The Issue The issue in this case is whether Petitioner, a disappointed bidder, waived its right to pursue administrative remedies by failing timely to file a notice of intent to protest.
Findings Of Fact On November 26, 2002, Respondent Department of Transportation ("Department") issued a request for proposals on a contract for the development of a transportation facility, which was to be located adjacent to the Miami International Airport. On March 3, 2002, Petitioner MIC Development, LLC ("MIC") submitted the only proposal that the Department received in response to this solicitation. The next activity of relevance to this case occurred three years later, on May 20, 2005, when a selection committee decided to reject all proposals (as mentioned, there was just one) and discontinue the procurement. By two letters dated May 31, 2005, each of which was addressed to a principal of MIC and marked "certified mail," "return receipt requested," the Department notified MIC of its decision. It is undisputed that the Department did not post its decision on the internet. There is, however, a genuine and spirited dispute concerning the date on which MIC received the Department's decision-letters; as a result, the evidence is in conflict regarding whether MIC received the Department's notice of rejection on June 3, 2005, as the Department contends, or on June 10, 2005, as MIC maintains. It is not necessary to resolve this particular dispute because——for reasons that will soon become apparent——the contested fact is immaterial. On June 14, 2005, MIC filed a notice of intent to protest the Department's decision to reject its proposal. Nine days later, on June 23, MIC filed its formal written protest. The Department insists that MIC's initial protest- notice, having been filed more than 72 hours after MIC's receipt of the notice of rejection, was untimely, thereby constituting a waiver of the right to a hearing. The Department urges that this case be dismissed on that basis. MIC asserts that its notice was filed within 72 hours after receiving the Department's letters——which it claims were defective in any event and hence legally insufficient to trigger the 72-hour filing period——and that, even its protest-notice were untimely, equitable principles should be invoked to allow this case to go forward notwithstanding the filing delay.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department refer this matter to DOAH for a final hearing on the merits of MIC's protest of the rejection of its proposal. DONE AND ENTERED this 20th day of April, 2006, in Tallahassee, Leon County, Florida. S 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 20th day of April, 2006.
The Issue Whether the Department of Transportation's proposed action, the award of the contract in question to WRS Infrastructure and Environment, Inc., is contrary to its governing statutes, its rules or policies, or the proposal specifications.
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: In March 1999, the Department issued a request for proposals, RFP-DOT-99/2000-6026DS ("RFP"), requesting that experienced firms submit proposals "for the purpose of providing district-wide contamination assessment and remediation services" in the Department's District VI, which consists of Miami-Dade and Monroe Counties. The RFP solicited proposals for an indefinite quantity contract, with a term of three years and a maximum value of $5 million. The proposals were to be presented in two separate, sealed packages, one containing the proposer's Technical Proposal and the other containing the proposer's Price Proposal. Pursuant to Section 1.16 of the RFP, the Technical Proposal were to be opened and evaluated before the Price Proposals were opened. Section 1.8.2 of the RFP is entitled "Responsiveness of Proposals" and provides: All Proposals must be in writing. A responsive Proposal is an offer to perform the Scope of Services in accordance with all the requirements of this Request for Proposal and receiving a score of seventy (70) points or more on the Technical Proposal. Proposals found to be non- responsive shall not be considered. Proposals may be rejected if found to be irregular or not in conformance with the requirements and instructions herein contained. A Proposal may be found to be irregular or non-responsive by reasons that include, but are not limited to, failure to utilize or complete prescribed forms, conditional Proposals, incomplete Proposals, indefinite or ambiguous Proposals, and improper or undated signatures. (Emphasis in original.) Eight firms submitted proposals in response to the RFP, including WRS, OHM, and Metcalf & Eddy. A three-member Technical Review Committee was assembled, and the Technical Proposals were submitted to the Technical Review Committee for evaluation; all eight Technical Proposals received a score of 70 points or more. The Price Proposals were then opened and evaluated in accordance with the criteria set forth in the RFP. The Department posted a Notice of Intent to Award on August 26, 1999, in which it stated its intention to award the District VI contract to OHM. OHM was the highest-ranked proposer with a total score of 125.879 points; WRS