Findings Of Fact The Florida Department of Transportation (DOT) is required by state and federal law to ensure that a certain percentage of funds available for construction, design and consulting service contracts be provided as opportunity for utilization by small business concerns owned and controlled by socially and economically disadvantaged individuals (DBEs). DBE contract goals are established by the DOT for each construction contract. Every bidder must submit a form to the DOT which either documents compliance with the DBE contract goal or, if compliance is not met, must provide sufficient information to demonstrate that good faith efforts were made by the bidder to meet the goal. Prior to June of 1984, it was the practice of the DOT to allow contractors ten days after the bid letting to correct their DBE forms or to submit their good faith effort documentation. After holding numerous workshops throughout the State, the DOT amended its rules relating to participation by disadvantaged business entities. As pertinent to this proceeding, the amendment requires that all DBE documentation be submitted at the time of the submission of the bid proposal. Bidders are notified that: ".... Failure to satisfy these requirements shall result in a contractor's bid being deemed nonresponsive and the bid being rejected." Rule 14-78.03(2)(b)4, Florida Administrative Code. This rule became effective on May 23, 1984. All prequalified bidders were mailed a copy of the rule amendments prior to their effective date. Petitioner received a copy of the new rule prior to May 23, 1984. By notice dated June 28, 1984, contractors were advised that sealed bids would be received on July 25, 1984, on various road projects. The bid documents advised that the DBE goal for Project Number 50020-3516 was 10 percent. Form 932-10 entitled "Disadvantaged/Women Business Enterprise Utilization Affirmative Action Certification" advised bidders that Form 1 is required to accompany the bid documents. The specifications for Job Number 50020-3516 contain extensive provisions with regard to compliance with the DBE contract goals. Among these provisions is the following language contained in Section 2-5.3.2: "... Award of the Contract shall be conditioned upon submission of the DBE and WBE participa- tion information with the bid proposal and upon satisfaction of the contract goals or, if the goals are not met, upon demonstrating that good faith efforts were made to meet the goals." (Emphasis added.) The specifications lists as grounds for disqualification of bidders "failure to satisfy the requirements of 2-5.3." On July 25, 1984, Petitioner submitted a bid in the amount of 8171,370.51 for Job Number 50020-3516. Attached to the bid was Form 932-10 and Form No. 1, the latter indicating that petitioner's proposed utilization of DBEs was 7.6 percent of the total contract amount. While noting that two other DBEs were contacted without success, petitioner provided no further documentation regarding its good faith efforts to comply with the 10 percent contract goal. Three contractors submitted bids on this project. The next lowest bidder was Baxter Asphalt & Concrete, Inc., which submitted a bid of $191,540.92 and demonstrated compliance with the DBE contract goal. The third bidder, Capital Asphalt, Inc., submitted a bid of $204,651.35, fell below the 10 percent DBE contract goal and, like the petitioner, failed to demonstrate that it made a good faith effort to comply. The DOT engineer's estimate on this project was approximately $147,000.00. By notice dated August 17, 1984, the DOT advised that all bids received on Job Number 50020-3516 had been rejected. Two reasons were given for the rejection: that "the low bidder failed to meet DBE Contract Requirements" and that "awarding to the second low bidder is not in the best interest of the State." During June, July, and August following the adoption of the new rules regarding DBE requirements, it was the general policy of the DOT Awards Committee to reject all bids on a project if the low bidder failed to meet DBE requirements and there was more than a one percent difference between the first and second low bids. Beginning in September or October, 1984, this policy was changed to one of awarding to the second or third most responsible bidder as long as the bid was within the State estimate. Consequently, the DOT has now determined to award this challenged bid to Baxter Asphalt & Concrete, Inc. In another bid letting occurring on May 30, 1984, on Project Number 55160-3517, petitioner failed to submit with its bid proposal the forms for demonstrating compliance with the DBE requirements. By letter dated May 30, 1984, and received on June 4, 1984, petitioner was advised to forward, without delay, the necessary Form No. 1. The Form returned by petitioner showed 8 percent DBE participation. Since the contract goal was 10 percent, petitioner was afforded another opportunity to comply, did comply and receive approval on June 11, 1984, and was later advised that yet another DBE form needed to be completed. On July 17, 1984, petitioner received a letter from the DOT advising that the contract had been awarded to petitioner as of July 16, 1984. For all bid lettings occurring since June or thereafter, the DOT has rejected bids from contractors who have not submitted evidence with their bid proposal of either DBE compliance or a good faith effort to comply. New forms have been utilized to require such submittals with the bid proposal and removing the prior 10 day grace period language. Also, on August 22, 1984, the DOT sent a "Notice to All Contractors" that: "... all submittals for evaluating Good Faith Efforts in meeting DBE/WBE goals must be submitted with the bid proposal in order to be considered for award of the contract. Failure to submit the Good Faith Effort documentation with the bid may result in rejection of the bid."
Recommendation Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that a Final Order be entered rejecting as non-responsive the bid submitted by petitioner on Job Number 50020-3516, and awarding the contract to Baxter's Asphalt & Concrete, Inc. Respectfully submitted and entered this 27th day of February, 1985, in Tallahassee, Florida. DIANE D. TREMOR Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of February, 1985. COPIES FURNISHED: Michael P. Bist, Esquire 300 Lewis State Bank Building Tallahassee, Florida 32301 Larry D. Scott, Esquire Haydon Burns Building, MS-58 Tallahassee, Florida 32301-8064 Frank A. Baker, Esquire 204 Market Street Marianna, Florida 32446 Paul Pappas, Secretary Department of Transportation Haydon Burns Building Tallahassee, Florida 32301
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: The Department of Transportation (D0T) advertised for bids on State Project Number 97879-3336 in July of 1986. The project involves new roadway construction with specified materials, drainage installation, curbs, gutters and sidewalks adjacent to the Orange Bowl in Dade County. The D0T set a disadvantaged business enterprise (DBE) participation goal for this project of fifteen percent. In order to comply with this goal, a bidder must state its intention to subcontract with a D0T certified DBE an amount of work equal to or greater than fifteen percent of the total dollar value of its bid. The D0T opened the nine bids received for this project on July 30, 1986. The intervenor Capeletti Brothers, Inc. (Capeletti), submitted the apparent low bid in the amount of $2,044,000.18, and the petitioner Russell, Inc. (Russell), submitted the apparent second low bid of $2,047,503.00 The remaining bids ranged between $2,124,527.32 and $2,851,657.26. Bidders indicate compliance with the minority participation goals established for a project through the submittal of "DBE/WBE Utilization Form No. 1," which is submitted with the bid. In this case, Capeletti provided information on Form No. 1 that it would subcontract with Ivory Modernized Services to do "trucking" and "aggregates" at a dollar amount of $307,622.00, or 15.05 percent of the total contract amount. Russell indicated on Form No. 1 that it would subcontract with Community Asphalt Corporation to do "asphalt paving" at a dollar amount of $352,151.00, or 17 percent of the total contract amount. During the bid letting process, it is the practice of the DOT to conduct a facial review of the "DBE/WBE Utilization Form No. 1" submitted with the bid to determine whether the named subcontractor is a certified DBE or WBE and whether the participation goal set for that project has been met. Prior to awarding the contract, the DOT does not make a separate investigation to determine whether a listed DBE subcontractor is actually capable of performing the work for which the bidder has indicated. Any such investigation is made at or after the time a contractor actually submits to the DOT a request for authorization to sublet, which occurs after the DOT has awarded the contract to the bidder. The DOT considers the successful bidder to be bound to pay a DBE at least the amount listed on Form No. 1 submitted with its bid. If, for some reason, the DBE listed cannot perform the work for which it has subcontracted to perform, the DOT will require the prime contractor to either pay that amount to the listed DBE or subcontract with another DBE for that work. Ivory Modernized Services, Inc. (Ivory), is a DOT certified DBE. In its application to the DOT for certification, it listed "trucking (hauling of aggregates)" as the nature of its business. The DOT requests such information on the application because it publishes a directory of certified DBEs for the use of bidders on state contracts. Prior to submitting its bid, Capeletti and Ivory agreed that if Capeletti were the successful low bidder on this project, Ivory would furnish and deliver aggregates to the job site. It was agreed that the responsibility for obtaining and delivering the aggregates to the project site would rest with Ivory. The sum of $307,622.00 was derived by estimating the quantities of the various types of aggregates needed for the project, the material cost per ton, the hauling cost per ton and the amount and charge for on-site hauling. In the past, Capeletti has directly purchased rock from mining pits in the area. While Capeletti has never before purchased fill from Ivory, Ivory has performed one D0T job where it was responsible for both the buying and hauling of aggregates. Ivory does not own any fill land, pits or fill material, does not do any active pit excavation and does not plan to stockpile aggregate materials for this project. Ivory intends to negotiate with the rock pit owner for the required amounts, types and purchase prices of the aggregates needed, pick up those aggregates from the pits and transport them to the job site. The precise methods of payment for the aggregates has not yet been determined. In order to avoid any potential markups in the price of limerock and aggregates, Russell deals directly with the rock pits in purchasing its materials. Truckers are hired separately to deliver the materials to the job site, and they do not purchase the fill. In its bid, Russell did not list a DBE trucker or hauler because the fifteen percent participation goal could not be reached with amounts expended for trucking alone. It has been the past practice and policy of the DOT to allow all material costs to be included in meeting the DBE participation goal where the DBE subcontractor assumed the actual and contractual responsibility for the provision of the materials and supplies. For example, where a DBE grasser or concrete finisher also assumes responsibility for purchasing and obtaining the sod or concrete and responsibility for supplying those materials to the project site, the costs of the sod or concrete are included in meeting the DBE participation goal. The prime purpose of limiting payments which can be included in the case of "suppliers" who perform some commercially useful function is to prevent mere brokerage or pass-through services as qualifying for full participation in meeting DBE goals. "Commercially useful functions" performed by a "supplier" can include the stockpiling and transporting of materials.
