The Issue Whether Respondent Department of Transportation’s intended decision to conduct negotiations with Xerox State and Local Solutions, Inc., under ITN-DOT-13/14-8001-SM is contrary to the Department’s governing statutes, rules, or policies or to the solicitation specifications.
Findings Of Fact The ITN The Department is an agency of the State of Florida charged with planning, acquiring, leasing, constructing, maintaining, and operating toll facilities and cooperating with and assisting local governments in the development of a statewide transportation system. § 334.044(16)-(22), Fla. Stat. (2013).1/ The Department is authorized to enter contracts and agreements to help fulfill these duties. See §§ 20.23(6) and 334.044(7), Fla. Stat. FTE is a legislatively created arm of the Department and is authorized to plan, develop, own, purchase, lease, or otherwise acquire, demolish, construct, improve, relocate, equip, repair, maintain, operate, and manage the Florida Turnpike System. § 338.2216(1)(b), Fla. Stat. FTE is also authorized to cooperate, coordinate, partner, and contract with other entities, public and private, to accomplish these purposes. Id. The Department has the express power to employ the procurement methods available to the Department of Management Services under chapter 287, Florida Statutes.2/ § 338.2216(2), Fla. Stat.; see also Barton Protective Servs., LLC v. Dep’t of Transp., Case No. 06-1541BID (Fla. DOAH July 20, 2006; Fla. DOT Aug. 21, 2006). OOCEA (now known as the Central Florida Expressway Authority), MDX, and THEA are legislatively created or authorized agencies of the State with the power to fix, alter, charge, establish, and collect tolls, rates, fees, rentals, and other charges for the services and facilities system. §§ 348.0003(1)- .0004(2)(e), Fla. Stat. Each of these authorities has the power to enter contracts and to execute all instruments necessary or convenient for the carrying on of its business; to enter contracts, leases, or other transactions with any state agency or any other public body of the State; and to do all acts and things necessary or convenient for the conduct of its business and the general welfare of the authority in order to carry out the powers granted to it by law. § 348.0004(2)(g), (h), (k), Fla. Stat. On November 1, 2013, the Department advertised the ITN, soliciting proposals from vendors interested in participating in competitive negotiations for the award of a contract to provide a CCSS and associated operations and maintenance. The ITN was issued pursuant to section 287.057, Florida Statutes. The purpose of the ITN is to replace the existing customer service center systems of FTE, OOCEA, THEA, and MDX with a CCSS that can be expanded over time to include other tolling and transit agencies in the State of Florida. The CCSS is expected to process nearly all electronic toll transactions in Florida. The successful vendor will enter a contract directly with the Department. The Department will then enter agreements with the other authorities to address coordinated and joint use of the system. Generally, the ITN sets forth a selection process consisting of two parts. Part one involves: (a) the pre- qualification, or shortlisting, of vendors in order to determine a vendor’s eligibility to submit proposals; and (b) the proposal submission, evaluation, and ranking. Part two is the negotiation phase. The instant proceeding relates only to part one. Part two -- negotiations -- has yet to occur. The TRT and Selection Committee – The Evaluators Cubic alleges that “not all of the members of either [the Technical Review or Selection Committee] teams had the requisite experience or knowledge required by section 287.057(16)(a)1., Florida Statutes.” Accenture alleges that “the Selection Committee did not collectively have expertise in all of the subject areas covered by th[e] ITN.” Section 287.057(16)(a) provides in part that the agency head shall appoint “[a]t least three persons to evaluate proposals and replies who collectively have experience and knowledge in the program areas and service requirements for which commodities or contractual services are sought.”3/ In accordance with the requirements of section 287.057(16)(a), the ITN established a Technical Review Team (TRT) that would be “composed of at least one representative from each Agency and may include consultant (private sector) staff.” The ITN also provided for a Selection Committee that would be “composed of executive management at the Agencies.” Each agency executive director appointed two individuals from their agency to the TRT. Each agency director was familiar with the background and qualifications of their appointees, who had experience in various aspects of tolling operations including tolling, software, finance, and procurement. The following individuals were appointed to serve on the TRT. Bren Dietrich, a budget and financial planner for FTE, has an accounting degree and has worked at FTE for 12 years in budget and financial planning. Mr. Dietrich has been a technical committee member for seven or eight procurements. Mohamed Hassan, a senior operations manager for FTE, has been in information technology for nearly 40 years and with FTE for 22 years handling all aspects of software development and maintenance for the state’s largest tolling authority. Mr. Hassan’s expertise is in software development and maintenance. Mr. Hassan oversees staff that is responsible for maintaining the database application systems, hardware, communications coming in and going out of the customer service center, and any development projects such as transaction processing or account management system upgrades. Steve Andriuk is a deputy executive director for MDX and oversees all tolling operations within MDX’s jurisdiction. Mr. Andriuk’s tolling background goes beyond his tenure at MDX, as he previously was an executive director at Chesapeake Bay Bridge Authority. Jason Greene, MDX’s comptroller of financial controls and budget manager, has a background in finance and accounting and in project management. Mr. Greene has been with MDX for 11 years. Lisa Lumbard, who has been with OOCEA for 16 years, is the interim chief financial officer and previously was the manager of accounting and finance. Ms. Lumbard runs OOCEA’s finance and accounting office and has both procurement experience and substantial experience in the financial aspects of back- office tolling. David Wynne is the director of toll operations of OOCEA and is responsible for the overall collection of all tolls and for the violation enforcement process. Mr. Wynne has held some iteration of this position for approximately 11 years and worked for OOCEA for 16. He also has both procurement and substantial tolling experience. Robert Reardon, THEA’s chief operating officer, is responsible for THEA’s day-to-day operations, including tolls. Mr. Reardon has been with THEA for six years and has experience as a technical evaluator for public procurements. Rafael Hernandez is THEA’s manager of toll operations and oversees all toll operations within THEA’s jurisdiction. The TRT members collectively have the requisite knowledge and experience in tolling, software, finance, and procurement. The following individuals constituted the Selection Committee. Diane Gutierrez-Scaccetti has been FTE’s executive director since 2011 and worked for the New Jersey Turnpike Authority for over 20 years, the last two as executive director and the previous 14 as deputy executive director. Laura Kelley is OOCEA’s deputy director over finance administration and the interim executive director. Ms. Kelly has 30 years’ experience in transportation finance and management, 15 of which occurred at the Department and eight of which occurred at OOCEA overseeing information technology, finance, and procurement. Javier Rodriguez, MDX’s executive director, oversees all MDX operations, including planning, finance, operations, and maintenance functions. Mr. Rodriguez has been with MDX for seven years and was with the Department for over 15 years prior to his employment with MDX. Joseph Waggoner has been THEA’s executive director for approximately seven years. Prior to joining THEA, he was with the Maryland Department of Transportation for nearly 30 years, six of which were in tolling operations. ITN section 2.6.2 provides as follows: Following Proposal Oral Presentations by all short-listed Proposers (see section 2.25 Proposal Oral Presentations for additional details) the Technical Review Team members will independently evaluate the Proposals based on the criteria provided in Section 2.5.2 and will prepare written summary evaluations. There will then be a public meeting of the Selection Committee at the date, time and location in Table 1-2 Procurement Timeline. The Technical Review Team’s compiled written summary evaluations will be submitted to the Selection Committee. The Technical Review and Selection Committee will review and discuss the individual summary evaluations, and the Selection Committee will come to consensus about ranking the Proposers in order of preference, based on their technical approach, capabilities and best value. In addition to the Technical Review Team, the Selection Committee may request attendance of others at this meeting to provide information in response to any questions. The ITN is structured such that both the TRT and the Selection Committee have shared responsibility for evaluating proposals, with the Selection Committee having ultimate responsibility for ranking the Proposers for the negotiations stage of the procurement process. Combining the eight members of the TRT with the four members of the Selection Team means that there were a total of 12 individuals tasked with the responsibility of evaluating the proposals prior to the negotiations stage of the process. Pre-Qualification and Rankings In the pre-qualification portion of the ITN, interested vendors initially submitted reference forms to demonstrate that the vendors met the minimum project experience set forth in the ITN. Vendors meeting this requirement were invited to give a full-day Pre-Qualification Oral Presentation to the TRT in which each vendor was given the opportunity to demonstrate its proposed system. Under ITN section 2.6.1, A Technical Review Team will attend the Pre- Qualification Oral Presentations and will develop scores and written comments pertaining to the reviewed area(s) identified in Section 2.5.1. The Technical Review Team will be composed of at least one representative from each Agency and may include consultant (private sector) staff. The scores provided by each Technical Review Team member for each area of the Pre- Qualification Oral Presentations will be totaled and averaged with the scores of the other Technical Review Team members to determine the average score for an area of the Pre-Qualification Oral Presentation. The average score for each area of a Pre- Qualification Oral Presentation will then be totaled to determine a total Pre- Qualification Oral Presentation score. Each vendor’s Pre-Qualification Oral Presentation was then scored based on criteria set forth in ITN section 2.5.1. Any vendor that received a score of 700 or higher was “short- listed” and invited to submit proposals. Put differently, those receiving a score of at least 700 were deemed qualified to submit formal proposals. ITN section 2.5.1 provides that the “review/evaluation of the Pre-Qualification Oral Presentations will not be included in decisions beyond determining the initial short-list of Proposers to proceed in the ITN process.” Accordingly, the scores assigned in the pre-qualification phase were irrelevant after the short-listing. Six vendors submitted pre-qualifications responses, including Xerox, Accenture, and Cubic. On January 21, 2014, the Department posted its short-list decision, identifying that all six vendors, including Xerox, Accenture, and Cubic, were deemed qualified to submit formal written proposals to the ITN (the “First Posting”). As required by section 120.57(3)(a), Florida Statutes, the posting stated, “Failure to file a protest within the time prescribed in Section 120.57(3), Florida Statutes, or failure to post the bond or other security required by law within the time allowed for filing a bond shall constitute a waiver of proceedings under Chapter 120, Florida Statutes.” This posting created a point of entry to protest, and no vendor initiated a protest. After the First Posting, short-listed vendors submitted technical and price proposals and made Proposal Oral Presentations. ITN section 2.24 provides detailed instructions for technical and price proposal preparation and submission. ITN section 2.25 (as amended by Addendum 8) sets forth the process for short-listed vendors to make Proposal Oral Presentations to the TRT. Short-listed Proposers will each be scheduled to meet with the Technical Review Team for Proposal Oral Presentations of their firm’s capabilities and approach to the Scope of Work and Requirements within the time period identified in Table 1-2 Procurement Timeline. Short-listed Proposers will be notified of a time and date for their Proposal Oral Presentation. Proposal Oral Presentation sessions are not open to the public. The Selection Committee will attend these Presentations. In advance of the Proposal Oral Presentations Proposers will be given detailed instructions on what the format and content of the Proposal Oral Presentation will be, including what functionality shall be demonstrated. The Department may also provide demonstration scripts to be followed. Proposers should be prepared to demonstrate key elements of their proposed System and Project approach and to respond to specific questions regarding their Proposals. These Proposal Oral Presentations will be used to present the Proposer’s approach and improve understanding about the Department’s needs and expectations. The Technical Review Team will participate in all Proposal Oral Presentations. After each Oral Presentation, each individual on the Technical Review Team will complete a written summary evaluation of each Proposer’s technical approach and capabilities using the criteria established in Section 2.5.2 in order to assure the Technical Proposal and Oral Presentations are uniformly ranked. The evaluation will consider both the Technical Proposal and the Oral Presentations. ITN section 2.5.2 is titled “Best Value Selection” and provides as follows: The Department intends to contract with the responsive and responsible short-listed Proposer whose Proposal is determined to provide the best value to the Department. “Best value,” as defined in Section 287.012(4), F.S., means the highest overall value to the state, based on objective factors that include but are not limited to . . . . ITN section 2.5.2 goes on to delineate seven “objective factors,” or evaluation criteria, on which proposals would be evaluated: Company history Project experience and qualifications Proposed Project approach to the technical requirements Proposed approach to the Project plan and implementation Proposed approach to System Maintenance Proposed approach to Operations and performance Price ITN section 2.6.2 explains the process for evaluation of technical proposals and Proposal Oral Presentations and states that: Following Proposal Oral Presentations by all short-listed Proposers (see Section 2.25 Proposal Oral Presentations for additional details) the Technical Review Team members will independently evaluate the Proposals based on the criteria provided in Section 2.5.2 and will prepare written summary evaluations. There will then be a public meeting of the Selection Committee at the date, time and location in Table 1-2 Procurement Timeline. The Technical Review Team’s compiled written summary evaluations will be submitted to the Selection Committee. The Technical Review Team and Selection Committee will review and discuss the individual summary evaluations, and the Selection Committee will come to consensus about ranking the Proposers in order of preference, based on their technical approach, capabilities and best value. In addition to the Technical Review Team, the Selection Committee may request attendance of others at this meeting to provide information in response to any questions. Of the six short-listed vendors, five submitted proposals and gave Proposal Oral Presentations, including Xerox, Accenture, and Cubic. The Department then undertook a ranking using the evaluation criteria delineated in ITN section 2.5.2. To perform this ranking, TRT members individually evaluated the proposals and prepared detailed, written evaluations that tracked the evaluation criteria factors. The TRT’s evaluations, together with proposal summaries prepared by HNTB, were provided to the Selection Committee in preparation for a joint meeting of the TRT and Selection Committee on April 9, 2014. At the April 9th meeting, the TRT and Selection Committee members engaged in an in-depth discussion about the bases for and differences between the individual TRT members’ rankings and evaluations. Thereafter, the Selection Committee made its ranking decision. On April 10, 2014, the Department posted its ranking of vendors, with Xerox first, Accenture second, and Cubic third (the “Second Posting”). The Second Posting also announced the Department’s intent to commence negotiations with Xerox as the first-ranked vendor.4/ If negotiations fail with Xerox, negotiations will then begin with second-ranked vendor Accenture, then Cubic, and so on down the order of ranking until the Department negotiates an acceptable agreement. Accenture and Cubic each timely filed notices of intent to protest the Second Posting and timely filed formal written protest petitions and the requisite bonds. Negotiations are not at Issue ITN section 2.26 provides: Once Proposers have been ranked in accordance with Section 2.6.2 Proposal Evaluation, the Department will proceed with negotiations in accordance with the negotiation process described below. Proposers should be cognizant of the fact that the Department reserves the right to finalize negotiations at any time in the process that the Department determines that such election would be in the best interest of the State. Step 1: Follow the evaluation process and rank Proposals as outlined in Section 2.6 Evaluation Process. Step 2: The ranking will be posted, in accordance with the law (see Section 2.27), stating the Department’s intent to negotiate and award a contract to the highest ranked Proposer that reaches an acceptable agreement with the Department. Step 3: Once the posting period has ended, the Negotiation Team will undertake negotiations with the first-ranked Proposer until an acceptable Contract is established, or it is determined an acceptable agreement cannot be achieved with such Proposer. If negotiations fail with the first-ranked Proposer, negotiations may begin with the second-ranked Proposer, and so on until there is an agreement on an acceptable Contract. The Department reserves the option to resume negotiations that were previously suspended. Negotiation sessions are not open to the public and all negotiation sessions will be recorded by the Department. Step 4: The Negotiation Team will write a short plain statement for the procurement file that explains the basis for Proposer selection and how the Proposer’s deliverables and price will provide the best value to the state. Step 5: The Department will contract with the selected Proposer. As Accenture and Cubic protested the decision by the Department to enter negotiations with Xerox (and because of the automatic stay provision of section 120.57(3), Florida Statutes) the negotiation phase of the procurement never commenced. Thus, this proceeding concerns the Department’s actions up to the Second Posting, and not what may happen during future negotiations. Second Posting and Intended Award Section 1.2 of the ITN sets forth the procurement timeline for the CCSS project. The ITN originally indicated that the “Posting of Ranking/Intended Award” would occur on March 31, 2014. By addendum issued on February 13, 2014, the date for “Posting of Ranking/Intended Award” was changed to April 10, 2014. Section 1.3.1 of the ITN provides an agenda for the April 10, 2014, “Meeting to Summarize and Determine Ranking/Intended Award.” Section 2.27 of the ITN is labeled “POSTING OF RANKING/INTENDED AWARD.” Section 2.27.1, Ranking/Intended Award, provides that “[t]he Ranking/Intended Award will be made to the responsive and responsible Proposer that is determined to be capable of providing the best value and best meet the needs of the Department.” Section 2.27.2 is labeled “Posting of Short- list/Ranking/Intended Award” and provides in part that “[a]ny Proposer who is adversely affected by the Department’s recommended award or intended decision must . . . file a written notice of protest within seventy-two hours after posting of the Intended Award.” Joint Exhibits 10 and 12 are copies of forms used to announce the rankings of the Proposers. It is not clear from the record if these forms are a part of the ITN. Nevertheless, the forms are identical in format. Each form has three boxes that follow the words “TYPE OF POSTING.” The first box is followed by the word “Shortlist,” the second box is followed by the word “Ranking,” and the third box is followed by the words “Intended Award.” The form also has three columns that coincide with the three boxes previously referenced. The three columns are respectively labeled, “X indicates shortlisted vendor,” “ranking of negotiations,” and “X