was the second-highest-ranked proposer with a total score of 125.675 points; and, Metcalf & Eddy was the third-highest-ranked proposer with a total score of 118.569 points. It was noted in the Notice of Intent to Award that all eight proposals were accepted as responsive. On August 31, 1999, WRS filed a notice of its intent to protest the intended award of the District VI contract to OHM, and it filed its Formal Protest and Petition for Formal Administrative Hearing on September 10, 1999. Metcalf & Eddy did not file a protest with regard to the August 26, 1999, Notice of Intent to Award. As a result of information obtained by the Department subsequent to the filing of WRS's protest, OHM's proposal was re-evaluated, and, on October 20, 1999, the Department posted a Notice of Intent to Award (Revised), in which it stated its intention to award the District VI contract to WRS. The scores of WRS and Metcalf & Eddy remained unchanged as a result of the re-evaluation of OHM's proposal, but OHM's score decreased to 124.212 points. As a result, WRS became the highest-ranked proposer, OHM became the second-highest-ranked proposer, and Metcalf & Eddy remained the third-highest-ranked proposer. On October 25, 1999, Metcalf & Eddy filed its Notice of Intent to Protest with the Department, and it filed the Formal Protest of Metcalf & Eddy, Inc., on November 4, 1999. A settlement conference was conducted on November 17, 1999, but the Department and Metcalf & Eddy were unable to resolve the issues raised in Metcalf & Eddy's protest. As a result, the Formal Protest of Metcalf & Eddy, Inc., was referred to the Division of Administrative Hearings on January 28, 1999, and initiated this proceeding. On December 9, 1999, the Department's Awards Committee met to re-consider its decision of October 15, 1999, to award the District VI contract to WRS in light of the issues raised in the protests filed by OHM and Metcalf & Eddy. The Awards Committee decided not to disturb the decision reflected in the October 20, 1999, Notice of Intent to Award (Revised). SPURS Number Section 1 of the RFP provides that the "State of Florida Department of Transportation Request for Proposal Contractual Services Acknowledgement (Pur #7033) . . . will be handed out at the mandatory pre-proposal meeting." The form itself is entitled "State of Florida Request for Proposal, Contractual Services Bidder Acknowledgement" ("Bidder Acknowledgement form"). A box that appears near the top of the Bidder Acknowledgement form is labeled "STATE PURCHASING SUBSYSTEM (SPURS) VENDOR NUMBER."3 The Bidder Acknowledgement form also includes a statement of General Conditions, which provides in pertinent part: Execution of Proposal: Proposal must contain a manual signature of authorized representative in the space provided above. Proposal must be typed or printed in ink. Use of erasable ink is not permitted. All corrections made by proposer to his proposal price must be initialed. The company name and SPURS vendor number shall appear on each page of the bid as required. . . . WRS, OHM, and Metcalf & Eddy included an executed copy of the Bidder Acknowledgement form at the beginning of their proposals. The Bidder Acknowledgement form is not a part of either the Technical Proposal or the Price Proposal. Metcalf & Eddy inserted "042428218-003" in the box reserved for the SPURS number; WRS inserted "P13202"; and OHM inserted "#94-1259053." "042428218-003" is a SPURS number assigned by the Department of Management Services, and Metcalf & Eddy is a vendor registered with that department. "P13202" is not a SPURS number. "#94-1259053" is OHM's federal identification number, and is the number that they commonly use as their SPURS number in the proposals they submit to the Department. Both WRS and OHM are registered as interested vendors with the Department of Management Services, pursuant to Section 287.042(4), Florida Statutes.4 Metcalf & Eddy included its name and its SPURS number on each page of the proposal it submitted in response to the District VI RFP. Neither WRS nor OHM included the name of the company and the SPURS number on each page of their proposals. There is no requirement in the District VI RFP that the name of the company and the SPURS number be included on each page of the proposal. Section 1.8.6 of the RFP is entitled "Waivers" and provides: The Department may waive minor informalities or irregularities in Proposals received where such is merely a matter of form and not substance, and the correction or waiver of which is not prejudicial to other Proposers. Minor irregularities are defined as those that will not have an adverse effect on the Department's interest and will not affect the price of the Proposal by giving a Proposer an advantage or benefit not enjoyed by other Proposers. Paragraph 6 of the General Conditions set forth on the Bidder Acknowledgement form provides in pertinent part: "AWARDS: As the best interest of the State may require, the right is reserved to reject any and all proposals or waive any minor irregularity or technicality in proposals received. " Nancy Lyons is the Contractual Services Unit Administrator for District VI. Ms. Lyons reviews the