Findings Of Fact Background In September 1988, Respondent, Department of Transportation (Department), issued an invitation to bid (ITB), State Project NO. 89 060-3523, for road work on SR-76 (Kanner Highway) in Martin County, Florida. By October 26, 1988, the bid opening date, four bids had been filed with the Department. On December 5, 1988, the bid results were posted by the Department. The bid results revealed that Petitioner, Dickerson Florida, Inc. (Dickerson), was the lowest bidder at $1,057,464.71 and that Ranger Construction Industries, Inc. (Ranger) at $1,145,177.61 was the second lowest bidder. The bid results further revealed that the bid of Dickerson had been rejected as non-responsive because it purportedly did not achieve the disadvantaged business enterprise (DBE) goal of 12 percent established by the ITB, and that the Department proposed to award the contract to Ranger. Dickerson timely filed a written notice of protest and formal written protest contesting the Department's decision, and the matter was referred to the Division of Administrative Hearings for formal hearing. The Bid Documents Pertinent to this case, the ITB contained the following provisions: SPECIAL PROVISIONS DISADVANTAGED BUSINESS ENTERPRISES 2-5.3.2 Submittals for Contracts with Goals: For all contracts for which DBE contract goals have been established, each contractor shall meet or exceed or demonstrate that it could not meet, despite its good faith efforts, the contract goals set by the Department. The DBE participation information shall be submitted with the Contractor's bid proposal. Award of the Contract shall be conditioned upon submission of the DBE participation information with the bid proposal and upon satisfaction of the contract goals or, if the goals are not met, upon demonstrating that good faith efforts were made to meet the goals. The Contractor's bid submission shall include the following information (Submitted on Forms Nos. 275-020-002-DBE Utilization Affirmative Action Certification, 275-020-003- DBE Utilization Summary and 275-020-004-DBE Utilization Form): The names and addresses of certified DBE firms that will participate in the contract. Only DBEs certified by the Department at the time the bid is submitted may be counted toward DBE goals. A description of the work each named DBE firm will perform. The dollar amount of participation by each named DBE firm. If the DBE goal is not met, suffi- cient information to demonstrate that the contractor made good faith efforts to meet the goals. (Emphasis added) Accompanying the ITB were three DBE utilization forms which, pertinent to this case, provided the vehicle for complying with the foregoing special provisions, and which the bidder was required to complete and include in its bid. Among these was form 275-020-004, the DBE Utilization Form, which required, consistent with the special provisions, that the bidder provide the name, address, and telephone number of the DBE subcontractor, as well as the item number and description of the work the subcontractor was to perform. One utilization form, signed by the bidder (prime contractor), was to be submitted for each DBE utilized on the project. Significantly, the utilization form to be signed by the bidder contained the following provision: (Signature and submission with the prime contractor's bid signifies acceptance of the quote and an obligation to subcontract the work to the DBE as indicated). The other two DBE utilization forms that were to be included in the bid were form 275-020-003, the DBE Utilization Summary, and form 275-020-002, the DBE Utilization Affirmative Action Certification. The DBE Utilization Summary provided the vehicle for the bidder to submit the dollar amount of participation by each DBE firm, and to derive a DBE percentage participation for the total project. It also requested that the bidder provide the following information: Number of DBE Utilization Forms attached NOTE: Sign and attach all Utilization Forms which you are using toward the DBE goal. By submittal of the DBE Utilization Form and the DBE Utilization Summary, the bidder could comply with the special provisions of the ITB regarding DBE utilization. The final DBE utilization form that was to be included in the bid, the DBE Utilization Affirmative Action Certification, required the bidder to certify the existence of an approved DBE Affirmative Action Program Plan or that it was submitting a plan for approval with its bid. The certification form, which was to be signed by the bidder, contained the following conspicuous notation: The Florida Department of Transportation requires the Disadvantaged Business Enterprise Utilization Form(s) to accompany the bid documents.... FAILURE TO SUBMIT THE DISADVANTAGED BUSINESS ENTERPRISE UTILIZATION FORM(S) REFLECTING FULL COMPLIANCE WITH THE CONTRACT GOAL, OR IF THE DISADVANTAGED BUSINESS ENTERPRISE UTILIZATION FORM(S) DO NOT REFLECT FULL COMPLIANCE WITH THE CONTRACT GOAL, FAILURE TO SUBMIT SUFFICIENT DOCUMENTATION TO DEMONSTRATE GOOD FAITH EFFORTS TO MEET THE GOAL WILL BE JUST CAUSE TO CONSIDER THE BID NONRESPONSIVE AND TO REJECT THE BID. THESE DOCUMENTS MUST BE SUBMITTED WITH THE BID PROPOSAL. Dickerson's Bid The bid submitted by Dickerson included the DBE Utilization Affirmative Action Plan Certification and a DBE Utilization Summary evidencing a DBE percentage participation for the total project of 13.39 percent. As submitted, the utiliza- tion summary listed Dickerson's DBE subcontractors and the amount of their participation as follows: A. Highway Valets, Inc. -- $ 6,473.35 B. Temple's Heavy Hauling -- $44,536.25 C. Highway Valets, Inc. -- $ 6,730.00 D. Pary, Inc. -- $ 5,264.00 E. Siboney Contracting Co. -- $45,938.55 F. Advance Barricades and Signing, Inc. -- $32,599.80 Accompanying Dickerson's bid were DBE Utilization Forms for Highway Valets, Inc. and Temple's Heavy Hauling, signed by the DBE subcontractor and Dickerson, which contained the item number and description of the work to be performed by those subcontractors, as well as a DBE Utilization Form for Siboney Contracting Company, signed only by Dickerson, which contained the item number and description of the work to be performed by that subcontractor. No DBE Utilization Form was submitted for Pary, Inc. or Advance Barricades and Signing, Inc., and Dickerson's bid contained no information to demonstrate the item number or work those firms were to perform on the project. Upon noting the absence of any DBE Utilization Forms for Pary or Advance Barricades, or any other documentation from which the item numbers and work description for these DBE's could be ascertained, the Department reduced the dollar value of Dickerson's DBE participation by the amount allocated to these firms, and recalculated a DBE percentage for Dickerson of 9.8 percent, well below the DBE goal of 12 percent. Thereafter, upon concluding that Dickerson's failure to include the item number and description of the work to be performed by the DBE's was not a minor irregularity that could be waived, discussed infra, and that Dickerson had submitted no documentation with its bid to demonstrate that it could not in good faith achieve the goal, the Department proposed to reject Dickerson's bid as non-responsive for its failure to achieve the DBE goal of 12 percent established by the ITB. 1/ On December 12, 1988, some seven days after the Department posted the bid result, Dickerson submitted to the Department a DBE Utilization Form for Pary and Advance Barricades which contained the item number and description of the work to be performed by those firms. Notably, neither form was signed by Dickerson, as required by the ITB, and the quotation of Advance Barricades was for $53,208, some $20,618.20 more than the participation allotted to that firm in the utilization summary submitted with Dickerson's bid. A Minor Irregularity? Minor irregularity is defined by Rule 13A-1.002(10), Florida Administrative Code, as: ... a variation from the invitation to bid ... which does not affect the price of the bid or give the bidder ... an advantage or benefit not enjoyed by other bidders ..., or does not adversely impact the interests of the agency. Variations which are not minor can not be waived. In the instant case, the proof demonstrated that Dickerson's failure to include a description of the work Pary and Advance Barricades were to perform on the project would adversely affect the interests of the agency. The Department has experienced significant problems in the past in its administration of the DBE program, particularly in the reliability of the DBE participations contained in bid documents. The purpose of the special provisions of the ITB, which parrot Rule 14-78.003(2)(b)3, Florida Administrative Code, relating to the name, amount of participation, and work to be performed by the DBE subcontractors are designed to assist the Department in achieving the goals established by the DBE program by increasing the reliability of the bid documents. Historically, bids have been submitted to the Department with inflated DBE participations and with the names of DBE's who had never been contacted by the prime contractor to perform any work on the project. Absent a description of the work the DBE subcontractor had agreed to perform, the Department has been frustrated in its efforts to confirm, post bid, that the DBE subcontractor is doing the type and amount of work for which it contracted. Consequently, DBE participation on a project has frequently differed significantly from that stated in the bid documents, and as contemplated by the Department By requiring compliance with the special provisions of the ITB, and its rule, the Department essentially forces the solidification of a contract between the prime contractor and the DBE subcontractor, and gains reliability in the DBE participation specified in the bid documents, and achieves a binding commitment that can be verified post bid. Under such circumstances, a bid's failure to include a description of the work a DBE subcontractor is to perform on the project is a variation that would adversely impact the interests of the agency and cannot be waived.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered dismissing the formal protest filed by Dickerson Florida, Inc. DONE and ENTERED in Tallahassee, Leon County, Florida, this 17th day of February, 1989. WILLIAM J. KENDRICK 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 February, 1989.
The Issue The issues are as follows: (a) whether Respondent failed to follow applicable policies and procedures in evaluating responses to Request for Proposal P-01-01 ("the RFP"); and (b) whether two of the bidders colluded in filing their proposals.