indicates intended award.” With respect to the last two columns, explanatory comments appearing at the bottom of the form read as follows: ** Ranking: The Department intends to negotiate separately and will award a contract to the highest ranked vendor that reaches an acceptable agreement with the Department. The Department will commence negotiations with the number one ranked vendor until an acceptable contract is agreed upon or it is determined an acceptable agreement cannot be reached with such vendor. If negotiations fail with the number one ranked vendor, negotiations may begin with the second-ranked vendor, and so on down the order of ranking until the Department is able to negotiate an acceptable agreement. *** Intended Award: “X” in the Intended Award column indicates the vendor whom the Department intends to award the contract to, but does not constitute an acceptance of any offer created by the vendor’s proposal or negotiations. No binding contract will be deemed to exist until such time as a written agreement has been fully executed by the Department and the awarded vendor. If irregularities are subsequently discovered in the vendor’s proposal or in the negotiations or if the vendor fails to submit required [b]onds and insurance, fails to execute the contract, or otherwise fails to comply with the ITN requirements, the Department has the right to undertake negotiations with the next highest vendor and continue negotiations in accordance with the ITN process, reject all proposals, or act in the best interest of the Department. On April 10, 2014, the Department issued a posting wherein the “Ranking” box was checked and the “Intended Award” box was not. According to Sheree Merting, it was a mistake to have only checked the “Ranking” box because the box labeled “Intended Award” should have also been checked. Petitioners contend that by not simultaneously checking both the “Ranking” and “Intended Award” boxes that the Department materially changed the process identified in the ITN. Protesters’ arguments as to this issue appear to be more related to form than substance. In looking at the plain language of the ITN, it reasonably appears that the Department intended to simultaneously announce the “Ranking” and “Intended Award.” The fact that the Department failed to combine these two items in a single notice is of no consequence because neither Cubic nor Accenture have offered any evidence establishing how they were competitively disadvantaged, or how the integrity of the bidding process was materially impaired as a consequence of the omission. In other words, Sheree Merting’s confessed error of not checking the “Intended Award” box contemporaneously with the “Ranking” box is harmless error. See, e.g., Fin. Clearing House, Inc. v. Fla. Prop. Recovery Consultants, Inc., Case No. 97-3150BID (Fla. DOAH Nov. 25, 1997; Dep’t of Banking & Fin. Feb 4, 1998)(applying harmless error rule to deny protest where agency initially violated provisions of section 287.057(15), Florida Statutes, by selecting two evaluators instead of three required by statute, but later added required evaluator). Sequential Negotiations As previously noted, section 2.26 of the ITN provides that following the ranking of the short-list proposers, the “Negotiation Team will undertake negotiations with the first- ranked Proposer until an acceptable Contract is established . . . [and] [i]f negotiations fail with the first-ranked Proposer, negotiations may begin with the second-ranked Proposer, and so on until there is an agreement on an acceptable Contract.” Petitioners assert that the Department has abandoned the sequential negotiation process set forth in section 2.26 and has announced “that it will conduct the procurement negotiations only with Xerox as the number one ranked proposer” and that the process of negotiating with only one proposer is contrary to the law because section 287.057(1)(c) “requires that the Department negotiate with all proposers within the competitive range.” Diane Gutierrez-Scaccetti testified as follows (T: 1119): Q: Now, you understand that as a result of the rankings that were posted on April 10th, negotiations under this ITN are to proceed with only a single vendor, is that right? A: I believe the ITN provided for consecutive negotiations starting with the first-ranked firm and then proceeding down until we reached a contract. Contrary to Petitioners’ assertions, the evidence establishes that the Department intends to follow the negotiation process set forth in section 2.26. Petitioners’ contention that section 287.057(1)(c) does not authorize sequential negotiations is a challenge to the terms, conditions, and specifications of the ITN and should have been filed within 72 hours after the posting of the solicitation as required by section 120.57(3)(b). Petitioners have waived their right of protest with respect to this issue. Petitioners’ waiver notwithstanding, section 287.057(1)(c) does not preclude the type of sequential negotiation process set forth in section 2.26 of the ITN. Section 287.057(1)(c) provides in part that “[t]he invitation to negotiate is a solicitation used by an agency which is intended to determine the best method for achieving a specific goal or solving a particular problem and identifies one or more responsive vendors with which the agency may negotiate in order to receive the best value.” (Emphasis added). Section 287.057(1)(c)4. provides that “[t]he agency shall evaluate replies against all evaluation criteria set forth in the invitation to negotiate in order to establish a competitive range of replies reasonably susceptible of award [and] [t]he agency may select one or more vendors within the competitive range with which to commence negotiations.” (Emphasis added). The opening paragraph of section 287.057(1)(c), which is essentially the preamble portion of the ITN provisions, expresses the purpose for which the ITN process was developed, to wit: “to determine the best method for achieving a specific goal or solving a particular problem.” In furtherance of the stated purpose, the Legislature instructs, in the preamble, that the process should “identif[y] one or more responsive vendors with which the agency may negotiate in order to receive the best value.” If the preamble is read in statutory isolation, then one could reasonably conclude that if the agency identifies more than one responsive vendor then the agency should negotiate with each of the vendors “in order to receive the best value.” Arguably, the preamble merely looks at vendor “responsiveness” as the guidepost for determining with whom the agency shall negotiate. Mere “responsiveness” however, is clearly not the only standard for selecting a vendor through the ITN process and illustrates why this portion of the statute cannot be read in isolation. As previously noted, subparagraph four of section 287.057(1)(c), provides that the agency “shall . . . establish a competitive range of replies reasonably susceptible of award,” and once this is done, “[t]he agency may select one or more vendors within the competitive range with which to commence negotiations.” (Emphasis added). By using the word “may” in subparagraph four, the Legislature is authorizing agencies to exercise discretion when selecting vendors with whom to negotiate. In exercising its discretion, agencies can decide to negotiate with a single vendor or with multiple vendors. An agency’s exercise of its discretion is not absolute and the “check” on the exercise of its discretion, in the context of the instant case, is a bid protest whereby an unsuccessful bidder can attempt to prove that the procurement process was impermissibly tainted. Contrary to Petitioners’ allegations, the sequential negotiation process utilized by the Department in the present case does not run afoul of section 287.057. Petitioners forcefully argue that they have been shutout of the negotiation process because neither of them was ranked first. This assertion mischaracterizes the nature of the sequential negotiation process used by the Department. The evidence shows that if the Department fails to come to terms with Xerox, then negotiations may begin with the second-ranked vendor, and so on down the order of ranking until the Department negotiates an acceptable agreement. The truth of the matter is that neither of the protesters has been shutout of the negotiations. It is simply the case that neither occupies the preferred position of being the highest ranked, short-listed vendor. Petitioners also argue that the Florida Department of Transportation Commodities and Contractual Services Procurement Manual – 375-040-020, prohibits sequential negotiations. For invitations to negotiate, the manual provides: There are two general negotiation methods used: Competitive Method A – Vendors are ranked based on technical qualifications and negotiations are conducted commencing with the first ranked vendor. Competitive Method B – Vendor qualifications are evaluated and vendors may be short-listed. Negotiations of scope and price will be conducted with short-listed or all vendors. An award is made to the vendor with the best combination of proposal, qualifications, and price. According to Petitioners, the ITN does not comport with either Method A or Method B. Again, Petitioners failed to timely challenge the ITN specifications regarding sequential negotiations and thus have waived this argument. Even if the merits of the argument are considered, Petitioners’ argument fails. The methods described in the manual are not the only methods available to the Department; in fact, the manual, by stating that “there are two general negotiation methods used (emphasis added),” recognizes that the methods are subject to refinement or modification as the Department deems best to meet the perceived needs of a particular solicitation as long as the final method complies with section 287.057(1), Florida Statutes. Further, the procurement manager for the ITN, Sheree Merting, testified that the shell, or template, provided by the Department’s central office, and used when drafting an invitation to negotiate, contains a combination of the manual’s methods A and B, which is referred to as A/B. The order of negotiations provided for in the ITN and reiterated in the First and Second Postings is not, therefore, inconsistent with the Department’s policies or procedures. Best Value Decision Petitioners contend that the Department, via the Second Posting, has already (and improperly) determined which vendor will provide the best value to the State even though negotiations have not yet occurred. This contention is not supported by the evidence. ITN section 2.5.2 states the Department’s intent to contract with the vendor whose proposal is determined to provide the best value and sets forth the statutorily mandated objective factors, or criteria, on which proposals will be evaluated. ITN section 2.6.2 provides that the TRT and Selection Committee will review and discuss the TRT members’ individual summary evaluations and the Selection Committee “will come to consensus about ranking the Proposers in order of preference, based on technical approach, capabilities and best value.” The evidence reflects that the evaluation factors were applied during the evaluation process to formulate a best value ranking, but the question of which vendor ultimately provides the best value to the State will not be conclusively determined until after negotiations are concluded. See § 287.057(1)(c)4., Fla. Stat. (“After negotiations are conducted, the agency shall award the contract to the responsible and responsive vendor that the agency determines will provide the best value to the state, based on the selection criteria.”). As testified by Ms. Gutierrez- Scaccetti, “[t]he Selection Committee agreed upon the ranking of firms. It has not made an award.” This is consistent with the ITN and Florida law, which require award to the best value proposer after negotiations. Evaluation Criteria Properly Followed As explained above, ITN section 2.5.2 sets forth the evaluation factors that the TRT and Selection Committee were to use in evaluating proposals. Petitioners allege that the TRT and Selection Committee did not follow the ITN and based their evaluations and rankings on factors other than those listed in ITN section 2.5.2. The evidence establishes that the TRT did in fact use these factors, as evidenced by the detailed evaluation summaries prepared by each of the eight TRT members, which almost uniformly tracked these factors. Seven of these summaries are organized by headings that mirror the seven criteria of section 2.5.2. The remaining summary, prepared by TRT member Mohamed Hassan, was formatted in terms of pros and cons, but nonetheless addressed all of the section 2.5.2 evaluation criteria. Reflective of the TRT’s approach, TRT member David Wynne prepared detailed, typed proposal summaries that are four pages long and single-spaced for each proposal. Mr. Wynne’s summaries capture his deliberate thought process in ranking the proposals and include headings that directly tie back to the evaluation criteria in the ITN. His summaries include specific details from each proposal justifying his qualitative assessment of the proposals. For example, he discusses the benefits of Xerox’s Vector 4G tolling platform, Xerox’s proposed project schedule, and maintenance. Mr. Wynne even included a breakdown of the pricing and his thoughts on how the pricing compared to the other vendors. The other TRT members had equally detailed summaries. When read as a whole, these summaries demonstrate that the TRT engaged in a rational, deliberative, and thoughtful evaluation of the proposals based on the ITN criteria. Additionally, the TRT members testified that they applied the ITN section 2.5.2 factors in conducting their evaluations. Thus, the evidence demonstrates that the TRT members did as instructed in the ITN and evaluated proposals based on ITN section 2.5.2’s factors. There is no credible basis to find that the section 2.5.2 criteria were not the bases of the TRT’s evaluations, rankings, and narratives. The evidence also establishes that the Selection Committee applied ITN section 2.5.2 factors in reaching its decision. The Selection Committee reviewed the TRT summaries, along with a detailed notebook prepared by HNTB, the Department’s consultant. The HNTB notebook was a comprehensive summary of information compiled from the vendors’ voluminous proposals and organized in a digestible format to aid the Selection Committee’s review, including helpful summaries providing head-to-head objective comparisons of vendor pricing, software development, and vendors’ exceptions and assumptions. The HNTB notebook of materials objectively compiled the content taken directly from the vendors’ own proposals and included no editorial comments or opinions by the Department’s consultants. Moreover, the HNTB notebook contained a chart summarizing the TRT’s rankings by TRT member, along with copies of each TRT member’s detailed written summaries. It also contained a detailed, 36-page pricing summary that pulled price information directly from the vendors’ proposals and summarized the information in a manner that allowed for easy side-by-side comparison. The notebook also included a systems matrix summary that was prepared by taking proposed systems information directly from the vendors’ proposals and combining it in a format that could be easily processed. In fact, the notebook even included pages copied directly from the proposals. Armed with the comprehensive TRT summaries and the HNTB notebook, the Selection Committee then engaged the TRT in a thoughtful and detailed discussion and analysis of the qualitative merits of each vendor’s proposal -- all within the bounds of the section 2.5.2 criteria. Petitioners contend that during the TRT and Selection Committee’s discussions, issues such as risk were improperly considered. Although “risk” was not a separately labeled criterion under section 2.5.2 (“risk of solution” is, however, referenced as a sub-bullet), risk is inherently a significant consideration in each of the evaluation factors. Stated differently, the concept of risk is integral to the ITN section 2.5.2 factors, and the Department properly considered such risks. For example, a vendor’s prior project experience -- whether it has successfully completed similar projects before -- was a listed criterion, which is directly relevant to the risk the Department would take in selecting a vendor, that is, the risk that the vendor’s experience is or is not sufficient to assure a timely project completion and quality services under the ITN. Indeed, section 287.057(1)(c) requires that the Department consider prior experience. Another example of risk considered by at least one Selection Committee member was the potential that Accenture’s project manager would not be assigned solely to this project, but might be shared with Accenture’s Illinois tolling project (“local presence commitment” is referenced as a sub-bullet in section 2.5.2). The evidence shows that Accenture stopped short of saying without qualification that its project manager would be released from Illinois and solely assigned to CCSS. This uncertainty raised a risk concern whether the critical project implementation would be properly managed. Considerations such as these are rational and reasonable. There is a Reasonable Basis for the Department’s Ranking Petitioners further contend that there was no reasonable basis for the Department’s intended decision to begin negotiations with Xerox. However, as explained above, the evidence demonstrates the opposite as the TRT and Selection Committee collectively discussed and considered the evaluation criteria and the Selection Committee reached consensus on moving forward to negotiations with Xerox. Moreover, there is ample evidence that the Selection Committee’s decision was rational and reasonable. The TRT and Selection Committee’s discussion at the April 9, 2014, meeting where the ranking decision was reached, demonstrates the studied analysis by which the evaluations were conducted. At the meeting, the four Selection Committee members, who had already reviewed the TRT members’ individual rankings and evaluations, each questioned the TRT members about their assessments of the proposals. Selection Committee members asked about the bases for the differences between the individual TRT members’ evaluations, and the TRT members explained why they ranked the vendors the way they did. The discussion revolved around the top three ranked vendors, Xerox, Accenture, and Cubic, which one TRT member described as being “head and shoulders above the rest” -- that is, above the vendors ranked fourth and fifth. As noted above, the Selection Committee members’ primary focus in these discussions was on risk assessment -- the financial risks, operations risks, and information technology risks that the TRT members believed accompanied each proposal. Major Selection Committee items of discussion included modifications to the existing systems, proprietary versus off- the-shelf software issues, and the vendors’ proximity to Florida. Additional discussion points included the risk associated with Accenture’s use of multiple subcontractors and Cubic’s lack of experience with certain tolling systems. From these discussions, it appears that the overriding factor behind the Selection Committee’s ranking decision at the April 9 meeting was Xerox’s proven experience with other similar and large tolling projects, including some of the country’s largest tolling systems, which Accenture and Cubic simply did not possess.5/ As one Selection Committee member expressed, Xerox brought a “comfort level” that did not exist with Accenture and Cubic. Moreover, Xerox, with 78 percent, is the leader in the evaluative category that looks at the percentage of the company’s existing baseline system that meets the CCSS requirements -- more than Accenture’s and Cubic’s combined percentages. As the percentage of existing baseline system compliance increases, the implementation risks decrease. Selection Committee members Diane Gutierrez-Scaccetti and Joseph Waggoner expressed the importance of this based on their firsthand experience with existing tolling systems in use for their respective agencies. In sum, this analysis and assessment is a valid and reasonable basis for the Department’s decision. Cubic also contends that such analysis is improper because the ITN allowed transit firms to submit proposals, thus making tolling experience an irrelevant evaluative factor. This contention fails because by prequalifying transit firms to bid, the Department was not precluded from considering a vendor’s specific tolling experience as part of the evaluative process. Contrary to Cubic’s allegation, the factors listed in ITN section 2.5.2, including “Project Experience and Qualifications,” contemplate tolling experience as being part of the relevant analysis. Therefore, the Selection Committee was fully authorized under the ITN to consider the benefits of a proven commodity -- a firm with Xerox’s extensive tolling experience. The Selection Committee’s qualitative assessment that, on the whole, Xerox was the better choice for commencing negotiations was supported by reason and logic and was wholly consistent with the ITN specifications. Petitioners further argue that the Department’s ranking decision is inconsistent with the pre-qualification scoring, where Accenture and Cubic each scored slightly higher than Xerox. This argument fails as ITN section 2.5.1 