proposals to determine if they are responsive and to determine if an irregularity or omission is minor and can be waived under the terms of the RFP. It is Ms. Lyons practice to waive as a minor irregularity the omission of a SPURS number or the inclusion of an incorrect SPURS number to be a minor irregularity because, if a vendor is registered with the Department of Management Services, the SPURS number is readily available to the Department. In addition, the SPURS number does not effect either the technical content of the proposal or the price in the proposal. The WRS and OHM proposals were not rejected by the Department's District VI Contractual Services Unit even though WRS and OHM failed to include their SPURS numbers on the Bidder Acknowledgement form and failed to include the company name and SPURS number on each page of their proposals. Disparate treatment. In 1998, Metcalf & Eddy submitted a proposal in response to a Request for Proposals issued by the Department's District IV. In its Price Proposal, Metcalf & Eddy failed to include a price or a zero in three blanks reserved for the daily rate, weekly rate, and monthly rate for an X-Ray Fluorescence (XRF) Spectrum Analyzer; Metcalf & Eddy included as the "Total" for this item "$0.00." Metcalf & Eddy's District IV proposal was rejected as non-responsive as a result of these omissions. Metcalf & Eddy filed a Formal Written Protest and Request for Formal Administrative Hearing and challenged the decision to reject its proposal as non-responsive. After informal efforts to resolve the issue raised in the protest were unsuccessful, Metcalf & Eddy withdrew its protest; the Department entered a Final Order on August 11, 1998, dismissing the protest. Summary The evidence presented by Metcalf & Eddy is not sufficient to establish that the Department's decision to accept the WRS and OHM proposals as responsive is clearly erroneous, contrary to competition, arbitrary, or capricious. The omission of the SPURS number on the Bidder Acknowledgement form is a minor irregularity that did not give WRS or OHM a substantial advantage over Metcalf & Eddy and was of no consequence to the Department because it has ready access to the SPURS numbers included in the database of interested vendors maintained by the Department of Management Services. Furthermore, WRS and OHM were not required to include their company name and SPURS number on each page of the proposal because this requirement was not included in the specifications in the RFP. Finally, Metcalf & Eddy has failed to present evidence to establish that it is the victim of disparate treatment by the Department; the decision of the Department to reject the proposal it submitted to District IV in 1998 is irrelevant to the issues raised in this proceeding.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Transportation issue a final order dismissing the Formal Protest of Metcalf & Eddy, Inc. DONE AND ENTERED this 30th day of July, 2001, 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 30th day of July, 2001.
Findings Of Fact Respondent, Department of Transportation, advertised its Invitation to Bid on Contract No. E4504, State Project Job No. 99004-3509 for work consisting of providing trees and shrubs with on-site placement for State Road 858 in Broward County, Florida. The Invitation to Bid advised that a mandatory pre-bid conference would be conducted on January 10, 1991. Although it was the responsibility of Kathleen L. Mims to submit bids on behalf of Mims Gardens, Inc., and to attend pre-bid conferences, Stephen H. Mims attended the mandatory pre-bid conference for this bid instead. At the pre-bid conference, after all attendees were provided with bid packages, the meeting was called to order by Teresa L. Martin, Respondent's Assistant District Contracts Administrator. Martin and Carl Higgins, the Project Engineer, explained unit pricing and how averaged prices were to be calculated. Higgins explained that although some of the pay items consisted of aggregate quantities of different plants, only a single average price was to be calculated for the total number of plants required for that category and only one figure was to be placed in the box for each pay item even if that pay item consisted of different plants with different prices. When Martin and Higgins concluded their remarks, they gave the attendees the opportunity to ask questions regarding the bid and the proper completion of the bid form. Stephen Mims heard the explanation for calculating the average price for the total number of plants in a single pay item category. He did not pay much attention to the explanation, however, because he was concentrating on counting the number of pages in his bid package. Although he did take some notes on some of the information given during the mandatory pre-bid conference, he made no notes regarding calculating the prices to be submitted on the bid form. He assumed that whatever information was needed would be included in the bid package itself. After the mandatory pre-bid. conference, he gave the bid package to Kathleen L. Mims to complete and submit to Respondent. He did not show her the notes that he had taken and did