The Issue The issue in this case concerns whether the Florida Department of Transportation's (FDOT's or Department's) proposed action to award a contract to Couch Construction, L.P., is contrary to the agency's governing statutes, the agency's rules or policies, or the bid or proposal specifications.
Findings Of Fact The Florida Department of Transportation (Department) issued an Invitation to Bid (ITB) for road resurfacing on State Road 10/US 90 in Columbia County, Florida; Financial Project No. 208406-1-52-01 (The Project). Four companies submitted responses to the ITB. Couch was low bidder at $2,271,354.81, and Petitioner was second low at $2,278,263.07. The ITB incorporated the plans and specifications for the proposed highway resurfacing. The price proposal specifications stated in pertinent part: Item Number 2102-10. . .Approximate Quantity. . . 4,320.00 hours Item Number 2102-74-1 . Approximate Quantity . . .75,780.00 each day Item Number 2102-99 . . Approximate Quantity . . . 720.00 each day None of the bidders filed a timely objection to the price proposal specifications. Article 2-6, of the Florida Department of Transportation Standard Specifications for Road and Bridge Construction states: A proposal will be subject to being considered irregular and may be rejected if it shows omissions, alternations of form, additions not called for, conditional or unauthorized alternate bids, or irregularities of any kind; also if the unit prices are obviously unbalanced, either in excess of or below the reasonable cost analysis values. After the bids were opened, each bid was reviewed by the Department to determine whether the bid was mathematically and/or materially unbalanced. The Department's Preliminary Estimates Engineer conducts an unbalanced review of the bids to determine if the bids are mathematically unbalanced. A bid is considered to be mathematically unbalanced if the prices quoted are significantly different from the approximate cost of the item to the contractor. It is very common for bids on construction projects to contain some item prices that are mathematically unbalanced. Bid prices that are mathematically unbalanced are considered by the Department to be non-material irregularities if they do not affect the order of the bidders. In determining whether a mathematically unbalanced price is material, the Department follows a policy set out by the Federal Highway Administration (FHWA). The Department has been following the same policy since at least 1992. The FHWA does not allow for materially unbalanced bids to be accepted by the Department on projects that are federally funded. A materially unbalanced bid is one in which there is a reasonable doubt as to whether award to the bidder submitting the mathematically unbalanced bid will result in the ultimately lowest cost to the Department. The Department has developed an Unbalanced Program Logic for its computer analysis of the bids. The program flags the items that are mathematically unbalanced. It flags the item with an "A" for those items that are above the tolerance window, "U" for under the tolerance window, and "F" as front-loaded items. The flagged items which are short-listed by the computer program are sent to the designer of record to verify the quantities and to verify whether the correct pay item was used. The designer of record verified that the quantities were correct for this Project. As part of the bid review, the Department does a statistical average or mean average for each of the bid items. A standard and a-half deviation either side of the mean is established. The bid items outside that standard and a-half deviation, positive or minus, are discarded. The remaining bid items are re-averaged and this second average is referred to as the "serious average." A front-end loaded item is an item for which work is performed early in the contract. Mobilization is considered a front-end loaded item. Couch's Mobilization item 2101-1B was flagged by the computer analysis. The Department did an analysis of the Mobilization item. The Department started with the difference between Couch's bid and the Petitioner's bid on this item, $18,0000.00. That amount was multiplied by the current interest rate, 10 per cent, and then multiplied by a factor of .5, which spread it over half the contract, times 180-day contract period divided by 365, one calendar year. The result was $434.84, which represents the potential advantage that could result from paying the $18,000.00 amount early in the contract. That amount, $434.84, did not materially unbalance Couch's bid. The three items identified by Petitioner as unbalanced (paragraph 3, above) were low and did not present any detriment to the Department. If those three items overran at the rate established, it would be an advantage to the Department. In evaluating unbalanced bids, the Department follows the guidance in a May 1988 memorandum from the FHWA, which addresses bid analysis and unbalanced bids. The memorandum provides that where unit prices for items bid are either unusually high or low in relation to the engineer's estimate of the price, the accuracy of the estimated quantities of the items are to be checked. If the quantities are reasonably accurate, the bid is to be further evaluated to determine whether the mathematical imbalance is materially unbalanced such that there is "reasonable doubt that award to the bidder submitting the mathematically unbalanced bid will result in the lowest ultimate cost to the Government." The analysis of a mathematically unbalanced bid to determine if it is materially unbalanced considers the effect of the unbalanced bid on the total contract amount; the increase, if any, in the contract cost when quantities are corrected; whether the low bidder will remain as the low bidder; and whether the unbalanced bid would have a potential detrimental effect upon the competitive process or cause contract administration problems later. In this case, the Department compared the unit prices (line item prices) by each bidder on the bid proposal sheet to the average unit price for that item. The average unit price is based upon an average of the bidders' unit prices bid for a given pay item and the Department's estimated unit price for that item. If an individual bidder's unit price is significantly greater or less than the average price, the Department's computer flags the item as mathematically unbalanced. Such a bid then receives further evaluation by the Department to ensure the accuracy of the original estimates of the quantities of those items for which an unbalanced unit price has been submitted. The Department also reviews the project plans for accuracy. The more in-depth review is performed to determine if there is a potential for a cost overrun or if there is an error in the Department's estimated quantities which would result in an increased cost to the Department for the project. In this case, Couch and Anderson submitted bid proposals for each of the individual line item prices contained on FDOT's form. Couch's unit price for the off-duty law enforcement item was $0.25/hour. The Department's average price for the off-duty law enforcement item was $25.22/hour. The Petitioner's quotation for off-duty law enforcement was $26.00/hour. The Department's computer analysis of Couch's bid flagged the off-duty law enforcement item as mathematically unbalanced. The quote by Petitioner for the off-duty law enforcement item was not unbalanced, and therefore was not flagged for further review by the Department. The same analysis was applied to the barricades and variable message sign items, with similar results. The Department also did an in-depth review of item 2101-B, Mobilization, for front-end loading. The result of that analysis was that, as a result of front-end loading, there was the probability of increased cost to the Department of $443.84. This small increase in the cost to the Department was not large enough to change the order of the bidders. Therefore, it was not a materially unbalanced item. The Department then made a more in-depth review of the three mathematically unbalanced items in Couch's bid and determined that none of those items were materially unbalanced, because none of them had the potential to increase the cost to the Department and none of them had the potential to change the order of the bids. In sum, the Couch bid was not materially unbalanced. The evidence in this case is insufficient to support a basis for rejecting the Couch bid.
Recommendation On the basis of all of the foregoing, it is RECOMMENDED that the Florida Department of Transportation issue a final order in this case dismissing the Petitioner's Formal Protest and Request for Hearing; denying all relief requested by the Petitioner; and awarding the subject contract to the Intervenor, Couch Construction, L.P. DONE AND ENTERED this 7th day of May, 1999, in Tallahassee, Leon County, Florida. MICHAEL M. PARRISH Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 7th day of May, 1999.
The Issue The issue in this proceeding is whether the Respondent, the Department of Insurance, acted illegally, arbitrarily, fraudulently, or dishonestly in rejecting all bids for lease #460:0119 and not awarding subject lease to Petitioner.
Findings Of Fact The Department of Insurance established a requirement to lease 5371 square feet of office space in Daytona Beach, Florida, and a "Request for Space Need" was approved by the Department of Management Services on February 11, 1998. The Department of Insurance subsequently issued a Request for Proposal (RFP) for lease #460:0119 (Respondent's Exhibit 1). A non-mandatory pre-bid conference was held on June 1, 1998, in Daytona Beach and two prospective bidders, Petitioner and Nova Village Market partnership attended. The RFP provided that proposals which did not meet all mandatory requirements of the RFP would be rejected as non- responsive. The RFP provided for evaluation criteria are awards factors. The awards factors totaled 100 points with no minimum point total required. Ten of the points were allotted for moving costs defined as the costs of relocating communications, networks, furniture and other equipment. This factor gave the current landlord an automatic 10-point advantage since there would be no relocation costs. Moving costs provisions tend to discourage the presentation of bids because the bidders have to overcome an automatic 10-point advantage provided the current landlord. The RFP also provided that all proposals could be rejected, however, such "rejection shall not be arbitrary, but be based on strong justification." None of the conditions of the RFP were questioned or challenged by interested parties. Two responses were received by the Department of Insurance in response to the RFP and these were opened in Respondent's Tallahassee office on July 8, 1998, by Mr. Kip Wells of the Department. One was received from the current landlord, Nova Village Partnership, hereafter Nova, and the other from the Petitioner. The Nova proposal was deemed non-responsive. Neither Nova nor Petitioner contested the determination that Nova's proposal was non-responsive. Only one responsive proposal, the Petitioner's proposal, remained. On July 9, 1998, the Department representative, Mr. Kip Wells, called Petitioner to schedule an appointment for 9:00 a.m., on July 10, 1998, to visit and evaluate the proposed facility. No persons from the Department appeared at the scheduled appointment. At 10:45 a.m., on July 10, 1998, Kip Wells called Petitioner to say that since Petitioner's proposal was the only responsive proposal received, and that "all bids" were being rejected. Mr. Wells testified at hearing. His reason for rejecting the remaining bid was: When I saw that it was obvious the current landlord was not going to be very cooperative, I decided that one choice was not enough. If we were going to have to make a move, we needed more than one thing to choose from. So, I immediately - - since I had already set up with local people in Daytona to tell them that I was coming down to evaluate the bids, I sent them an E-mail and told them that I would not be meeting the following day to evaluate the bids. Mr. Wells decided to reissue the RFP without any moving costs criteria, and redistribute those 10 points among the other award factors. Petitioner filed a Notice of Intent to Protest and then a Formal Protest, both in a timely fashion. There is no state policy prohibiting the award of a lease to a sole bidder on a RFP. The "Leasing Policy" of the Department of Insurance states that "The Lease Administrator, with assistance from the Division employees, will establish bid or quote specifications. These specifications will include special needs for the Division(s) as well as the evaluation criteria upon which to evaluate the proposals." Neither the Department's Lease Policy (Petitioner Exhibit 3) nor the State's Real Property Leasing Manual (Petitioner's Exhibit 4) give the Lease Administrator the authority to reject or evaluate bid responses. Neither does he have a vote in the bid evaluation process. His responsibility is to coordinate the process. Randall Baker, Manager of Private Sector Leasing of the Bureau of Property Management of the Department of Management Services (hereinafter DMS), testified. The DMS prepares a manual as a guideline for user agencies to assist in the leasing of property. The DMS manual is not binding on agencies and DMS has no review oversight; however, their comments on agencies' leases are reviewed by the state auditing authorities and failure to follow the guidelines can result in audit criticism. Baker confirmed that the agency's written procedures as outlined in the RFP were consistent with the DMS guidelines. The DMS manual states as follows regarding the receipt of only one responsive proposal: When only one responsive proposal is received it may be considered and accepted providing the following conditions are documented: Adequate competition was solicited. The rate is within established rental rate guidelines. The proposal meets stated requirements. The proposal was processed as though other proposals were received. The Petitioner's bid was responsive to the RFP and the lease rate bid by the Petitioner was less than the average rate for state leases in the Daytona area and less than the amount budgeted by the Department for this lease. The lease rate by the Petitioner was reasonably priced and competitive. Although the agency failed to complete the process as envisioned, see paragraph 20 below, this was in no way the fault of Petitioner. The Department's leasing policy requires that the lowest and best response to an RFP be determined through cost analysis and evaluation by an evaluation committee. Mr. Wells did not forward Petitioner's bid to or discuss with the evaluation committee Petitioner's bid, but unilaterally rejected it. It was clear from Mr. Wells' testimony that this was his individual decision and was based upon his personal belief that it was the best thing to do.1 At hearing, the stated justification for rejecting "all bids" was that it gave the Department the opportunity to delete the requirement of moving costs from the awards factors; however, the evidence does not indicate that the moving cost provision result in non-competitive bids. The sole responsive bidder was within the local lease price range and within budget. Neither the Respondent nor DMS has established a policy prohibiting the acceptance of a sole responsive bid if there is competition solicited. The Department of Insurance has accepted a sole bid on at least one project in the past. There was no evidence that the RFP was not an open and fair competition. The evidence shows that it was properly advertised, that all conditions were known, and that all interested parties had an equal opportunity to participate. In sum, there was adequate competition in submitting the bids. Mr. Baker testified regarding the policy of DMS. The DMS policy is that if there is one responsive bidder, there has been competitive bidding. The RFP provides that the Respondent may reject all bids if it has strong justification. See paragraph 5 above. Mr. Baker also provided examples of "strong justification for rejecting proposals." His examples include facilities which are proposed outside the required geographic area, prices considerably in excess of state guidelines and agency budgets, specification changes due to modification of the agency's program requirements, and "intervening external forces." No evidence establishing a strong justification for rejecting the Petitioner's bid was presented. Without completing the process and evaluating the Petitioner's bid, the agency never considered whether the bid was in the state's best interest. However, this was not the fault of the Respondent, and the agency's failure to follow its procedures should not inure to its benefits. Further, Because there was no minimum score required on the evaluation criteria of the RFP, there is no need to evaluate Petitioner's proposal because it is the only responsive proposal. For all the reasons stated above, the rejection of Petitioner's bid was contrary to the terms of the RFP, contrary to state policy, and arbitrary.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is, RECOMMENDED: That a Final Order be entered which finds that: Respondent's actions in rejecting Petitioner's responsive bid were arbitrary; The Respondent did not follow the requirements set forth in the Department of Insurance Leasing Policy, nor the Department of Management Services Real Property Leasing Manual, or the Request for Proposal itself; That no adverse interest to the State or the Department would have occurred had Petitioner's responsive bid been accepted; and therefore, Petitioner's claim shall be upheld as the lowest cost and best proposal for RFP #460:0119, and that the Department of Insurance shall award Petitioner Lease #460:0119. DONE AND ENTERED this 30th day of October, 1998, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 30th day of October, 1998.