expressly provides that the evaluations and scoring of the Pre-Qualification Oral Presentations will not be included in decisions beyond determining the initial short-list. Regardless, these three vendors were essentially tied in that scoring: Accenture’s score was 885.38, Cubic’s was 874.75, and Xerox’s was 874.00. Petitioners also contend that the Selection Committee’s ranking decision is inconsistent with the ranking decision of the TRT majority. The ITN is clear, however, that the Selection Committee would be the final arbiter of ranking. No Demonstrations Were Cancelled The procurement timeline in the original ITN allotted ten business days for Proposal Oral Presentations. The revised timeline in Addendum 8 allotted two days. Cubic asserts that this reduction in presentation time occurred because the Department, without explanation, cancelled planned vendor demonstrations that were to occur during Proposal Oral Presentations, thus placing Cubic at a disadvantage as it was unable to present its demonstrations to Selection Committee members. Cubic also asserts that the cancellation of demonstrations is an indication that the Department had already made up its mind to select Xerox. The ITN and the testimony are unequivocal that no demonstrations were “cancelled.” ITN section 2.25 contemplates that the Department may request demonstrations in the proposal evaluation phase but in no way states that demonstrations will be held. Section 2.25 also provides that if any demonstrations were to be held, they would be as directed by the Department. Thus, the ITN did not guarantee Cubic any presentation, as Cubic suggests. Moreover, all vendors were treated equally in this regard. Further, the evidence reflects that the decision to hold demonstrations only during the Pre-Qualification Presentations was made when the ITN was released and that the Department never planned to have vendor demonstrations at the Proposal Oral Presentations. Indeed, during the mandatory pre- proposal meeting, the Department informed all vendors of the planned process, to include one demonstration at the pre- qualification phase and an oral presentation and question-and- answer session during the proposal and ranking phase. In short, Cubic presented no credible evidence in support of its allegations regarding the alleged cancellation of the demonstrations or any resulting harm. Exceptions and Assumptions were properly considered The ITN required vendors, in their technical proposals, to identify assumptions and exceptions to contract terms and conditions. Significantly, the ITN states that the Department is not obligated to accept any exceptions, and further that exceptions may be considered at the Department’s discretion during the evaluation process. ITN Technical Proposal Section 9 provides, in its entirety: Technical Proposal Section 9: Exceptions and Assumptions If Proposers take exception to Contract terms and conditions, such exceptions must be specified, detailed and submitted under this Proposal section in a separate, signed certification. The Department is under no obligation to accept the exceptions to the stated Contract terms and conditions. Proposers shall not identify any exceptions in the Price Proposal. All exceptions should be noted in the certification provided for in Proposal Section 9. Proposers shall not include any assumptions in their Price Proposals. Any assumptions should be identified and documented in this Section 9 of the Proposal. Any assumptions included in the Price Proposals will not be considered by the Department as a part of the Proposal and will not be evaluated or included in any Contract between the Department and the Proposer, should the Proposer be selected to perform the Work. Failure to take exception in the manner set forth above shall be deemed a waiver of any objection. Exceptions may be considered during the Proposal evaluation process at the sole discretion of the Department. Petitioners allege that the ITN did not clearly set forth how vendors’ exceptions and assumptions would be treated and that the Department accordingly failed to consider such exceptions and assumptions. This is a belated specifications challenge and therefore has been waived. Regardless, the evidence demonstrates that both the TRT and Selection Committee did, in fact, consider the exceptions and assumptions in the evaluation and ranking of proposers. The TRT and Selection Committee were instructed to consider exceptions and assumptions and to give them the weight they deemed appropriate subject to staying within the confines of the ITN’s section 2.5.2 criteria. Consistent with these instructions, some TRT members included comments regarding exceptions and assumptions in those members’ evaluation summaries, reflecting that exceptions and assumptions were considered during the evaluation process. Other TRT members considered the exceptions of minimal significance given that the Department would address them during negotiations and was not bound to agree to any. Indeed, the evidence was that it was the Department’s intent to sort out the exceptions and assumptions in the negotiation process and, again, that the Department need not agree to any exceptions initially set forth by the vendors. Thus, the Department acted rationally and within the bounds of the ITN and its discretion when considering exceptions and assumptions. The Selection Committee Reached Consensus Accenture alleges that the Selection Committee failed to carry out its duty to reach a “consensus” in ranking vendor proposals. The evidence establishes the exact opposite. The ITN provides that the Selection Committee will come to “consensus” about ranking the vendors in order of preference, based on technical approach, capabilities, and best value. A consensus does not require unanimity. According to the testimony of Selection Committee member Javier Rodriguez, who was the only Selection Committee member who voted for Accenture as his first choice, “at the end, Xerox got three votes from the Selection Committee; Accenture got one. So for me, consensus meant: Are we in consensus to move forward with Xerox? And as I said at the selection meeting, I didn’t object. So from a consensus standpoint, we’re moving on to starting negotiations with Xerox, and that was the intent.” Therefore, the unrebutted evidence is that the Selection Committee did, in fact, reach consensus. Subject Matter Experts Accenture contends that the TRT and Selection Committee made use of subject matter experts in the course of the evaluation and ranking in violation of Florida statutory requirements and governing procurement policies. The record, however, is void of any substantial competent evidence in support of these allegations. Tim Garrett is the tolls program manager for HNTB under the General Engineering Consulting contract for FTE. Mr. Garrett was the overall project manager assigned to support FTE in the development and execution of the ITN. He and other HNTB employees, such as Wendy Viellenave and Theresa Weekes, CPA, provided support to both TRT and Selection Committee members in regards to summarizing proposals and defining the process. There is no evidence that any employee of, or sub-consultant to, HNTB communicated qualitative assessments or opinions about any of the competing proposals to TRT or Selection Committee members. Rather, the evidence shows that HNTB facilitated the TRT’s and Selection Committee’s evaluation work by presenting to the committee members data in the form of summaries, charts, and recapitulations pulled from the voluminous technical and price proposals submitted by the five competing vendors. Other than the support provided by HNTB, the record is essentially devoid of evidence that proposal evaluators made use of subject matter experts.6/ But in any event, neither Petitioner has made a showing that the use of subject matter experts is proscribed by governing statutes, rules, policies, or the specifications of the ITN. Although the use of subject matter experts was not addressed in the ITN itself, the Department, before the Pre- Qualification Oral Presentations in early January 2014, issued written “Instructions to Technical Review Committee.” These instructions authorized TRT members to confer with subject matter experts during the procurement process on specific technical questions and subject to certain additional parameters, as follows: Subject Matter Experts Subject matter experts are authorized to support the TRC on specific technical questions that the TRC members may have throughout the procurement process. Subject matter experts may respond to questions on any aspect of the procurement or proposal, but may not be asked to, nor will they support, the evaluation of proposals, which is the responsibility of each TRC member. A subject matter expert can discuss the specific elements of the ITN and a vendor’s proposal with a TRC member, but they cannot meet with more than one TRC member at a time, unless in a public meeting – subject to the Procurement Rules of Conduct stated above. The subject matter experts are fact finders. A subject matter expert cannot disclose the specific questions asked by another TRC member. No evidence has been presented to establish that the Instructions to Technical Review Committee, as to the use of subject matter experts, violated Florida law or the terms of the ITN, or that any subject matter expert -- whether affiliated with HNTB or not -- failed to perform within the parameters set forth in the Instructions.7/ Both Petitioners devoted significant hearing time to the FTE consultancy work of John McCarey, McCarey Consultants, LLC, and John Henneman, an employee of Atkins Engineering, Inc., and sub-consultant to HNTB. There has been no showing by Petitioners that either Mr. McCarey or Mr. Henneman served as a subject matter expert to any member of the TRT or Selection Committee or that either had improper contacts in regards to the evaluation or ranking of the vendors. The undisputed evidence is that Mr. McCarey did not serve as a subject matter expert for any of the evaluators. As for Mr. Henneman, although one TRT member testified in deposition that he “believe[d]” Mr. Henneman was a technical expert or considered one of the subject matter experts, there is no evidence that Mr. Henneman served as a subject matter expert for any of the evaluators -- TRT or Selection Committee. In sum, there is simply no evidence that any of the subject matter experts had any improper influence on the TRT or Selection Committee members.8/ No Improper Contacts, Attempts to Influence, or Bias Cubic alleges that there was improper contact between the Department and Xerox during this protest that violates the statutorily imposed “cone of silence” for procurements. Cubic also asserts that there were attempts by Xerox to influence the evaluations or rankings based on the Department’s, or the other agencies’, past or existing relationships with Xerox or Xerox’s acquired entities. There simply is no record support for the assertions that there was any improper contact or any attempt by any person to influence the Department’s evaluations or rankings based on past or existing relationships between the Department and Xerox or Xerox’s acquired entities. Xerox’s counsel did not have any contact with the TRT or the Selection Committee prior to the filing of the protests and the attendant “stop” of the procurement process pursuant to section 120.57(3)(c), Florida Statutes. The only contact Xerox’s counsel had with TRT or Selection Committee members was as a participant with the Department’s counsel in pre-deposition meetings with some witnesses designated by Petitioners -- all in the context of ongoing litigation following the filing of Accenture’s and Cubic’s protest petitions. This contact is essentially no different than Petitioners’ contact with Department personnel in depositions and the trial, as well as during the section 120.57(3)(d)1., Florida Statutes, settlement conference with the Department. Furthermore, all such contact was after both the TRT’s and the Selection Committee’s work under the ITN was completed and the said contact was of no import to the procurement process. In short, there is no evidence of attempts by Xerox to influence the process, improper contact between Xerox and the Department, or Department bias in favor of Xerox. Responsiveness of Xerox’s Proposal The evidence, at best, is that the Department has yet to fully vet the representations made in the proposals by the respective Proposers, including Xerox. Protesters suggest that such a full vetting is a condition precedent to negotiations. Such an argument, however, ignores ITN section 2.12, which has to be reconciled with ITN section 2.9.1 b). ITN section 2.9.1 b) provides in part that “[t]he Proposer shall have Key Team members with the following experience at the time of Proposal submission.” The section then goes on to list several positions that fall within the “Key Team Personnel” category. Petitioners contend that the Contract Project Manager, Quality Assurance Manager, and Human Resources Manager proposed by Xerox fail to meet the “Qualifications of Key Team Personnel” set forth in ITN section 2.9.1 b), thus rendering the Xerox proposal nonresponsive. ITN section 2.12 provides in part that “[a]fter the Proposal due date and prior to Contract execution, the Department reserves the right to perform . . . [a] review of the Proposer’s . . . qualifications [and that] [t]his review will serve to verify data and representations submitted by the Proposer and may be used to determine whether the Proposer has an adequate, qualified, and experienced staff.” Xerox’s omission, at this point in the process, amounts to a non-material deviation from the ITN specifications given that ITN section 2.12 reserves in the Department the right to review key personnel representations made by Xerox, and any other short-listed Proposer, at any time “prior to Contract execution.” Cubic also contends that Xerox and Accenture submitted conditional Price Proposals rendering their proposals non- responsive under ITN section 2.16. The analysis turns on the provisions of Technical Proposal Section 9: Exceptions and Assumptions, which provides a detailed description of how exceptions and assumptions are to be provided by vendors, and explains that “[e]xceptions may be considered during the Proposal evaluation process at the sole discretion of the Department.” As provided by the ITN, all vendors included a detailed listing of exceptions and assumptions in their Technical Proposal. Consistent with the discretion afforded to the Department under ITN Technical Proposal Section 9 to consider listed exceptions during the Proposal evaluation process, the Department then made the following inquiry of each of the Proposers: Please identify whether your price proposal is based on the Department’s acceptance of the Exceptions in Section 9 of your technical proposal? Please identify whether your price proposal is based on the Department’s acceptance of the Assumptions in Section 9 of your technical proposal? Xerox responded to both inquiries as follows: “The Xerox price proposal is based on the assumptions and general risk profile created by the inclusion of Section 9. We assume the parties will reach mutual agreement on the issues raised in Section 9 without a material deviation in the price proposal.” In addition to providing written answers to the questions, the vendors also addressed these issues in the Proposal Oral Presentations in response to questions by the Department. By the end of the Proposal Oral Presentations, all three vendors had made clear to the Department that resolution of exceptions and assumptions would not affect the proposed price. For example, Xerox’s senior executive in charge of the procurement, Richard Bastan, represented that there is no financial implication to any of the exceptions and that Xerox would honor the terms and conditions and the scope of services in the ITN for the price set forth in the Price Proposal. Accordingly, none of the proposals were improperly conditioned, and Xerox, Accenture, and Cubic were treated equally. Cubic also contends that Xerox’s proposal was nonresponsive as Xerox allegedly failed to meet the stated experience minimums for transactions processed and accounts maintained. There is, however, no credible evidence to support this contention. Indeed, the evidence is that the Department, through its consultant HNTB, verified these requirements by calling the referenced projects. Moreover, Xerox met or exceeded the stated minimums with its New York project reference. The Department’s decision that Xerox was responsive on this issue is logical, reasonable, and supported by the evidence. Price Proposals ITN section 2.5.2 lists “price” as a factor to consider in determining “Best Value.” The vendors’ price proposals were presented to the TRT members for purposes of conducting their evaluations. Price was also an appropriate factor for consideration by the Selection Committee. Accenture argues that “[t]he ITN does not indicate how pricing will be considered by FDOT during the selection process.” Accenture’s contention that the ITN failed to disclose the relative importance of price is a challenge to the terms, conditions, and specifications of the ITN and should have been filed within 72 hours after the posting of the solicitation, as required by section 120.57(3)(b). Accenture has waived its right of protest with respect to this issue. Conflict of Interest Accenture complains that “[n]either Mr. Henneman nor Mr. McCarey submitted conflict of interest forms as required under the Department’s Procurement Manual . . . [because both] were present during the oral presentations made by the vendors in connection with this procurement.” Accenture also complains that Wendy Viellenave never disclosed that her husband works for TransCore, a company that is a subcontractor for Xerox. Ms. Viellenave’s husband currently works for TransCore as a maintenance and installation manager in California and has not worked in Florida in nearly twenty years. There is no credible evidence that Ms. Viellenave, through the relationship with her husband, has any “significant” direct or indirect -- financial or otherwise -- interest in TransCore that would interfere with her allegiance to the Department. The fact that Ms. Viellenave is married to an individual that works for a Xerox subcontractor is insufficient, in itself, to establish a real or potential conflict of interest. Jack Henneman currently runs the back office operation for FTE at its Boca Raton facility. His future role for the CCSS is as project manager for the implementation of the CCSS. Mr. Henneman became aware of the CCSS procurement through his work on a Florida Transportation Commission Report that culminated in 2012. This report documented the cost efficiencies for all of the tolling authorities in Florida. Mr. Henneman attended some of the Pre-Qualification Demonstrations as his schedule would permit because he is the “go-forward” project manager for the CCSS implementation. Mr. Henneman formerly worked for ACS from 2002 – 2009, and met Ms. Gutierrez-Scaccetti during his employment with the company. Mr. Henneman was the transition manager for the transfer of the back office operation of the New Jersey Turnpike from WorldCom to ACS. Mr. Henneman did not have any contact with Ms. Gutierrez-Scaccetti from approximately 2009 to 2012. In his capacity as the “go-forward” project manager, Mr. Henneman reviewed the technical proposals submitted by the vendors in the instant proceeding but he did not have any discussions with the TRT members or the Selection Committee members about the proposals. He reviewed the technical proposals for the purpose of educating himself so that he would be better prepared to carry out his functions as the “go-forward” project manager. John McCarey is a sub-consultant to FTE general engineering contractor, Atkins. Mr. McCarey has a future role as being a part of the negotiations group for the CCSS. Mr. McCarey formerly worked for Lockheed for approximately 25 years and then spent 5 years working for ACS. Mr. McCarey was the chief financial officer for ACS’s State and Local Solutions Group at one time. Mr. McCarey left the employment of ACS in 2006. Mr. McCarey currently assists with various functions, including work on issues with the consolidation of the back office systems of OOCEA and FTE. For approximately 10 years before becoming a sub-consultant, Mr. McCarey had not had any contact with Ms. Gutierrez-Scaccetti. As it relates to the CCSS project, there is no persuasive evidence that Mr. McCarey provided recommendations to the TRT or the Selection Committee.
Recommendation Based on the Findings of Fact and Conclusions of Law, it is recommended that Petitioners’ protests be dismissed. DONE AND ENTERED this 4th day of September, 2014, in Tallahassee, Leon County, Florida. S LINZIE F. BOGAN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 4th day of September, 2014.
The Issue As stated by the Administrative Law Judge in his Recommended Order, the issue presented is: "whether the Petitioner waived its right to a hearing by failing to request a hearing within the period of time described in the Notice to Show Cause."
Findings Of Fact After review of the record in its entirety, it is determined that the Administrative Law Judge's Findings of Fact found in paragraphs 1 through 9 of the Recommended Order are supported by the record and are accepted and incorporated as if fully set forth herein.