Findings Of Fact On October 15, 2003, Respondent, through the City's procurement office, issued the RFP for the purpose of obtaining professional services for technical assistance in the administration of Respondent's DBE program. The City received six responses to the RFP including proposals from the following: (a) Petitioner, a joint venture/strategic partnership with Carroll & Carroll Consulting, Inc. and Tracking Systems of America, Inc.; (b) a joint venture consisting of Renaissance Design Build Group of Jacksonville, Inc., OTAi, Inc., and J & W. Consultants of Jacksonville, Inc. (Renaissance); and (c) Anderson & Associates, P.A. with OK Consulting Agency, Inc. as a sub-consultant (Anderson). Pursuant to the RFP as amended, the bidders had to deliver their proposals to the City's Department of Administration and Finance, Procurement and Supply Division, by November 14, 2003. The City placed a date-stamp on the proposals to establish the date and time of their receipt. The City also maintained a list/sign-in sheet of each proposal timely delivered, whether by mail or hand delivery. Anderson was the third bidder listed on the sign-in sheet. J & W Consultants of Jacksonville, Inc., representing the Renaissance joint venture, was the fifth bidder listed on the sign-in sheet. Petitioner was the last bidder listed on the sign-in sheet. The fact that J & W Consultants of Jacksonville, Inc., signed the sign-in sheet on behalf of its joint venture or was listed on the sign-in sheet instead of Renaissance Design Build Group of Jacksonville, Inc., does not mean that the Renaissance proposal was not timely or properly filed. Any member of a joint venture could have signed the sheet or been listed on the sheet indicating the City's timely receipt of a joint venture proposal. The RFP stated that the proposals could not include more than 25 pages. There is no evidence that any of the proposals, including the Renaissance and Anderson bids, contained more than 25 pages. After receiving the proposals, Respondent's evaluation committee reviewed them, using a matrix to rank each bid in each of 11 categories. The evaluation committee did not make hand- written notes, positive or negative, regarding the proposals of Renaissance and Anderson. The committee did make notes regarding four of the proposals including Petitioner's bid. Specifically, the committee noted the following about Petitioner's bid: (a) no verification of financial stability information; (b) tracking the project vs. tracking payment; (c) past record of professional accomplishments not related to requested services; and (d) price, $752,000. There is no requirement for the evaluation committee to make notes during the evaluation process. Respondent did not violate its policies, procedures, laws, rules, or regulations by not making notes on all proposals or by making notes only on the four bids that received the lowest scores. The matrix used to evaluate the proposals was more than sufficient to differentiate the merits of each proposal in all 11 categories. Based on the overall scores, Respondent's decision to rank Renaissance in first-place, Anderson in second- place, and Petitioner in third-place was not clearly erroneous. The evaluation committee did not request any of the bidders to make oral presentations. The decision to request bidders to make oral presentations is discretionary with the evaluation committee. There is no evidence that the committee abused its discretion in not requesting the top three bidders, including Petitioner, to make oral presentations. The RFP as amended requires that bidders complete and file the following forms with each proposal: (a) Conflict of Interest Certificate; (b) Public Entity Crime Information; Certification of Eligibility; (d) Non-collusion Bidding Certification; (e) Public Official Disclosure; (f) Certification Regarding Lobbying; and (g) Certification of Primary Participant Regarding Debarment, Suspension, and Other Responsibility Matters. The proposals of Renaissance, Anderson, and Petitioner contained all of these required forms. The RFP as amended also contains forms that contractors and subcontractors are required to file in order for them to participate in Respondent's DBE program. These forms include the following: (a) Bidder's List; (b) Intent to Perform Contract as Subcontractor; (c) Declaration of Prime Contractor; Contractor's Request for Payment; and (e) Schedule of Subcontractors. The above-referenced forms clearly apply to the DBE program for which the winning entity will provide technical assistance. The record is not clear whether the forms also apply to the RFP. In any event, the forms could possibly apply to the instant proposals only if the bidders intended to use subcontractors or sub-consultants in performing the contract. The Renaissance proposal includes only the three members of the joint venture and does not include the participation of any subcontractors or sub-consultants. The Anderson proposal includes all the necessary forms for the participation of one sub-consultant. Petitioner's proposal includes all the forms listing its joint venture members/partners as sub-consultants. The RFP specifically states that consultants must have a local office and experience providing consulting or small disadvantaged minority business support for two or more years. The RFP does not require consultants to be certified as a DBE. Petitioner did not file a timely challenge to the qualifications for consultants as set forth in the RFP. Anderson's proposal on its face indicates that it is properly certified as a DBE by the City with a pending application for DBE certification by Respondent. Anderson's sub-consultant is certified as a DBE by the City and recognized by the UCAP to include DBE certification by Respondent. Anderson's proposal included the necessary forms to establish the DBE certification of its sub-consultant. The Renaissance proposal on its face indicates that the joint venture is made up of three certified minority-owned businesses. At the time that Renaissance submitted its proposal, Respondent had certified at least one joint venture member, OTAi, Inc. as a DBE consultant. Because Renaissance was a joint venture and did not intend to use subcontractors, it was not necessary to include forms in its proposal that are applicable only to subcontractors. The Renaissance and Anderson proposals show that they meet the RFP's experience requirements for consultants. There is no evidence to the contrary. The RFP includes a form for bidders to use entitled Cost or Price Summary Format for Jacksonville Transportation Authority. However, this form is not included as a mandatory form to be completed and filed with each proposal. Instead, the form is merely a suggested format. Anderson and Petitioner elected to use the suggested cost summary form in their proposals. They capped the cost of the contract at $123,528 and $752,000, respectively. Renaissance did not use the cost summary form. Instead, Renaissance listed all project tasks and designated specific team members to perform each task. Next, Renaissance provided Respondent with cost detail by estimating the total number of hours required to complete each project task by the designated team members. Renaissance then provided a billing rate for each team member. Even though Renaissance did not set forth a cap for the cost of its proposal, it provided more than enough information for Respondent to determine the cost by multiplying the number of hours for each task, times the billing rate for each team member performing that task. During the hearing, Petitioner's witness was able to calculate the cost of the Renaissance proposal, which was considerably higher than the proposals of Anderson and Petitioner. A member of the evaluation committee testified that she scored the cost element of Renaissance's proposal rather low (five out of a possible ten points). Even so, the greater weight of the evidence indicates that Renaissance's cost detail was not ambiguous and that the cost detail provided by all six proposals was responsive to the RFP. In a letter dated December 24, 2003, Respondent advised the City's procurement office that all six proposals were responsive to the RFP. Respondent listed Anderson, Petitioner, and Renaissance in alphabetical order as being the most interested, available and qualified proposals. In a letter dated January 8, 2004, the City's procurement office advised Respondent that it agreed with Respondent's decision regarding the three highest-ranked proposals. The letter stated that Respondent could proceed with fee and contract negotiations with the firm of its choice. Petitioner subsequently learned that it was the third- place proposal. Petitioner then requested copies of the Renaissance and Anderson proposals from the City's procurement office. In making those copies, the City's staff erroneously included an RFP-addendum acknowledgment from the Renaissance proposal in the copy of the Anderson proposal that the City provided to Petitioner. This clerical error is not evidence that Renaissance and Anderson engaged in collusion when filing their proposals. Additionally, it does appear that some participants in the Renaissance and Anderson proposals may have worked on the City's arena and ballpark project. However, there is no evidence that they worked on that project at the same time or even knew about the other's involvement with the project. In fact, there is no evidence that participants in the Renaissance and Anderson proposals knew of each other's existence until Respondent issued and Petitioner challenged the instant RFP.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That Respondent issue a final order dismissing the Detailed Formal Written Bid Protest. DONE AND ENTERED this 17th day of June, 2004, in Tallahassee, Leon County, Florida. S SUZANNE F. HOOD 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 17th day of June, 2004. COPIES FURNISHED: Linda J. Platte Don Platte Florida Bureau of Legal Investigations 101 East Union Street, Suite 401 Jacksonville, Florida 32202 David Cohen, Esquire Jason R. Gabriel, Esquire Edwards and Cohen Attorneys at Law Six East Bay Street, Suite 500 Jacksonville, Florida 32202 Michael Blaylock, Executive Director Jacksonville Transportation Authority 100 North Myrtle Avenue Jacksonville, Florida 32203
Findings Of Fact Standard Specifications are a part of every DOT construction contract issued. Subsection 8-1.1 of these standard Specifications provides that a subcontractor shall be recognized only in the capacity of an employee or agent of the Contractor, and his removal may be required by the Engineer, as in the case of any employee (Exhibit 1). Subsection 8-5 thereof provides the Contractor shall assure that all superintendents, foreman and workman employed by him are competent, careful and reliable (Exhibit 3). All contracts entered into by DOT provide for a contract completion time and provide for adjustment to the contract period for delays in construction due to factors beyond the contractor's control which could not be reasonably anticipated at the time bids for the contract were received (Exhibit 4). Requests for extension of contract time are made by the Contractor to DOT, and each request is evaluated on its merits. Often these requests for extension of contract time are made after the contract is completed and the contractor is seeking relief from penalties accrued as a result of his failure to complete the contract in the time allocated. Prior to 1987, all contracts entered into by DOT contained built-in delays based on average weather conditions expected during the contract period. Since mid-1987, contract delays due to expected adverse weather are not included in the contract time, but the period is subsequently adjusted based on daily recording of weather conditions during the contract period. There is no policy by DOT, as suggested by Petitioner, that delays due to weather outside the initial contract period but within the extension granted due to weather delays will not be considered by DOT in granting extensions of contract time. Federal Department of Transportation grants to Florida DOT for road construction in Florida contain a provision that a certain percentage of the contract must be subcontracted to DBE's. This provision is included in the contracts on which the prime contractors submit bids. In order to qualify as a responsible bidder on these contracts, the Contractor must show compliance with the DBE quota for the job at the time his bid is submitted or show that despite good faith efforts the Contractor was unable to meet the DBE goals. DOT certifies individuals and companies which meet the minority business standards needed for certification and maintains a current list of all potential subcontractors who can be used by the Contractor to meet the DBE quota for the specific contract on which the Contractor bids. These DBE subcontractors are not qualified by DOT as capable to perform the work for which they hold themselves out as able to perform. DOT qualifies no subcontractors, either DBE or non-DBE. In the event the Contractor needs to replace a subcontractor for any reason, his application to replace a non- DBE subcontractor is routinely approved by DOT. However, if the Contractor proposes to replace a DBE subcontractor, the Contractor must replace him with another DBE subcontractor (if this is necessary to retain the required DBE participation) and show to DOT that the replacement was for just cause and does not constitute unlawful discrimination. Accordingly, it is more likely to delay a project if a DBE subcontractor is replaced for failure to perform the work for which he subcontracted than if a non-DBE subcontractor has to be replaced for the same reason. Although DOT individually considers each request for extension of contract time, it treats delays resulting from DBE subcontractor performance the same as it treats delays resulting from non-DBE subcontractor performance. As noted in finding 2 above, the contract provides that subcontractors are agents or employees of the Contractor. Accordingly, extensions of time for completion of the contract are not generally granted when the delay is due to the agents or employees of the Contractor. It is the refusal of DOT to treat DBE subcontractors different from non-DBE subcontractors that forms the basis of Petitioner's challenge to this "policy" that extensions of contract time are not granted when the delay was due to the DBE subcontractor failing to comply with his subcontract which failure was "beyond the control" of the Contractor.
The Issue The issues in this case are whether Respondent violated Subsections 489.129(1)(g)1., (j) and (m), Florida Statutes (2004),1/ and, if so, what penalty should be imposed.