Findings Of Fact Findings based on stipulation The School Board of Broward County, Florida, ["Board"] issued bid number 94-307D [Lease of School Board Owned Parking Lot - Term Contract] on the 22nd day of November, 1993. Three bidders responded to the invitation to bid. They were: Bliss Parking, Inc., a Florida Corporation ("Bliss"); Fort Lauderdale Transportation, Inc., d/b/a USA Parking Systems ("USA"); and Carl A. Borge. An initial review of the tabulations of the bids indicated that Bliss and USA had submitted the identical percentage of shared revenue to the Board in their respective bids. After the review of the bids, Board staff posted a recommendation to award the bid to USA. [See the "remarks" portion of Exhibit B.] A bid protest was filed by Bliss because of the "remarks" portion of Exhibit B. After a review of Bliss' bid protest, Board staff amended its recommendation to reject all bids because of the issues raised in Bliss' protest. After Board staff notified all bidders of this amended recommendation, USA filed a notice and formal protest. The Board, at its meeting on March 1, 1994, heard the presentation of USA and Board staff. The Board, after deliberating the matter, deferred the item until the meeting of March 15, 1994, wherein seven Board members would be present. At the March 15, 1994, Board meeting, by a vote of 4 to 3, the Board granted USA's protest and awarded the bid to USA whom the Board had determined was the highest bidder meeting bid specifications. All bidders were notified of the Board's action and on the 16th day of March 1994 Bliss timely filed its notice of protest and its formal written protest. Bliss appeared with counsel before the Board on the 5th day of April 1994. After considering arguments of counsel for Bliss and reviewing the material in Agenda Item H-1 and in consideration of its previous actions, it voted to reject Bliss' protest seeking the rejection of all bids received and re-bidding of the item. Bliss subsequently requested a formal hearing under Chapter 120.57, Florida Statutes. Findings based on evidence adduced at hearing The General Conditions portion of the Invitation To Bid includes the following provision: INTERPRETATIONS: Any questions concerning conditions and specifications must be submitted in writing and received by the Department of Purchasing no later than five (5) working days prior to the original bid opening date. If necessary, an Addendum will be issued. A related provision in the Special Conditions portion of the Invitation To Bid reads as follows: 21. INFORMATION: Any questions by prospective bidders concerning this Invitation to Bid should be addressed to Mrs. Sharon Swan, Purchasing Agent, Purchasing Department, (305) 765-6086 who is authorized only to direct the attention of prospective bidders to various portions of the Bid so they may read and interpret such for themselves. Neither Mrs. Swan nor any employee of the SBBC is authorized to interpret any portion of the Bid or give information as to the requirements of the Bid in addition to that contained in the written Bid Document. Questions should be submitted in accordance with General Condition #7. Interpretations of the Bid or additional information as to its requirements, where necessary, shall be communicated to bidders only by written addendum. The Special Conditions portion of the subject Invitation To Bid includes the following provisions: REFERENCES: A minimum of three (3) references must be provided by completing page 14 of the bid. Failure to provide references with the bid or within five (5) days of request by the Purchasing Department will be reason for disqualification of bid submitted. All references will be called. SBBC reserves the right to reject bid based on information provided by references. Page 14 of the Invitation To Bid has three sections, each of which reads as follows: COMPANY NAME: STREET ADDRESS: CITY: STATE: ZIP: TELEPHONE NUMBER: CONTACT PERSON'S NAME: NUMBER OF PARKING SPACES: LENGTH OF CONTRACT: At page 12 of the Invitation To Bid, the following note appears under the Bid Summary Sheet portion of the document: "NOTE: Calculation of high bidder shall be the bidder offering the highest percent of shared revenue meeting all specifications and conditions of this bid." The Special Conditions portion of the Invitation To Bid also contains a procedure for resolving tie bids, which reads as follows, in pertinent part: TIE BID PROCEDURES: When identical prices are received from two or more vendors and all other factors are equal, priority for award shall be given to vendors in the following sequence: A business that certifies that it has implemented a drug free work place program shall be given preference in accordance with the provisions of Chapter 287.087, Florida Statutes; The Broward County Certified Minority/ Women Business Enterprise vendor; The Palm Beach or Dade County Certified Minority/Women Business Enterprise vendor; The Florida Certified Minority/Women Business Enterprise vendor; The Broward County vendor, other than a Minority/Women Business Enterprise vendor: The Palm Beach or Dade County vendor, other than a Minority/Women Business Enterprise vendor; The Florida vendor, other than a Minority/Women Business Enterprise vendor. If application of the above criteria does not indicate a priority for award, the award will be decided by a coin toss. The coin toss shall be held publicly in the Purchasing Department; the tie low bid vendors invited to be present as witnesses. The Petitioner filled out all three sections on page 14 of the Invitation To Bid and submitted that page with its bid. The three references listed by the Petitioner were companies for whom the Petitioner provided parking services or parking facilities, but none of the three references listed by the Petitioner was a land owner from whom the Petitioner leased land for the operation of a parking facility. Mr. Arthur Smith Hanby is the Director of Purchasing for the School Board of Broward County. In that capacity he is in charge of the bidding process for the School Board. Specifically, he was in charge of the bidding process for the subject project. In the course of evaluating the bids on the subject project, the evaluation committee reached the conclusion that there was a problem with the bid submitted by the Petitioner with respect to the references listed in the Petitioner's bid. In the original bid tabulation and recommendation posted on January 4, 1994, the recommendation was that the contract be awarded to the Intervenor, whose bid amount tied with the Petitioner's bid amount. 4/ The reasons for the recommendation were described as follows in the "remarks" portion of the tabulation and recommendation form: REJECT BID FROM BLISS PARKING, INC. REFERENCES WERE GIVEN ON PAGE 14 OF BID. ALL REFERENCES WERE CALLED. BASED UPON INFORMATION PROVIDED BY THESE REFERENCES AND IN ACCORDANCE WITH SPECIAL CONDITION #10, IT IS RECOMMENDED THAT THE BID FROM BLISS PARKING, INC. BE REJECTED. EVALUATION OF THIS BID CEASED AT THIS TIME. THERE MAY BE ADDITIONAL REASONS WHY THIS BID COULD NOT BE ACCEPTED. The sole reason for the rejection of the Petitioner's bid was that the references listed by the Petitioner were not the types of references the evaluation committee wanted to receive. The evaluation committee wanted references from entities who, like the School Board, were land owners who had leased land to a parking lot operator. The evaluation committee was of the opinion that references from other sources would not adequately protect the interests of the School Board. There is nothing in the Invitation To Bid that addresses the issue of who should be listed as references. Specifically, there is nothing in the Invitation To Bid requiring that references be submitted from land owners who had leased land to a parking lot operator. At the time of the issuance of the subject Invitation To Bid, the Petitioner was operating the subject parking lot for the School Board. There were no material differences in the bids submitted by the Petitioner and the Intervenor other than the differences in the types of references they listed. The Petitioner's references who were contacted did not provide any adverse information about the Petitioner. The evaluation committee spoke to two of the references listed by the Petitioner, but did not speak to the third listed reference. The third reference listed by the Petitioner was a court reporting firm located across the street from the location of the subject parking lot. The evaluation committee did not speak to anyone at the court reporting office because the telephone number listed for that reference was not a working number. The evaluation committee made an unsuccessful attempt to locate the telephone number of the court reporting firm in the telephone book.
Recommendation On the basis of all of the foregoing, it is RECOMMENDED that the School Board issue a final order in this case concluding that the Petitioner's bid is responsive to the Invitation To Bid and that the School Board then take one of the courses of action described in paragraph 26, above. DONE AND ENTERED this 23rd day of June 1994 at Tallahassee, Leon County, Florida. MICHAEL M. PARRISH Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of June 1994.