Conclusions This proceeding was initiated by a request for a formal administrative hearing filed by Petitioner, SHELL OIL COMPANY (hereinafter SHELL), challenging the Violation and Notice to Show Cause issued by the Respondent, DEPARTMENT OF TRANSPORTATION (hereinafter DEPARTMENT), regarding SHELL'S driveway connection to State Road 7 in Dade County, Florida. This matter was referred to the Division of Administrative Hearings (DOAH) for a formal hearing on October 21, 1997. On October 27, 1997, DOAH issued its Initial Order assigning the case to Michael M. Parrish, a duly appointed Administrative Law Judge, and setting forth the responsibilities of the parties. The hearing was scheduled for January 29, 1998, in Miami, Florida. An Order Granting a Motion for Continuance was issued on December 19, 1997, rescheduling the hearing for March 19, 1998. On March 5, 1998, the hearing was again continued. The hearing was held on May 14, 1998, by telephone. Appearances on behalf of the parties were as follows: For Petitioner: John Lukacs, Esquire Lukacs & Lukacs, P.A. 1825 Coral Way, Suite 102 Miami, Florida 33145 For Respondent: Paul Sexton, Esquire Chief Administrative Law Counsel Brian F. McGrail, Esquire Assistant General Counsel Department of Transportation 605 Suwannee Street, Mail Station 58 Tallahassee, Florida 32399-0458 Stipulated Facts were filed prior to hearing with three exhibits attached. The deposition of Ingrid Birenbaum, the DEPARTMENT'S District Six Permits Engineer at the time the Notice to Show Cause was issued, was filed with DOAH together with exhibits introduced at the deposition. A transcript was prepared and filed subsequent to the hearing. By agreement of the parties, no witnesses were presented and the Stipulated Facts with the three exhibits attached and the deposition of Ingrid Birenbaum constituted the record in this case for the purpose of disposing of the limited issue of timeliness. On June 22, 1998, the DEPARTMENT filed its Proposed Recommended Order and SHELL filed its Findings of Fact, Conclusions of Law and Recommended Order. On July 21, 1998, the Administrative Law Judge issued his Recommended Order. Exceptions to the Recommended Order were filed by SHELL on August 5, 1998, and the DEPARTMENT filed its response to the exceptions on August 17, 1998. Thereafter, SHELL filed a reply to the DEPARTMENT'S response to the exceptions, the DEPARTMENT filed a motion to strike the reply as unauthorized, and SHELL filed a response to the motion to strike.
Appeal For This Case THIS ORDER CONSTITUTES FINAL AGENCY ACTION AND MAY BE APPEALED BY ANY PARTY PURSUANT TO SECTION 120.68, FLORIDA STATUTES, AND RULES 9.110 AND 9.190, FLORIDA RULES OF APPELLATE PROCEDURE, BY FILING A NOTICE OF APPEAL CONFORMING TO THE REQUIREMENTS OF RULE 9.110(d), FLORIDA RULED OF APPELLATE PROCEDURE, BOTH WITH THE APPROPRIATE DISTRICT COURT OF APPEAL, ACCOMPANIED BY THE APPROPRIATE FILING FEE, AND WITH THE DEPARTMENT'S CLERK OF AGENCY PROCEEDINGS, HAYDON BURNS BUILDING, 605 SUWANNEE STREET, M.S. 58, TALLAHASSEE, FLORIDA 32399- 0458, WITHIN THIRTY (30) DAYS OF RENDITION OF THIS ORDER.
The Issue Was the Department of Education's (Department) refusal to review and evaluate Nationwide Credit, Inc.'s (Nationwide) response to the Department's Request for Proposal, Collection Services for Defaulted Florida Guaranteed Student Loans and Delinquent Florida Teacher Scholarships Loans, No. 99-06 (RFP) contrary to governing statutes and rules, clearly erroneous, contrary to competition, arbitrary, or capricious? Was the Department's failure to consider the reason for Nationwide's untimely delivery of its response to the RFP contrary to governing statutes and rules?
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: Nationwide is a foreign corporation authorized to do business in the State of Florida. Nationwide is in the business of collecting defaulted student loans and has worked with the State of Florida, and specifically the Department, for approximately nine years. On October 9, 1998, the Department issued RFP No.99-06, which solicited proposals for the provision of collection services for defaulted student loans. The technical requirements and requests found in the RFP were prepared by the Office of Student Financial Affairs (OSFA) which was the section within the Department requesting the services and the section which ultimately performed the review and evaluation of the responses to the RFP. The initial deadline for receipt of responses to the RFP was 3:00 p.m. Eastern Standard Time (EST) on December 3, 1998. The responses were to be delivered to the Department's Office of Purchasing for initial inspection and distribution to OSFA. The Department, through four separate RFP addenda, received and accepted by Nationwide, revised and postponed the response deadline until January 20, 1999, at 3:00 p.m. EST. The postponement was caused by the delay of the Department responding to questions posed by prospective vendors during the question and answer portion of the RFP procurement process. Nationwide had been prepared to submit it proposal to the Department on the date of the previous deadlines. The Department scheduled the deadline for receipt of proposals at 3:00 p.m. to accommodate those prospective vendors who used third-party delivery services. The response review process as established by the RFP consisted of the following: (a) a review of the technical components to be completed by February 3, 1999; (b) a cost proposal evaluation to be completed by February 9, 1999; and (c) a posting of intended award by February 16, 1999. In accordance with the RFP, multiple contracts were to be entered into based on the highest ranked responses. The actual signing of these contracts was not to occur until March 1999, after approval of the awards by the State Board of Education. Nationwide has previously provided the Department with the same services called for by the RFP. It was Nationwide's wish that it continue to provide those services and accordingly, its employees expended between 50 and 70 hours preparing Nationwide's response. On January 19, 1999, Nationwide, from its office in Marietta, Georgia, utilized a third party, Federal Express, to deliver Nationwide's response to the Department's RFP. Nationwide's general business practice is to use Federal Express and there has never been a problem with late delivery. Nationwide does not have an office in Tallahassee, Florida. Nationwide's only Florida office is in south Florida. Nationwide directed Federal Express to ship its response to the RFP by Priority Overnight Service and further directed Federal Express to deliver Nationwide's response to the RFP to the Department by 10:00 a.m. EST on January 20, 1999. These instructions to Federal Express were clearly reflected on the Airbill. Federal Express picked up Nationwide's proposal at 1:20 p.m. EST on January 19, 1999. Due to an error in the Federal Express distribution process, Nationwide's response to the RFP was not delivered to the Department until January 21, 1999, at 10:41 a.m. EST. Nationwide did not contact the Department on January 20, 1999, after 10:00 a.m. EST (the time Federal Express was to deliver Nationwide's proposal) to determine if its proposal had been delivered timely by Federal Express. There was sufficient time between 10:00 a.m. and 3:00 p.m. on January 20, 1999, for Nationwide to hand deliver its proposal to the Department had Nationwide been aware that its proposal had not been delivered by Federal Express as requested by Nationwide. Eighteen responses were submitted to the Department's Office of Purchasing prior to 3:00 p.m. EST on January 20, 1999. In order to ensure that no vendor had access to another vendor's proposal, the proposals were locked in a secured room. At 3:01 p.m. EST on January 20, 1999, the Office of Purchasing physically opened the 18 responses that were timely submitted and in its possession. The Office of Purchasing then conducted an initial review which included a tabulation of the responses to ensure that all responses satisfied procedural requirements. The timely proposals were also inspected to ensure that the appropriate transmittal letter was enclosed. The Office of Purchasing did not open the technical or price components of the responses. Once the initial review was completed by the Office of Purchasing, the proposals were sent to OSFA for purposes of conducting the detailed technical review contemplated by the RFP. The initial review by the Office of Purchasing took two days, and the proposals were not forwarded to OSFA until around January 25, 1999. At the time Nationwide's proposal was received by the Department, the Office of Purchasing was still in the process of completing its initial review. None of the timely proposals had been forwarded to OSFA for detailed review at this time. By letter dated January 27, 1999, the Department advised Nationwide that its proposal had been received after the deadline and that its proposal must be "retrieved no later than February 15, 1999." At this time, the evaluation of the technical and costs proposals by OSFA had not been completed. The Department similarly advised another vendor whose proposal had been received 30 minutes after the deadline. Nationwide did not retrieve its proposal, and it still remains in an unopened state with the Department. The Department rejected Nationwide's proposal without any consideration being given to the circumstances surrounding the untimeliness of Nationwide's proposal. At the time Nationwide's proposal was rejected, the Office of Purchasing had knowledge of the fact that Nationwide had submitted its proposal to Federal Express in advance of the due date and in sufficient time to be delivered timely to the Department. On February 8, 1999, after contacting the Office of Purchasing to determine the reasons for the rejection of its proposal, Nationwide provided the Department with a written explanation from Federal Express explaining why Nationwide's proposal was untimely. Nationwide then requested the Department to consider the circumstances and use its discretion to waive the late filing and review the proposal. By letter dated February 12, 1999, the Department advised Nationwide that it was unable to consider Nationwide's untimely proposal. It is the Department's policy that, under the purchasing rules of the State of Florida, it should never consider or review a proposal received from a vendor after the date and time specified in the RFP regardless of the reason for the untimeliness. However, the Department did indicate that it may waive that policy where the untimeliness is due to an "act of God," such as a tornado or hurricane, which prevented timely delivery or resulted in the Department's office being unable to accept delivery in a timely fashion. General Conditions, Paragraph 3, of Form PUR-7033, revised 6/1/98, provides in relevant part as follows: PROPOSAL OPENING: Shall be public, on the date, location, and the time specified on the acknowledgement form. It is the proposer's responsibility to assure that this proposal is delivered at the proper time and place of the proposal opening. Proposals which for any reason are not so delivered, will not be considered. (Emphasis furnished.) Section 40.16 of the RFP provides as follows: PUBLIC OPENING OF PROPOSALS Each proposal will be dated, time-marked, and logged by the department as received. Each will also be examined to verify that it is properly addressed and sealed. Any proposal received after the specified date and time for receipt of proposals will be rejected and returned unopened to the contractor. (Emphasis furnished.) Section 40.17 of the RFP provides as follows: REJECTION OF PROPOSALS Proposals which do not conform to the requirements of this Request for Proposal may be rejected by the department. Proposals may be rejected for reasons which include, but are not limited to, the following: * * * The proposal is received late. (Emphasis furnished.) Section 40.15 of the RFP provides as follows: 40.15 ACCEPTANCE OF PROPOSALS * * * The department also reserves the right, in its sole discretion, to waive minor irregularities in proposals. A minor irregularity is a variation from the Request for Proposal which does not affect the price of the proposal, or give the contractor an advantage or benefit not enjoyed by other contractors, or adversely impact the interest of the department. (Emphasis furnished.)
The Issue The issue in this bid protest is whether Respondent acted arbitrarily when it decided to reject all of the bids it had received in response to a solicitation seeking bids on a contract for roof repairs.
Findings Of Fact On January 10, 2008, the Florida Department of Environmental Protection (the "Department" or "DEP") issued an Invitation to Bid (the "ITB"), the purpose of which was to solicit competitive bids from qualified contractors on a project whose scope of work envisioned repairs to the wind-damaged roofs of several buildings located on the grounds of the Hugh Taylor Birch State Park in Fort Lauderdale, Florida. Some of the buildings to be repaired were single-family residences. Work on these structures accordingly needed to conform to the requirements prescribed in the 2007 Manual of Hurricane Mitigation Retrofits for Existing Site-Built Single Family Residential Structures (the "Manual"), which the Florida Building Commission (the "Commission"), following an explicit legislative directive, see Section 553.844(3), Florida Statutes,1 recently had adopted, by incorporative reference, as a rule. See Fla. Admin. Code R. 9B-3.0475 (2007).2 The Rule had taken effect on November 14, 2007, giving the Manual's contents the same status and force as the Florida Building Code. Id. Just before the Department issued the ITB, the Commission had approved, at a meeting on January 8, 2008, a modified version of the Manual, which it called the 2007 Manual of Hurricane Mitigation Retrofits for Existing Site-Built Single Family Residential Structures, Version 2 (the "Revised Manual"). In consequence of the Commission's approval of the Revised Manual, the Florida Department of Community Affairs ("DCA") caused a Notice of Proposed Rule Development to be published on January 25, 2008, in the Florida Administrative Weekly. This official advertisement announced that the Commission intended to amend Rule 9B-3.0475, so that its incorporative reference would mention the Revision Manual instead of the Manual. See 34 Fla. Admin. W. 461-62 (Jan. 25, 2008).3 DCA caused a Notice of Proposed Rule respecting the intended revision of Rule 9B-3.0475 to be published on February 1, 2008, in the Florida Administrative Weekly. See 34 Fla. Admin. W. 605 (Feb. 1, 2008).4 On February 5, 2008, the Department issued Addendum No. 4 to the ITB (the "Addendum"). The Addendum provided in pertinent part as follows: Bidders shall bid the project as specified despite the recent change in Rule 9B-3.0475 relating to hurricane mitigation retrofits. Any additional water barrier will be accomplished by Change Order after award of the contract. (The foregoing provisions of the Addendum will be referred to hereinafter as the "Directive"). On February 12, 2008, the Department opened the bids it had received in response to the ITB. Ten (out of 12) of the bids submitted were deemed responsive. The bid of Petitioner Spinella Enterprises, Inc. ("Spinella") was one of the acceptable bids. On February 19, 2008, DEP posted notice of its intent to award a contract to the lowest bidder, namely Spinella, which had offered to perform the work for $94,150. The second lowest bidder was The Bookhardt Group ("Bookhardt"). Bookhardt timely protested the intended award, raising several objections, only one of which is relevant here. In its formal written protest, dated March 3, 2008, Bookhardt alleged that "[t]he new State of Florida law F.S. 553.844 was not part of the solicitation." On April 4, 2008, Rule 9B-3.0475, as amended to incorporate by reference the Revised Manual, took effect. See Fla. Admin. Code R. 9B-3.0475 (2008). On May 16, 2008, DEP posted notice of its intent to reject all bids received in response to the ITB. (Bookhardt's protest, which remained pending, had never been referred to DOAH for a formal hearing.) Spinella timely protested the Department's decision to reject all bids. In an email sent to Spinella on July 22, 2008, DEP's counsel explained the rationale behind the decision: The reason the Department rejected all bids follows. When the Department posted the notice of intent to award the contract to Spinella Enterprises, Inc., the second low bidder (Bookhardt Roofing) protested the intent to award. The second low bidder's basis for protesting the intended award was that Addendum 4 directed bidders to ignore certain rules of the Construction Industry Licensing Board [sic], which had become effective after the bid opening, which was not in accordance with the law. As a result, this may have caused confusion and the Department had no assurance that bidders were bidding the project correctly. In addition, the statement in Addendum 4 that the Department would add the required moisture barrier afterward by change order set up a situation where bidders had no idea how much the Department would be willing to pay for the change order. Further, the moisture barrier was not the only thing required by the new rules. Potential bidders may not have bid due to these uncertainties. The Department agreed with Bookhardt's assertions and rejected all bids . . . . Notwithstanding Spinella's protest, the Department issued a second invitation to bid on the project in question. As of the final hearing, the bids received in response to this second solicitation were scheduled to be opened on August 12, 2008. Ultimate Factual Determinations The Department's decision to reject all bids is premised, ultimately, on the notion that the Directive told prospective bidders to ignore an applicable rule in preparing their respective bids.5 If this were true, then the Directive could have been a source of potential confusion, as the Department argues, because a prudent bidder might reasonably hesitate to quote a price based on (possibly) legally deficient specifications. The Directive, however, did not instruct bidders to ignore an applicable, existing rule. Rather, under any reasonable interpretation, it instructed bidders to ignore a proposed rule and follow existing law. Such an instruction was neither confusing nor inappropriate. To be sure, the first sentence of the Directive——at least when read literally——misstated a fact. It did so by expressing an underlying assumption, i.e. that Rule 9B-3.0475 recently had been changed, which was incorrect. In fact, as of February 5, 2008, the Rule was exactly the same as it had always been. (It would remain that way for the next two months, until April 6, 2008).6 DEP's misstatement about the Rule might, conceivably, have confused a potential bidder, at least momentarily. But DEP did not factor the potential for such confusion into its decision to reject all bids, and no evidence of any confusion in this regard was offered at hearing.7 More important is that the unambiguous thrust of the Directive was to tell bidders to rely upon the "not recently changed" Rule 9B-3.0475, which could only have meant Florida Administrative Code Rule 9B-3.0475 (2007) as originally adopted, because that was the one and only version of the Rule which, to that point, had ever existed. Thus, even if the Department were operating under the mistaken belief, when it issued the Addendum, that Rule 9B-3.0475 recently had been amended; and even if, as a result, DEP thought it was telling prospective bidders to ignore an applicable, existing rule, DEP nevertheless made clear its intention that prospective bidders follow the original Rule 9B- 3.0475, which was in fact the operative Rule at the time, whether or not DEP knew it. Indeed, as any reasonable potential bidder knew or should have known at the time of the Addendum, (a) the Commission recently had approved the Revised Manual, but the contents thereof would not have the force and effect of law unless and until the Revised Manual were adopted as a rule, which had not yet happened; (b) the Commission had initiated rulemaking to amend Rule 9B-3.0475 so as to adopt the Revised Manual as a rule, but the process was pending, not complete; (c) Rule 9B-3.0475 had not been amended, ever; and, therefore, (d) the Manual still had the force and effect of law. See endnote 6. The Directive obviously could not alter or affect these objective facts. At bottom, then, a reasonable bidder, reviewing the Directive, would (or should) have concluded either (a) that the "recent change" which DEP had in mind was the Commission's approval of the Revised Manual (or the subsequent announcement of the proposed amendment to Rule 9B-3.0475) or (b) that DEP mistakenly believed the Rule had been changed, even though it had not been. Either way, a reasonable bidder would (or should) have known that the Department wanted bidders to prepare their respective bids based not on the Revised Manual, but the Manual. In other words, regardless of what DEP subjectively thought was the existing law, DEP clearly intended (and unambiguously expressed its intent) that bidders follow what was, in fact, existing law. This could not have confused a reasonable bidder because, absent an instruction to exceed the minimum required legal standards (which the Directive was not), a reasonable bidder would have followed existing law in preparing its bid, just as the Directive required. Once it is determined that the Directive did not, in fact, instruct bidders to ignore an applicable, existing law, but rather told them to rely upon the applicable, existing law (notwithstanding that such law might change in the foreseeable future), the logic underlying the Department's decision to reject all bids unravels. Simply put, there is no genuine basis in logic or fact for concluding that the Addendum caused confusion. The other grounds that DEP has put forward do not hold water either. Contrary to the Department's contention, the possibility that a Change Order would be necessary if an "additional water barrier" were required could not possibly have confused potential bidders or caused them to be uncertain about how much money the Department would be willing to pay for such extra work. This is because Article 27 of the Construction Contract prescribes the procedure for entering into a Change Order, and it specifies the method for determining the price of any extra work. See ITB at 102-05. The fact that the proposed amendment to Rule 9B-3.0475, if it were to be adopted and become applicable to the instant project, might require other additional work, besides a water barrier, likewise could not reasonably have caused potential bidders to refrain from bidding, for the same reason: The Construction Contract contains explicit provisions which deal with the contingency of extra work or changes in the work. Id. In sum, DEP's intended decision to reject all bids cannot be justified by any analysis that a reasonable person would use to reach a decision of similar importance. It is, therefore, arbitrary.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department enter a final order finding that its decision to reject all bids was arbitrary. Because the Department elected not to comply with the statutory directive to abate this procurement pending the outcome of Spinella's protest, with the result that the contract at issue possibly has been awarded already to another bidder; and because the choice of remedies for invalid procurement actions is ultimately within the agency's discretion, the undersigned declines to make a recommendation regarding the means by which DEP should rectify the harm to Spinella, but he urges that other appropriate relief be granted if Spinella cannot be awarded the contact. DONE AND ENTERED this 2nd day of October, 2008, in Tallahassee, Leon County, Florida. JOHN G. VAN LANINGHAM 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 2nd day of October, 2008.