not give her the information given to him at the mandatory pre-bid conference regarding the fact that only one number was to be provided for each pay item even if that pay item consisted of plants with different prices or regarding how to calculate a single average price for the total number of plants in each pay item category. Kathleen L. Mims completed and submitted a bid on behalf of Mims Gardens, Inc. When she completed the bid price proposal sheet, she listed individual unit prices for each of the plants in the pay item categories that contained more than one plant. She did not calculate a single average price as required by Respondent in order that all bids could be evaluated against each other. Although Kathleen Mims had never previously submitted a bid to the Department of Transportation, and although the bid price proposal sheet was different than those she routinely completed, she did not contact Teresa Martin or Carl Higgins to inquire as to the proper method for completing the bid price proposal sheet. Although the Bid Blank itself contained no directions regarding the specific procedure to be used in filling out the bid price proposal sheet, she did not ask her husband Stephen Mims what information had been given to him during the mandatory pre-bid conference. Additionally, although the bid package advised potential bidders as to requirements for filing a protest regarding the bid solicitation itself, Mims Gardens did not protest the bid solicitation. Stephen Mims did not assist in the preparation of the bid proposal of Mims Gardens. When the bid proposal for Mims Gardens was completed, Kathleen Mims did not show it to Stephen Mims to ascertain if it complied with the instructions given to him at the mandatory pre-bid conference. She simply filed her bid with the Department of Transportation on January 18, 1991, the deadline for submittal of bids for the project in question. Thirteen sealed bids were received and opened by the Department of Transportation. Mims Gardens submitted the lowest bid based on the contractor's total bid price from the bid form. Vila and Son Landscaping submitted the second lowest bid. On January 25, 1991, the Department posted its Notice of Intent to award the project to Vila and Son Landscaping. That notice advised that the Department had determined the bid of Mims Gardens to be an irregular bid proposal and that the bid of Mims Gardens was therefore rejected. One other bid also contained multiple quantities and prices in some of the pay item categories, was also declared irregular, and was also rejected. Kathleen Mims admitted at the final hearing in this cause that if she had attended the mandatory pre-bid conference, she would have been able to fill out the bid proposal sheet correctly. Mims filed its notice of intent to protest on January 25, 1991, and its formal protest filed on February 1, 1991, was timely.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered: Declaring Petitioner's bid to be non-responsive; Rejecting Petitioner's bid; and Awarding Contract No. E4504, State Project Job No. 99004-3509 to Vila and Son Landscaping Corp. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 25th day of March, 1991. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 25th day of March, 1991. APPENDIX TO RECOMMENDED ORDER DOAH CASE NO. 91-0990BID Petitioner's proposed findings of fact numbered 1 except for the second and third sentences, 3-7, and 10-14 have been adopted either verbatim or in substance in this Recommended Order. The second and third sentences of Petitioner's proposed finding of fact numbered 1 have been rejected as being irrelevant to the issues under consideration in this cause. Petitioner's proposed findings of fact numbered 2, 8, and 9 have been rejected as being unnecessary for determination of the issues herein. Petitioner's proposed finding of fact numbered 15 has been rejected as not being supported by the weight of the evidence in this cause. Respondent's proposed findings of fact numbered 1, 2, the first sentence of 3, 4, and 6-11 have been adopted either verbatim or in substance in this Recommended Order. Respondent's proposed finding of fact numbered 5 and the second sentence of Petitioner's proposed finding of fact numbered 3 have been rejected as being irrelevant to the issues under consideration in this cause. COPIES FURNISHED: Mark Hankins, Assistant General Counsel Susan P. Stephens, Assistant General Counsel Florida Department of Transportation 605 Suwannee Street Tallahassee, Florida 32399-0450 Nancy Katherine Neidich, Esquire 2810 East Oakland Park Boulevard Suite 102 Post Office Box 5121 Fort Lauderdale, Florida 33310 Ben G. Watts, Secretary Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0458 ATTN.: Eleanor F. Turner, M.S. 58
The Issue On May 12, 2004, did Respondent, Department of Transportation (DOT), act illegally, arbitrarily, dishonestly, or fraudulently when it cancelled the posting and noticed its intent to reject the bid of Rosiek Construction Co., Inc. (Rosiek), in relation to financial project Nos. 256903-1-52-01 and 256903-1-56-01, Pinellas Bayway Bridge Replacement, SR 682 (the Project)? § 120.57(3)(f), Fla. Stat. (2004).