Findings Of Fact In June 1987 The School Board of Lee County, Florida invited the submission of sealed bids for grading and drainage improvements at the new Multipurpose Building at Fort Myers High School. In addition to requiring grading, the project involves the erection or placement of structures in the nature of a drainage system consisting of culverts, pipes, and concrete inlets with grates, to be tied into the existing drainage system off School Board property across a county right-of-way into a culvert for discharge across the street, and which on School Board property attaches to and becomes a part of an existing building. Sealed bids were submitted by Systems Technologies Co. of Ft. Myers, Inc. (hereinafter "Systems Technologies") and by Ledo Lines, Inc. Respondent determined Systems Technologies to be the lowest responsible bidder and advised Ledo Lines, Inc., that it would be awarding the contract to Systems Technologies. Warren W. Hunt is the president and the qualifying agent of Systems Technologies. Hunt has an underground utilities contractor's license which has been inactive since it was obtained by him in March, 1986, being inactive therefore both at the time that Hunt submitted the bid on behalf of Systems Technologies and at the time of the final hearing in this cause. The inactive status results from Hunt's failure to complete the license process with the State of Florida. Since Hunt's license was inactive due to being incomplete at the times material to this cause, neither Hunt nor Systems Technologies was a licensed contractor and Systems Technologies was not a responsible bidder at the time that the bid was submitted. The contract specifications set forth the method by which the bids would be evaluated. Paragraph numbered 2.9 on page PD-4 provides as follows: Comparison of Proposals - Proposals will be compared on the basis of total computed price for each division of work. Total computed price equals the sum of the prices for the lump sum Contract Item, plus the sum of the total prices for the unit price Contract Items for each Division of work. The total price for each unit price Contract Item will be obtained by multiplying the estimated quantity of each item by the correspond- ing unit price set forth in the Proposal form[.] That provision, accordingly, requires that the bids be evaluated based upon the sum of all line items rather than based only upon their total or "bottom line" figure. Respondent's Director of Facilities Planning admitted that he failed to comply with this provision of the contract specifications in evaluating the two bids submitted to him and in determining that the bid should be awarded to Systems Technologies. In Systems Technologies' bid, the sum of the prices for the lump sum contract items plus the sum of the total prices for the unit price contract items amounts to $30,109.60. However, in submitting its bid Systems Technologies incorrectly added its column of figures and incorrectly computed its Total Contract Price (Estimated) to be $29,768. Since the contract specifications envision a unit price bid rather than a lump sum bid, the amount of the bid of Systems Technologies is in fact the amount of $30,109.60. The bid of Ledo Lines, Inc., is for $29,913.84. Ledo Lines, Inc., is, therefore, the low bidder on this project. The contract specifications when read in their entirety clearly require that the low bid be determined by adding the unit price and lump sum components rather than relying on the lump sum "bottom line" figure shown for Total Contract Price (Estimated). Employees of the consultant who Prepared the specifications testified that they expect to be able to hold the bidders to the unit prices but not to the Total Contract Price (Estimated) because the estimated quantities may change. Thus, the evidence is uncontroverted that the determination of low bidder pursuant to the contract specifications is based upon the total of the unit price provisions and not by the single figure at the bottom of the page which adds those individual prices and which was added erroneously in this case by Systems Technologies. In their Prehearing Stipulation, the parties stipulated that the School Board is subject to mandatory competitive bidding for this project. They further stipulated that where there is mandatory competitive bidding, the contract must be awarded to the lowest qualified, responsive bidder. Since Systems Technologies is neither a qualified, responsive bidder nor the lowest bidder, it is clear that Ledo Lines, Inc., is the lowest responsive bidder for the project in question.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is, RECOMMENDED that a Final Order be entered determining Ledo Lines, Inc., to be the lowest responsive bidder and awarding the contract for grading and drainage improvements to the Multi- purpose Building at Fort Myers High School to Ledo Lines, Inc. DONE and RECOMMENDED this 25th day of September, 1987, at Tallahassee, Florida. LINDA M. RIGOT, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 25th day of September, 1987. COPIES FURNISHED: James E. Melvin, Superintendent School Board of Lee County 2055 Central Avenue Fort Myers, Florida 33901 E. G. Couse, Esquire Post office Drawer 1647 Fort Myers, Florida 33902 Harry A. Blair, Esquire Post Office Box 1467 Fort Myers, Florida 33902
Findings Of Fact The Respondent, Department of Corrections, by advertisement in a Jackson County, Florida newspaper on March 27, March 30 and April 6, 1988, sought bids for the provision of office space for the Department's offices in Marianna. The bid specifications, including, as pertinent hereto; minimum square footage, a requirement that Energy Performance Index calculations and certification thereof by an architect or engineer be shown, and the requirement that all parking spaces be on site, was made available to potential bidders on March 28. A pre-proposal conference of potential bidders was held on March 31 to explain and clarify the specifications. Bids were submitted by the two Petitioners, and the bids were opened on April 14, 1988. On or about April 19 or 20, Wendell Beall and Robert Sandall evaluated the bid proposals and made a preliminary determination that the Rainbow bid was non-responsive in three areas. It was determined that the required square footage depicted on the Rainbow bid was inadequate; the parking provision was inadequate in that not enough "on-site" spaces were shown on the bid; and the Energy Performance Index calculations and certification by an architect or engineer was not supplied. On April 21, 1988, the lease committee, chaired by Thomas Young, met and reviewed both bid packages submitted by the Petitioners and affirmed Mr. Beall and Mr. Sandall's findings, with the result that the agency decided to award the contract to Brooks. The bid specifications required a minimum of 12,756 net square feet of rentable office space. Only 11,862 square feet could be identified as net rentable square footage on the Rainbow bid's floor plan, as calculated in compliance with the "standard method of space measurement." This square footage calculation was consistent with the actual measurements of the building made by Mr. Beall himself. The Brooks' bid depicted an adequate amount of square footage in compliance with the specifications. Mr. Beall calculated the net rentable interior square footage by utilizing the standard method of space measurement provided for in the rules of the Department of General Services and, after deducting nonusable, nonrentable space under that standard, rule mandated method, he arrived at the net rentable office space figure of 11,862 square feet. Rainbow at no time has presented any conflicting measurement or alleged any specific errors in Mr. Beall's calculations. Item A-10 of the bid specifications requires a floor plan to be submitted showing the present configurations of the building, with measurements that equate to the required net rentable square footage. This means that the minimum square footage must be shown in the floor plan attached and submitted with the bid specifications, even if the building may contain more square footage. The Department supplied a specific number of offices of various sizes and a required configuration no floor plan in order to depict work units that should be constructed and/or arranged together, as part of the specifications in the Invitation to Bid documents. The purpose of this agency floor plan was to give potential bidders a guide to calculate the cost of remodeling existing space to meet the agency's needs so that those potential bidders could amortize that cost as part of the rental amount involved. Therefore, the proposed floor plan included in a bidder's package should not vary substantially from the final plan used to actually remodel the leased space in accordance with the agency's requirements. Accordingly, the only submittal of plans which is permissible subsequent to the bid opening, as contemplated by the bid specifications, are the final plans developed by a successful bidder in consultation with the agency after the bid award. No floor plan may be unilaterally submitted by a bidder after the bid opening since that would constitute an illegal amendment of the bid. Only a floor plan done in consultation with the agency in order to make final adjustments so that all office space and other related space will comply with the agency's precise requirements may be done after the bid is actually awarded, and this must be based upon the floor plan originally submitted in the bid itself in conformance with the bid specifications regarding office layout, square footage and the like. The Rainbow bid simply contained an inadequate amount of square footage necessary to be a responsive bid in this regard. An additional bid specification at issue concerns the requirement of 77 exclusive use, on-site parking spaces. The Rainbow bid only made provision for 27 on-site exclusive parking spaces, with the remaining 50 spaces of the required 77 being off the proposed building site, approximately 155 feet away, without sidewalk access to the proposed office building. The Brooks' bid incorporated all required parking spaces on the site, as required by the specifications. The Rainbow bid was non-responsive concerning the parking space specification as well. Mr. Beall prepared the bidding documents as Budget Manager for the Department of Corrections' Region I. He was the person designated in the bidding documents to answer any questions requiring clarification by prospective bidders before bids were prepared and submitted. Mr. Beall established that the intent of the agency with regard to this parking space requirement was to require all 77 parking spaces to be on-site. No bidder or prospective bidder asked any questions of Mr. Beall concerning this specification prior to the submittal of any of the bids. Mr. Brooks, however, did consult with Mr. Beall on the question of the Energy Performance Index specification item before he submitted his bid. Mr. Brooks is a former physics and advanced mathematics teacher with some 20 years experience in construction. He has been a licensed general contractor and master builder for residential, commercial and industrial types of construction for 11 years. He typically designs and draws his own plans, including those submitted with the bid at issue. He spent approximately 100 hours of his time on preparation of this bid. Mr. Brooks had previously been awarded a rid by the Department of Corrections on which he simply invalid the item concerning the Energy Performance Index (EPI) specification. That item was found to be responsive by the Department, and the bid was awarded to Mr. Brooks. On a subsequent bid on a different job, Mr. Brooks again merely initialed the EPI specification, which he intended to mean that he would perform the job at issue such that the EPI requirements would be met. He was not awarded the bid on that particular job, but upon his informally notifying the Department of Corrections that he might protest the decision to award the bid to a different bidder, the Department personnel advised him that they might choose to raise the issue of his responsiveness to the EPI specification in that situation. With this history in mind, Mr. Brooks, before submitting his bid, contacted Mr. Beall to inquire as to what would be considered an appropriate response to the EPI specification on the bidding documents. The EPI has been calculated by Mr. Brooks on numerous projects in the past, and he is capable of calculating it as to this project. He found, however, that it would be impossible to calculate a precise and accurate EPI specification response, because he would not have the final floor plan from which to calculate it, with all the information that would give him concerning room configurations, size, location and size of windows, size and type of heating and air-conditioning equipment and many other factors. Mr. Brooks could, however, give his certification that the energy performance requirement would be met, once the final plans were completed in conjunction with discussion with the agency after award of the bid, which comports with standard agency policy and practice. Because he was concerned that any energy performance calculations he might supply would not necessarily be accurate in the final analysis, in relation to the final "to be constructed" plans, Mr. Brooks contacted Mr. Beall to obtain his guidance about what would be considered a proper response to this specification item. Mr. Beall advised him that a letter certifying that he would comply with the specification as to this issue would be an appropriate alternative to simply initialing the specification. The same opinion was also voiced at the lease committee meeting. Mr. Beall's advice to Mr. Brooks in this regard was based upon advice given him by Mr. Edwin Johnson of the Department of General Services and was based upon past agency policy concerning treatment of this issue on previous bids considered by the lease committee. Previous bids had indeed been accepted in the form submitted by Mr. Brooks and had not been found to be nonresponsive as to the EPI issue. Thus, Mr. Brooks, in addition to initialing the specification concerning the EPI, also supplied the referenced letter certifying that he would comply with that specification and agency requirement. Rainbow, on the other hand, merely initialed that item in the specification and bidding document. Thus, the Brooks' bid is the more responsive on the issue of the EPI than the Rainbow bid. The bid award to Brooks was posted on May 2, and on May 4, Rainbow filed a Notice of Protest of she award which was received by the Department, timely on May 5. Shortly after that date, counsel for Rainbow requested that the Department's representatives and counsel meet with him and Mr. Jett, his client, of Rainbow Properties, to discuss the agency's award to Brooks and rejection of Rainbow's bid. On May 10, 1988, the Department's regional representatives and its counsel met with Mr. Jett of Rainbow Properties and his attorney, Mr. Barley. Mr. Jett used this opportunity to explain how he felt that the Rainbow bid had complied with the bid specifications in the three specific areas discussed above. The Department's counsel explained on that occasion that the bid could not be amended after opening and posting of the bids. Mr. Jett's bid had only shown 11,862 square feet identifiable as rentable space in the floor plan submitted with the bid, although 12,756 square feet were required by the bid specifications. Additionally, as discussed above, of the 77 required on-site parking spaces, only 27 were provided on site with 50 of them being off site, with Rainbow not establishing that it had ownership or right of control to the off site spaces. Additionally, as discussed above, there was the problem of no calculations or assurances being provided regarding the EPI specification, it merely having been initialed in Rainbow's bid submittal. At the May 10 meeting, Mr. Jett was given the opportunity to explain how his bid complied with the specifications at issue and to discuss how he felt the Department had misinterpreted his response or made an error in measuring or calculating the square footage available in his building. He provided no alternative calculations or measurements of the building, however, which would depict more than the 11,862 square feet measured by the Department's staff or which would show that measurement was incorrect. He was reminded that the only possible information he could legally provide the agency after the opening of bids was in the nature of minor clarification concerning how he had calculated the square footage. He was instructed that he could not revise his plans in order to establish that more square footage was available because that would be an illegal amendment of his bid after the bids were open and posted. At the May 10 meeting Mr. Jett also maintained that the Department had allowed for other than on site parking; however, but the bidding document or Invitation to Bid only contained one blank, and only one subsection on the bidding form, for the bidders to indicate 77 spaces designated as on site spaces. Mr. Jett maintained that since the Department had provided option "(A)" under this on-site parking specification item, that he was therefore free to add other options. Using that logic, however, it would also appear that he could have submitted a bid depicting spaces literally on the other side of town and still had a responsive bid. That clearly is not the correct interpretation of that specification. He also maintained that the EPI was impossible to calculate at the time of bidding, in view of the fact that final plans were not available to support the ultimate calculation. In any event, at the conclusion of this meeting, Department personnel informed Mr. Jett and his counsel that would inform him of its decision within a few days. The Department did not inform Mr. Jett that he would be permitted to amend his bid after obtaining professional help and redrawing his blueprint in an effort to show that the minimum square footage was available. Indeed, Rainbow and Mr. Jett did obtain the services of an architect and drew a new floor plan which it offered as PR-1 at the hearing. If the floor plan originally attached to Rainbow's bid, consisting of Exhibit PR-2 in evidence, is compared with the blueprint submitted by the architect after the meeting with the Department representatives on May 10, it can be discerned that the blueprint is not a mere refinement or clarification of the initial floor plan, but rather that major modifications have been made to the initial floor plan submitted with the bid. These consist of walls which have been moved, small rooms in some areas which have been eliminated, restrooms which have been deleted and an existing spiral staircase area which was eliminated, and a hallway enclosed, in order to add additional rentable square footage where new offices could be added. Thus, this blueprint offered at hearing was not a mere refinement or clarification of the original floor plan submitted with the Rainbow bid, but rather sufficiently different from original floor plan as to constitute a material amendment or modification to the bid. It therefore cannot be considered. The floor plan submitted with the bid was nonconforming to the bid specifications as to the square footage item and Rainbow cannot be permitted to rectify and correct that with the architect's new blueprint and floor plan offered at the time of the hearing. 1/ In short, insufficient square footage was depicted and that is not a minor waivable irregularity. Soon after this May 10 meeting, the Department changed its position, decided that both bids were not responsive and rejected them. Its alleged basis for doing so was that the Brooks bid was nonresponsive as to the energy performance index criteria and that the Rainbow bid was nonresponsive as to that criteria, as well as to those concerning minimum square footage and on-site parking availability; the same as the original grounds for rejecting Rainbow's bid. Timely formal protests of that second agency action were filed by both Brooks and Rainbow. In that connection, Rainbow's formal written protest of the original award to Brooks, which was announced and noticed on May 2, 1988, was untimely. The formal written protest must be filed within ten days of the notice of protest. Rainbow's original notice of protest was filed with the agency on May 5 and the formal written protest was not filed until May 17. Rainbow, in conjunction with its filing, filed a motion for leave to late-file the formal protest with the agency on the basis that it had mistakenly filed the formal protest with the Division of Administrative Hearings. That petition was filed with the Division on May 16th. The deadline for filing the formal protest was May 15th. Petitioner Rainbow, however, did not learn of the second intended agency action until May 16th, however, and may have been somewhat misled about the necessity of filing its formal protest by May 15th because of the informal discussion of May 10th. It is also true, however, that the informal meeting was improper, as discussed herein and was called at the behest of Rainbow without assurance that the filing time was tolled.