The Issue The issue for consideration in this hearing is whether the Department's proposed awarded in Request for Proposal RFP-DOT-95/96-7003-RA, for district- wide asbestos consulting services to Occupational Health Conservation was proper.
Findings Of Fact On or about January 12, 1996, the Department's District 7 properly solicited proposals for a contract to perform district-wide asbestos consulting services for the agency. The request for proposals, RFP-DOT-95/96-7003-RA, consisted of the request accompanied by Exhibits A through D and Forms A though F, with appendices. Because the buildings upon which the work was to be done were not yet acquired, the contract in issue was to be an "indefinite quantity contract" for which the Department had budgeted $200,000 per year for up to five years. As a part of the proposal, the firms were to submit a technical proposal, a statement of Disadvantaged Business Enterprise (DBE) participation, and a price proposal. The Department would then evaluate each proposal and assign a score to each of the three sections. The proposal with the highest score out of a possible 100 points, would be the intended award recipient. The technical proposal portion of the submittal was worth a maximum of sixty-five points. It was subdivided into two main parts, the management plan, worth thirty-five points, and the technical plan worth 30 points. Each of those two areas had sub-parts with maximum scores, and the three members of the District's Technical Review Committee were to evaluate each proposal submitted, compare it against the instructions contained in the RFP and the Scope of Services Exhibit attached thereto, (Exhibit A), and assign a numerical score to it. The three members of the Technical Review Committee were all employees of the Department's District VII Right-of-way office. They were William Scott, project manager and the District's Right-of-way administrator for certification and compliance; Carol Kingston, a senior agent in the District's Right-of-way certification and compliance section; and Lisa Murrin, an employee in the hazardous materials section of the District's project development and environmental office. These three members were prohibited from discussing with each other any of the proposals submitted and were forbidden to compare one proposal with another. In response to the advertised solicitation, the Department received proposals from sixteen firms. Each proposer was to complete a form to demonstrate Departmentally certified DBE participation. If a proposer indicated it would utilize DBEs for more than ten percent of the work, it was to receive the maximum for that element, five points. If the proposer indicated it would use DBEs for more than five but less than ten percent of the work, it would received two points for that element. Any proposer which indicated a proposed use of less than five percent DBEs would not receive any points for that element. The District's Professional Services Unit examined the submittals and assigned points consistent with those criteria. The RFP called for proposers to state prices for a hypothetical project which was broken down into twelve items, for each of which prices were to be indicated. Some of these items called for a lump sum quote while others called for a price per square foot, per man hour or per crew day. Department personnel then transferred these numbers submitted by the proposer to a form similar to that on which the prices were submitted by the proposing firm but which also included a multiplier indicating the specific square feet, man hours or crew days. Thereafter, the Department staff computed the price for each individual item and added the figures arrived at for a total price. In this procurement the price element was worth a maximum of twenty points. Consistent with the rating system used here, the lowest price submitted was to receive an award of the full twenty points. As called for in the provisions of Section 1.17.6.2 of the RFP, the other proposers would be assigned points based upon "the percent of deviation from the low price total" with the highest price proposal to receive no points. In addition to the Technical Review Committee, the Department also appointed a Selection Committee of three members including Mr. Scott, the project manager, who was also a member of the Technical Review Committee; Mr. Amos, the deputy right of way manager for Land Acquisition; and Mr. Thompson, the District right of way manager. These committee members were to evaluate the proposals and assign from ten to zero points for executive judgement based on the criteria outlined in Section 1.17.7 of the RFP which included: the consistency of price with the technical aspects of the proposal; the degree of expectation of accomp- lishing program objectives, considering technical aspects proposed, Proposer's past experience, and performance; and the extent of DBE participation. Sixteen proposals were received, all of which were determined to be responsive. Of the sixteen proposals received, it was obvious that the proposals of Atlanta Testing & Engineering, Inc., (Atlanta), and Envirow Science Technologies, Inc., (EST), were calculated in error since each had prices in the hundreds or thousands of dollars for items which were to be priced per square foot. As a result, Atlanta's bid price was $47,244,975 and EST's was $14,353,302, where the remaining fourteen proposals ranged from $4,270 to $24,394. Intervenor, OHC, and Florida Groundwater Systems, Inc., (FGS), both bid $4,270. Based on what appeared to be obvious error in the proposals, the Department asked both Atlanta and EST to withdraw their submittals. Atlanta complied but EST refused, asking that the Department recalculate its proposal using new prices per square foot. The Department could not properly do this since it cannot accept changes in bids or proposals after opening. As a result, EST's proposal as submitted was used by the Department in its evaluation of the remaining submittals. When this was done, the two proposers who submitted the proposals at $4,270 each received 20 points and EST, with a proposal at $14,244,975 received no points. However, since the other proposals, even the one for $24,394, were so much closer to the low bids than to the remaining obviously high bid of in excess of $14 million, they received between 19.99 points and 19.97 points. GLE received a score of 19.98 points for price. This made a realistic appraisal of these remaining bidders almost impossible, so a decision was made to see what the point spread would be like if EST's high proposal had been withdrawn. When that was done, OHC and FGS still received twenty points for their low prices quotation, but GLE, which bid $14,609, received only 9.72 points. When the fifteen proposers remaining after Atlantic withdrew were analyzed by the Selection Committee it appeared that Intervenor, OHC, was awarded 56.34 points for its written technical proposal, 20 points for bidding the lowest price, and 2 points for having more than 5 but less than 10 percent DBE participation, for a Technical/Price/DBE (T/P/DBE) total of 78.34 points. When the 10 points for executive judgement was added, OHC had a point total of 88.34. Petitioner, GLE, was awarded 56 points for its written technical proposal, 19.98 points for its price submittal; 5 points for having more than 10 percent DBE participation for a T/P/DBE Total of 80.98 points. When 7 points was added for executive judgement, it had a point total of 87.98. Intervenor, FGS, the other low price bidder was awarded 49.33 points for its written technical proposal, 20 points for price, 5 points for having more than 10 percent DBE participation for a T/P/DBE Total of 74.33 points. When 9 points were added for executive judgement, it had a point total of 83.33. However, when the Selection Committee evaluated the fourteen proposals, also leaving out the high Atlantic proposal, OHC, one of the low bidders, still had a T/P/DBE total of 78.34 points. Petitioner, GLE, which had bid almost $10,000 more than OHC, then, because of the spread of the remaining bids, was awarded price points of 7.92 instead of 19.98, and ended up with a T/P/DBE Total of 70.72 instead of 80.98. FGS, also a low price bidder, got 20 points for price and had a T/P/DBE total of 74.33, the same as it had before. When the 10, 7 and 9 points for Executive Judgement were awarded, respectively, as before, OHC and FGS still had their previous standings, but GLE, whose points had been altered by the removal of Atlantic's bid and the resultant point spread, was in a worse position than it had been in previously . GLE's proposal indicated it would use EM Analytical, Inc., a DBE certified by the Department, for microscopy services that would constitute more than 10 percent of the work under the contract, and as a result, was awarded 5 points in the DBE category. OHC's proposal indicated it would use Award Engineering, Inc., a certified DBE, for asbestos surveys that would account for between 5 and 10 percent of the work. For this proposal, OHC received 2 points in the DBE category. However, Award Engineering, Inc. was not licensed as an asbestos consultant or an asbestos contractor pursuant to Chapter 469, Florida Statutes, at the time of the submittal. It had, however, informed the Department it could perform "asbestos abatement and surveys" when it applied for DBE status. Department policy provides that when an RFP makes DBE participation optional, any proposer who commits to using DBE sub-contractors will receive credit for that commitment whether or not the identified sub-contractor is certified or, in fact, even if no DBE is identified. This is because substitution of DBE sub-contractors after bid is generally allowed with Departmental approval, given in this case. Therefore, the fact that Award Engineering might not have been licensed at the time of submittal is not disqualifying in this case. The provisions of the RFP relating to licensing requirements of contractor and subcontractor personnel is off-set by the fact that DBE participation in this procurement was optional, and under these circumstances, it cannot reasonably be said that OHC's proposed use of an unlicensed sub-contractor gave it an unfair advantage over other bidders. As a result of the analysis of the submitted proposals by both its Technical Review Committee and its Selection Committee, on February 27, 1996, the Department posted notice of its intention to award the contract in issue to OHC.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Transportation enter a final order in this matter awarding the work for RFP-DOT-95/96-7003-RA to Occupational Health Conservation, Inc., and dismissing the protest and request for intervention in support of the protest by GLE Associates, Inc. and Florida Groundwater Systems, Inc., respectively. DONE and ENTERED this 29th day of May, 1996, in Tallahassee, Florida. ARNOLD H. POLLOCK, 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 29th day of May, 1996. APPENDIX TO RECOMMENDED ORDER, CASE NO. 96-1490-BID To comply with the requirements of Section 120.59(2), Florida Statutes (1993), the following rulings are made on the parties' proposed findings of fact: Petitioner's Proposed Findings of Fact. Accepted but distinguished. & 3. Accepted. 4. - 9. Accepted and incorporated herein. Accepted. - 13. Accepted and incorporated herein. 14. - 16. Accepted. Accepted and incorporated herein. Rejected. - 24. Accepted and incorporated herein, Respondent's Proposed Findings of Fact, (as joined in by Intervenor, OHC. 1. - 4. Accepted and incorporated herein. 5. & 6. Accepted and incorporated herein. 7. - 9. Accepted and incorporated herein. 10. - 15. Accepted and incorporated herein. 16. & 17. Accepted. Accepted and incorporated herein. Accepted. Accepted and incorporated herein. Accepted. - 27. Accepted and incorporated herein. Accepted. Accepted and incorporated herein. Accepted. - 35. Accepted and incorporated herein. COPIES FURNISHED: J. Riley Davis, Esquire Katz, Kutter, Haigler, Alderman, Marks, Bryant & Yon, P.A. Highpoint Center, Suite 1200 106 East College Avenue Tallahassee, Florida 32301 Thomas H. Duffy, Esquire Department of Transportation Haydon Burns Building, Room 562 605 Suwannee Street, M.S. 58 Tallahassee, Florida 32399-0458 Hala A. Sandridge, Esquire Fowler, White, Gillen, Boggs, Villareal & Banker, P.A., Post Office Box 1438 Tampa, Florida 33601 Rick D. Mahan Florida Groundwater Systems, Inc. 111 South Armenia Avenue Tampa, Florida 33609 Ben G. Watts Secretary Department of Transportation Haydon Burns Building ATTN: Diedre Grubbs 605 Suwannee Street, MS-58 Tallahassee, Florida 32399-0450 Thornton J. Williams General Counsel Department of Transportation 562 Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450
Findings Of Fact Background On February 23, 1988, Respondent, Department of General Services (Department), issued an invitation to bid (ITB) numbered 218-285-400-6, whereby it sought to establish a 24-month term contract for the purchase of large lamps, photo lamps, and studio, theatre, television, and video lamps by all State of Florida agencies. By April l, 1988, the bid opening date, four bids had been filed with the Department. On April 12, 1988, the bid results were posted by the Department. The bid results revealed that Petitioner, Mercedes Lighting and Electrical Supply, Inc. (Mercedes), was the lowest bidder and that Intervenor, Marpan Supply Company, Inc. (Marpan), was the second lowest bidder. The bid results further revealed that the bid of Mercedes had been rejected because it did not include a list of in-state service representative(s) as required by the ITB, and that the Department proposed to award the contract to Marpan. On April 12, 1988, Mercedes timely filed its notice of protest with the Department. Along with its notice of protest, Mercedes submitted a list of its in-state service representatives, and noted on its letter of transmittal that this list was "not included at time of bid." The bid documents Pertinent to this case, the ITB contained the following special condition: Service Availability of in-state representation to assist in proper application and to resolve technical problems is a requirement of this bid and the resulting contract. Bidders must, therefore, include as part of the bid a list of in-state service representative(s) who will be responsible for providing these services during the term of the proposed contract. Failure to comply with this requirement will result in disqualification of bid. . . . The coordination effort will be handled by the specific individual designated on the ordering instruction sheet. The ITB also contained the following general condition: 7. INTERPRETATIONS/DISPUTES: Any questions concerning conditions and specifications shall be directed in writing to this office for receipt no later than ten (10) days prior to the bid opening. No interpretation shall be considered binding unless provided in writing by the State of Florida in response to requests in full compliance with this provision. Any actual or prospective bidder who disputes the reasonableness, necessity or competitiveness of the terms and conditions of the Invitation to Bid, bid selection or contract award recommendation, shall file such protest in form of a petition in compliance with Rule 13A 1.006, Florida Administrative Code. Failure to file a protest within the time prescribed in Section 120.53(5), Florida Statutes, shall constitute a waiver of proceedings under Chapter 120 Florida Statutes. Mercedes did not protest the bid specifications or conditions within 72 hours after receipt of the ITB, nor did it seek any interpretation of the conditions specifications. Notably, the only protest filed by Mercedes was after the bid opening. The bid protest At hearing, Mercedes contended that its bid complied with the ITB because it included a list of Mercedes' in-state service representative(s) or, alternatively, that its failure to include a list of its in-state representative(s) was a minor irregularity that the Department should waive. 1/ Mercedes contends that its bid included a list of in-state service representatives, and therefore was responsive to the ITB, because of its response to page 11 of the bid package entitled "Ordering Instructions", and because there appeared on the back of the manufacturer's catalogs and price list, submitted with its bid, a Florida sales office for the manufacturer at which sales and technical information could be obtained. Mercedes' contention and the proof offered to support it are not credible. The form included at page 11 of the ITB provided, and was responded to by Mercedes, as follows: ORDERING INSTRUCTIONS NOTE: ALL ORDERS SHOULD BE DIRECTED TO: FEDERAL EMPLOYER IDENTIFICATION NUMBER (FEID) : 59-1891811 VENDOR: Mercedes Lighting and Electrical Supply, Inc. STREET ADDRESS OR P.O. BOX: 7354 SW 48th St. CITY, STATE, ZIP: Miami, Florida 33155 TELEPHONE: (305) 665-5550 TOLL FREE NO: DELIVERY: DELIVERY WILL BE MADE WITHIN SEE PAGE 4 DAYS AFTER RECEIPT OF PURCHASE ORDER. DELIVERIES IN EXCESS OF SEE PAGE 4 DAYS WILL NOT BE CONSIDERED. TEAMS FOR PROMPT PAYMENT; NET percent 30 DAYS PRODUCT INFORMATION; DIRECT INQUIRY TO: (NAME, ADDRESS, AND TELEPHONE NUMBER OR INDIVIDUAL IN YOUR ORGANIZATION WHO MAY BE CONTACTED REGARDING CONTRACT WHICH MAY RESULT FROM THIS BID.) NAME AND TITLE: Victor J. LaPorta, Vice President ADDRESS: 7354 SW 48th St. CITY, STATE, ZIP: Miami, FL. 33155 TELEPHONE: (305) 665-5550 TOLL FREE NO.: Mercedes did not indicate in its response to the "Ordering Instructions" form that Mr. LaPorta was its in-state service representative, and its response could not reasonably be so construed. The individual a bidder designated on this form was, pursuant to the special condition of the ITB regarding "Service", the coordinator between a purchaser and the in-state service representative. Mercedes' contention that its bid included a list of its in-state service representatives, because the manufacturer's technical catalogs and price list submitted with its bid contained the location and phone number of the manufacturer's sales office in Florida, in addition to 23 other states, is incredible. The manufacture's technical literature and price list was, pursuant to the special conditions of the ITB, a required part of the bid. While the manufacturer may have listed its sales offices on the back of its literature, there is nothing in Mercedes' bid that remotely suggests it intended that listing to be considered its list of in-state service representatives, nor could its response reasonably be so construed. In rejecting Mercedes' contention that its bid was responsive to the ITB, and rejecting its proof as inherently improbable and unworthy of belief, I note that the Department has issued similar ITB's for a number of years. But for the language in this ITB advising bidders that failure to include a list of in-state service representatives would result in disqualification of the bid, the service provision has remained essentially the same, as has the "Ordering Instructions" form and the requirement that the manufacturer's technical literature and price list be included in the bid. When this same contract was let two years ago, Mercedes was a bidder. Included within its response to that ITB was a list of its in-state service representatives. A minor irregularity? While Mercedes did not protest the terms and conditions of the bid within 72 hours of receipt of the ITB, it offered proof at hearing which tended to demonstrate that the demand for technical assistance under the state contract was not frequent. Based on this premise, Mercedes contended that its failure to include a list of in-state service representatives with its bid was a minor irregularity that should be waived by the Department. Again, Mercedes' contentions are not persuasive. Whether the demand for technical assistance is frequent or infrequent may be germane to a timely challenge to the propriety of the ITB requirement that a list of in-state service representative included in the bid. However, where, as here, the bidder did not protest such condition in a timely manner, it has waived its right to a Chapter 120 proceeding to contest its propriety. Under such circumstances, the protest is limited to whether the failure to include such a list was a minor irregularity, and the frequency of demand for technical assistance is not relevant. 2/ Minor irregularity is defined by Rule 13A-1.002(10), Florida Administrative Code, as: ...a variation from the invitation to bid... which does not affect the price of the bid..., or give the bidder... an advantage or benefit not enjoyed by other bidders..., or does not adversely impact the interests of the agency. Variations which are not minor can not be waived. The ITB mandated that failure to include a list of in-state service representatives with the bid would result in the bid's disqualification. Under such circumstances, Mercedes cannot be permitted to correct the deficiency after bid opening, and the deficiency cannot be deemed minor, because it would accord Mercedes an advantage not enjoyed by other bidders. Succinctly, Mercedes could revisit its bid on bid opening, refuse to supply the required list, and thereby effectively disqualify itself and withdraw its bid. The other bidders who timely submitted their lists would not have an opportunity to revisit their bids or withdraw their bids, but would be held to the provision of the ITB that prohibited such withdrawal for 90 days after bid opening. A frivolous protest Mercedes' protest was frivolous. It presented no justifiable question for resolution, and was without basis In fact or in law. Mercedes knew when it submitted its bid that a list of in-state service representatives was required. It simply forgot to include that list. When this oversight was disclosed at bid opening, it tried to supplement its bid. This effort, for the reasons set forth in the conclusions of law, was ineffective. Now, Mercedes would have the hearing officer believe that it intended its response to the "Ordering Instructions" form, as well as the manufacturer's technical literature and price list included in the bid, as its list of in-state service representatives. Such proof is not credible, such was not Mercedes' intent, and its response cannot reasonably be so construed. Mercedes' contention that its failure to include such list should be waived as a minor irregularity is likewise factually and legally without merit. See Saxon Business Products, Inc. v. Department of General Services, 4 FALR 1102-A (1982), wherein this issue was previously resolved adverse to the position advocated by Mercedes. The impact of the protest The current term contract for lamps expires June 9, 1988. Upon expiration of that contract, state agencies will not be accorded the savings generated by a term contract and will be required to competitively bid any lamp purchase over $3,000. Had Mercedes not protested the Marpan award, state agencies would have enjoyed continued savings under a term contract that would have provided them prices 50 percent lower than could be obtained through individual agency bids.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered dismissing the formal protest filed by Mercedes Lighting and Electrical Supply, Inc. DONE AND ENTERED In Tallahassee, Leon County, Florida, this 3rd day of June, 1988. WILLIAM J. KENDRICK Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1050 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of June, 1988.
