Rejected as constituting subordinate and unnecessary details. Paragraph 12: Rejected as constitution a proposed ultimate conclusion of law, rather than a proposed finding of fact. (The conclusion is warranted, but it is a conclusion nevertheless.) Findings submitted by Intervenor: (No separate proposals; the Intervenor adopted the proposed findings of the Respondent.) COPIES FURNISHED: Robert A. Rosillo, Esquire School Board of Palm Beach County 3318 Forest Hill Boulevard, Suite C-302 West Palm Beach, Florida 33406-5813 Alan C. Brandt, Jr., Esquire Leiby, Ferencik, Libanoff and Brandt Suite 400 150 South Pine Island Road Fort Lauderdale, Florida 33324 Richard B. Warren, Esquire Kelley, Aldrich & Warren, P.A. 801 Spencer Drive West Palm Beach, Florida 33409 Dr. C. Monica Uhlhorn, Superintendent Palm Beach County School Board 3340 Forest Hill Boulevard West Palm Beach, Florida 33406-5869
The Issue Whether Petitioner waived its right to protest the Supplemental Notice of Intent to Award issued by the Department on December 1, 2020.
Findings Of Fact On March 17, 2020, the Department issued Request for Proposals Number 06-80101500-J (the RFP) seeking vendors to provide services through state term contracts in two categories (Service Categories): (1) management consulting services (MCS) and (2) financial and performance audit services (FPA). The awarding of state term contracts resulting from the RFP does not guarantee the awarded vendors business; instead, being selected for award under a state term contract merely allows the awarded vendors to further compete for business from state agencies and certain defined eligible users who require the services offered under the contract. After vendors are selected for a state term contract, a state agency or eligible user who requires the services issues a request for quotes from the state term contract vendors. The vendors decide whether they want to compete for the specific services solicited by submitting a quote, and the procuring agency or user then selects from the contracted vendors the vendor that can best fit its unique needs based on the quotes. Accordingly, the purpose of the RFP is simply to pre-qualify the vendors for the future possibility of obtaining work from state agencies and eligible users. Consequently, the Department’s award to multiple vendors for each Service increases competition and gives the users significant choice in selecting a vendor, with each additional award having the effect of increasing the competition and choice available to state agencies and other eligible users who utilize the state term contract. The Department separately evaluated proposals submitted in the two Service Categories and made separate awards for each Service Category. Integrity Group submitted proposals for both Service Categories. Petitioner’s Protest concerns only the actions of the Department in conducting the procurement for the MCS Service Category and does not implicate the FPA Service Category. As part of the evaluation for the MCS Service Category, each vendor submitted a summary of its experience and a separate proposal for each individual Service (Services a through l) within the MCS Service Category. Integrity Group submitted a response summarizing its experience and an individual proposal for each of the MCS Services (Services a through l). Five evaluators appointed by the Department were tasked with scoring each vendor’s response with respect to experience, as well as separately evaluating and scoring each Service proposal submitted for Services a through l. The vendor with the highest score for each Service was awarded a state term contract for such Service, and the RFP reserved to the Department the right to make additional awards to vendors that scored within 25% of the highest score for each Service. The Department initially posted its Notice of Intent to Award and a list of the vendors that were awarded contracts in each Service on September 29, 2020. While the Department awarded Integrity Group state term contracts for the FPA Service Category, it did not make any awards to Integrity Group for the MCS Service Category. The Notice of Intent to Award for the MCS category posted by the Department on September 29, 2020, stated: State of Florida Notice of Intent to Award Management Consulting Services RFP No: 06-801 01500-J Date: September 29, 2020 As to the Management Consulting Services (MCS) category of the above-mentioned Request for Proposals, pursuant to sections 287.057(1)(b) and 120.57(3), Florida Statutes, the Department of Management Services hereby posts its Notice of Intent to Award a contract to the vendors listed in the MCS Award List attachment. Vendors who submitted proposals but were not awarded a Contract are listed in the MCS No Award attachment. Vendors who have submitted proposals deemed non-responsive are listed in the MCS Non-responsive attachment. Failure to file a protest within the time prescribed in section 120.57(3), Florida Statutes, or failure to post the bond or other security required by law within the time allowed for filing a bond shall constitute a waiver of proceedings under chapter 120, Florida Statutes. Any protest concerning this agency decision or intended decision must be timely filed with the Agency Clerk. Protests may be filed by courier, hand delivery, or U.S. mail at Department of Management Services, Office of the General Counsel, Attention: Agency Clerk, 4050 Esplanade Way, Suite 160, Tallahassee, FL 32399-0950. Protests may also be filed by fax at 850-922-6312 or by email at agencyclerk@dms.fl.gov. It is the filing party’s responsibility to meet all filing deadlines. From October 9 to 12, 2020, the Department received formal protests from four vendors not initially selected for award: Intervenor, MGT; TEK Systems Global Services, LLC; Slalom, LLC; and Tidal Basin Government Consulting, LLC. Integrity Group did not file a notice of protest within 72 hours of the Department’s posting of its September 29, 2020, Notice of Intent to Award, and did not file a formal written protest within ten calendar days from the filing of a notice of protest. On December 1, 2020, and after having engaged in resolution conferences with each of the protesting vendors, the Department issued a Supplemental Notice of Intent to Award, which awarded contracts to the four protesting vendors. Thereafter, on December 4, 2020, Integrity Group filed a notice of intent to protest related to the Department’s Supplemental Notice of Intent to Award, and on December 14, 2020, filed Petitioner’s Protest. Petitioner’s Protest alleges that “the Integrity Group is substantially and adversely affected by the Department’s improper and fundamentally flawed procurement process and erroneous decision to exclude the Integrity Group from receiving any awards.” However, as explained in the Conclusions of Law below, Petitioner’s Protest is untimely, has been waived, and should be dismissed.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding that Petitioner lacks standing and dismissing Petitioner’s Protest with prejudice. DONE AND ENTERED this 22nd day of January, 2021, in Tallahassee, Leon County, Florida. S JAMES H. PETERSON, III Administrative Law Judge 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 22nd day of January, 2021. COPIES FURNISHED: Rebekah Davis, Esquire Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399 Marion Drew Parker, Esquire Radey Law Firm Suite 200 301 South Bronough Street Tallahassee, Florida 32301 Mia L. McKown, Esquire Holland & Knight LLP Suite 600 315 South Calhoun Street Tallahassee, Florida 32301 Benjamin J. Grossman, Esquire Foley & Lardner LLP Suite 900 106 East College Avenue Tallahassee, Florida 32301 Christopher Brian Lunny, Esquire Radey Law Firm Suite 200 301 South Bronough Street Tallahassee, Florida 32301 Karen D. Walker, Esquire Holland & Knight, LLP Suite 600 315 South Calhoun Street Tallahassee, Florida 32301 Mallory Neumann, Esquire Foley & Lardner LLP Suite 900 106 East College Avenue Tallahassee, Florida 32301 William D. Hall, Esquire Dean Mead & Hall Suite 1200 106 East College Avenue Tallahassee, Florida 32301 James A. McKee, Esquire Foley & Lardner LLP Suite 900 106 East College Avenue Tallahassee, Florida 32301 William Chorba, General Counsel Office of the General Counsel Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399-0950 Jonathan Satter, Secretary Department of Management Services 4050 Esplanade Way, Suite 285 Tallahassee, Florida 32399-0950 Daniel R. Russell, Esquire Dean Mead & Hall Suite 1200 106 East College Avenue, Tallahassee, Florida 32301