Recommendation In consideration of the above findings of fact and evidence of record, the candor and demeanor of the witnesses and the pleadings and arguments of the parties, it is, therefor RECOMMENDED that the petition of Rainbow Properties, a Florida general partnership, should be denied and dismissed for the reasons found and concluded above, and that the petition of C. Leon Brooks be GRANTED and that the subject bid be awarded to C. Leon Brooks. DONE and ENTERED this 27th day of October, 1988, in Tallahassee, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of October, 1988.
The Issue The issue addressed in this proceeding is whether Petitioner or Intervenor submitted the lowest and best bid.
Findings Of Fact On December 20, 1989, the District Board of Trustees, Okaloosa-Walton Community College, issued an Invitation to Bid (ITB) for Phase I Construction of the OWCC-WUF Joint Use Campus. The total project was estimated to cost about $5,000,000.00. The funds for the project would come in large part from the Public Education Capital Outlay Funds appropriated by the legislature and passed into law in the State's budget and to a limited extent from the college's renovation fund. Up to the time of hearing, the legislature had appropriated $3,000,000.00 for the project. The college's renovation fund contained approximately $70,000.00. The board hopes that the additional funding needed for the project (approximately $2,000,000.00) will be appropriated by the legislature this summer. However, until the additional funds are appropriated, the Board, by statute, is prohibited from contracting for projects in excess of the amount of money which has been appropriated for such projects. See Section 235.42, Florida Statutes. Michael Richardson, of Bullock-Tice Associates Architects, Inc., was the architectural project manager. Each bidder was asked to provide a base bid and a separate bid on each of ten alternatives. Eight bids were submitted in response to the original solicitation. All eight bids were rejected. The bids were rejected because all eight bids for the base bid without the addition of any alternates exceeded the funds available for the project. The Board decided to rebid the project. The second ITB was issued on March 26, 1990. The second ITB was restructured in an effort to obtain a base bid within the amount of money which had been appropriated for the project. Alternates could then be added to the base bid until the funds ran out. Specifically, the project was revised to provide for a base bid and separate bids on six alternates. The base bid essentially provided for construction of a classroom (Building No. 3) and a utility plant. Alternates 1 and 2 provided for outside civil, electrical, and landscaping work related principally to the buildings covered by the base bid. Alternates 3 and 4 related principally to the construction of two additional buildings and landscaping related to those buildings. Alternates 1-4 added work to the project. Alternates 5 and 6 deleted certain work from the project. Paragraph 1A of the Instructions to Bidders required that: To receive full consideration, all bids must be executed and submitted in strict accordance with the "INSTRUCTIONS TO BIDDERS. Paragraphs 7C and 7D of the Instructions to Bidders required that: Unit Prices: Each bidder shall state in the schedule provided on the Form of Proposal the amount he proposes for each applicable Unit Price requested. Unit price amounts shall include all costs of material, labor, equipment, insurance, bonds, taxes, overhead and profit and shall be used for determining amounts to be paid for all additional work on the project. Credits for any work omitted shall be determined by Unit Price at the amount scheduled. The Owner reserves the right to reject any Unit Price if considered excessive or unreasonable, or to accept any and all such Unit Prices which may be considered fair and reasonable. Alternates: In order that the Owner may discern an alternative use or type of material, or an increase or decrease in the scope of the Project, such items will be defined as Alternates and will be specifically described by the Drawings and/or Specifications. Alternates will be listed in the Form of Proposal in such a manner that the bidder will be able to clearly indicate the sums that will be added to or deducted from the Base Bid. Alternates shall include all costs of materials, taxes, bonds, handling, overhead, and profits and the acceptance of any alternate shall be in strict accordance with applicable Specification Sections. At some point after the initial bid instructions were sent out, and prior to the bid opening, the project architect drafted and sent to bidders a document entitled "Clarification to All Bidders." This document stated: It is the intention of the Owner to award all add Alternates upon receipt of additional funding this Summer. Due to this circumstance, the determination of Low Bidder will most likely be based upon the Base Bid plus Alternate 1 through 4 and 5 & 6 if so desired. This procedure is in accordance with rules of the Florida State Board of Education for Educational Facilities. (emphasis supplied) No bidder challenged the clarification's inclusion in the specifications for the project. Bidders generally interpreted this "Clarification" to mean that the Board of Trustees intended to award a contract for the total project, and thus would make its determination of low bid based on the total sum of the bids for base bid and alternates 1-4. However, bidders were not uniform in their application of that language to developing their specific bids and were not uniform in their interpretation of whether the Board's method of award of the bid as set out in the clarification was guaranteed by the clarification's language. In other words, some bidders realized that the use of the words "most likely" in the clarification meant exactly what it said and was not a guarantee that the project would be awarded according to the method established in the clarification. Petitioner, on the other hand, at its peril ignored the words "most likely" and altered its normal method of calculating its bid. In any event, no bidder received any advantage over another bidder due to the clarification's issuance and no bidder was favored or discriminated against because of the clarification. All bidders received the clarification and reacted to it in the normal course of their businesses and prepared their bids according to those dictates. Six bids were received on the second ITB, including Jack Moore & Company, Inc. and Sharpe, Inc. The bids on the base bid and the various alternates were as follows: CONTRACTOR BASE BID TOTAL SEE ATTACHED EXHIBIT 1 Under the method of determining low bidder set out in the clarification, Jack Moore & Company was the low bidder. However, the Petitioner's bid, as well as all other bidders' bids, exceeded the amount of money that the Board had on hand for construction of the project. Therefore, the Board of Trustees felt that it could not award the contract according to the method set out in the clarification and examined the bids to determine the amount of construction which could be accomplished for the amount of money it had on hand ($3,000,000.00 from the legislature and $70,000.00 from the renovation fund). By using only the $3,000,000.00 from the legislature, Opus South would have been the low bidder on the base bid. However, by adding approximately $25,000.00 from the renovation fund, the college had enough money to award the base bid plus alternates 1 and 2. Money for alternates 3 and 4 was not available. The Board decided to award the base bid plus alternates 1 and 2. Sharpe, Inc. was the low bidder on the base bid plus alternates 1 and 2. The Board awarded the contract to Sharpe. Petitioner was approximately $100,000 over the amount bid by Sharpe on the base bid plus alternates 1 and 2. The Board's reasoning was not arbitrary or capricious in the award of the bid to Sharpe. Since the language of the clarification was not binding on the Board, the method used by the Board was within the specifications. Finally, there was no substantial evidence of fraud or collusion on the part of the Board in its award of the bid to Sharpe and no evidence was submitted that Sharpe was not responsive to the ITB. In fact, all the bidders responded to the exact same specifications, thereby affording the Board an exact comparison between the various bids submitted to it for the project. The only difference in the bids was in how each individual bidder calculated its bid to arrive at it's price. Such differences occur in all bid situations and do not serve to lessen the exact comparison of the bids on the specifications. Therefore, Sharpe, having presented the lowest and best bid, should be awarded the contract on the base bid plus alternates 1 and 2.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is: RECOMMENDED that the Board enter a final order finding Sharpe, Inc., submitted the lowest and best bid and awarding the bid on the base bid plus alternates 1 and 2 to Sharpe, Inc. DONE and ENTERED this 13th day of July, 1990 in Tallahassee, Leon County, Florida. DIANE CLEAVINGER 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 13th day of July, 1990.
The Issue The primary issue for determination is whether Respondent's decision to rescind a previous notice of award of a bid to Petitioner First Master Lessors, Inc., on the basis that the original bid was nonresponsive, was appropriate. If rescission of that bid award was proper, a secondary issue is whether Respondent was also justified in rejecting the competing bid submitted on behalf of Petitioner DSJ Realty Company Inc.