Findings Of Fact The subject of this protest is financial project Nos. 256903-1-52-01 and 256903-1-56-01, Pinellas Bayway Bridge Replacement. Respondent and 12 other pre-qualified bidders received copies of the bid solicitation notice, plans and specifications for the Project at issue. Rosiek submitted a responsive bid for the Pinellas Bayway Bridge Replacement on April 28, 2004. There were no other bidders. Rosiek is pre-qualified to bid and receive the contract for the Project and therefore is a responsible bidder. On May 12, 2004, DOT posted its notice of intent to reject all bids. Rosiek timely filed this bid protest on May 14, 2004, with DOT, along with the statutorily required bid protest bond. DOT's 2004 Standard Specifications for Road and Bridge Construction is applicable to this project. FACTS BASED UPON ROSIEK'S ADMISSIONS DOT had advertised its bid solicitation notice for Financial Project Nos. 256903-1-52-01 and 256903-1-56-01, Pinellas Bayway Bridge Replacement on or about March 4, 2004. Rosiek received the copy of the Bid Solicitation Notice for the Project. Rosiek did not file a specifications challenge with respect to the referenced Project. DOT advertised the amount of $37,087,000.00 as its budgeted amount for the Project. Rosiek submitted a total bid of $50,470,378.12 for the Project (total bid A+B). ADDITIONAL FACTS Juanita Moore is a manager of the DOT Contracts Administration Office. She served as a member of the Technical Review Committee and the Awards Committee in relation to the Project. When the Technical Review Committee is confronted with a bid, such as the Rosiek bid, which is from a single bidder, something is missing from the bid or for certain differentials in price between the bid received and the official cost estimate, the Technical Review Committee considers these to be "problem jobs." In connection with terminology, Ms. Moore explained that the budget figure, referred to in the Bid Solicitation Notice for the Project as a Proposal Budget Estimate, is derived from an earlier estimate in the process and in turn an official cost estimate was established for the Project. The official cost estimate is also referred to simply as the estimate. The official cost estimate has not been disclosed as has been explained in the Preliminary Statement to the Recommended Order. The official cost estimate here is broken down into component items within the Project pertaining to cost for Mobilization, Concrete Class IV, Concrete Class V, etc. After the Technical Review Committee considered the Rosiek bid, the bid was passed on to the Awards Committee where it was decided to reject the bid. According to Ms. Moore the bid was rejected as too high when compared to the official cost estimate. The reference to a bid being too high relates to a bid which is more than 10 percent in excess of the official cost estimate. The budget figure and the official cost estimate are not necessarily the same in a given instance. The fact that it was the only bid was also a factor considered in the rejection. As Ms. Moore explained, at the time the Rosiek bid was rejected, it was principally because it was too high in relation to the official cost estimate. Given the posture in this case, the rejection as the only bid will form the basis for resolving this dispute, absent DOT's willingness to divulge the amount of the official cost estimate or how it was established. DOT does not have an established policy for rejecting bids based upon the fact that only a single bidder responded to the solicitation. In her experience, Ms. Moore does not remember DOT rejecting a bid solely on the ground that there was only one bidder. The minutes of the Awards Committee meeting held on May 12, 2004, detail the response by that committee to the Rosiek bid. In the copy of that document provided for this proceeding, DOT's official cost estimate is redacted. The percentage differential between the official cost estimate and the Rosiek bid is likewise redacted. The item number 0101-1 for Mobilization reflects Rosiek's bid of $4,900,000.00 compared to the official cost estimate which is redacted. Similarly, Item No. 0400-4-4, Concrete Class IV refers to the contractor bid price of $800.00 per cubic yard compared with the official cost estimate which is redacted. There are other comparisons between several additional categories or items in which the contractors bid price is reflected but the official cost estimate in comparison is redacted. The minutes go on to describe how the review being made by the Awards Committee led to the conclusion that the official cost estimate could be adjusted, placing the bid received by Rosiek a certain percentage above the estimate on a 10 percent criteria job but the differential between the adjusted official cost estimate and the Rosiek bid is not revealed as a percentage because of redaction. The DOT district where the project would be located is District 7, the Tampa office. The minutes of the Awards Committee meeting indicate that the district and the Technical Review Committee recommended to the Awards Committee that it reject the Rosiek bid and re-advertise. That was the decision made by the Awards Committee on May 12, 2004, to re-let in June. Nothing in the minutes prepared by the Awards Committee refers to the significance of Rosiek as the only bidder and any concern which the Awards Committee had about that fact. On May 12, 2004, when DOT provided a Cancellation of Posting and a Notice of Intent to Reject to Rosiek, it did not state the rationale for that decision. It merely indicated to Rosiek that it was DOT's intent to reject all bids on the project and advised Rosiek of its opportunity to contest that decision. On May 5, 2004, Kenneth A. Hartmann, P.E., the