Findings Of Fact The Parties At all times relevant to this proceeding, Respondent was a certified general contractor in the State of Florida, having been issued License No. CG C1507065. Respondent's license as a general contractor was first issued on April 12, 2004, and is current and active. At all times relevant to this proceeding, Respondent was part-owner and the qualifying agent of a Florida corporation named Golden Rule Construction Group, Inc. (hereinafter referred to "GRCG"). The Board is the state agency charged with regulating the practice of contracting in the State of Florida pursuant to Chapters 455 and 489, Florida Statutes. Facts Related to Freedman Property On or about June 1, 2005, Barry Freedman (hereinafter referred to as "Freedman") entered into a contract to construct a room addition and remodel a bathroom at Freedman's residence at 2349 East Manor Avenue in Port St. Lucie, Florida. The pre-printed contract indicated that the contractor was GRCG. Also, the letterhead on the contract included the name "Golden Rule Construction Group, Inc." and the company's address, telephone number, fax number, and Respondent's general contractor's license number. The contract was executed by Freedman, as the homeowner, and Steve DiBenedetto (hereinafter referred to as "DiBenedetto"), as the contractor. All negotiations and presentations relative to the contract were between Freedman and DiBenedetto. The contract price was $52,652.00. Of this amount, Freedman paid $14,657.00, all of which was accepted by DiBenedetto as contractor for GRCG. Initially, on or about May 31, 2005, Freedman gave DiBenedetta a $10,000.00 check as a deposit for the construction project. On or about July 13, 2005, Freedman gave DiBenedetto a $4,657.00 check as a second payment under the contract. The payee on both checks was GRCG. DiBenedetta and a man identified as John Smith3/ commenced the bathroom remodeling project in June 2005 and satisfactorily completed that project by September 2005. The bathroom remodeling project was started and completed, even though no building permit had been pulled. Based on representations of DiBenedetta and/or John Smith, Freedman believed no permit was necessary for the bathroom remodel.4/ The Contract does not delineate or specify the cost of the room addition and the cost of the bathroom remodeling project. However, the value of the bathroom remodel was estimated by a qualified independent third party to be $7,804.00. The room addition was to begin in September or October 2005, after the plans for the addition were completed. The plans were never provided by GRCG, and it never commenced work on the room addition as provided for in the Contract. Eventually, Freedman went to the architect and purchased the plans for the room addition in order to move forward on the project. After completing the bathroom remodel, GRCG abandoned the project and never began the room addition that was provided for in the contract. The amount paid by Freedman to GRCG, $14,657.00, exceeds the value of the work performed by $6,853.00. Facts Related to Ekstrom Property On or about October 28, 2004, Larry Ekstrom (hereinafter referred to as "Ekstrom") entered into a contract (hereinafter referred to as "Ekstrom Contract") with GRCG to construct a new home a 117 Creek Drive in Port Charlotte, Florida (hereinafter referred to as "Eckstrom property"). The Ekstrom Contract was executed by Ekstrom, as the owner, and Keith Powell, as the contractor. The Ekstrom Contract price was $808,306.31. The Ekstrom Contract provided that work on the construction project was to commence upon issuance of the permit by Charlotte County. In accordance with that contract, after the permit was issued, GRCG began work on the construction project at the Eckstrom property. Eckstrom's understanding was that, pursuant to the Eckstrom Contract, GRCG would request periodic payments from Eckstrom that would be used to pay for materials, suppliers, and sub-contractors. Ekstrom made two payments to GRCG as payment for the project under the Ekstrom Contract. The first payment in the amount of $40,420.00 was made on October 29, 2004, when the Ekstrom Contract was fully executed. The second payment in the amount of $82,900.59 was paid to GRCG on or about March 3, 2005, as a "progress payment" under the terms of the Ekstrom Contract. On or about July 1, 2005, a Claim of Lien was recorded against Eckstrom's property by Tom Brunton Masonry, Inc. (hereinafter referred to as "Brunton Masonry"), for $18,029.91. The Claim of Lien was for the unpaid costs of labor, services, and materials furnished by Brunton Masonry for improvements to the Ekstrom property at 117 Creek Drive from April 2005 until May 2005. According to the Claim of Lien, Brunton Masonry provided the subject labor, services, and materials pursuant to a contract it had with GRCG. The Claim of Lien indicated that the total value of the labor, services, and materials furnished by Brunton Masonry was $39,243.91, "of which there remains an unpaid balance of $18,029.91." Eckstrom successfully negotiated with Brunton Masonry and the $18,029.91 lien was reduced to $14,000.00. On or about October 25, 2005, Eckstrom paid Brunton Masonry the negotiated amount of $14,000 to satisfy the Claim of Lien. On or about August 2, 2005, a Claim of Lien was recorded against the Eckstrom property by Murphy Concrete Works, Inc. (hereinafter referred to as "Murphy Concrete"), for $35,400.00. The Claim of Lien was for labor and material furnished by Murphy Concrete to perform concrete work on the Eckstrom property in accordance with a contract with GRCG. According to the Claim of Lien, the subject labor and materials were furnished between March 4 and 11, 2005. In order to remove the lien from his property, in or about September 2005, Eckstrom paid Murphy Concrete $35,400.00 to satisfy the Claim of Lien. Eckstrom paid a total amount of $49,400.00 to satisfy the above-referenced liens against his property. In April, May or June 2005, Eckstrom had a conversation with Keith Powell, in which Powell told Eckstrom that there was a company takeover by one of GRCG partners. In or about early summer 2005, GRCG stopped work on the Eckstrom property. Prior to that time, GRCG scraped and filled the lot and put in the foundation footers and stem wall. Prior to the liens being recorded against the Eckstrom property and after GRCG had ceased working on the property, Mr. Powell talked to Eckstrom and offered to complete the construction project. However, because previous discussions and representations with Powell had not yielded any positive results, Eckstrom had no confidence in Powell and, thus, did not accept Powell's offer. After GRCG ceased work on the Eckstrom property for more than 90 days, Eckstrom contracted with Towles Corporation to complete the construction project. Towles completed the construction of the house at a cost of $934,000.00.5/
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner, the Department of Business and Professional Regulation, Construction Industry Licensing Board, enter a final order: (1) finding that Respondent, Keith C. Powell, violated Subsections 489.129(1)(g)1., (j), and (m),6/ Florida Statutes, and imposing a $1,000.00 fine for each violation, for a total of $3,000.00; (2) requiring Respondent to make restitution to Barry Freedman in the amount of $6,853.00; (3) requiring restitution to Larry Eckstrom in the amount of $49,400.00; and (4) requiring Respondent to attend a minimum of seven additional hours of continuing education. DONE AND ENTERED this 31st day of January, 2008, in Tallahassee, Leon County, Florida. S CAROLYN S. HOLIFIELD 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 31st day of January, 2008.
The Issue The issue in this case is whether, in making an award of a lease for office space, the Respondent acted according to the requirements of law.
Findings Of Fact In February, 1993, the Department of Labor and Employment Security ("Department") issued a Request for Proposal and Bid Submittal No. 540:0969 ("RFP") seeking to lease approximately 18,684 square feet of office space in Jacksonville, Florida, for a period of six years. The space was to house the Office of Disability Determinations ("ODD"), which processes disability claims and determines whether claimants are eligible for Social Security and Supplemental Income benefits. The office has minimal contact with the general public. The RFP provided that all bids were subject to conditions stated within the RFP. Bids not in compliance with RFP conditions were subject to rejection. RFP Article D, General Provisions, Paragraph 8 provides as follows: The Department reserves the right to reject any and all bid proposals for reasons which shall include but not be limited to the agency's budgetary constraints; waive any minor informality or technicality in bids' to accept that bid deemed to be the lowest and in the best interest of the state, and if necessary, to reinstate procedures for soliciting competitive proposals. A pre-bid conference was conducted by the Department on February 16, 1993. Representatives from the vendors involved in this proceeding attended the conference. Bids were opened on March 5, 1993. The Department received five responses, three of which were deemed to be responsive and which were evaluated. The remaining two responses were determined to be nonresponsive and were not evaluated. On or about March 10, 1993, based on the evaluations, the Department proposed to award the bid to Koger Properties, Inc. On or about March 17, 1993, the Department notified the vendors of the intended award. The Petitioners filed timely notices protesting the intended award. TOWNCENTRE PROPOSAL Paragraph 13 sets forth conditions to which a bidder must agree in order to be awarded a bid. Subsection "a" of the paragraph states, "[i]f successful, bidder agrees to enter into a lease agreement on the Department of General Services Standard Lease Agreement Form BCM 4054 (Attachment F - Do not complete)." The copy of the Department of General Services Standard Lease Agreement Form which was included in the RFP was a poorly reproduced copy. Article III of the Lease Agreement Form provides as follows: III HEATING, AIR CONDITIONING AND JANITOR SERVICES 1.a. The Lessor agrees to furnish to the Lessee heating and air conditioning equipment and maint(illegible) in satisfactory operating condition at all times for the leased premises during the term of the lease at the (illegible) of the Lessor. b. The Lessor agrees to maintain thermostats in the demised premises at 68 degrees Fahrenhe(illegible) the heating season and 78 degrees Fahrenheit during the cooling season; and certifies that boilers the(illegible) been calibrated to permit the most efficient operation. The Lessor agrees to furnish janitorial services and all necessary janitorial supplies for the leased (illegible) during the term of the lease at the expense of the Lessor. All services required above shall be provided during the Lessee's normal working hours, whic(illegible)marily from 7:30 a.m. to 5:30 p.m., Monday through Friday excluding state holidays. Also attached to the RFP was a copy of an addendum to the lease, also poorly reproduced. The addendum provides as follows: Article III, Paragraph III Addendum for Full Service Lease The lessor and lessee mutually agree that the described prem(illegible) leased in this lease agreement shall be available to the department (lessee) for its exclusive use twenty four (24) (illegible) per day, seven (7) days per week during the lease term. T(illegible) space to be leased by the department will be fully occupied during normal working hours from 7:30 a.m. to 5:30 p.m., Mo(illegible) through Friday, excluding holidays, Saturdays and Sundays, (illegible) may be fully or partially occupied during all other periods (illegible) time as necessary and required at the full discretion of th(illegible) department. Accordingly, services to be provided by the le(illegible) under the terms of the lease agreement, including electrici(illegible) other utilities, will be provided during all hours of occup(illegible) at no additional cost to the department (lessee). Although the copy of the lease agreement and addendum included in the RFP were poorly reproduced, it is clear that the addendum modifies the paragraph of the lease agreement related to provision of heating, air conditioning and janitorial services to require that HVAC services be provided throughout the premises during all hours of occupancy at no additional cost to the Department. The proposal submitted by Towncentre included an "Attachment Z" which states as follows: The following represent exceptions and/or clarifications to the terms of the Request for Proposal and Bid Submittal Form ("RFP") for the referenced Lease. Except as noted herein, Bidder shall comply fully with the terms of the RFP..." Item #7 of Attachment Z states as follows: The Building in which the space is offered is serviced by central heating, ventilating and air conditioning; therefore, no separate thermostats will be provided in the space other than in the computer room. However, the required temperature standards will be maintained and satisfied. The computer room HVAC shall be available 24 hours a day. Otherwise, after-hours HVAC is billed at $80 per hour. Attachment Z also included additional exceptions to the provisions of the RFP. Contrary to the requirements set forth in the addendum attached to the lease form included in the