Findings Of Fact Respondent issued an Invitation To Bid in order to obtain a leasehold of 15,397 square feet of office space to house operations of its child support enforcement office in Lakeland, Florida, for a term of seven years with an option to renew the lease for two additional three year periods. The Invitation To Bid (ITB) states Respondent's reservation of the right to reject, if in the best interest of the State of Florida, any and all bids. Further, the invitation states a number of conditions that submitting bidders must meet in order for their bids to be deemed responsive. Among the stated conditions is the requirement that bids be submitted on the standardized bid submittal form enclosed in the ITB in compliance with conditions specified on that form. Further, bidders are directed to complete the bid submittal form providing acknowledgements requested by the form. Another stated condition of the ITB is the requirement that a bidder be the owner of record of the facility and parking areas offered for lease; or, if a lessee seeking to sublease, submit with the bid proposal documentation of authority to sublease the facility and parking areas. A further ITB condition requires each bid to be signed by the owner, corporate officers or legal representative of the bidding entity. Corporate, trade or partnership titles of the bidding entity are to be stamped or typewritten beside the actual signature. Bid submissions signed by an agent are required to be accompanied by written evidence from the owner of record documenting the agent's authority. All bid submittal signatures are to be notarized. Page 4 of the standardized bid submittal form enclosed in the ITB requires, in paragraph 11, that any bid offering premises for consideration (including parking areas), which are presently occupied or which will covered by other active leases on the anticipated lease effective date, must be accompanied by documentation executed by those tenants indicating their acknowledgement of the bid and their ability to vacate the premises by the proposed lease effective date. Submitting bidders are required to indicate whether this requirement is applicable to their bid. Page 4 of the standard bid submittal form contains a number of other conditions which require agreement by the submitting bidder. Proof of the bidder's agreement to those conditions is to be documented by the bidder's initials on each page of the bid submittal package and the bidder's notarized signature on page 16, the submittal form's concluding page. Among the conditions on Page 4 of the form is the agreement of the successful bidder to provide leased space to Respondent for exclusive use on a 24 hour basis, seven days per week during the term of any lease resulting from the bid. This condition further explicitly states that the space to be leased will be fully occupied during normal working hours of 8 a.m. to 5 p.m. during the week and may be fully or partially occupied at other times as necessary in Respondent's discretion. Respondent's bid request specified that bidders must offer a minimum of 65 parking spaces in conjunction with premises proposed for lease. Of those spaces, two spaces were required to meet requirements of accessibility for handicapped parking. Of the remaining spaces, 52 spaces were required to accommodate full size automobiles. All parking was required to be provided as part of the lease cost to Respondent and under the "control of the bidder, off street, suitably paved and lined." On May 16, 1989, five bids were opened, including those submitted on behalf of Petitioner DSJ Realty Company Inc. (DSJ), and Petitioner First Master Lessors, Inc. (MASTER). Out of the five bids opened, only the bids of MASTER and DSJ were determined to be responsive. After evaluation of the bids by Respondent's personnel, the bid was awarded to MASTER on July 6, 1989. On July 11, 1989, and in response to the award to MASTER, a notice of intent to protest the award was filed by counsel for Dale S. Jones, as trustee; DSJ; and Elizabethan Development, Inc. (ELIZABETHAN). By letter dated July 12, 1989, Alan Taylor filed a protest of the lease award to MASTER. That letter simply stated its efficacy as a protest with the words "[w]e hereby protest the award of lease # 590:2087 to First Master Lessors, Inc." No particular factual or legal basis for the protest was stated. Taylor is associated with ELIZABETHAN and his letter is typed on stationary of that business entity. Taylor, designated the bidder on page one of the DSJ bid submittal, was authorized to act solely on behalf of DSJ in the submission of its bid by its president, Dale S. Jones, Jr. Documentation of that authority is contained in a May 8, 1989 memorandum attached to the bid package. There is no documentation in the bid submittal package of DSJ that Taylor was empowered to act on behalf of ELIZABETHAN, or that ELIZABETHAN was authorized to act on behalf of any entity in regard to the bid submittal. While not set forth in the bid package, testimony at the final hearing establishes that Jones is the sole owner of DSJ. Subsequent to the filing of the DSJ protest, Respondent determined to reject the bids of MASTER and DSJ as nonresponsive. By letter dated August 28, 1989, Respondent informed both counsel for DSJ and MASTER of this decision. As set forth in the August 28, 1989 letter, Respondent's decision to reject the bid of DSJ was based upon the failure of DSJ's bid submittal to reflect that its agent, Alan Taylor, or the proposed lessee designated in that bid submittal, DSJ Realty Company, had control of the property offered for lease to Respondent. The August 28, 1989 letter also stated Respondent's rejection of MASTER's bid due to a lack of control of the property sought to be leased, specifically control over parking spaces to be provided in conjunction with the premises to be leased. MASTER's bid submittal stated that the bid requirements in paragraph 11 of the bid submittal form requiring documentation of acknowledgements by any existing tenants of the premises (including parking areas) offered for lease, and ability of those existing tenants to vacate the premises, was not applicable. In response to the bid requirement for 65 parking spaces, MASTER's bid proposed 17 "exclusive" spaces on site and 48 "nonexclusive" spaces off site. An attachment to the bid response was a copy of a letter dated June 10, 1983, from the First Christian Church to a predecessor of MASTER, First Bank of Lakeland. The church, located across the street from the site proposed to be leased to Respondent by MASTER, granted "permission to the First Bank of Lakeland to use our parking lot for the convenience of their employees." Subsequent to the opening of bids and receipt of DSJ's bid protest, MASTER provided Respondent with another letter from the church reciting permission for MASTER to use 48 spaces within the church parking lot for the parking of Respondent's employees and clients, provided that the church reserved the right to use those spaces at any time upon the giving of one week's written notice to MASTER. The church also reserved the right to cancel the agreement at any time upon the giving of 60 days written notice. The letter was dated May 15, 1989. Also, as established at the final hearing, yet another letter was sent to MASTER's authorized agent from the church. That letter documents the rejection by the church of any "formalization" of a reciprocal parking arrangement with regard to the premises proposed to be leased by MASTER. However, the letter, dated July 20, 1989, restated the church's consent to the use of the parking lot by tenants of the premises proposed for lease by MASTER in accordance with its previous letter of May 15, 1989. Another letter attached to the bid submittal of MASTER, is also dated May 15, 1989. Directed to Respondent's facilities services manager, this letter is signed by an individual named Geneva Pettus as "[a]gent for First Master Lessors, Inc." The letter signed by Pettus references the 1983 letter from the church and states in pertinent part: We further guarantee your parking requirements during the term of the lease and will accommodate such spaces either within our own building or other locations if changes in the above parking facilities should occur. The MASTER bid submittal contains no documentation of authority of Geneva Pettus to act as agent for MASTER. Further, as established by the proof at final hearing, the vast majority of on site spaces controlled by MASTER are leased to present tenants or their employees. Remaining unencumbered parking spaces are inadequate to meet Respondent's bid requirements. The "guarantee" by Pettus, absent her lack of authorization to act for MASTER, is further invalidated by failure of MASTER to provide acknowledgements, as required by paragraph 11 of the bid submittal form, from the existing lessees of those parking spaces controlled by MASTER which would have to be vacated in order to comply with bid requirements. The proof establishes that MASTER did not have control of a portion of the property submitted for lease consideration by Respondent, specifically the proposed parking areas. Such lack of control is nonresponsive to Respondent's bid requirements. Notably, the May 15, 1989 date of Pettus' letter coincides with the May 15, 1989 letter to MASTER from the church. Respondent's facilities service manager, involved in evaluation of the bid submittals, was understandably concerned that this letter's existence was not disclosed to Respondent's personnel prior to August 17, 1989. The position of the church as reflected in the letter caused Respondent's personnel to reevaluate the issue of whether MASTER's bid demonstrated the requisite control over the property submitted for bid consideration and concluded that such control was absent. The DSJ bid submittal contains the notarized signature of Dale S. Jones, Jr., in the space on page 16 reserved for the signature of the bidder. His signature is followed by the title "PARTNER." That term is not further described, nor is a partnership or connection of that partnership with Jones identified in the bid package. At the final hearing, Jones confirmed his signature. However, the proof fails to establish that the required initials on each page of the DSJ bid package are those of Jones. Jones was unacquainted with the bid package submitted on his behalf, having merely looked through the package before affixing his signature. Further, the bid submittal form, on page 16, has a blank space for insertion of the name of the bidder submitting the bid package. The bid package submitted on behalf of DSJ contains no name in this portion of the submittal form. Page 16 of the bid submittal form also requires that the bidder indicate the name of the entity in whose name the subsequent lease is to be written, if that entity is one other than the bidder. The bid, signed by Jones and submitted by Taylor on behalf of DSJ, contains the statement that any future lease resulting from the bid should be titled in the name of "DSJ REALTY COMPANY as managing and Leasing Agent for Crystal Lake 301 and 302 Joint Venture." Also attached to the DSJ bid submittal package is a copy of an instrument entitled "DEED TO TRUSTEE UNDER TRUST AGREEMENT." By terms of that instrument, the fee simple title to the property and appurtenances of the site of the building proposed to be leased by DSJ, was purportedly conveyed to Dale S. Jones, Jr., as "Trustee under Land Trust Agreement dated June 15, 1987". By terms of the deed, Jones is granted specific authority to convey, lease or otherwise exercise those rights to property which are commensurate with ownership. The grantor of the deed, dated July 7, 1987, is Florida Southern College. The bid package of DSJ contains no documentation that either Jones or DSJ is authorized to act as an agent on behalf of "Crystal Lake 301 and 302 Joint Venture." Further, the bid package of DSJ offers no explanation as to the identity of this entity. As established by Jones' testimony at hearing, the entities "Dale S. Jones, Trustee" and DSJ Realty, Inc., are not interrelated businesses. The DSJ bid submittal further contains no documentation of authority for ELIZABETHAN or Taylor to act as an agent on behalf of "Crystal Lake 301 and 302 Joint Venture." It is found that the bid submittal of DSJ is nonresponsive to the requirements of Respondent's ITB. In response to Respondent's letter rejecting the bids of Petitioners, counsel for both parties filed petitions dated September 8, 1989, protesting the decision and requesting administrative proceedings. The petition filed on behalf of DSJ, ELIZABETHAN, and Dale S. Jones, as Trustee, was entitled "PETITION FOR FORMAL HEARING AND FORMAL BID PROTEST" and alleges the submitting bidder to be ELIZABETHAN. The document, in support of the July 12, 1989 protest of the bid award to MASTER, sets forth specific grounds for that protest. Further, it is alleged in the petition that DSJ was appointed to act as the agent of Dale S. Jones, as trustee, in appointing ELIZABETHAN as his agent. It is found that these allegations, with regard to the identity of the submitting bidder, are not supported by any competent substantial proof; that Dale S. Jones, as trustee was not a submitting bidder; and that ELIZABETHAN was not a submitting bidder. Each petition filed in opposition to Respondent's August 28, 1989 rejection letter, was accompanied by a $5,000 cashier's check payable to Respondent. MASTER subsequently substituted this check with a surety bond. DSJ's July 12, 1989 protest of the bid award was not accompanied by any bond.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered finding the bids of MASTER and DSJ to be unresponsive; finding the cancellation of the award to MASTER to be justified; dismissing ELIZABETHAN and Dale S. Jones, as trustee, as petitioners in this proceeding; and rejecting all bids. DONE AND ENTERED this 14th day of November, 1989, in Tallahassee, Leon County, Florida. DON W. DAVIS 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 14th day of November, 1989. APPENDIX The following constitutes my specific rulings, in accordance with Section 120.59, Florida Statutes, on findings of fact submitted by the parties. Petitioner Master's Proposed Findings. Petitioner MASTER's proposed findings consisted of 21 pages encompassing unnumbered paragraphs dealing with an intertwined mixture of legal conclusions, argument and proposed factual findings. Therefore, MASTER's submission cannot be treated by the Hearing Officer in this appendix on an individualized basis for each proposed finding. However, MASTER's submission has been reviewed and addressed, where possible, by the findings of fact set forth in this recommended order. Otherwise, all disputed issues of material fact have been addressed by the evidence adduced at the hearing held in this cause. Petitioner DSJ's Proposed Findings. Addressed in substance, remainder rejected as unnecessary. Rejected, unsupported by the evidence. Addressed in substance. Rejected, unnecessary to result. 7.-1I. Adopted in substance. Rejected, unsupported by the evidence. Addressed in substance. Adopted by reference. Adopted in substance. 16.-21. Not relevant inasmuch as Jones, in an individual capacity or the legal capacity of trustee or partner, was not a bidder. 22.-23. Adopted in substance. Rejected, legal conclusion, relevancy. Addressed in substance. 26 Rejected, not supported by the evidence. Taylor was authorized to act on behalf of DSJ Realty, Inc., by the corporate president. 27.-28. Rejected, not supported by the evidence; no evidence that Jones was a bidder. 29.-32. Rejected as unnecessary in view of result. 33.-42. Adopted in substance. Respondent's Proposed Findings. 1-12. Adopted in substance. COPIES FURNISHED: Jack E. Farley, Esq. Department of Health and Rehabilitative Services 4000 West Buffalo Avenue 5th Floor, Room 500 Tampa, FL 33614 Gregory L. Coler Secretary Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, FL 32399-0700 John Miller, Esq. General Counsel Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, FL 32399-0700 Sam Power Agency Clerk Department of Health and Rehabilitative Services 1323 Winewood Boulevard Tallahassee, FL 32399-0700 Bruce Marger, Esq. 1700 66th Street, North Suite 501 St. Petersburg, FL 33710 David H. Simmons, Esq. 120 South Orange Avenue P.O. Box 67 Orlando, FL 32602 =================================================================