The Issue Whether Sing Oil Company has demonstrated by a preponderance of evidence that development rights in certain real property it owns have vested against the provisions of the Tallahassee-Leon County 2010 Comprehensive Plan.
Findings Of Fact Procedure. On November 9, 1990, Sing Oil filed an Application for Vested Rights Determination with the TLCPD. The following information concerning the development of the property was contained on the Application. "Sing Oil Company" is listed as the "owner/agent." Question 3 lists the name of the project as "Sing Oil Company-Woodville." Leon County Environmental Management Permit, DER General Permit, DOT Drainage Connection Permit, DOT Connection Permit, Leon County Septic Tank Permit, and expired Leon County Building Permit are included in Sing Oil's Application as forms of government approvals and as the actions of government relied on by Sing Oil. On March 11, 1990, a hearing was held to consider the Application before the Staff Committee comprised of the County Attorney, the Director of Planning for the Tallahassee-Leon County Planning Department, and the Director of Growth Management for the County. By letter dated March 19, 1991, Mark Gumula, Director of Planning of the TLCPD, informed Sing Oil that the Application had been denied. By letter dated March 19, 1991, to Mr. Gumula, Sing Oil appealed the decision to deny the Application. On April 12, 1991, the Division of Administrative Hearings received the request for a hearing to review this matter. The Property. Sing Oil currently owns approximately 1.97 acres of property (the Property) located at the Northwest corner of Woodville Highway (SR 363) and Lawhon Road. At the time Petitioner purchased it, the Property was zoned to permit construction of a convenience store. Sing Oil contracted to purchase the property on August 24, 1988, and obtained title to the property by Warranty Deed executed December 22, 1988, recorded in O.R. Book 1354, Page 2081 of the Public Records of Leon County, Florida for the purchase price of $160,000. At the time Sing Oil purchased the Property, there was an occupied residence located on the Property. Development Activity. The project Sing Oil proposed to develop is a 3,250 square foot Sing convenience store, with 38 parking spaces, on a 48,000 square foot site, and with total impervious surface being 25,650 square feet. After acquisition of the site, Sing Oil had the residential structure removed in preparation for site improvements. Prior to acquisition of the Property, the Property was surveyed by Bobby A. Presnell & Associates, and Broward Davis & Associates had performed a substantial amount of on-site work to determine feasibility for development and absence of any environmental or other site problems which would impair development. The Property was purchased for the specific purpose of building a convenience store. Governmental Approvals. On December 23, 1988, one day after acquisition of the site, Sing Oil filed its Application for an Environmental Management Permit with Leon County, and obtained Permit #89-0076 on January 5, 1989. On February 7, 1989, Sing Oil obtained Florida Department of Environmental Regulation Permit #RC37-160284. On March 13, 1989, Sing Oil filed its application with the Florida Department of Transportation for a Drainage Connection Permit and Application #15880 was approved on March 15, 1989. On April 5, 1989, Florida Department of Transportation Connection Permit #55-898-19 was issued to Sing Oil. On May 8, 1989, Sing Oil applied for and obtained a State of Florida, Department of Health and Rehabilitative Services On Site Sewage Disposal System Permit. On June 22, 1989, Sing Oil was issued Leon County Building Permit #89- 01392. The Leon County Environmental Management Permit has as an attached exhibit the Sing Oil Company Site and Grading Plan prepared by Broward Davis & Associates, Inc. and approved by Leon County. Page 2 of the Site Plan which is an Exhibit to the Environmental Permit contains the following notes: Lot Area: 1.97 Ac. Site Area: 48,000 sq. feet Proposed Building Area: 3,250 sq. feet Proposed Use: Convenience Store Parking Reqd.: 17 spaces Parking Provided: 38 spaces Vehicle Use Area: 21,000 sq. feet Landscape Islands Reqd.: 4 Landscape Islands Provided: 4 Area of Walks & Dumpster Pad: 1,064 sq. feet Total Impervious Area: 25,650 sq. feet Total Green Area: 22,350 sq. feet (47%) Total Interior Green Area: 17,560 sq. feet (37%) Development Expenses. The cost of purchase of the Property was $160,000.00. At the time of purchase, a residential structure was located on the Property. The structure was removed from the Property and sold for $7,000.00. Therefore, the net cost to Sing Oil for the original purchase of the Property was $153,000.00. These costs were incurred by Petitioner in reliance on the zoning classification of the property at the time of purchase. Prior to closing on the Property, Petitioner expended approximately $1,000.00 on survey and preliminary engineering work. After closing, Sing Oil expended $1,568 in engineering fees in connection with the Application for the Environmental Management Permit, and an additional $1,140.00 for the permit. These costs were incurred by Petitioner in reliance on existing zoning and permissible uses at the time of purchase of the Property. Subsequent to the issuance of the Environmental Management Permit, Petitioner expended $143,179.39 in engineering work permit fees, application fees and impact fees. These costs were incurred by Petitioner in reliance on existing zoning and permissible uses, the Environmental Management Permit, approved exhibits to the permit and other permits and approvals obtained from State and local government. Current Status of the Development. The Property is a fairly level site, with no severe grading or environmentally sensitive features and is ready for construction. Other than the removal of an existing residential structure, no site development or vertical construction has occurred on the site. The Building Permit. On June 16, 1989, Petitioner made payment to Leon County for a county- wide impact fee and for a building permit. Leon County issued a building permit for the site on June 22, 1989. In July 1989, Petitioner and Amoco Oil Company executed a confidentiality agreement. In February 1990, Petitioner and Amoco executed a purchase agreement, and the merger of the Petitioner with Amoco was completed in October 1990. At the time of the execution of the confidentiality agreement leading to its merger with Amoco, Petitioner placed development activity on hold pending the merger. By the time the merger was accomplished in October 1990, Petitioner's building permit had expired and Leon County had adopted the 2010 Comprehensive Plan. At no time during the course of the merger nor at any time after the issuance of the building permit in June 1989, did the Petitioner request an extension of the building permit. Had a request for extension of the permit been received, the County would have routinely granted an extension for at least 90 days, with no limit on further extensions. Application of the 2010 Comprehensive Plan. At the time Petitioner purchased the Property, existing zoning would have permitted development of the Property for Petitioner's intended use, a convenience store and gasoline station. The current land use designation for the Property pursuant to the 2010 Comprehensive Plan prohibits development for retail commercial purposes. The Comprehensive Plan does permit multi-family residential and office uses of certain sizes on the Property. Petitioner has presented no evidence that application has been made to Leon County for any Comprehensive Plan concurrency or consistency determinations for any other proposed use for the site. Detrimental Reliance. Petitioner has established that it relied on existing zoning and permits that it obtained from State and local government in incurring costs associated with its intended development of the Property. The "detriment" Petitioner suffers as a result of such reliance is occasioned by Petitioner's admittedly inadvertent failure to extend or renew the previously issued building permit. Therefore, Petitioner's inability to proceed with its development as planned, due to the interim adoption of the 2010 Comprehensive Plan, is a result of its own omission and not the result of any act or omission on the part of the Leon County government.
Findings Of Fact On five dates in June and July, 1988, Respondent advertised in The Orlando Sentinel newspaper its Invitation to Bid for the project known as High School "BB." The advertisement announced that bids would be received at 2:00 p.m. on August 4, 1988, at which time all bids would be publicly opened. The advertisement stated that Respondent reserved the right to waive irregularities. The Invitation to Bid stated that bids received after the deadline "will be returned unopened" and bids "received on time" will be opened publicly. The Invitation to Bid also stated: "The Owner reserves the right to waive any informality or irregularity in any bid received when such a waiver is in the best interest of the Owner. The contract would be awarded, according to the Invitation to Bid, within 45 days after the opening of bids. The location designated for the opening of the bids was the Facilities Services building located at 6200 Chancellor Drive, Orlando, Florida. The bids were opened in a conference room within the building. Robert Gallardo, who is Respondent's Director of School Planning and Construction, was in charge of the bidding process. Mr. Gallardo has been in this position for six years. During this time, he has been responsible for the majority of school construction bids for Respondent. He estimates that he has supervised ten such bids. On August 4, 1988, Mr. Gallardo worked in his office in the Facilities Services building until 1:55 p.m. At that time, he asked his secretary if the bid tabulation forms had been prepared, and, with the forms, he left his office for the conference room where the bids were to be opened. Mr. Gallardo entered the conference room, which was occupied by a number of bidders' representatives, at 1:58 p.m., according to the clock on the wall. At a few seconds before 2:00 p.m., he first spoke, asking that all bids be handed in. He then asked his secretary to call the front desk to see if any bids had been turned in there and needed to be brought down the hall into the conference room. This was a normal procedure. In past bids, some bidders left their bids with the receptionist at the front desk. Prior to obtaining any response from his secretary who was talking on a phone in the conference room, Mr. Gallardo announced his name and position and announced that he was going to open bids. He then picked up a sealed bid from the pile of sealed bids in front of him. As he was about to open the envelope, at or about 30 seconds past 2:00 p.m., a man entered the conference room and said that he had a bid to deliver. The man disclosed the bidder which he represented, but Mr. Gallardo did not clearly hear the name and did not know whose bid was being offered to him. Mr. Gallardo accepted the bid and placed it at the bottom of the pile. The late bid was from Intervenor. A few seconds after it was accepted Mr. Gallardo opened the first bid. A few seconds after that, another man entered the conference room and attempted to deliver a bid. Mr. Gallardo refused to accept the bid because, as he explained, the first bid had already been opened. Mr. Gallardo's practice has consistently been to accept late bids, provided they are delivered prior to the opening of the first bid. Mr. Gallardo had not previously known of Intervenor, which had never previously even submitted a bid on a school job being let for bid by Respondent. Mr. Gallardo's only prior contact with Intervenor's representative who delivered the bid was seeing the man in the building, along with other bidders' representatives, prior to the opening of the bids; however, Mr. Gallardo did not know who the man represented. There was no fraud or collusion in the acceptance of the late bid. There was no evidence that, under the facts of this case, Respondent abused its discretion in accepting Intervenor's late bid. Petitioner's bid was lowest among the bids delivered prior to 2:00 p.m. However, Intervenor's bid was over $500,000 lower than Petitioner's bid on a project costing in excess of $25 million. Respondent has confirmed Mr. Gallardo's decision not to reject Intervenor's bid as late. On August 16, 1988, Respondent published the agenda for the next school board meeting, which was scheduled for August 23, 1988. One of the items to be taken up was the award of the contract for High School "BB." By letter dated August 18, 1988, Petitioner declined Respondent's invitation to participate in what the parties referred to as an informal hearing at the August 23 school board meeting. Threatening unspecified sanctions under state and federal law if Respondent awarded the contract at the August 23 meeting, Petitioner demanded a formal hearing and asserted that the bidding process should be stayed until resolution of the protest, under Section 120.5361 [sic -- apparently referring to Section 120.53(5)(c)]. By memorandum dated August 23, 1988, Respondent's attorney opined that Rule 6A-2.016(7) did not require Respondent to utilize the Section 120.53(5) bid protest procedures, but, out of an abundance of caution and in the interest of expediting resolution of the dispute, recommended the referral of Petitioner's protest to the Division of Administrative Hearings. By letter dated August 23, 1988, Respondent referred the protest to the Division of Administrative Hearings for a formal hearing.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered dismissing the bid protest of Petitioner. DONE and RECOMMENDED this 15th day of September, 1988, in Tallahassee, Florida. ROBERT E. MEALE Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 15th day of September, 1988. APPENDIX TO RECOMMENDED ORDER, CASE NO. 88-4078BID Treatment Accorded Petitioner's Proposed Findings of Fact 1. Adopted except to the extent that "timely" implies that Intervenor's bid was improperly accepted. Such an implication is rejected as legal argument. 2 and 4. Adopted in substance. 3. Rejected as irrelevant. 5-7. Rejected as not findings of fact except that the inference of Intervenor's efficient utilization of time following the deadline is rejected as unsupported by the evidence and irrelevant. 8-9. Adopted to the extent relevant. 10-11. Rejected as irrelevant. 12-15. Rejected as subordinate to the procedures set forth in the Invitation to Bid and advertisement, especially concerning the waiver of irregularities. First sentence adopted. Second sentence rejected as recitation of testimony through semicolon and irrelevant as to remainder except that the basis for Mr. Gallardo's decision is adopted and modified to add that he accepted the late bid in accordance win his past practice. Petitioner proved all of the facts in this proposed finding except that it could have used effectively any additional time. In any event, all of the facts in this paragraph are irrelevant and are rejected for this reason. The theory of Petitioner's case, as well as the evidence that it offered, was that in this and every other major bid, the last minutes before the deadline are critical due to the unwillingness or inability of subcontractors to supply critical numbers substantially before the deadline. This theory proves too much because, if true, the Hewitt court would have been constrained to consider such a universal fact and thereby would have prevented the agency in that case from accepting the late bid. The Hewitt case stands for the proposition that, in general, an agency may accept late bids before the first bid is opened. It is incumbent upon a frustrated bidder to show that the agency abused its discretion, under the circumstances of the individual case. Petitioner has in essence suggested that the burden is upon the agency to show that it did not abuse its discretion, at least once the frustrated bidder shows that it spent a lot of time and money in preparing its bid and could have used more time. To the contrary, Hewitt tells the frustrated bidder that it must find evidence of impropriety, such as fraud or collusion, in the agency's acceptance of the late bid. This mandate is especially clear in light of the recent Groves-Watkins decision. 18-19 and 22. Rejected as irrelevant. See Paragraph 17. Adopted. 20A-20F. Rejected as legal argument. First sentence rejected as subordinate and recitation of testimony. Second sentence rejected as speculative. Rejected as speculative and unsupported by the evidence. Rejected as irrelevant and unsupported by the evidence. 24A-27. Rejected as legal argument. Adopted in substance. Rejected as not finding of fact. Treatment Accorded Respondent/Intervenor's Joint Proposed Findings of Fact 1-2. Adopted. 3-4. Rejected as not finding of fact. 5-6. Adopted in substance. Rejected as irrelevant. 8. Adopted in substance. 9-12. Adopted in substance except that Mr. Gallardo did not arrive in the conference room "several minutes" before 2:00 p.m. and Intervenor's representative arrived about 30 seconds after 2:00 p.m. 13. Rejected as irrelevant. 14-15. Adopted in substance. Rejected as unnecessary. Adopted. Rejected as irrelevant. See Paragraph 17 in Petitioner's proposed findings. COPIES FURNISHED: Joseph G. Thresher, Esquire Dykema Gossett Ashley Tower Suite 1400 100 South Ashley Drive Post Office Box 1050 Tampa, Florida 33601-1050 William M. Rowland, Jr., Esquire Rowland, Thomas & Jacobs, P.A. 1786 North Mills Avenue Orlando, Florida 32803 Scott H. Johnson, Esquire Maguire, Voorhis & Wells, P.A. Two South Orange Avenue Orlando, Florida 32801 James L. Schott Superintendent Orange County Public Schools Post Office Box 271 434 North Tampa Avenue Orlando, Florida 32802 Honorable Betty Castor Commissioner of Education The Capitol Tallahassee, Florida 32399