District 7 Secretary, prepared the District Response to Post- Bid Evaluation of Bids in Excess of Approved Award Criteria. The document is presented in question-and-answer form. In response to the question numbered 4 within the document, related to the prospect of critical safety deficiencies in the existing system being corrected by the construction of a new bridge, Mr. Hartmann responded with the answer "No." In relation to question numbered 2, excluding normal inflation, the question was asked whether re-advertising the project would likely result in a higher bid. Mr. Hartman answered "No." In response to question numbered 16, related to his recommendation as the district secretary, for action that should be taken by the Awards Committee he stated "This project should be rejected and re-advertised for a June 2004 1st [sic]. Considering that the project is medium to large and was competing against two other large bridge projects on the same day it is understandable that the contractor's bid was higher than our estimate." In response to question numbered 15 concerning the work load level of the contracting industry in the locality where the project would be constructed, Mr. Hartmann referred to "a high level of work load." At hearing Donald Skelton, P.E., the District 7 Secretary testified in support of the rejection of the Rosiek bid. In the past he had served as Director of Transportation Development with DOT, a position that made him responsible for preparation of the design plans and contract packages that are bid. He had involvement with this Project pertaining to the preparation of design plans and getting the Project to contract letting. He reviewed the Rosiek bid. In discussions related to the Rosiek bid during the post-bid evaluation period, there was a concern over a lack of competition and the differential between, what Mr. Skelton refers to, as the budget amount and the bid amount by Rosiek. Mr. Skelton was mindful of potential safety issues that might warrant the prospect of trying to find additional money to fund the Project, if it was necessary to replace the existing bridge for safety reasons. If the bridge were structurally deficient or in bad shape, that would need to be addressed, versus the additional time necessary to potentially rebid the project. No safety issues of that sort were found by Mr. Skelton. Mr. Skelton explained that the fact that there was single bidder made it difficult, if not impossible, to make a comparison between that bid and what the true market value of the bridge construction would be. Mr. Skelton expressed the hope by the DOT, that there would be more than one bidder in the future to truly get an impression of the degree of competition and whether the competition would result in a realistic price for the public. He recognized that there is no guarantee that DOT is going to get a lower bid if the project is re-bid. Mr. Skelton indicated that when you have multiple bids you can compare what the economic system would support in relation to the affordability of the project. That comparison is of similarity in prices among the competitors trying to win the job, with the belief that bidders put their best effort forward to prevail in the competition. A single bid does not give any indication of market factors, in his view. Michael Rosiek is the vice-president for Rosiek. In his testimony, he expressed a concern that if the project was re-let for bid, Rosiek's competitive position would not be good, in that the other contractors would have read the Rosiek bid that was made in the first letting, informing the competitors of the Rosiek price to its detriment. Further, Mr. Rosiek expressed a concern that in a re-letting the company would be bidding "against ourselves." Louis Wenick, P.E., has a business consulting service. The nature of the business is consulting work relating to the construction industry. A considerable part of the business involves DOT projects. In his work Mr. Wenick is involved with scheduling, cost analysis, and entitlement analysis in DOT projects. He is familiar with DOT's specifications, policies, and procedures. Mr. Wenick is a registered engineer in Florida and a certified general contractor in Florida. Mr. Wenick obtained information from DOT concerning its history in receiving sole bids for a project and the instances in which the sole bidder was awarded the contract. Mr. Wenick looked at procedures followed by DOT in awarding contracts. Mr. Wenick looked at the DOT experience in re- letting bids to determine if a company was a low bidder in the first letting when bids were rejected, and what percentage of the time that low bidder would succeed in being awarded the contract upon a re-letting. Mr. Wenick prepared certain charts intended to depict the DOT response in the areas examined by the witness. Rosiek's Exhibit numbered 3 is referred to as Problem Jobs for the April 28, 2004, letting, with two posting dates of May 20, 2004, and June 7, 2004, respectively. The chart depicts the proposal I.D. number (bid), the project number and the type of problem identified in reviewing bid responses and a brief statement of the Technical Committee's comments and the Awards Committee's disposition in those projects depicted. Nothing more is described in the chart. In no case set forth in the chart was the type of problem described in any detail or, limited to an experience with a single bidder, as opposed to perceived problems in relation to the bid that was too high, as well as having a single bidder or to the problem of having a bid that was too high alone. Seven projects were awarded. Two were not. The rejections were based upon the bids being too high. One of the projects initially awarded was later