Findings Of Fact The Department of Community Affairs has its headquarters in the Rhyne Building on Centerview Drive in the City of Tallahassee. The Rhyne Building is one of a cluster of office buildings in the Koger Center which is owned by Koger Properties, Inc. One of the organizational units in the Department is the Energy Office, which was organizationally located within the Office of the Governor until 1991. At that time, the Energy Office was transferred by the Legislature to the Department, and the Department temporarily located the Energy Office organizationally as one of the components in the Office of the Secretary. The Secretary of the Department has decided to organizationally and physically integrate the Energy Office into the Department's Division of Housing and Community Development, having determined that the Energy Office programs are functionally related to that Division's programs. The Energy Office was physically housed in a building owned by Petitioner on Bronough Street in the City of Tallahassee. After the Energy Office was merged with the Department, the Department decided to move the Energy Office to the Rhyne Building. Officials of the Department responsible for supervision of the Energy Office had found it inconvenient to travel the distance between the Bronough Street and Centerview Drive locations and were experiencing difficulty in getting Energy Office personnel and other Department personnel to meet with each other and coordinate related duties. Accordingly, on January 31, 1993, the Department moved the Energy Office out of the Bronough Street building and into the Rhyne Building. As a result of that move, Petitioner has filed a lawsuit against the Department, alleging, inter alia, that the Department breached its lease with Petitioner. That litigation is still pending. Another organizational component of the Department is the Florida Housing Finance Agency. That Agency is physically located in the Marathon Building on Seagate Drive in the City of Tallahassee, part of the Koger Center. That Agency is in need of additional office space caused by new programs and by additional employees. The Agency does not have adequate space for its employees in its current location. The Agency and senior Department officials desire that the Agency remain in close physical proximity to the Rhyne Building since the Agency, like the other components of the Department, receives its administrative and other support services, including fiscal, legal, personnel, and procurement, from the Department. Further, the Agency, like the other divisions of the Department, have a number of interrelated programs which require a close working relationship. Although there were a number of possible solutions to the overcrowding faced by the Agency, splitting its different components into different locations was determined to be impracticable. Accordingly, several proposals to relocate other components of the Department were considered. Ultimately, the Department decided to lease additional office space for the Agency and locate the Energy Office in the Rhyne Building. A state agency which needs private office space of 3,000 square feet or more is required to engage in competitive bidding procedures. A state agency initiates such a process by submitting a Request For Prior Approval of Space Need ("RSN") to the Department of Management Services ("DMS") to show its need for additional space. Attached to the RSN is a Letter of Agency Staffing, which is used to determine the additional space needed based on the number and pay grade of agency employees and other variables. When an RSN is submitted, DMS first determines whether there is suitable state office space to meet the needs of the agency. If state-owned space is not available, the agency may solicit competitive bids from private lessors for the proposed lease by using a Request For Proposal ("RFP"). The state agency prepares the specifications used in the RFP, using the guidelines of DMS. Such specifications include a functional description of the type of space needed, the square footage, and the area of acceptable locations. The area of location of the premises is outlined by geographic boundaries on a map of the city or county where the space is needed, and the map is attached to the RSN and the RFP. The RFP also contains the evaluation criteria created by the agency soliciting bids for determining the score for each bidder's proposal. Each criterion is assigned a specific score, and the total possible score for all criteria is 100. The Department's interest in keeping its component programs in close proximity to each other and to the Office of the Secretary in the Rhyne Building at the Koger Center for supervisory, management, and operational effectiveness is strong. The amount of additional space needed, however, made the Department's acquisition of additional space subject to competitive bidding. The Department employee responsible for obtaining the additional space, Kirby Bass, advised senior management officials that in order for the Department to realize its desire to locate all of its components in proximity to the Office of the Secretary in the Koger Center, the Department could simply expand its current leases in the Koger Center in yearly increments below 3,000 square feet, thereby avoiding the requirement that the Department engage in the competitive bidding process. Rather than following the incremental approach, Bass' supervisor, Lynn Ekholm, directed him to prepare appropriate specifications for a new lease to accommodate 55 new and transferred employees needing approximately 14,000 square feet of additional space. Bass began gathering the information and preparing the paperwork to obtain the additional office space under the direction and supervision of Ekholm, the Department's Director of Administrative Services, and Mary Anne McMullen, the Department's Assistant Secretary, who had been charged with resolving the Department's office space problems. Bass contacted Randall Baker at DMS and discussed with him that Department's requirements for procuring additional office space. He also contacted the purchasing agents at the Department of Revenue and at the Department of Labor and Employment Security ("DLES") to determine how best to prepare the requisite documentation to meet the lease parameters desired by his Department. He discussed his Department's desire to obtain office space in an existing building in or near the Koger Center. Bass discovered that DLES had two leases obtained through competitive bidding within a small geographic area encompassing the Koger Center. One lease encompasses in excess of 15,000 square feet and is dated December 13, 1990; the other lease encompasses in excess of 16,000 square feet and is dated November 19, 1992. In both of those bid solicitations, DLES had received bid proposals from only two bidders located within that boundary -- Koger Properties, Inc., and Parkway-Oakland General Partnership. Each of those bidders received one of those two bid awards. Bass also made telephone inquiries to owners of buildings within the geographic area utilized by DLES to obtain those two leases and drove through the area. Bass did not go into any of the buildings that he drove past to inquire of the rental agents whether they in fact had any space available. He did notice a sign located at or near the complex east of the Oakland Complex advertising space available for up to 18,000 square feet. The evidence is unclear as to the exact buildings with the sign. If the sign related to the buildings known as the Parkway-Oakland Complex, no space was available, according to the testimony of one of the Department's witnesses. If that sign related to the Parkway Terrace Building, that building is owned by one of Petitioner's related companies, and that building is full. As a result of Bass' driving in the area, the Department did not discover any vacant space in any existing building within the geographic boundaries utilized by DLES. As a result of Bass' telephone contacts to owners of existing buildings within the geographic boundaries utilized by DLES, the only rental agent who represented that he had sufficient space available at that time was the rental agent for the Koger Center. That rental agent further advised Bass that although he had sufficient space available in the Koger Center, the rental rate would not be competitive with rates charged by other landlords. Accordingly, at the time that the Department drafted the geographic boundaries and evaluation criteria which are the subject of this proceeding, it knew that the Koger Center had sufficient space available although the Koger Center's rental agent did not consider his rates to be competitive, and the Department knew of no other available space within the boundaries. The Department prepared its RSN, utilizing the geographic boundaries which DLES had used. As stated in the RSN and in the subsequent RFP, the geographic boundaries selected by the Department are as follows: Beginning at the intersection of Capital Circle and Governor's Court Road, proceed west on Governor's Court Road until it ends. Continue on a projection, due west, to the intersection with Blair Stone Road. Proceed south on Blair Stone Road to Paul Russell Road. Proceed east on Paul Russell Road to Monday Street. Continue east on Monday Street to Capital Circle. Go north on Capital Circle to Governor's Court Road, the point of beginning. The RSN also represented that the Department was seeking a new lease for 14,193 square feet, more or less, to house 55 employees from June 1, 1993, through March 31, 1997. The Department submitted its RSN to DMS where it was reviewed by Randall Baker. DMS is authorized to approve an RSN submitted by a state agency seeking to lease private office space. DMS checks to determine if there is space available in a state-owned building, and, if there is not, approves the request of an agency to lease private space. DMS also checks to verify that the amount of space being requested is appropriate for the number and types of employees who will occupy the desired space. DMS does not have the authority to approve or disapprove other components of the RSN; for example, DMS can only make recommendations regarding such items as geographic boundaries. Baker reviewed the RSN, determined that there was no space available in a state-owned building, determined that the amount of space requested was appropriate for the number and types of employees to be housed in the additional space, and determined that the RSN form was properly completed. Baker was concerned about the small geographic area from which the Department would accept bids. He noted, for example, that the northern boundary cuts through a residential area and is not a commercial thoroughfare. He checked the vendor list maintained by DMS and found that there were other properties which were available but which were outside the boundaries to be utilized by the Department. Based upon his experience, he knew that an expanded radius for bid submittal would be likely to obtain a better rental rate for the Department. Baker sent the Department a letter, dated December 30, 1992, which states as follows: While we are approving your Request for Space Needs, it should be noted that the boundaries are rather restricted and may eliminate bidders who have quality space available. The Department employees who received and/or reviewed that letter did not consider Baker's letter to be a criticism of the Department's desired geographic boundaries. Accepting the first half of the sentence and ignoring the second half of the sentence, the Department determined that Baker's letter represented approval of its RSN and the geographic boundaries set forth therein. Accordingly, on January 26, 1993, the Department issued its RFP for its proposed Lease No. 520:0062. The bid specifications contained in that RFP called for 14,193 square feet of office space, more or less, to be available for occupancy not later than June 1, 1993. In addition, the RFP specified that the office space must be located in the City of Tallahassee inside the same geographic boundaries described in the Department's RSN. The RFP also contained the criteria by which bid submittals would be evaluated. Those criteria are as follows: C. EVALUATION CRITERIA (AWARD FACTORS) The successful bid will be that one determined to be the lowest and best. All bids will be evaluated based on the award factors enumerated below. Rental, using Total Present Value methodology for basic term of lease (see #D, General Provisions Items 3 and 4) applying the present value discount rate of 5.38 percent. (Weighing: 30) The effect of environmental factors, including the physical characteristics of the building and the area surrounding it, on the efficient and economical conduct of Departmental operations planned for the requested space. (Weighing: 15) 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: 15) Frequency and availability of satisfactory public transportation within one block of the offered space. (Not to exceed a weight of 10 award factors) (Weighing: 4) Availability of adequate dining facilities within one mile of the offered space. (Weighing: 5) Proximity of offered