The Issue Whether the Florida A&M University's intended action to reject all bids and re-advertise the project to construct "Utilities Improvement-Central Chilled Water Plant, Phase V", known as BR-389, is illegal, arbitrary, dishonest, or fraudulent.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: Parties Neel Mechanical Contracting, Inc., is a Georgia corporation authorized to do business in Florida and licensed by the Florida Construction Industry Licensing Board. Its business is air conditioning, and it specializes in larger projects such as the one at issue herein. Robert C. Sullivan is the President of Neel Mechanical. Thomas Gregory Lang is a project manager employed by Neel Mechanical and the chief estimator for Neel Mechanical; Mr. Lang is the person primarily responsible for preparing Neel Mechanical's bid proposal for Project BR-389. The Florida Board of Regents is a corporate body consisting of the Commissioner of Education and thirteen citizens appointed by the Governor and approved by three members of the Cabinet; it is subject to the general supervision and control of the Department of Education. Sections 240.203(2), 240.205, and 240.207(1), Florida Statutes (1999). The Board of Regents is a member of the State University System, is charged generally with overseeing the state universities, and has the authority to approve and execute contracts for "construction for use by a university when the contractual obligation exceeds $1 million." Sections 240.209 and 240.205(6), Florida Statutes (1999). 4/ Florida Agricultural and Mechanical University ("FAMU") is a public university located in Tallahassee, Florida, and is one of ten universities in Florida's State University System. Section 240.2011, Florida Statutes (1999). The university president is the chief administrative officer of the university and is responsible for its operation and administration. Section 240.227, Florida Statutes (1999). At the times material to this proceeding, Frederick S. Humphries was president of FAMU, and Samuel J. Houston was the Director of FAMU's Office of Facilities Planning and Construction. Mr. Houston has primary responsibility for supervising the bid process and the staff that prepared the bid documents and evaluated the bids for Project BR-389. Mr. Houston acts in this capacity on behalf of President Humphries and the Board of Regents. Mr. Houston also is ultimately responsible for the administration of Project BR-389. Bayou Mechanical, Inc. ("Bayou Mechanical") is a mechanical contractor which submitted a bid on Project BR-389. Call for Bids In Volume 25, Number 13, of the Florida Administrative Weekly, dated April 2, 1999, FAMU, on behalf of the Board of Regents, issued a Call for Bids on Project BR-389, which involves construction of a chilled water plant on the FAMU campus. The Call for Bids provided that all bidders must have a valid Florida license to do the work at the time of bid opening and a minimum of five years experience with similar projects. Project BR-389 involves a construction contract and is the fifth phase of the construction of an underground chilled water system on the FAMU campus. The project consists of constructing a portion of the system and connecting it to the existing system. The Call for Bids notified prospective bidders that sealed bids would be received at FAMU on May 4, 1999, until 2:00 p.m., after which time the bids would be opened and the bid tabulations posted. The Call for Bids further provided: "Bids must be submitted in full and in accordance with the requirements of the drawings and Project Manual." The Call for Bids advised that these documents were available at the offices of the Architect/Engineer for the project, Bosek, Gibson & Associates, Inc. ("Bosek, Gibson"), in Tallahassee, Florida. In Addendum #2 to the Project Manual, dated April 30, 1999, the date for submission of bids was changed from May 4, 1999, to May 11, 1999. The Project Manual contains Instructions to Bidders, consisting of pages 6 of 106 through 22 of 106 and dated October 16, 1989; General Conditions of the Contract for Construction, consisting of pages 23 of 106 through 106 of 106 and dated October 16, 1989; Special Conditions of the Contract, consisting of pages I-1 through I-10 and dated October 16, 1989; Supplement J to the Project Manual, consisting of pages 1 through 11 and dated February 13, 1996; Supplement K to the Project Manual, consisting of pages 1 through 5 and identified as the February 1999 Revision; Exhibit L, Supplementary Conditions to the General Conditions of the Contract for Construction, consisting of pages 2 through 16; and the Technical Specifications, which are separately identified and numbered. As noted in the Call for Bids, drawings are also included in the bid documents. Neel Mechanical, Bayou Mechanical, and Council Contracting submitted bids for Project BR-389 on May 11, 1999, the date on which the bids were opened and the price proposals were read. According to the Bid/Proposal Tabulation form that was posted from May 14 through 19, 1999, Neel Mechanical was the apparent low bidder on the base bid and on the two alternates 5/; Neel Mechanical's base bid and its bid on alternates were within FAMU's budget for the project. Bayou Mechanical submitted the second lowest bid on the base bid and the alternates; Bayou Mechanical was within the budget on the base bid but over budget on the alternates. No recommended award or intent to award was indicated on the Bid/Proposal Tabulation form. Shortly after the bids were opened, several issues were raised with respect to the bid process. First, the FAMU staff discovered that Neel Mechanical had failed to affix its corporate seal to the signature page of the bid Proposal Form and to the Bid Bond that was part of the bid submission. Second, York International Company ("York") sent via facsimile on May 11, 1999, a letter advising FAMU's Office of Facilities Planning and Construction that York intended to protest the bid. This letter raised the third issue: Of the two manufacturers identified in the project specifications, York and The Trane Company ("Trane"), only Trane manufactured a chiller that could meet the project specifications. Fourth, Mark A. Daughtery, a project manager for Bayou Mechanical, sent a letter dated May 14, 1999, to Craig Allen at Bosek, Gibson advising him that Bayou Mechanical intended to file a formal protest on Project BR-389 and identifying two issues of concern to Bayou Mechanical: Neel Mechanical's failure to affix its corporate seal to its bid submission and "the Chiller being sole sourced to Trane Company." Each of these issues is discussed in detail below. Corporate Seal The Instructions to Bidders contained in the Project Manual provide: B-16 Preparation and Submission of Bids Each Proposal shall be submitted on the form contained in the Project Manual and bid prices shall be indicated thereon in proper spaces, for the entire Work and for all Alternates. (See B-8) In the event of a discrepancy in the bid amount on the Proposal between the numeric and written quotes, the written amount will govern. Each Proposal must give the full business address of the Bidder and state whether it is an individual, corporation or partnership. Proposals by a corporation must be signed with the legal name and seal of the corporation followed by the name of the state of its incorporation and the manual signature and designation of an officer, agent or other person authorized to bind the corporation. (Emphasis added.) When it was submitted on May 11, 1999, Neel Mechanical's bid did not include the impression of its corporate seal on the bid Proposal Form signature page or on the Bid Bond submitted as part of the proposal. After the bid opening, an employee of Neel Mechanical received a telephone call from Henry Swift, FAMU's Project Manager for Project BR-389, in which he advised Neel Mechanical that its bid had not been sealed. This conversation was followed by a request from Mr. Swift, sent via facsimile transmittal to Neel Mechanical on May 13, 1999, requesting a "Letter of Clarification which confirms your status as a corporation licensed to do business in the State of Florida, registered with the Secretary of State, etc. Finally, please be sure to sign and seal your letter with your corporate seal." A letter to Mr. Swift, dated May 14, 1999, was signed and sealed by Robert C. Sullivan, President of Neel Mechanical. The letter was received in FAMU's Office of Facilities Planning and Construction on May 19, 1999. Shortly after Mr. Sullivan sent the May 14, 1999, letter, Neel Mechanical received another telephone call from Mr. Swift in which he advised Neel Mechanical that the seal needed to be physically affixed to the bid Proposal Form. Peter Lang, a project manager employed by Neel Mechanical, had business in Tallahassee, so Mr. Sullivan asked that he take the seal to Mr. Swift's office and affix it to the bid Proposal Form. When Peter Lang arrived at Mr. Swift's office, someone brought out the file and gave him the bid Proposal Form, and he affixed Neel Mechanical's corporate seal to the signature page of the form. Neel Mechanical's corporate seal was not affixed to the Bid Bond, although the seal of the surety company was on the Bid Bond when the bid was submitted. The Bid Bond was part of Neel Mechanical’s bid submission. FAMU verified on May 13, 1999, that Neel Mechanical was authorized to do business in Florida and held the requisite Florida license to perform the work required by the project. Centrifugal chiller specifications and York's letter of "intent to protest" Section 15685-1 of the Technical Specifications included in the Project Manual contains the specifications for the Centrifugal Chillers - Water Cooled to be installed as part of Project BR-389. Those specifications provide in pertinent part: PART 2 - PRODUCTS MANUFACTURERS Available Manufacturers: Subject to compliance with requirements, provide centrifugal chillers from one of the following: Trane Co., The York Int'l. UNIT DESCRIPTION: * * * Refrigerant: Chiller shall be provided with low pressure refrigerant HCFC-123. The size of the chiller specified for Project BR-389 was 2200 tons. 6/ Lane Jackins is the owner of Applied Mechanical Equipment and is a manufacturer's representative for York. He reviewed the technical specifications for the chiller contained in Part II of Section 15685-1 of the Technical Specifications for Project BR-389 and determined that York could not furnish a chiller that met the specifications. York does not manufacture a chiller of 2200 tons that uses R123 refrigerant, although it uses R123 refrigerant in smaller machines up to 750 tons. The equipment manufactured by York in the 2,000-ton range uses R134A refrigerant, which operates at different pressures than R123. The York equipment using R134A refrigerant is of an entirely different design than that using R123 refrigerant. In addition, York does not manufacture a chiller with the voltage required by the project specifications. Three or four days before the bids were to be submitted, either Mr. Sullivan or Mr. Lang spoke with Mr. Jackins about York's providing Neel Mechanical with a price for the chiller. Mr. Jackins responded that York would not submit a price for the equipment because York did not manufacture a chiller that would meet the technical specifications included in the bid documents. The Instructions to Bidders in the Project Manual provide: B-12 Basis for Bidding - Trade Names For clarity of description and as a standard of comparison, certain equipment and materials have been specified by trade names or manufacturers. To insure a uniform basis for bidding, the Bidder shall base the Proposal on the particular systems, equipment or materials specified and approved substitutes as provided in Paragraph 3.19, Substitutes, of the General Conditions. After bids are received, no equipment or materials will be approved as a substitute for the specified product. Paragraph 3.19 of the General Conditions provides: Substitutions Substitutions for a specified system, product or material may be requested of the Architect/Engineer, and the Architect/Engineer's written approval must be issued as an addendum before substitutions will be allowed. All requests for substitutions must be submitted prior to the opening of bids, and approvals shall be granted no less than seven (7) days prior to the bid date. Substitutions requested after that date will receive no consideration. Substitutions are changes in materials, equipment, methods, or sequences of construction, design, structural systems, mechanical, electrical, air conditioning controls, or other requirements of the Drawings or Specifications. (Emphasis in original.) In the portion dealing with "SPECIFICATIONS AND DRAWINGS," Section 15010 of the Technical Requirements, "MECHANICAL REQUIREMENTS," provides as follows: By submitting a bid for equipment or material other than the "Design Basis Equipment" (i.e., that which is shown on the Contract Drawings), the Contractor: Represents that he has personally investigated the proposed substitute product and determined that it is equal or superior in all respects to that specified and complies with all the requirements set forth in Paragraph 3.19 of the General Conditions; Certifies that the cost data presented is complete and includes all related costs under this Contract but excludes costs under separate contracts, and excludes the Engineer's redesign costs, and waives all claims for additional costs related to the substitution which subsequently become apparent; Will coordinate the installation of the accepted substitute, making such changes as may be required for the work to be complete in all respects; and, Certifies that the proposed equipment meets the requirements of the Contract Documents. Neither York nor any prospective bidder on Project BR-389 requested within the time limits specified in Paragraph 3.19 of the General Conditions that a York product be substituted for the chiller specified for Project BR-389. Mr. Lang contacted Craig Allen at Bosek, Gibson a day or two before bids were to be submitted and told Mr. Allen that York was not able to provide a chiller that met the project specifications. According to Mr. Lang, Mr. Allen responded that he "was totally surprised that they [York] didn't have a machine that was going to meet this spec." 7/ Mr. Lang based Neel Mechanical's bid on pricing information it received from Trane, which manufactures a chiller that meets the project specifications. An additional reason Mr. Lang based Neel Mechanical's bid on the Trane equipment was his belief that, all things being equal, FAMU preferred to have Trane equipment installed in Project BR-389 because other chillers installed at FAMU were manufactured by Trane. Mr. Lang believed that the specifications for the chiller had been deliberately drawn to require use of Trane equipment. In a letter dated May 11, 1999, the day the bids for Project BR-389 were submitted and opened, Mr. Jackins notified FAMU's Office of Facilities Planning and Construction that York intended to protest the bid on Project BR-389. Mr. Jackins stated in the letter: The chiller as specified is a flat specification. There is only one manufacturer that will meet the criteria as spelled out in the contract documents. This is not in the best interest of the University System of Florida or the State of Florida. An official protest outlining all the proprietary items will be forthcoming. The letter was sent via facsimile on May 11, 1999, prior to the time the bids were opened. Mr. Jackins believed that the "flat specification" was not in the best interest of the university because it precluded competitive pricing for the chiller. Mr. Sullivan learned on May 11 or May 12, 1999, that York intended to file a bid protest. Believing that Neel Mechanical would be awarded the contract as the apparent low bidder, Mr. Sullivan met with Mr. Jackins and several employees of Neel Mechanical, including Greg Lang, at which time Mr. Sullivan proposed an alternative to York's filing a bid protest. Mr. Sullivan told Mr. Jackins that, in his opinion, the situation could best be handled through a meeting between Neel Mechanical, Mr. Jackins, Mr. Houston, and the project engineers. According to Mr. Sullivan's plan, Mr. Jackins could present York's pricing, and FAMU, with the engineers’ assistance, could decide if they wanted to switch from the equipment specified in the bid documents to York equipment. If FAMU agreed to accept the York equipment, then, if it were awarded the contract, Neel Mechanical would purchase the York equipment rather than the Trane equipment Neel Mechanical had included in its proposal. After some discussion, Mr. Jackins agreed with Mr. Sullivan's proposed solution. Post-bid activity from the perspective of Neel Mechanical Immediately after the bids were opened, Craig Allen, an employee of Bosek, Gibson telephoned Mr. Lang and asked if Neel Mechanical was still happy with its bid. According to Mr. Lang, Mr. Allen stated that "this is a standard practice of mine on bid day to call the apparent low bidder and just make sure that they haven't found some colossal error in their math or whatever that made them low." 8/ Mr. Lang told Mr. Allen that Neel Mechanical was still happy with its bid. After this conversation, Mr. Lang waited for the letter from FAMU awarding the contract to Neel Mechanical. He was not concerned that the award was not made immediately because, in his experience, some time always passed between bid opening and the time the winning bidder received the contract. However, in anticipation of the award of the contract, Neel Mechanical proceeded to talk with subcontractors, to start scheduling the project, and to line up equipment that it would need to purchase for work on the project. Neel Mechanical employees also made several visits to the site of the project. At some point after the bids were opened, Mr. Sullivan heard that the procurement officials at FAMU were discussing with FAMU's legal department the issues of Neel Mechanical's failure to affix the corporate seal to its bid and the ramifications of York’s threatened bid protest. Mr. Sullivan responded by telephoning the office of FAMU's general counsel. He spoke with Faye Boyce about these issues and told her that he considered his failure to affix the corporate seal to Neel Mechanical's bid to be insignificant. He also advised her that he had worked out an arrangement with the representative of York whereby York would withdraw its protest and Neel Mechanical would talk with the engineers about the York chiller so a decision could be made whether they wanted to use the York equipment or stay with the Trane equipment which met the project specifications. In a subsequent telephone conversation with Ms. Boyce, Mr. Sullivan received the impression that she had looked into the issues he had raised in their previous telephone conversation. Mr. Sullivan could not recall Ms. Boyce's exact words, but had the impression from their conversation that the contract award to Neel Mechanical had been approved and that confirmation would be sent out shortly. At some point after Mr. Sullivan's conversation with Ms. Boyce, Greg Lang telephoned Henry Swift to find out the status of the contract award. Mr. Swift told Mr. Lang that, in Mr. Lang's words, "the problem had been reviewed and found to be insignificant, and . . . that the letter of intent to award had already been made." 9/ According to Mr. Lang, Mr. Swift told him that FAMU would notify the bidders of the intent to award the contract to Neel Mechanical. On the basis of this conversation, Mr. Lang believed that Neel Mechanical would receive a letter "just any day." When Neel Mechanical did not receive a letter, Mr. Lang telephoned Mr. Swift again. According to Mr. Lang, Mr. Swift stated that he did not know why the matter was being held up. After this second conversation with Mr. Swift, Mr. Lang telephoned Mr. Houston several times but did not receive a return call. Mr. Lang then wrote a letter to Mr. Houston, dated July 9, 1999, in which he inquired about the status of the contract award: It has now been almost two months since you received bids for this project, and as the low bidder we have still not received notification of your intent to award. We have