RFP, the Towncentre proposal included additional charges for after hours uses. The Department determined that the Towncentre proposal was nonresponsive and disqualified the proposal from further consideration. Because the Towncentre proposal includes HVAC charges which are specifically prohibited under the terms of the RFP, the Towncentre proposal is nonresponsive to the RFP. Towncentre asserts that other sections of the RFP indicate that, within the leased premises, only the computer room is required to be heated or cooled on a continuous basis. Vendors had an adequate opportunity to direct questions regarding the RFP to Department officials. There is no evidence that Towncentre sought clarification from the Department related to this matter prior to submitting the bid proposal. In the notification to Towncentre that the bid had been determined to be nonresponsive to the RFP, the Department identified the other exceptions as additional reasons for the determination of nonresponsiveness. At hearing Towncentre introduced no evidence related to the remaining items included within Attachment Z. BRYAN SIMPSON JR. FOR P.V. ASSOCIATES The Simpson bid was deemed to be responsive and was evaluated. The evaluations were performed by three Department employees, Dorea Sowinski, Albert Cherry, and Tom Mahar. On March 9, 1993, the evaluators visited the physical locations of the three responsive bids. (Although the bid had been declared nonresponsive, they also visited the Towncentre site, apparently as a courtesy.) The Simpson space is located in downtown Jacksonville. After completion of the site visits, the evaluators separately and independently completed their evaluation sheets. The evaluators awarded a total of 262 points to Koger Properties and 248 points to Simpson. Page 7 of the RFP sets forth the evaluation criteria which were considered in awarding evaluation points. The RFP stated as follows: The successful bid will be the one determined to be the lowest and best. All bids will be evaluated based on the award factors enumerated below: Rental, using Present Value methodology for basic term of lease (See D, General Provisions Items 3 and 4) applying the present value discount rate of 5.6 per cent. (Weighing: 35) Conformance of and susceptibility of the design of the space offered to efficient layout and good utilization and to the specific requirements contained in the Invitation to Bid. (Weighing: 20) The effect of environmental factors, including the physical characteristics of the building and the area surrounding it on the efficient and economical conduct of the Departmental operations planned for the requested space. (Weighing: 20) Offers providing contiguous space within preferred boundaries. (Weighing 5) Frequency and availability of satisfactory public transportation within one block of the offered space. (Weighing 15) Availability of adequate dining facilities within one mile of the offered space. (Weighing: 2) Proximity of offered space to the clients served by the Department at this facility. (Weighing: 3) Proximity of offered space to other Department activities as well as other public services. (Weighing: 0) TOTAL POINTS: 100 Simpson asserts that the evaluators acted improperly in awarding points in categories 3, 5, 6 and 7. Category 3 relates to the effect of environmental factors, including the physical characteristics of the building and the area surrounding it on the efficient and economical conduct of the Departmental operations planned for the requested space. Although Simpson asserts that category 3 is vague and ambiguous, there was no objection to the category prior to the submission of the bid responses and the announcement of the proposed lease award. Each evaluator could award up to 20 points in this category for a total of 60 available points. Koger was awarded 55 points. Simpson received 27 points. As to individual evaluators awards, Tom Mahar awarded Simpson five points, Albert Cherry awarded Simpson ten points, and Dorea Sowinski awarded Simpson 12 points. Based on the written memo dated March 10, 1993, identifying the reasons for the recommended bid award, two of the three evaluators considered the Koger space to be located in a safer area than the Simpson facility, and, at least in part, based their point awards on this factor. The two evaluators cite minimal anecdotal information in support of their opinions. The evaluators undertook no investigation related to safety issues and there are no facts to support their opinions. Their award of points for "environmental factors" is arbitrary. Category 5 relates to the frequency and availability of public transportation within one block of the offered space. Each evaluator could award up to 15 points in this category for a total of 45 available points. Both Koger and Simpson received the maximum 45 points. RFP Page Two, question 8 provides as follows: Public Transportation availability: BIDDER RESPONSE: (Check appropriate box) Taxi , Bus , Frequency of service closest bus stop . Both Koger and Simpson indicate service by taxi and bus. The Koger proposal indicates a frequency of service as "8 BUSES" and the closest bus stop as "IN FRONT OF BUILDING ON WOODCOCK DRIVE." Simpson indicates a frequency of service as "15 minutes" and the closest bus stop as "front of building." The Department asserts that the Koger level of transportation access, albeit less than that serving the Simpson site, is satisfactory and therefore entitled to an award of all points available. Simpson asserts that the greater availability of public transportation to the Simpson site should result, under the terms of the evaluation criteria, in Simpson receiving more points than the Koger site for this category. The evaluation criteria clearly requires consideration of both the frequency and availability of satisfactory public transportation. Simpson asserts that in considering the transportation category, the evaluators should have reviewed local public transportation schedules. Review of such schedules establishes that the Simpson site is served more frequently by public bus transportation than is the Koger site, and further establishes that the number of bus routes directly serving the Simpson property far exceeds the routes serving the Koger site. Simpson did not include the schedules in the RFP response. The Simpson site is also located nearby the downtown public transportation transfer station at which point many, perhaps all, local bus routes connect. Simpson did not denote the location of the transfer station in the RFP response While the evaluation committee is not required to consider the bus schedules in reviewing bid proposals, the evaluation committee failed to consider the substantially greater frequency and availability of public transportation to the Simpson site relative to the Koger site, as set forth in the respective RFPs. The Department's position is contrary to the specific criteria identified in the RFP. The award of equivalent points for transportation access to both Simpson and Koger is unsupported by fact or logic and is arbitrary. Category 6 relates to the availability of adequate dining facilities within one mile of the offered space. Each evaluator could award up to two points in this category for a total of six available. Koger was awarded six points. Simpson received one point. When the evaluators rated the adequacy of dining facilities, they considered only those dining facilities which were located within two blocks of the offered space. Such is contrary to the clear terms of the RFP. The Department offered no rationale for the decision to amend the RFP criteria after submission of the proposals. The Simpson RFP response states only that there are adequate dining facilities within walking distance of the offered facility. The Koger response states that there are "three (3) sandwich shops within walking distance in the Koger center and other numerous restaurants within one (1) mile." As to individual evaluators awards, Tom Mahar awarded Simpson one point, while both Albert Cherry and Dorea Sowinski awarded Simpson zero points. Mahar's award was based on his opinion, again based on alleged safety concerns, that employees would be hesitant to walk to nearby restaurants and that driving and parking presented a problem in the downtown location. Cherry voiced a similar opinion. As to alleged safety concerns, Mahar and Cherry again based their opinions on minimal anecdotal information, supported by neither fact nor logic. Neither evaluator undertook any factual analysis of the safety issues relative to the proposed site. Their award of points for this category is arbitrary. On the other hand, Sowinski did not see any restaurants close to the Simpson site during the site visit. In excess of 40 restaurants are located within one mile of the Simpson site. The restaurants provide a variety of dining options both as to expense and fare. Sowinski's failure to observe restaurants located across the street from the Simpson site is, although difficult to understand, apparently a simple mistake on her part. Category 7 relates to the proximity of offered space to the clients served by the Department at this facility. Each evaluator could award up to three points in this category for a total of nine available. Simpson offered no evidence that the determination of points awarded for category 7 was inappropriate.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that the Department of Labor and Employment Security enter a Final Order DISMISSING the protest filed by Towncentre Venture, and WITHDRAWING the proposed award of lease contract based on the Request for Proposal and Bid Submittal No. 540:0969. DONE and RECOMMENDED this 28th day of June, 1993, in Tallahassee, Florida. WILLIAM F. QUATTLEBAUM 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 28th day of June, 1993. APPENDIX TO CASES NO. 93-2015BID and 93-2106BID The following constitute rulings on proposed findings of facts submitted by the parties. Petitioner Towncentre Venture Towncentre Venture's proposed findings of fact are accepted as modified and incorporated in the Recommended Order except as follows: 4. Rejected, second sentence is irrelevant. 5-7. Rejected, irrelevant. Taken as a whole, the RFP indicates that HVAC services are to be provided throughout the leased premises during all hours of occupancy at no additional cost to the Department. The evidence fails to establish that the vendors were confused about the terms of the RFP. There were apparently no related questions addressed to Department personnel during the pre-bid conference or at any time subsequent to the conference and prior to the bid opening. 10. Rejected. Not supported by the document cited which does not identify the attachment by letter. 13. Rejected, irrelevant. The standard form lease included in the RFP was a sample document. None of the blank spaces were completed. 16. Rejected, irrelevant. The attendees at the conference were provided an opportunity to inquire as to all matters. There were apparently no questions asked related to the RFP's requirement that HVAC services be provided throughout the facility during all hours of occupancy at no additional cost to the Department. 17-18, 20-21. Rejected, irrelevant. The terms of the RFP are clear. 19. Rejected, irrelevant. The terms of the addendum for full service lease clearly indicate that such HVAC services were to be provided at no additional charge, not just in the computer room, but throughout the entire leased facility. 22. Rejected. The Towncentre bid was nonresponsive to the terms of the RFP. Petitioner Bryan Simpson, Jr., for P. V. Associates P. V. Associates' proposed findings of fact are accepted as modified and incorporated in the Recommended Order except as follows: 3. Rejected, not supported by the greater weight of the evidence which establishes that the RFP was issued seeking space for the Jacksonville Office of Disability Determinations. 4, 23, 24. Rejected, unnecessary. Respondent Department of Labor and Employment Security The Respondent's proposed findings of fact are accepted as modified and incorporated in the Recommended Order except as follows: 17. Rejected. The decision to award equivalent points for public transportation access fails to reflect the substantially greater access provided to the Simpson site and is arbitrary. 20-21. Rejected, not supported by greater weight of evidence which establishes no evidence that safety concerns were based on a reasonable evaluation of facts. There are no facts to support the conclusion that the Simpson location if less safe than the Koger site. COPIES FURNISHED: Shirley Gooding, Acting Secretary Suite 303, Hartman Building 2012 Capital Circle S.E. Tallahassee, Florida 32399-2152 Cecilia Renn Chief Legal Counsel Suite 307, Hartman Building 2012 Capital Circle, S.E. Tallahassee, Florida 32399-2152 Thomas M. Jenks, Esquire Pappas and Metcalf, P.A. 1 Independent Drive, Suite 3301 Jacksonville, Florida 32202 Nathan D. Goldman, Esquire Marcia Maria Morales, Esquire 200 Laura Street Post Office Box 240 Jacksonville, Florida 33202 Edward Dion, Esquire Assistant General Counsel Suite 307, Hartman Building 2012 Capital Circle S.E. Tallahassee, Florida 32399-2189
The Issue The questions presented here concern the entitlement of the Petitioner or Intervenor to be awarded lease rights under the Respondent's proposed Lease No. 590:8026, in that Petitioner and Intervenor have claimed that entitlement to the exclusion of the other party.