space to Department of Community Affairs, Secretary's Office, Rhyne Building, Koger Center. (Weighing: 25) Moving cost (furniture, equipment, etc.) (Weighing: 1) Aggregate square footage in street level space. (Weighing: 5) Total award factors = 100 The bid specifications contain no other guidelines or information on how each criterion will be evaluated or how points will be awarded within the point spread for each criterion. Other state agencies have utilized proximity as an evaluation criterion, and DMS considers proximity a legitimate and potentially important criterion. However, the proximity that is usually referred to is proximity to the clients being served, not, as in this case, proximity to the Office of the Secretary. At first blush, the bid specifications allocate the highest score to cost and the second highest score to the proximity of the leased space to the Rhyne Building. The evaluation criteria in the RFP place almost as much weight on proximity to the Office of the Secretary (criterion 6), assigning 25 points, as on the rental amount bid (criterion 1), assigning 30 points. Yet, criterion 2 with its weight of 15 points may also relate to proximity to the Office of the Secretary by its use of vague terms about the area surrounding the building and the efficient and economical conduct of the Department's operations. It may well be, therefore, that the proximity to the Office of the Secretary offers a maximum score of 40 points, while the amount of rent only offers 30 points. Some state agencies awarding points for proximity include in their bid specifications a grid showing how many points are to be awarded for each incremental distance that a space being offered is from the target. Such a grid discloses to potential bidders in advance the number of points a bidder could expect to receive, for example, for a building located ten miles from the target as compared with how many points a bidder would receive for a building located one mile away. The Department's RFP contains no such grid system. In the RFP under consideration herein, it is certain that Koger Center would receive the maximum number of points allowable for proximity since the Office of the Secretary is located there. There is no requirement that any other bidder receive any points for the proximity criterion. Upon reviewing the bid specifications under consideration herein, Anagram Corporation timely filed its notice of protest and its formal protest challenging those bid specifications. By operation of law, the timely filing of the formal protest has caused the bidding process to be stayed until the resolution of this proceeding. Leonard Pepper is an officer and shareholder in Anagram Corporation. He is also an officer, shareholder or partner in other business entities which offer commercial space for rent in Tallahassee. Pepper and his companies have been leasing buildings to the State for the last 25 years. During that period, Pepper and his companies have won bid awards approximately 18 to 20 times. Neither Pepper nor Anagram has available office space within the geographic boundaries contained within the RFP. The Anagram building recently vacated by the Energy Office is still available. It, together with two other small buildings on adjacent parcels also owned by Anagram, would have sufficient space to respond to the RFP, but they are outside the geographic area specified. Gemini Associates, one of Pepper's related businesses, owns two buildings in what is known as the old FDLE Complex on Adams Street midway between the Capitol and the Governor's Mansion. One of those buildings has 27,000 square feet available and the other has 32,000 square feet available. Those buildings are also outside the geographic boundary specified in the RFP. Pepper has already made arrangements, however, for Gemini Associates to transfer title to those buildings to Anagram if Anagram so desires. Accordingly, Petitioner owns or controls property which meets the bid specifications but for the geographic boundaries contained in the RFP. The more potential bidders there are in a bid solicitation process, the more competitive the bidders will be. Accordingly, expanding the radius from the restrictive boundaries contained in the Department's RFP is likely to result in obtaining a better rental rate. The Department's choice of geographic boundaries after ascertaining that only Koger Center was known to have available space although not at competitive rates, after learning that those boundaries on two different occasions had produced only two bids, and after being cautioned by DMS that the boundaries were restrictive enough to preclude available quality space, leads to only one reasonable conclusion: that the Department intended to award the bid to the Koger Center if Koger submitted a bid. The bid specifications drawn by the Department were likely to achieve the Department's intended goal to have all of its organizational components physically housed in close proximity to the Office of the Secretary in the Koger Center, despite the requirement that the Department solicit competitive bids.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered sustaining Petitioner's protest to the bid specifications of proposed Lease No. 520:0062, declaring those bid specifications to be void, and terminating any bid solicitation process based upon those bid specifications. DONE and ENTERED this 12th day of May, 1993, at Tallahassee, Florida. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 12th day of May, 1993. APPENDIX TO RECOMMENDED ORDER DOAH CASE NO. 93-0854BID Petitioner's proposed findings of fact numbered 1-6 and 9-11 have been adopted either verbatim or in substance in this Recommended Order. Petitioner's proposed finding of fact numbered 7 has been rejected as not being supported by the weight of the competent, credible evidence in this cause. Petitioner's proposed finding of fact numbered 8 has been rejected as being subordinate to the issues involved herein. Petitioner's proposed findings of fact numbered 12-14 have been rejected as not constituting findings of fact but rather as constituting conclusions of law, argument of counsel, or recitation of the testimony. Respondent's proposed findings of fact numbered 1-7, 9-11, 14-17, 22, and 23 have been adopted either verbatim or in substance in this Recommended Order. Respondent's proposed findings of fact numbered 12 and 13 have been rejected as not being supported by the weight of the competent, credible evidence in this cause. Respondent's proposed finding of fact numbered 18 has been rejected as being subordinate to the issues involved herein. Respondent's proposed findings of fact numbered 19-21 and 24-28 have been rejected as not constituting findings of fact but rather as constituting conclusions of law, argument of counsel, or recitation of the testimony. Respondent's proposed finding of fact numbered 8 has been rejected as been irrelevant to the issues herein. COPIES FURNISHED: A. Eugene Lewis, Esquire Marlow V. White, Esquire Lewis & White Post Office Box 1050 Tallahassee, Florida 32302 Alfred O. Bragg, III, Esquire Robert C. Byerts, Esquire Department of Community Affairs 2740 Centerview Drive Tallahassee, Florida 32399-2100 William A. Friedlander, Esquire Friedlander & Mattox 3045 Tower Court Tallahassee, Florida 32303 Linda Loomis Shelley, Secretary Department of Community Affairs 2740 Centerview Drive Tallahassee, Florida 32399-2100 G. Steven Pfeiffer, General Counsel Department of Community Affairs 2740 Centerview Drive Tallahassee, Florida 32399-2100
The Issue The issue is whether Kelly Services is the lowest responsive bidder on Bid No. 89-23 and should be awarded the bid.
Findings Of Fact On June 2, 1988, the School Board of Bay County issued Bid Request No. 89-23 for garbage collection services at thirteen locations. A quotation sheet was included in the bid package. The quotation sheet indicated the thirteen locations with a blank next to each location and a dollar sign in front of each blank where each bidder was to indicate its average monthly total charge for each location. There was also a quotation schedule where the bidder was to indicate the calculations which went into the total bid for each location. The bid request provided: The Board reserves the right to waive formalities and to reject any and all bids or to accept any bid or combination of bids deemed in the Board's best interest and the decision of the Board will be final. Bidders desiring that their bid be considered on an all-or-none basis, either in whole or part, shall so indicate. It is the intent of this bid request to secure prices and establish contracts for garbage collection services for the twelve schools specified herein and the District Maintenance Department. Awards will be made by location and will be based on an average monthly total charge as calculated on the quotation sheet. The bids were opened at 10:00 am., June 13, 1988, at the offices of the Bay County School Board. Three completed bid packages were submitted. Kelly Services, Argus and M&O each submitted a completed bid quotation sheet containing the bid for each location. M&O also submitted a letter which stated: We would like to submit this bid on an all- or-nothing basis as specified in paragraph four of the cover letter to the bid. For an estimated cost of $3,391.84. The quotation sheet and quotation schedule submitted by M&O did not reflect the all-or-nothing bid amount. Instead, the quotation sheet and quotation schedule showed a total bid of $3,738.24 when calculated by location. Based on the bids submitted by each bidder as shown on the quotation sheet add quotation schedules, Kelly Services was low bidder on five locations (Callaway, Tyndall, Waller, Southport, and Cedar Grove) ; Argus was low bidder on six locations (Parker, Hiland, Haney, Mosley, Beach and Merritt Brown); and M&O was low bidder on two locations (West Bay and the District Maintenance Department). Prior to the deadline for submitting bids, John Harrison, Purchasing Agent for the Board, responded to an inquiry from M&O by advising M&O that it could submit two bids, one as specified in the Bid Request by location and one as an all-or- nothing bid. No other bidders were advised that they could submit two bids. At the bid opening, M&O did not submit a quotation sheet or schedule for its all-or-nothing bid. A bid which did not have a breakdown per dump per container per facility would not be acceptable to the Board and does not meet the specifications in the Bid Request. The breakdown per dump per container per location is necessary to verify proper invoicing for specific locations on months when there is a change in the number of dumps or containers at that location. After opening the bids, the Board compiled the low bid for each location and then totaled that list. That total of $3,606.09 was greater than the all-or-nothing bid by M&O. Because M&O's all-or-nothing bid failed to meet the specifications by not having a location breakdown the Board contacted M&O to determine if its "estimated" bid was firm and to request a breakdown on the quotation schedule form for the all- or-nothing bid. On June 15, 1988, two days after the bid opening, M&O submitted a letter to the Board clarifying that its all-or- nothing bid was a firm bid for each location and M&O submitted a quotation schedule for each location per dump per container (see page 7 of Joint Exhibit 1 and the last page of Joint Exhibit 2). The charge for each location in this quotation schedule is different than the quotation schedule submitted by M&O at the bid opening and is for the most part lower per location than either M&O's first quotation schedule or the low bids taken from the quotation schedules submitted at the bid opening. Based on the letter and all-or-nothing quotation schedule filed by M&O on June 15, 1988, the Board determined to award the bid for garbage collection services to M&O for the all- or-nothing bid of $3,391.84.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law it is RECOMMENDED that The School Board of Bay County enter a Final Order rejecting all bids and readvertising the bid request for garbage collection services as specified in Bid Request No. 89-23. DONE and ENTERED this 13th day of September, 1988, in Tallahassee, Florida. DIANE K. KIESLING Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 13th day of September, 1988. APPENDIX TO THE RECOMMENDED ORDER IN CASE NO. 88-3768BID The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on the proposed findings of fact submitted by the parties in this case. Specific Rulings on Proposed Findings of Fact Submitted by Petitioner, Kelly Services: 1. Each of the following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 1-3(1-3); 4-6(3); 7-11(7-11); and 12 (9) Specific Rulings on Proposed Findings of Fact Submitted by Respondent, School Board of Bay County: Each of the following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 1(2); 3(10&11); and 5(8). Proposed findings of fact 6, 7, and 9 are irrelevant. The first sentence of proposed finding of fact 2 is unsupported by the competent, substantial evidence. The remainder of proposed finding of fact 2 is adopted in substance as modified in Finding of Fact 3. Proposed finding of fact 4 is rejected as being unsupported by the competent, substantial evidence. The last sentence of proposed finding of fact 5 is rejected as being argumentative, conclusory and unsupported by the competent, substantial evidence. Proposed finding of fact 8 is unnecessary. Specific Rulings on Proposed Findings of Fact Submitted by Intervenor, Argus Services, Inc.: Each of the following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 2-4(1-3); 6-8(5); 9 & 10(6) 11(3); and 12(11). Proposed findings of fact 1 and 5 are unnecessary. Proposed findings of fact 13-17 are rejected as constituting argument and not findings of fact. COPIES FURNISHED: Jeffrey P. Whitton Attorney at Law Post Office Box 1956 Panama City, Florida 32402 Franklin R. Harrison Attorney at Law 304 Magnolia Avenue Panama City, Florida 32401 Scott W. Clemons Attorney at Law Post Office Box 860 Panama City, Florida 32402 School Board of Bay County Post Office Drawer 820 Panama City, Florida 32402-0820 M&O Sanitation, Inc. 266 N. Star Avenue Panama City, Florida 32404