had several telephone conversations with the attorney representing the regents in this matter, and we were lead [sic] to believe that we would have received information before this time. Please review this matter and call us. If there are outstanding issues which concern you, we would like to know about them and work with you to get them resolved. Post-bid activity from the perspective of FAMU Mr. Houston and members of his staff considered the omission of the corporate seal to be a minor deficiency in Neel Mechanical's bid proposal. Nonetheless, even though Neel Mechanical had been allowed to seal the bid Proposal Form, Mr. Houston asked FAMU's Office of General Counsel to conduct research and determine if the deficiency was one that could be waived. Mr. Houston was not involved in drawing up the technical specifications for Project BR-389; rather, he relied on the project engineers to be familiar with the products to be used in the project. Mr. Houston advised the project engineers that he wanted a competitive bid, and, because the chiller was a major component of the project, he instructed the engineers to prepare specifications that could be met by equipment produced by at least two manufacturers. In a letter dated May 18, 1999, Craig Allen, the engineer at Bosek, Gibson who prepared the specifications for Project BR-389, notified Mr. Houston that he was not aware until the "notice of protest" was received from York that York could not provide a chiller of the required capacity which used R123 refrigerant. Mr. Allen advised Mr. Houston that Mr. Jackins, the York representative, had indicated that he wanted to meet with Mr. Allen to discuss York's chiller selections for the project. A recommendation that the contract be awarded to Neel Mechanical was signed on June 8, 1999, by Phyllis Nottage, the Assistant Director of FAMU's Office of Facilities Planning and Construction; on June 10, 1999, by Mr. Houston; on June 14, 1999, by Louis Murray, an Associate Vice President of FAMU; and on June 14, 1999, by Robert Carroll, a Vice President of FAMU with supervisory authority over the Office of Facilities Planning and Construction. The recommendation was contained in a document entitled "Award of Construction Contract," which provided as follows: On May 11, 1999, bids were received for the above-referenced project within the approved budget for the Base Bid and Alternates One (1) through (2), in the total amount of $3,996,400. The requirements for the Minority Business Enterprise Plan as set forth in the project specifications have been satisfied by the Contractor. The consulting Architect/Engineer and the University Facilities Planning and Construction Office recommend the award of this contract to Neel Mechanical Contractors, Inc. President Humphries signed the Award of Construction Contract on June 17, 1999. The preparation and signing of the Award of Contract form and the preparation of the Letter of Intended Decision were part of the bid review process, but Mr. Houston considered them preliminary, without effect until the final decision on the contract award was made and the bidders were formally advised of FAMU's intended decision with respect to the award of the contract. On June 21, 1999, Mr. Houston received a telephone call from Kenneth Ogletree, Director of the Board of Regents’ Office of Facilities Planning, 10/ in which Mr. Houston was advised that the Board of Regents had received an inquiry from a legislator in reference to Project BR-389 and requesting that Mr. Houston prepare a response to the legislator's inquiry. Mr. Ogletree sent Mr. Houston, via facsimile on June 21, 1999, a copy of a letter dated May 28, 1999, from Carey Huff, President of Bayou Mechanical, to Durell Peaden, a member of the Florida House of Representatives and a State Representative from District In the letter, Mr. Huff complained that Neel Mechanical, although apparent low bidder for Project BR-389, had failed to seal the bid Proposal Form and the Bid Bond and that, therefore, Neel Mechanical's bid was non-responsive. Mr. Carey requested that Representative Peaden contact FAMU so that Bayou Mechanical would be awarded the contract for the project as lowest responsive bidder. Mr. Carey stated in his May 28, 1999, letter to Representative Peaden that the college had refused to allow Bayou Mechanical to examine Neel Mechanical's bid but that Mr. Houston had informed them that Neel Mechanical had failed to seal its bid properly. 11/ Mr. Ogletree also sent Mr. Houston, via facsimile on June 21, 1999, a copy of a letter from Representative Peaden to Dr. Adam W. Herbert, Chancellor of the State University System. In his letter, Representative Peaden asked that Dr. Herbert look into the matter and "see that all equity was followed in the bid process." In response to the Board of Regents' request that he respond to Representative Peaden's inquiry, Mr. Houston prepared a letter dated June 22, 1999. In this letter, which was directed to Mr. Ogletree, Mr. Houston stated that FAMU wished to award the contract for Project BR-389 to Neel Mechanical as the low bidder on the project. Mr. Houston stated that FAMU considered Neel Mechanical's failure to affix the corporate seal on the bid Proposal Form and the Bid Bond to be a minor discrepancy. Mr. Houston further stated that FAMU's Office of General Counsel agreed with the conclusion regarding the corporate seal issue and recommended that the contract be awarded to Neel Mechanical. Finally, Mr. Houston advised Mr. Ogletree that President Humphries had signed the "Award of Construction Contract" form and that Mr. Houston's office was preparing "Letters of Intended Decision" to be sent to the bidders. The final decision on the contract award had not been made on June 10, 1999, when Mr. Houston signed the recommendation that the contract for Project BR-389 be awarded to Neel Mechanical, nor had it been made on June 22, 1999, when Mr. Houston wrote his letter to Mr. Ogletree. Rather, on June 22, 1999, the issues raised with respect to the bid process for Project BR-389 were still being reviewed by Mr. Houston and his staff and by FAMU's Office of General Counsel. The decision to reject all bids on Project BR-389 was made on June 24, 1999. On that date, Mr. Houston met with Vice President Murray, FAMU's attorney, and the Assistant Director of the Office of Facilities Planning and Construction, and the issues relating to the bidding process for Project BR-389 were reviewed. Mr. Houston identified these issues as Neel Mechanical's failure to seal its bid Proposal Form and its Bid Bond; potential protests from York and from Bayou Mechanical; and the problem relating to the technical specifications for the chiller. Of these issues, Mr. Houston considered the most serious the fact that, of the two manufacturers listed in the bid specifications, only Trane could provide the chiller for Project BR-389. The chiller was a major part of the project, and Mr. Houston wanted at least two sources for the chiller in order to encourage competition so that FAMU would get the lowest possible price for the project. Mr. Houston was also concerned that the specifications for the chiller created a de facto "sole source" bid and that the bid solicitation would, therefore, be illegal because FAMU didn't satisfy the statutory requirements necessary for it to specify that the chiller be purchased from a sole source. 12/ FAMU's attorney advised the participants at the June 24, 1999, meeting that the legal department had found no precedent within the State University System for waiving the requirement in the bid documents that the bid Proposal Form and the Bid Bond be sealed with the bidder's corporate seal. The participants at the meeting considered all of the outstanding issues and decided that it would be in the best interests of FAMU to reject all bids submitted on May 11, 1999, for Project BR-389. After the decision to reject all bids was made, Mr. Houston marked an "X" through the Award of Construction Contract form signed by President Humphries, and he prepared letters notifying the bidders of the intent to reject all bids for Project BR-389. Neel Mechanical's bid protest In a letter to Neel Mechanical dated July 6, 1999, Mr. Houston stated: Bids on the above referenced project were opened May 11, 1999. However, we regret to inform you that all Bids have been rejected as in the best interest of the University. This project is presently being re-advertised in the Florida Administrative Weekly. The University apologizes for the time it has taken to reach this decision. We trust that you will cooperate with our course of action and look forward to receiving a proposal from you at the next opening. Thanks for your continued interest in the State University System's Construction Program. The envelope containing Mr. Houston's July 6, 1999, letter was post-marked July 9, 1999, and the letter was received by Neel Mechanical on Tuesday, July 13, 1999. The Instructions to Bidders in the Project Manual provide: Rejection of Bids The Owner reserves the right to reject any and all bids when in the opinion of the Owner such rejection is in the best interest of the Owner. Paragraph B-1 of the Instructions to Bidders provides that the Board of Regents is the owner of the project. On July 13, 1999, after Neel Mechanical received the letter from Mr. Houston notifying it that all bids on Project BR- 389 had been rejected, Mr. Sullivan and Greg Lang went to Mr. Houston's office to urge him to rescind the decision and award the contract to Neel Mechanical. Mr. Sullivan told Mr. Houston that they felt that the issue regarding the corporate seal was insignificant. At this time, Mr. Sullivan also told Mr. Houston that he and York had reached an agreement whereby York would withdraw its protest and Neel Mechanical would present the York product to the University and let the University decide if it wanted to go with the Trane chiller or switch to a York product. Mr. Sullivan thought that Mr. Houston was sympathetic to Neel Mechanical but that the decision had been made by the administration and the legal department. Mr. Sullivan also got the impression that the decision to reject all bids was based on the corporate seal issue. On July 13, 1999, Neel Mechanical hand-delivered its Notice of Intent to Protest Bid to Samuel J. Houston, Director of the Office of Facilities Planning and Construction at Florida A&M University and to FAMU's Office of General Counsel. There is no dispute that the Notice of Intent to Protest Bid was actually received in Mr. Houston's office on July 13, 1999. On July 23, 1999, Neel Mechanical hand-delivered its Formal Written Protest and Petition for Formal Administrative Proceedings to Sam Houston, Director, Florida A&M University, Facilities Planning Department, Plant Operations Facility, Building A, Room 100, 2400 Wahnish Way, Tallahassee, Florida 32307 and to FAMU's Office of General Counsel. Also on July 23, 1999, a copy of the Formal Written Protest and Petition for Formal Administrative Proceedings was sent by United States Mail to the Board of Regents, Office of General Counsel, 325 West Gaines Street, Suite 1454, Tallahassee, Florida 32399-1950. There is no dispute that the Formal Written Protest and Petition for Formal Administrative Proceedings was actually received in Mr. Houston's office on July 23, 1999. The Instructions to Bidders in the Project Manual dated October 16, 1989, provide: Bid Protest To be considered, a bid protest must be received by the Director, Capital Programs, Florida Board of Regents, 1601 Florida Education Center, 325 West Gaines Street, Tallahassee, Florida 32399-1950, as provided in Section 120.53, Florida Statutes. Failure to file a notice of protest in this manner shall constitute a waiver of the Bidder's right to proceedings under Chapter 120, Florida Statutes. * * * B-26 Special Conditions Bidders shall be thoroughly familiar with the Special Conditions and their requirements. (Emphasis added.) Supplement J to the Project Manual, consisting of pages 1 through 11 and dated February 13, 1996, provides in pertinent part: (This supplement revises portions of the Project Manual for State University System projects dated October 16, 1989, and supersedes any other previously issued supplements related to the referenced topics.) Revise the Instructions to Bidders Section of the Project Manual as Follows: * * * Revise Paragraph B-22, Bid Protest, to read as follows: B-22 Bid Protest Any person who is affected adversely by the Board of Regents decision or intended decision shall file with the Associate Vice Chancellor, Capital Programs, Florida Board of Regents, 1602 Florida Education Center, 325 West Gaines Street, Tallahassee, Florida 32399-1950, a notice of protest in writing within 72 hours, excluding Saturday, Sunday, and State legal holidays, after receipt of the bidding documents if the protest is directed toward the bidding conditions or after the notice of the Board of Regents decision or intended decision on contract award or bid rejection if the protest is directed toward contract award or bid rejection. Thereafter, a formal written protest by petition in compliance with Section 120.53(5), and Section 120.57, F.S., must be filed with the Associate Vice Chancellor, Capital Programs, Florida Board of Regents, 1602 Florida Education Center, 325 West Gaines Street, Tallahassee, Florida 32399-1950, within ten (10) days after the date the notice of protest was filed. Failure to file a timely notice of protest of [sic] failure to file a timely formal written protest petition shall constitute a waiver of protest proceedings. Any protest filed prior to receipt of the notice of the Board of Regents decision or intended decision will be considered abandoned unless renewed within the time limit provided for protests. (Emphasis added.) Supplement K to the Project Manual, consisting of pages 1 through 5, provides in pertinent part: SUPPLEMENT TO PROJECT MANUAL ISSUED BY FLORIDA A&M UNIVERSITY REGARDING PARAGRAPH B-26, SPECIAL CONDITIONS (February 1999 Revision) B-26 SPECIAL CONDITIONS - This supplement modifies paragraph B-26 by adding and clarifying bidding requirements and instructions. * * * PROTEST PROCEDURES: This paragraph supersedes the paragraph (No. B-22) under the general terms and conditions whereby the notice of intended protests or written formal protests including bonding requirements from bidders must be submitted to: Mr. Sam Houston, Director, Florida A&M University, Facilities Planning Department, Plant Operations Facility, Building A, Room 100, 2400 Wahnish Way, Tallahassee, FL 32307. A bid tabulation with the recommended award(s) will be posted at the address indicated in Paragraph B-26, sub- paragraph 6 (Posting of Bid Tabulation). Any notice of protest or formal written protest to the award or intended award which is filed before the bid tabulation posting is null and void. To be considered, a notice of protest or formal written protest must be filed within the time limits set forth in Section 120.57(3)(b), Florida Statutes. Any notice of protest or formal written protest to the specifications issued by the University must be filed within the time limits set forth in Section 120.57(3)(b), Florida Statutes. Any notice of protest or formal written protest to any amendment issued by the University must be filed within the time limits set forth in Section 120.57(3)(b), Florida Statutes. (Emphasis added.) The instructions regarding the filing of bid protests in Supplement K supersede the instructions in Supplement J, which is dated February 13, 1996, and in the Instructions to Bidders in the Project Manual, which are dated October 16, 1989. Summary The evidence presented by Neel Mechanical is sufficient to establish that it timely filed its Notice of Intent to Protest and its Formal Written Protest and Petition for Formal Administrative Proceedings by hand-delivering the documents to Mr. Houston, at his office on the FAMU campus. The evidence presented by Neel Mechanical is not sufficient to establish with the requisite degree of certainty that FAMU acted fraudulently, arbitrarily, illegally, or dishonestly in deciding that it was in the best interest of FAMU to reject all of the bids submitted on May 11, 1999, for Project BR-389. First, FAMU's concerns that, by inadvertently including a technical specification that could be met by only one manufacturer, it had limited competition with respect to the chiller to be used in Project BR-389 and had inadvertently put out an illegal "sole source" specification were legitimate concerns. Mr. Houston instructed the engineer who prepared the technical specifications that he wanted the specifications drawn so that at least two manufacturers could provide the product, and the engineer prepared specifications relating to the "available manufacturers" which clearly contemplated that a chiller meeting the technical specifications could be provided by both York and Trane. FAMU did not act arbitrarily when it considered as one factor underlying the decision to reject all bids the lack of precedent in the State University System for waiving the requirement that the bid Proposal Form and Bid Bond carry the corporate seal of a corporate bidder. The evidence submitted by Neel Mechanical is not sufficient to establish with the requisite degree of certainty that the corporate seal issue was ultimately the only or even the major factor on which FAMU's decision to reject all bids was based. Mr. Houston identified the possibility that bid protests would be filed by York and by Bayou Mechanical as factors which FAMU considered in deciding to reject all bids. Nonetheless, the evidence taken as a whole permits the inference that the focus of the concern about the potential bid protests was not on avoiding the protests but on the validity of the issues raised by York and Bayou Mechanical. Accordingly, FAMU did not act arbitrarily when it considered these potential bid protests as one factor contributing to the decision to reject all bids. The evidence presented by Neel Mechanical is not sufficient to establish that the "Award of Contract" form executed by President Humphries on June 17, 1999, or Mr. Houston’s June 22, 1999, letter to Mr. Ogletree bound FAMU to award the contract to Neel Mechanical or that the subsequent decision to reject all bids defeated the purpose of the competitive bidding process.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Florida Agricultural and Mechanical University enter a final order dismissing the Formal Written Protest and Petition for Formal Administrative Proceedings filed by Neel Mechanical Contractors, Inc., and denying Neel Mechanical's Motion for Assessment of Attorney's Fees, insofar as it is based on the provisions of Section 120.595, Florida Statutes. Based on the foregoing Findings of Fact and Conclusions of Law, Neel Mechanical's Motion for Assessment of Attorney's Fees, insofar as it is based on the provisions of Section 120.569(2)(e), Florida Statutes, is denied. DONE AND ENTERED this 12th day of November, 1999, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO 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 12th day of November, 1999.