Findings Of Fact Respondent invited bid proposals for the provision of approximately 32,000 square feet of office space for its District VIII operation in Fort Myers, Florida. Petitioner, Chuck Bundschu, Inc., and Intervenor, Walter Lee Johnson d/b/a Walco Leasing Company, responded to the bid proposal by offering to provide the office space. Those responses may be found as part of the Composite Hearing Officer's Exhibit. Following the October, 1981, submittal of bid proposals, a bid evaluation committee was appointed by the Subdistrict Administrator for District VIII to consider the bids. In turn, he afforded guidance to that committee on the subject of the evaluation of the proposed bids offered by Bundschu and Walco, the only bidders for the project. The evaluation committee performed the task of weighing the bid proposals, in keeping with evaluation criteria which are outlined in Respondent's "Facilities, Acquisition and Management Manual" dealing with the procurement of lease space, which criteria are set forth in a form referred to as "HRSM 70-1, page A1-4-8," which is attached to chapter four of the manual. All criteria used for the evaluation process were drawn from that form with the exception of criterion No. 7, related to staff and client marking which was a product of this bid evaluation effort. (A copy of the HRS manual and forms may be found as Respondent's Exhibit No. 1, admitted into evidence. The evaluation committee's summarization utilizing the form criteria and the additional parking criterion may be found as a part of the Hearing Officer's Composite Exhibit, which is a replication of the original.) The HRS manual for procuring leased space is a publication of February, 1980, and establishes uniform guidelines by which bid proposals are considered by local officials who are part of Respondent's organization. Nonetheless, the exact weight to be afforded each criterion outlined in the manual is determined by the local evaluation committee. Weighing concerns the subject of awarding numerical values for beach bidder related to the various criteria with a maximum possible score being 100 points. On the basis of the evaluation performed by the committee, the Bundschu total was 88.25 points and the The Walco point total was 82 out of the possible 100 points. Consequently, the evaluation committee recommended that Bundschu be awarded the lease. Mark Geisler, in his capacity as Subdistrict Administrator, for District VIII, concurred in this evaluation as may be seen in his November 6, 1981, transmittal of the bid materials and associated evaluation, which transmittal may be found as pert of the Hearing Officer's Composite Exhibit. The District Administrator, District VII, in the person of Frances Clendenin, who was acting for the District Administrator, Ivor D. Groves, Ph.D., also recommended acceptance of the Bundschu bid. This position was made known by a memorandum of November 16, 1981. A copy of that recommendation is found as a part of the Hearing Officer's Composite Exhibit. The recommendations spoken to thus far were made known to Lester C. Missman, an official within the Division of General Services of the Department of Health and Rehabilitative Services. This division was, at the time of the bid proposals, and is now, headed by Dr. Homer Ooten, whose function within Respondent's organization includes the responsibility to evaluate lease proposals involving the Respondent agency and to make a final decision on the question of the lease award, based upon a review of the local subordinate unit's recommendation. By this, it is meant that the lease by Health and Rehabilitative Services as "user agency" is signed by Ooten based upon a delegation of authority to him through the vehicle of correspondence signed by the agency head. Ooten, upon considering the recommendation of the District Administrator's office, the Subdistrict Administrator and the evaluation committee, did not find fault with the criteria nor the point weighing scheme used in the evaluation process. He did question the cost analysis performed by the evaluation committee on the subject of client mileage for those clients receiving services from Respondent in a move from the HRS office in the Bundschu building where they were located at the time, to the building where Walco intended to let property. This was a distance of seven/tenths (7/10) of a mile and based upon the number of clients receiving services, there would be an estimated $100,000.00 in client mileage cost increase. This item was not deemed to be an appropriate consideration by Ooten and was disregarded in his review of the cost analysis performed by the evaluation committee. That cost analysis may be found as part of Respondent's Composite Exhibit No. 2, and includes interlineations by Ooten in his opinion on the subject of the cost analysis. That analysis had indicated an overall advantage of approximately $11,000.00 in favor of Bundschu and was premised upon costs related to Item 12 in the criteria, which criterion is cost of moving. It assumed a difference of over $131,000.00 in moving costs, the majority of which costs pertained to client inconvenience ($100,000.00), discounting $120,000.00 plus dollars related to the difference in the bid amount between the Walco and Bundschu bids which bid estimate was in favor of Walco. Ooten's opinion on the subject of the priority of including $100,000.00 plus dollars in clients' travel costs, when considered in the context of point awards under Item 12 in the criteria, lead Ooten to believe that the differential in point awards would not result in a 9.25 value of Bundschu versus a zero value for Walco. In his mind, the differential would be much less. Ooten made his own evaluation of moving costs per se, and through that process determined that approximately $15,600.00 would be necessary for a move into the Walco facility whereas $5,600.00 would be involved in the Bundschu move, which required the expansion of existing space in the Bundschu facility. Based upon an evaluation of the point differential in the rental rate criterion which was a differential of 2, that is 30 points out of a possible 30 for Walco and 28 points out of a possible 30 for Bundschu, Ooten also opined the this was an unreasonable assessment in view of the fact that the Walco bid amount was more than $120,000.00 less than the Bundschu bid. This taken together with the fact that there only existed approximately a $9,000.00 difference on moving costs between Bundschu and Walco, which was in favor of Bundschu, and there having been indicated a 9.25 out of a possible 10 point difference in Item 12 on the question of costs related to moving, led Ooten to believe that the true factual status of criteria Nos. 1 and 12 was not as depicted by the evaluation committee. Per Ooten, with proper assessment Walco would have received a higher point count than Bundschu through the process of applying the bid criteria, as well as being the lower bidder from the point of view of rental rates alone. After several exchanges with the District level personnel of Respondent who had been involved in the lease evaluation process, in which, on two (2) occasions, the local officials continued to support their initial opinion of the propriety of the award to Bundschu, a decision was made at the District VIII level to support the award of the lease to Walco as may be seen in the January 6, 1982, correspondence from the District Administrator to Missman, a copy of which may be found as Respondent's Exhibit No. 4, admitted into evidence. On January 6, 1982, Ooten issued a letter to the District VIII Administrative Services Director indicating the authority to award Lease No. 590:8026, formerly referred to as No. 590:1472, for the benefit of Walter Lee Johnson d/b/a Walco Leasing Company. Having learned of this decision and in keeping with the provision Subsection 120.53(5), Florida Statutes, Bundschu, through counsel, indicated opposition to that award on January 12, 1982, followed by a formal petition letter setting forth grounds for the opposition, which petition was filed on January 19, 1982. This series of documents is part of the Hearing Officer's Composite Exhibit, through copies. Subsequently, Items 4 and 6 in the petition letter were resolved between the parties without the necessity of a hearing and this is borne out by a copy of the February 1, 1982, correspondence from counsel for the Respondent to counsel to the Petitioner, part of the Hearing Officer's Composite Exhibit. The matter was then referred to the Division of Administrative Hearings for a formal Subsection 120.57(1), Florida Statutes, hearing by correspondence from the Assistant General Counsel for Respondent, dated February 4, 1982, a copy of which may be found as a part of the Hearing Officer's Composite Exhibit. There followed the intervention of Walter Lee Johnson as a party of record and the hearing was held on April 27, 1982. Petitioner's first contention deals with the idea of discounting the lease value based on the value of the "stream of future lease payments." This theory is contended for through Robert Sizemore, C.P.A., expert witness of the Petitioner. He would call for the discount of lease payments on the theory that present dollars will have a discounted value in the future, as the lease period unfolds. Taking into account the method of payment by the Respondent and the vicissitudes involved in attempting to establish the value of today's dollar at a future time, this theory of discounted dollars at a 10 percent or 12 percent rate per annum in succeeding years is not indicated. Assessment through the legislative appropriations process of sufficient funds to meet lease payment demands is not contingent upon the value of the dollar at any given point in the history of the lease. Therefore, the "stream of future lease payments" concept is inapplicable here. Likewise, trying to project the value of today's dollar at some future date is so tenuous as to be an unacceptable method to evaluate the competing lease proposals. Finally, even if this method was used, a 10 percent discount rate for inflation would leave approximately a $67,000.00 difference in the bid proposals and a 12 percent per annum discount rate related to inflation would leave approximately $52,000.00 difference in the bid proposals, in favor of the Walco bid. Petitioner has contended that Respondent failed to properly account for direct moving expenses. In that regard, the calculations made by Ooten on the question of moving expenses as reported above are accepted as fact. As a third claim, Petitioner has alleged the agency s disregard for recommendation of its evaluation committee in making the lease award. While the initial recommendations of the evaluation committee and staff were disregarded, the District Administrator eventually accepted the point of view of the Division of General Services within the Respondent's Department. Moreover, even if the local officials within the Respondent's Department had not accepted Ooten's viewpoint, the initial evaluation committee's development of criteria was flawed and the Ooten perception was correct, leading to a decision in favor of Walco. Finally, the contention by Petitioner that the agency did not seek adequate input from third parties affected by the relocation of the facility was not demonstrated through testimony. The method for review of the proposed lease was acceptable and to the extent that it required an appreciation and response to the needs of others not directly involved in the lease process, it has been amply afforded. Evaluation was in keeping with Respondent's "Facilities, Acquisition and Management Manual, HRSM 70-1, fourth chapter" and the award is based upon concurrence of the Division Director of the General Services Division of HRS pursuant to that chapter. Through argument, counsel for the Petitioner has also referred to the fact that in the initial evaluation process set forth in the sixth criterion, superior points of 2.5 for Walco as opposed to 2.25 for Bundschu had been awarded, when in fact the narrative summary of the reasons for such awards indicate an advantage to Bundschu. Even if the .25 points were allowed in the favor of Bundschu, this would not change the result.
The Issue The issue in this case is whether the Respondent, the Department of Transportation (DOT), should award State Project No. 97160-3320 to Intervenor, Smith & Company (Smith), notwithstanding the bid protest filed by the Petitioner, Hubbard Construction Company (Hubbard), alleging that its bid was responsive and lower than Smith's bid.