rejected due to the unavailability of local funding to support the project. Mr. Wenick prepared a chart, Rosiek's Exhibit numbered 4. This reflects the DOT award results for sole or single bidders from the period July 1999 through April 2005. The columns in the chart show the numeric count of sole bids, at certain letting dates, with the contracts numbers, the name of the low bidder, and the disposition of the bids. The numeric count of sole bids is a running tally over the period. This reflects 52 sole bids of which eight were rejected, making the percentage accepted 84.62 percent. Again the nature of the projects is not shown in the chart, and this chart does not indicate the basis for rejection. Rosiek's Exhibit numbered 5 is another chart prepared by Mr. Wenick. It reflects instances in which projects were re-let for bid in the period July 1999 to April 2005. The letting dates are reflected. The project numbers, the low bidders names, if known, and the amount quoted is set out. The re-let date if the project was re-let is reflected. The low quote on re-bid and the low bidder's name on re-bid are reflected, as is the percentage difference between the low quote in the first letting and the low quote in the re- letting. Where data is established in all columns in the chart, 18 of the projects are shown to have been re-bid out of 24 projects that were bid initially. Within that group, five bidders who bid in the initial letting were awarded the contract in the re-letting, while 13 low bidders in the first letting were disappointed in the re-letting. This equates to 27.78 percent success rate by the low bidder in the initial letting when re-bidding in the re-letting. Having considered the exhibits prepared by Mr. Wenick, the information is insufficient to discern the reason for DOT's past policies and practices and to compare them to the present case for consistencies in the application of those policies and practices when rejecting bids. Additionally, the reason for the choices in any single project described in the charts cannot be appropriately understood from the charts and compared to the experience here. On the topic of the success rate for contractors who provided the low bid in the original letting and the low bid in the re-letting, it is so general an analysis, that it cannot be relied upon to determine the real significance for contractors who provided the low bid in the original letting, only to be disappointed in the re-letting when the contractor did not receive the contract.
Recommendation Upon consideration, it is RECOMMENDED: That a final order be entered dismissing the Rosiek Amended Formal Written Protest challenging the DOT decision to reject its bid. DONE AND ENTERED this 17th day of August, 2005, in Tallahassee, Leon County, Florida. S ___________________________________ CHARLES C. ADAMS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 17th day of August, 2005.
Findings Of Fact On August 31, 1994, the Respondent received and opened bids for its Project No. HSMV 92044000, Repairs, Art Sutton Drivers' License Office, Miami, Florida (the Project). The bid specification documents (the Specifications) for the Project included requirements for a Base Bid and for specific alternate proposals with respect to three defined items of alternate work. Section 01100 of the Specifications stated that "[a]ll Alternates described in this Section are required to be reflected on the Bid Form as submitted by the bidder." Part 2 of that section provided: ALTERNATE NO. 1 A. Provide a deductive price to the base bid for the removal of existing window units and the installation of new units as indicated in plans and specification Section 08520. ALTERNATE NO. 2 A. Provide a deductive price to the base bid for the provision of communications conductors see specification Section 16400. ALTERNATE No. 3 A. Provide a deductive price to the base bid for the installation of all landscape materials as indicated on plans and as per specification Section 02960. Also included in the Specifications as Exhibit 4 was a Proposal Form. The Specifications required each bidder to submit this form in triplicate on the bidder's letterhead. With respect to alternates, the Proposal Form required: With the foregoing as a Base Bid, the following costs of alternate proposals are submitted in accordance with the drawings and specifications. Alternate No. 1 Add or Deduct $ Alternate No. 2 Add or Deduct $ Alternate No. 3 Add or Deduct $ The Respondent's architect received four bids on August 31, 1994. As recorded on the Bid Tabulation and Notice of Award Recommendation, three bidders provided specific prices for the three alternates, as well as a Base Bid. The Bid Tabulation shows that two bidders provided specific prices for the three alternates and included the alternate prices in their Base Bids. The Petitioner provided specific prices for the three alternates, but excluded the alternate prices from its Base Bid. The fourth bidder provided a specific price for only one alternate and excluded that alternate price from its Base Bid. (The fourth bidder was disqualified as non-responsive for failing to submit prices on all three alternates.) In pertinent part, the Petitioner's proposal read: With the foregoing as a Base Bid, the following costs of alternate proposals are submitted in accordance with the drawings and specifications: Alternate No. 1 Add or Deduct . . . $4,400.00 Alternate No. 2 Add or Deduct . . . $1,158.00 Alternate No. 3 Add or Deduct . . . $2,084.00 These Alternates were in addition to the Petitioner's Base bid of $204,322.00. The proposal form submitted by the Petitioner comports with Exhibit 4 to the Specifications, which was the mandatory Proposal Form. On August 31, 1994, William