Findings Of Fact Prior to June, 1988, HRS determined that it needed 32,000 square feet of office space to house some of its indigent social services for southern Escambia County. Since the desired office space is greater than 2,000 square feet HRS was required to competitively bid lease number 590:1984. Towards that end, Respondent prepared an Invitation to Bid and a bid submittal package. The package contained various bid specifications, bid evaluation criteria and the numerical weight assigned to each of those criteria. Specific areas of importance to Respondent in the selection of its office space were: client safety one building to house all its units employee morale moving costs traffic flow within the building public access Many of the above areas were important to HRS since the agency would render indigent services to approximately 17,000 people a month, many of whom are handicapped or lack good mobility due to age or infirmity. Employee morale was important because of high employee burn out due to rendering aid to so many people who have so little and supplying a pleasant environment conducive to the work of the employees. Moving costs were important should HRS be required to find other space to operate in while necessary remodeling took place in the selected building, or be required to incur the expense of moving to a new building. 1/ All of the above areas were covered by one of Respondent's weighted bid evaluation criteria. The District Administrator of HRS, Chelene Schembera, is ultimately responsible for bidding, selection and leasing of all HRS facilities within District I, including Escambia County, Florida. In order to accomplish this task, Ms. Schembera appointed a bid evaluation committee to review and grade the responsive bids under the criteria established in the bid package, and to recommend to her the committee's choice of the lowest and best bid. Ms. Schembera's purpose in establishing the bid evaluation committee was to secure a cross section of input from people who had a variety of backgrounds and knowledge that would be material in evaluating the office space under the uses for which it was intended and the relative public worth of the work space. Ms. Schembera appointed individual who were familiar with the type of work to be done in the proposed space, as well as a persons familiar with the bid process. Ms. Schembera assigned to serve on the committee Charles Bates, Deputy District Administrator; Jim Peters, to provide a fiscal and overall administrative perspective as well as bid expertise; two citizens from the District Advisory Council to assure objectivity and to look at the properties from the perspective of a private citizen; Mamun Rashied, a program manager; Darlene McFarland, a program manager; Cherie Neal, a unit supervisor and program worker; and Stacey Cassidy, a clerical employee. Ms. Schembera did not personally know Cherie Neal or Stacey Cassidy. These staff members were designated by the supervisors upon Ms. Schembera's direction that she wanted persons who were both intelligent and respected by their peers. One private citizen member of the committee did not participate. The committee as constituted showed a great deal of thought on Ms. Schembera's part to ensure the objectivity of the bid process she was engaging in and to ensure the maximum amount of input from persons who had experience relevant to the overall review of the proposed real estate and to the decision they were being asked to make. The selection of the bid evaluation committee members was neither an arbitrary nor capricious act on Ms. Schembera's part. In fact, the evidence demonstrated the merit in constituting the committee as she did for the input she sought. The bid evaluation committee members, minus Mr. Bates, were briefed on their duties by Joe Pastucha, Facilities Services Manager. Mr. Pastucha is part of the staff responsible for the bid process at HRS. He provided these committee members with the weighted bid evaluation criteria found at page 15 in the bid package. He also gave the committee members a copy of Chapter 5 of the HRS manual containing guidelines for the bid process. His verbal instructions on specific procedures to follow in the evaluation process were limited since he did not wish to improperly influence the committee members. On July 20, 1988, HRS received three bids responding to its invitation to bid on Lease Number 590:1984. Bid A was submitted by Phillips and Company, the apparent second lowest bidder and Intervenor in this case. Its property consisted of one multi-story building located at 1740 North Palafox Street, Pensacola, Florida. Bid B was not responsive and therefore was not considered by HRS and is not a part of this litigation. Bid C was submitted by Petitioner Carmon S. Boone, and was the apparent low bid. Mr. Boone's property consisted of two buildings located at 401 and 411 North Baylen Street, Pensacola, Florida. The Boone property is the present location of Respondent's offices. Both Bid A and Bid C were within the mandatory geographical area designated in the bid package. Once the bids were received the bid evaluation committee began its work. The committee members, minus Mr. Bates, visited the Phillips property. However, the members did not visit the Boone property. There was no need. Four of the members currently worked at the Boone property and the other members had previously visited the Boone property on various other occasions. Mr. Bates was likewise already familiar with both properties. All members were sufficiently familiar with the cogent aspects of each property to allow them to make a rational decision. The bid evaluation committee, minus Mr. Bates, met as a group to evaluate each property in accordance with the weighted bid evaluation criteria. Each individual scored their sheets separately and the general consensus was supportive of recommending the Phillips property. Five committee members scored Mr. Phillips' property higher than the Boone property. The one exception was Mr. Peters who felt that HRS could not support a bid awarded for other than monetary reasons, i.e., he felt the lowest bid had to be accepted. Mr. Bates later reviewed all the bid synopsis sheets of the committee members and discussed the bid award with Mr. Peters and Mr. Pastucha. Mr. Bates felt that the Phillips property was the lowest and best bid. At about the same time, the staff responsible for providing technical assistance to the committee and the District Administrator were made aware that the general consensus of the committee was leaning towards the second lowest bidder, Phillips and Company, as the lowest and best bid. The staff members, one of whom was a bid committee member, disagreed with the award of the bid to Phillips and Company because the Boone property was the lower bid. The staff members sought to head off the committee's intended recommendation. The staff personnel held a meeting with some of the committee members in order to get them to join in a recommendation to Ms. Schembera of the Boone property. Mr. Boone was invited and attended the meeting. He was allowed to improperly bolster his bid by agreeing to convert the two buildings to one and other lesser additions. /2 The potential decision was discussed, but no committee member changed his or her mind. However, through a total lack of communication, a run away staff somehow rationalized themselves into a position of being authorized to submit a letter for Ms. Schembera's signature which awarded the Boone property the lease. Ms. Schembera became aware of her staff's attempt to subvert the bid process she had established. She refused to sign the letter submitted by the staff. She removed the staff member of the committee as a voting member. The staff member had supported the Boone property. She also removed a committee member who supported the Phillips property as a voting member. Ms. Schembera feared that her staff had improperly influenced this member to such an extent that his objectivity had been affected. Both members could still participate in committee discussions. Ms. Schembera thereby reasonably ensured the ongoing objectivity of the bid evaluation committee. The committee was reconvened, minus one member. It recommended the Phillips and Company property. Every reason given by the individual committee members for distinguishing and preferring one bid over another were rational and reasonable considerations and were covered by the bid evaluation criteria. Each individual member gave a rational and reasonable basis for the scoring he or she used on the bid synopsis score sheets. The scoring was done by each member after discussion of the two buildings and without influence from the other committee members. In essence, the committee felt that the Phillips property was the better property for the money. The Phillips property allowed working units to be located in one area with each such unit having its own access. It provided flat safe parking areas and sidewalks, bigger and more elevators, wide halls and windows which presented a bright, happy and pleasant working environment. The Boone property was in two buildings which could not accommodate co-located working units with their own access no matter how much remodeling took place. Parking and sidewalks are on a hill which is slippery when wet. It had one small elevator and narrow halls which did not adequately accommodate more than one wheel chair, and one ground floor where no windows could ever be remodeled into the building leaving a dark, dingy and unpleasant environment. Importantly, every committee member except for the staff member came to the conclusion that the Phillips and Company property was the lowest and best bid. There is no statutory or rule requirement that one scoring method be preferred over another. The only requirement is that the method be rational and reasonable especially where highly subjective, but legitimate criteria are involved in the selection of a particular piece of property. On these facts, the individual scoring methods used by the individual committee members were not arbitrary and capricious, but were very rational and reasonably related to the relative importance the committee members gave the above factors. After reviewing and considering information from the bid evaluation committee, the information on the bid synopsis sheet, and the oral recommendations of Mr. Bates, Mr. Peters and Mr. Pastucha, Ms. Schembera concluded that the Phillips property was vastly better, even considering costs. She found it to be materially superior in terms of construction, organization, client accessibility, handicap accessibility, repairability (in terms of walls), and maneuverability for clients and staff. She felt the Phillips' building's qualities would offer more "humanity" to the process of serving the Department's clients. Additional facts she considered when making her decision included the morale of the staff and their productivity; the ability of staff and clients to conduct their business in a reasonably pleasant, comfortable, safe, and easy to understand and comprehend environment; and the desire to provide a minimally adequate work space. In addition to other monetary costs, she considered energy costs and life cycle costs as reflected on the bid synopsis sheet. The bid synopsis sheet defined minimal energy and life cycle costs to be anything less than 55 BTU's per square feet per year. In this case, the Boone property reflected 39.5 BTU's per square feet and the Phillips property reflected 53.5 BTU's per square feet. Both properties were under the 55 BTU cutoff established by HRS. Translated into monetary figures (life cycle costs) the Boone property reflected a cost of $26,735.00 and the Phillips property reflected a cost of $41,160.00. It was the difference between the energy figures which caught Ms. Schembera's eye. In her layman's opinion, it was incomprehensible that the two buildings would have such a wide divergence of energy costs. /3 She learned from her staff that the information used to compute these costs was supplied by the bidders who had vested interests in the outcome. Ms. Schembera concluded the cost difference was minimal and not of overriding concern in relation to the physical characteristics of the two buildings and how they compared to each other. She quite correctly felt the two buildings were not comparable. In essence, the two buildings' differences in design location and construction rendered neither building comparable to the other building as a like facility under Section 255.254, Florida Statutes. 4/ Based on that information she gave the energy figures relatively little weight. More importantly, however, before the final bid award was made by HRS, the Division of General Services within HRS in its failsafe role in reviewing bids considered the life cycle cost figures of the two bids. The minimal language of Section 255.254, Florida Statutes, has been interpreted by HRS to mean that anything under 55 BTU's is minimal and except in one instance not applicable here, numerical differences under 55 BTU's are immaterial. The Division, without getting into the issue of the likeness of the facilities, concluded that both bids met the Department's interpretation of the "minimal" language of Section 255.254, Florida Statutes, and the relative numerical difference in the energy costs was immaterial. Ms. Schembera is entitled to rely on other more expert HRS Division staff to ensure a proper analysis of highly technical bid specifications such as the energy cost analysis required under Section 255.254, Florida Statutes. It does not matter that the review took place after Ms. Schembera had made her preliminary decision. What is important is that the review be made either personal or vicariously through staff before the final award is made. A proper review of energy costs was, therefore, made by Respondent before the final award was made. Likewise, Ms. Schembera's ultimate decision that the buildings were not comparable like facilities was a proper review of energy costs even though that conclusion was arrived at through a layman's unsophisticated, but more accurate intuition and common sense. To that extent, the energy cost data had no impact on the ultimate choice made by the District Administrator and were properly considered by the District Administrator. 5/ A letter for Ms. Schembera's signature adopting the committee's recommendation was drafted by Mr. Pastucha. The letter was signed and sent to the Department's Division of General Services for review. The District was requested to provide additional justification for its choice by the Department's Division of General Services. Mr. Rashied was directed to draft the response. He simply reorganized the original memorandum into a format more compatible with the Division's direction, clarified a few points and without significantly changing the content, submitted the response as directed. The Division acquiesced in Ms. Schembera's decision.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That the Department of Health and Rehabilitative Services enter a final order dismissing Case NO. 88-4900BID, and awarding lease number 590:1984 to Phillips and Company as the lowest and best bidder. DONE and ORDERED this 5th day of January, 1989, in Tallahassee, Florida. DIANE CLEAVINGER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 5th day of January, 1988.