Findings Of Fact State Project No. 97160-3320 (the project) is for work on the Polk County Parkway in Polk County. This project is funded entirely with state funds. It had a Disadvantaged Business Enterprise (DBE) goal of twelve percent, consisting of four percent black, and eight percent non-minority female. The Florida Department of Transportation (DOT) manages two separate DBE programs--a federal DBE program for federally funded projects, and a state DBE program for state-funded projects. The state program is based upon a disparity study conducted by MGT of America for the DOT in 1993. This study was conducted as a result of the case of City of Richmond v. J. A. Croson Co., 109 S.Ct. 706 (1989), which determined that a preferential contract system which was not based on actual discrimination was unconstitutional. The MGT disparity study found that there was evidence of disparate treatment by DOT in Florida, and in a very small number of counties outside of Florida. As a result, the state DBE program only certifies DBEs with home offices in Florida or the other counties identified in the disparity study. The DOT publishes a DBE directory for each bidding cycle. The DBE Directory includes DBEs certified or in the process of renewing expired certifications at the time the directory is published. The DBE directory includes DBEs for both the federal and state DBE programs but clearly indicates which DBEs are approved only for projects with at least some federal funding. Under DOT's policies and practices, a bidder can use any approved DBE listed in the directory even if the DBE's certification expires between publication and the bid letting. The deadline for submission of bids for the project was October 29, 1997. Hubbard's initial bid included a DBE Utilization Summary form indicating that it would achieve the DBE goal established for the project. The DBE Utilization Summary form gave Hubbard notice that another DBE Utilization Summary form listing the DBEs Hubbard would use, along with the dollar amounts of the subcontracts for each DBE listed, together with completed DBE Utilization forms for each DBE, had to be received by the DOT no later than 5 p.m. on the third business day after the bid letting. The DBE Utilization Summary form also gave notice that, otherwise: "Bids may be declared non-responsive . . . ." On November 3, 1997, Hubbard submitted a completed DBE Utilization Summary form, together with completed DBE Utilization forms. These forms stated that Hubbard stated would be using Suncoast Fabrics for erosion control work to meet $160,000 worth of the non- minority female goal for the project. Without the subcontract with Suncoast Fabrics, Hubbard would fall $160,000 short of meeting the non-minority female goal. In fact, Suncoast is not certified as a DBE for projects funded entirely by the State (i.e., without any federal funding). As a result, Hubbard's bid was $160,000 short of meeting the non-minority female goal for the project. After November 3, 1997, Hubbard discovered its error in relying on Suncoast Fabrics as a DBE for the project and on November 5, 1997, submitted another DBE Utilization Summary form and DBE Utilization form stating that, instead of paying Suncoast $160,000 for erosion control work, it would pay Margie Woods Trucking an additional $160,000. Hubbard's bid was reviewed by the DOT's Good Faith Efforts Committee of the DOT's Minority Programs Office for compliance with the project's DBE goals and was found to be non- responsive because Hubbard's DBE utilization forms relied on Suncoast Fabrics, which was not an approved DBE for state-funded projects and because, without Suncoast Fabric's participation, Hubbard's bid did not meet the project's DBE goals. Hubbard did not submit a package to demonstrate good faith efforts to meet the DBE goals (because Hubbard thought its bid met the DBE goals). The Good Faith Efforts Committee found that Hubbard's bid did not demonstrate good faith efforts to meet the DBE goals, a finding which Hubbard does not dispute. The Good Faith Efforts Committee did not consider Hubbard's November 5, 1997, submission attempting to substitute Suncoast Fabric's participation with an increase in Margie Woods Trucking's participation because it was submitted after the deadline for submitting DBE utilization forms. The findings and recommendations of the Good Faith Efforts Committee were submitted to the DOT's Technical Review Committee. The Technical Review Committee concurred with the Good Faith Efforts Committee that the apparent low bid and second low bid were non-responsive and that the project should be awarded to Smith. The findings and recommendations of the Technical Review Committee were submitted to the DOT's Contract Awards Committee. The Contract Awards Committee concurred with the Good Faith Efforts Committee and the Technical Review Committee that the apparent low bid and the apparent second low bid were nonresponsive, and awarded the contract to Smith. None of the DOT committees reviewing Hubbard's bid in the process of deciding to award the contract to Smith gave specific consideration to the question whether Hubbard's failure to timely submit DBE utiJization forms meeting the project's DBE goals should be waived as being a minor irregularity. The Department's policy is to strictly enforce the three-day period for submission of completed DBE utilization forms and to consider failure to submit DBE utilization forms meeting a project's DBE goals to be a material error mandating rejection of a bid as non- responsive. From January 1995 through December 1997, the Department rejected 18 out of 254 problem bids because the bids failed to meet DBE goals. The DOT rejected the bid of Edward M. Chadbourne and Associates in a prior letting on facts very similar to those in this case. Chadbourne proposed Suncoast Sod Farms, Inc., a DBE firm based in Alabama, for a project wholly funded by the state. As reflected in the DBE Directory for that letting, Suncoast Sod was not eligible for non-federally funded projects. In two prior state-funded projects for the Polk County Parkway, Suncoast Fabrics had been used by a contractor in its DBE submissions. The Department allowed the use of Suncoast Fabrics to count towards the contractor's DBE percentage because the DBE Directory for those projects erroneously failed to indicate that Suncoast Fabrics was certified as a DBE only for federally-funded projects. Similarly, the DOT awarded a contract to Murphree Bridge Corporation in a prior letting although Murphree did not meet the three percent DBE goal for that project. In that case, DOT advertisements prior to the letting erroneously stated that the goal was two percent, and Murphree met the advertised goal but not the actual 3 percent goal. In the two prior instances involving Suncoast Fabrics and the prior instance involving Murphree Bridge, the DOT declined to penalize the contractors for DOT's errors. However, there was no change in DOT's policy regarding the three-day period for submission of completed DBE utilization forms that meet a project's DBE goals. In addition, in those instances, DOT was unable to count the DBE utilization for purposes of its affirmative action program, for which it must report to the legislature. Suncoast Fabrics apparently did not realize it was not approved for state-funded contracts, and it misled Hubbard when Hubbard inquired as to Suncoast's DBE eligibility. But regardless whether Suncoast had an excuse for its erroneous belief, it was Hubbard's responsibility to use the DBE Directory to verify whether a DBE is authorized for use on a particular project, and the applicable DBE Directory clearly noted that Suncoast Fabrics was not approved for this project. In fact, Suncoast Fabrics was appropriately identified as not qualifying for state-funded projects in each DBE Directory since March 1997. DOT made no statement, representation or indication of any kind to Hubbard that would have misled Hubbard to think that Suncoast Fabrics was qualified as a DBE for State Project No. 97160- 3320. In this regard, Hubbard's situation is significantly different from the two prior instances involving Suncoast Fabrics, the prior instance involving Murphree Bridge. The Department did not intend for bidders to use the three- day period for submission of completed DBE Utilization forms to shop DBEs' prices, attempt to drive DBEs' prices down, or continue to solicit quotes from DBEs. The Department has no statute, rule, procedure, or policy permitting substitution of DBEs more than three days after a bid letting and before work begins. The Department does not permit substituting DBEs after an award is posted unless the DBE fails to perform, and then only with the express prior approval of the Department. Allowing a bidder the ability to shop DBEs' prices, attempt to drive DBEs' prices down, or continue to solicit quotes from DBEs after the three-day period could give the bidder a competitive advantage over bidders who do not. The amount of the bid submitted by a contractor can be affected by the bids it received from DBEs. The bid submitted may be based upon quotes received from particular DBEs. If one contractor were allowed to use an unqualified DBE whose price was low, and the other contractors did not rely on such quote, knowing that the DBE was unqualified, the first contractor could enjoy a competitive advantage. Although Hubbard asserted that it did not decide which DBEs to use until after its bid was submitted, the possibility of an advantage exists. Hubbard also contends that its failure to submit DBE Utilization forms meeting the DBE goal for the project is similar to Smith's alleged error in submitting a single DBE Utilization Summary form for both of the split goals (black and non-minority female), contrary to the instructions for the form. Suffice it to say that submitting the information on a single form is different from Hubbard's error. It is clear from Smith's submission that Smith's bid met the project's DBE goals; it was clear from Hubbard's bid that Hubbard's did not. DOT's decision to reject Hubbard's bid for failure to comply with the DBE requirements was not contrary to statute, rule, policy, practice or the bid specifications. Hubbard did not show that the Department's action was clearly erroneous, contrary to competition, arbitrary, or capricious.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, RECOMMENDED that the Department of Transportation enter a final order awarding State Project No. 97160-3320 to Smith & Company. RECOMMENDED this 1st day of May, 1998, in Tallahassee, Leon County, Florida. J. LAWRENCE JOHNSTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 1st day of May, 1998. COPIES FURNISHED: F. Alan Cummings, Esquire Cummings & Thomas, P.A. Post Office Box 1116 Ft. Lauderdale, Florida 33302-1116 Paul Sexton, Esquire Chief, Administrative Law Section Department of Transportation 605 Suwannee Street Tallahassee, Florida 32399-0458 Donna H. Stinson, Esquire Broad & Cassel 215 South Monroe Street Suite 400 Tallahassee, Florida 32301 Thomas F. Barry, Secretary Attention: Diedre Grubbs Haydon Burns Building Mail Station 58 605 Suwannee Street Tallahassee, Florida 32399-0450 Pamela Leslie, General Counsel Department of Transportation Haydon Burns Building Mail Station 58 605 Suwannee Street Tallahassee, Florida 32399-0450
Findings Of Fact The underlying case for which attorneys fees in the undisputed amount of $2,775.00 are sought involved a 1992 application by Union Trucking, Inc. for recertification by the Florida Department of Transportation (FDOT) as a disadvantaged business enterprise (DBE). Union Trucking, Inc. had originally been certified by FDOT in 1988, and upon successive applications for certification, had been recertified by FDOT in 1989, 1990 and 1991. Recertification was applied for on July 20, 1992 and denied on December 14, 1992. A request for formal hearing followed on January 15, 1993 and the case proceeded before the Division of Administrative Hearings (DOAH) until FDOT recertified Union Trucking, Inc. on October 15, 1993. On November 17, 1993, DOAH hearing officer P. Michael Ruff entered an order relinquishing jurisdiction, which resulted in FDOT's December 17, 1993 final order. FDOT's final order was entered on the grounds that certification had been granted, did not alter the recertification terms, and dismissed the request for formal hearing. On February 14, 1994, less than sixty days after entry of the FDOT final order, Petitioner filed its original "Application for Award of Attorneys Fees Pursuant to F.S. 57.111," hereafter "petition." On March 2, 1994, FDOT filed a response, which, although no motion to dismiss was filed, addressed assorted insufficiencies of the petition. FDOT's response did not raise any timeliness bar. An order of dismissal with leave to amend within fifteen days was entered by the undersigned hearing officer on April 21, 1994. The amended petition was filed May 11, 1994, and FDOT filed its response on May 26, 1994, still not asserting any timeliness bar. At formal hearing, the parties stipulated that the only issue for consideration was whether or not FDOT had been substantially justified in denying the 1992 recertification. Otherwise, it was undisputed that Petitioner is a small business party; that FDOT was not merely a nominal party; that the employment, amount of fee, and hours worked by Petitioner's counsel were as stated in the pleadings, and that there were no "unusual circumstances" as contemplated within the applicable statute and rule. The undersigned hearing officer suggested that the parties include in their post-hearing proposals arguments directed to timeliness, vel non, of the attorney's fee and costs petition, and thus, whether or not DOAH has jurisdiction of this case. With regard to the "substantial justification" issue, it is necessary to review the DBE process since 1991. Union Trucking, Inc.'s 1991 application for recertification was received by FDOT on April 30, 1991. Documents submitted to FDOT by Union Trucking, Inc. in conjunction with the 1991 application revealed that Petitioner corporation had undergone an ownership change on April 1, 1991, approximately 29 days prior to submittal of the 1991 application, which ownership change had transferred 49 percent of Union Trucking, Inc.'s corporate stock from Denise Willis to Robin P. Wilson; that the new owner, Robin P. Wilson, did not list any employment on her resume other than at Pritchett Trucking, Inc.; that Union Trucking, Inc. had a business relationship with Pritchett Trucking, Inc.; and that the new 49 percent owner of Union Trucking, Inc., Robin P. Wilson, is the daughter of Marvin Pritchett, owner of Pritchett Trucking, Inc. Marvin Pritchett is a white American male. Robin Pritchett Wilson is a white American female. Denise Willis, who previously owned the 49 percent of Union Trucking, Inc. stock which was transferred to Robin Wilson is also a white American female, and the stepdaughter of Marvin Pritchett. From Union Trucking, Inc.'s inception and at all times material, 51 percent of Union Trucking, Inc.'s stock has been owned by Warren Lee, a black American male. At all times material, Union Trucking, Inc. has been 100 percent owned by disadvantaged classes (female and black). At all times material, FDOT did not break down its disadvantaged certifications as to "black" versus "female" for purposes of categorizing DBE status, but only looked to whether or not at least 51 percent of the stock was owned by a member(s) of a disadvantaged class. FDOT has no rule specifically requiring that all owners work in the business, only that day to day control be in the hands of the disadvantaged class. FDOT conducted an on-site visit to Union Trucking, Inc. on July 22, 1991, at which time FDOT requested additional information as to Robin Wilson's employment with Union Trucking, Inc. and was notified that Robin Wilson spent approximately one to two hours per day working for Union Trucking, Inc. FDOT also inquired about Union Trucking Inc.'s business relationship with Pritchett Trucking, Inc. and received the explanation that the relationship was "like any lease owner with the company they lease with." DBE personnel at FDOT did not understand what this response meant, but they did not inquire further in 1991. Instead, the FDOT DBE certification committee voted to recertify Union Trucking, Inc. with a special monitor, because there were undefined "concerns" and unidentified "feelings" about the eligibility of Union Trucking, Inc. At formal hearing, FDOT personnel were very clear that recertification in 1991 with a "special monitor" meant that when Union Trucking, Inc. came up for recertification in 1992, an on-site review must be conducted. Prior to receiving Union Trucking, Inc.'s July 20, 1992 application for recertification, FDOT was notified by the Department of General Services (DGS) that DGS also had "concerns" about Union Trucking, Inc. On September 10, 1992, DGS notified FDOT that DGS had denied Union Trucking, Inc.'s application to DGS for Minority Business Enterprise (MBE) certification, that the DGS denial had been upheld at a DOAH hearing, and that FDOT would be provided a copy of the DOAH hearing officer's recommended order. FDOT subsequently received a copy of that recommended order which had been entered September 9, 1992. FDOT's Minority Programs Office Manager testified that, in his opinion, the recommended order in the DGS case (Exhibit DOT 9) "verified" the FDOT "concerns" expressed during the 1991 FDOT recertification process, but he defined those concerns as independent financing. The FDOT DBE certification committee chairperson testified that the recommended order addressed concerns expressed during the 1991 FDOT recertification process, but he defined the concerns differently, as lack of independency from familial relationships, i.e. control, and financial relationships of family corporations. Both men considered FDOT's and DGS' rules to be substantially similar. In fact, the September 9, 1992 recommended order to DGS involved a different agency (DGS) than FDOT, a different statute (Section 287.0943 F.S.) than the one authorizing FDOT's DBE program and different rules (Rules 13A- 2.005(4)(a) and (b) and 13A-4 F.A.C.) than the ones administered by FDOT. FDOT is required to operate under Section 337.135 F.S. and administer Rules 14-78.002 and 14-78.005 F.A.C. Also, the recommended order focused on a legal conclusion that Union Trucking, Inc. was financially dependent, or at least at the time of its corporate "start-up" in 1986 was financially dependent, upon Pritchett Trucking, Inc. The recommended order stated, in pertinent part, as follows: . . . co-owner of the applicant is Pritchett's daughter and a natural subject of his goodwill and generosity, such a relationship is prohibited by the statute, [referring to Section 287.0943 F.S.] Similarly, her service as a director of Pritchett corporation, carrying on Union's business from her desk at Pritchett Trucking is natural, but estab- lishes a prohibited relationship. [Bracketed material added her for clarification]. Upon receipt of the DGS recommended order, FDOT did not seek further explanatory information from the applicant, as was FDOT's standard procedure under its normal operation. Further, FDOT did not follow its own specially prescribed procedure for certified DBEs with "special monitor" status, in that FDOT did not conduct a new 1992 on-site review. Instead, two months later, FDOT sent its December 14, 1992 denial letter. The FDOT employee who prepared the letter testified that the letter denial was based on her review of all the information already in FDOT's DBE file on Union Trucking, Inc., upon the audio tape of the old 1991 on-site review interview, and upon corporate records of the Secretary of State. The FDOT letter, however, closely tracked the DGS recommended order but denied recertification by FDOT on the basis of FDOT Rules 14-78.005(7)(c)1. and 2.c. and 14-78.005(7)(a) F.A.C. It also stated that Union Trucking, Inc. was not an independent business entity or a small business concern and that there was an "affiliate" relationship under FDOT rules due to "Susan [sic] Wilson." It renamed Robin Wilson and also extrapolated a great deal of financial information that appears to come directly from the DGS recommended order. As a result of FDOT's denial of its 1992 recertification application, Union Trucking, Inc. requested a formal hearing. During the progress of that case before DOAH, FDOT received a copy of an affidavit by Robin Wilson in which she stated that Union Trucking, Inc. only purchased parts and fuel from Pritchett Trucking because Pritchett's Lake Butler terminal was the least expensive and most convenient source. Ms. Wilson also stated that Union Trucking, Inc. had not received any loans from her father's companies in four to five years, and that there were no current outstanding loans. In an effort to negotiate the issues and resolve matters without formal hearing before DOAH, FDOT finally conducted an on-site review in July 1993. Documentation was provided by Union Trucking, Inc. to show that all recent transactions with any of Marvin Pritchett's companies were properly invoiced "arm's length" transactions and that Union Trucking, Inc. dealt with many other companies as well; that Union Trucking, Inc.'s old debts to Marvin Pritchett's companies had been retired with zero balances prior to Union Trucking, Inc.'s 1992 recertification application to FDOT; and that Union Trucking, Inc. had three trucks and trailers normally being used full-time in its business. Random samplings by FDOT's consultant during this on-site review confirmed the information in the possession of FDOT prior to the 1992 application for recertification, most of which had been provided and was already in FDOT's possession as early as April 30, 1991. If FDOT had inquired concerning any loans at the time it received the recommended order in September 1992, it would have determined that all loans to Union Trucking, Inc. from any of Marvin Pritchett's various enterprises had been paid off prior to Union Trucking, Inc.'s 1992 recertification application to FDOT. FDOT's consultant's report after the 1993 on-site review determined that there currently were no "affiliated" firms under FDOT rules. It also appears from the report that FDOT then accepted that Robin Wilson split her time between office management for Union Trucking, Inc., running her own company named "Robin Pritchett Trucking Inc.," and working for her father's "[Marvin] Pritchett Trucking Inc." Having clarified these matters, FDOT no longer had problems or concerns with such an arrangement. Union Trucking, Inc.'s records on file for contract work with FDOT through other contractors also reflected use of owned trucks and drivers employed by Union Trucking, Inc. FDOT then recertified Petitioner effective October 15, 1993. At the attorney's fee and costs hearing herein, FDOT presented evidence that it did not have the correct location address for Union Trucking, Inc. when its personnel went to the July 1993 on-site review. This evidence does not justify FDOT's 1992 denial. Union Trucking, Inc.'s corporate office had moved a few weeks previous to the 1993 on-site review. Since Union Trucking, Inc. and its lawyer had been in constant communication with FDOT during the litigation phase of the recertification denial case, consistently urging an on-site inspection, any failure by Union Trucking, Inc. to clarify the geographical relocation of its office in 1993 was either an oversight or an innocent miscommunication. This change of address was not noted in Union Trucking, Inc.'s 1992 reapplication because the move had not yet occurred when that reapplication was submitted in July of 1992. Obviously, FDOT did not use the 1993 failure to notify the agency of a change of address as a reason to deny recertification in 1992, and FDOT also did not consider it a sufficiently serious flaw to withhold recertification after the July 1993 on-site review. FDOT also presented evidence that Robin Wilson did not tell the agency that she owned 100 percent of another corporate entity, "Robin Pritchett (her maiden name) Trucking, Inc." until the July 1993 on-site review. FDOT's two on- site reviewers concurred that "Robin Pritchett Trucking," consisting of one truck, which was sporadically used to haul wood chips, was never any cause for FDOT's concern. Apparently, FDOT considers hauling wood products to be an entirely different industry than the hauling of highway aggregates, which is the type of work done on FDOT contracts and the type of work done by Union Trucking, Inc. While Robin Pritchett Wilson's "affiliation" with her own independent corporation, "Robin Pritchett Trucking, Inc.," possibly was the type of "affiliation" which she should have disclosed, pursuant to FDOT's DBE rule, on Union Trucking Inc.'s 1992 application for recertification by FDOT as a DBE, it is clear that FDOT did not know of this nondisclosure when the agency denied recertification in December 1992. FDOT did not deny recertification at that time for that reason. FDOT also did not consider such nondisclosure to be a sufficiently serious flaw so as to withhold recertification after the disclosure at the July 1993 on-site review. Also, FDOT never asserted that its personnel had been confused in 1992 between "Robin Pritchett Trucking, Inc." and "[Marvin] Pritchett Trucking, Inc." Therefore, this late disclosure does not justify FDOT's 1992 denial of certification. In its July 1993 on-site review, FDOT investigated but found no barrier to recertifying Union Trucking, Inc. under the statutes and rules FDOT administers. There were no barriers related to familial relationships, related to Robin Wilson's being an owner of her own corporation, related to her being a director of any corporation, related to her owning a nominal number of stock shares in Marvin Pritchett's several businesses, related to her use of Pritchett's desk or office equipment, related to Pritchett loans to Union Trucking, Inc., related to Mr. Lee's use of a special account, or related to any other factual reason cited in either FDOT's December 14, 1992 denial letter or the September 9, 1992 recommended order affecting DGS. Nonetheless, FDOT's consultant's closing comments in the 1993 on-site report sum up FDOT's continuing overall approach to Union Trucking, Inc., both before the 1993 on-site review and thereafter. This approach is to "continue to question" successful DBEs whose principals have successful families and successful corporate investments. He wrote: Because of the close family relationships and multiple companies owned or operated, this firm will continue to be questioned as to eligibility for the DBE program. Any concerns I have remaining can only be resolved through the actual job perform- ance and compliance on future projects. I strongly recommend a continued compliance report be addressed with detailed concerns to support the next certif- ication provided the firm is recertified.