Phillip Austin, Peitioner's President, wrote the architect: Per our telephone conversation this date regard- ing the confusion relating to the Add/Deduct for Alternates 1, 2 and 3 for the above project, please be advised that our base bid did not include the work described in the Alternates. As stated if you want work described in Alternates 1, 2 and 3, you must add the cost to our base bid. The base bid including Alternates 1, 2 and 3 would, therefore, be $211,964.00. If we can provide additional information, please do not hesitate to contact us. The Respondent's architect completed and submitted the bid Tabulation and Notice of Award Recommendation to the Respondent in early September. The document clearly discloses the amounts of each bidder's Base Bid and Alternate proposals. Using plus (+) and minus (-) signs, the Bid Tabulation further shows each bidder's method of calculation. The record is devoid of evidence that the Respondent had any problem in evaluating the bids and identifying the lowest bidder. The Petitioner was the lowest bidder on any combination of base bid plus or minus any or all alternates. Subsequently the Petitioner received a NOTICE OF AWARD RECOMMENDATION dated October 4, 1994. The Notice informed the Petitioner that the Respondent "has recommended that the contract be awarded to your firm in the total amount of $211,964.00, accepting the Base Bid and Alternates #1, #2 & #3. The Administrator of Contracts Design and Permitting, Division of Building Construction, Department of Management Services, State of Florida will consider this recommendation." Larry R. Coleman, Construction Projects Administrator, signed the letter. The Petitioner acknowledged receipt. A representative of the second lowest bidder, Kalex Construction, then contacted the Respondent, complaining of the Award Recommendation. The grounds for the Kalex complaint are not in the record. However, on October 14, 1994, H. R. Hough, the Respondent's Contracts Administrator, sent the Petitioner a letter "to notify you of the State's decision to reject all bids on the above referenced project due to ambiguities in the specifications." Mr. Hough's reasons for the rejection are "other than those stated by the protestor," Kalex. The Respondent's Rule 60D-5.007, Florida Administrative Code, states: Determination of Successful Bidder. All projects except where competitive bidding is waived under the provisions of Rule 60D-5.008 will be publicly bid in accordance with the provisions in the project specifications bidding documents. Award of contract will be made to the responsive bidder, determined to be qualified in accordance with the provisions herein and meeting the requirements of the bidding documents, that submits the lowest valid bid for the work. The lowest bid will be determined as follows: The lowest bid will be the bid from the responsive bidder that has submitted the lowest price for the base bid or the base bid plus the additive alternates or less the deductive alternates chosen by the Agency to be included in or excluded from the proposed contract, taken in numerical order listed in the bid documents. The order of the alternates may be selected by the Agency in any sequence so long as such acceptance out of order does not alter the designation of the low bidder. Under the above-quoted rule, the Respondent compares bids beginning with the lowest "base bid." The Respondent is of the view that for this comparison to be fair and equal, all bidders must include the same scope of work in the "base bid." The Respondent does not interpret the above-quoted rule to allow deductive alternates from some bidders and additive alternates from others. (For reasons discussed in the Conclusions of Law which follow, the Respondent's interpretation and application of the above-quoted rule is erroneous.) The Specifications contain some ambiguous and inconsistent language regarding whether alternates should be treated as additive or deductive. The ambiguous and inconsistent language did not provide any bidder with an advantage or a disadvantage, nor did it otherwise affect the fairness of the bidding process.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Management Services issue a Final Order in this case awarding a contract for the subject project to the Petitioner. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 16th day of December 1994. MICHAEL M. PARRISH Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 16th day of December 1994. APPENDIX The following are my specific rulings on all proposed findings of fact submitted by all parties. Proposed findings submitted by Petitioner Paragraph 1: This is primarily a statement of position and is addressed in the Preliminary Statement. Paragraphs 2 through 10: Accepted in substance with a few unnecessary details omitted. Proposed findings submitted by Respondent Paragraphs 1 through 6: Accepted in substance. Paragraph 7: First sentence accepted in substance. Second sentence rejected as constituting a conclusion which is not warranted by the evidence. Third sentence is accepted as an accurate statement of how Respondent has been interpreting the subject rule, but is not accepted as constituting a correct interpretation of the rule. Paragraph 8: Rejected as misleading and confusing because the "scope of work" to be performed under the contract can only be determined after the Respondent decides which alternates to include and which to exclude. Paragraph 9: The first two sentences are accepted in substance. The last sentence is rejected as constituting a conclusion which is not warranted by the evidence. COPIES FURNISHED: Timothy J. Armstrong, Esquire Armstrong & Mejer Suite 1111 Douglas Centre 2600 Douglas Road Coral Gables, Florida 33134 Stephen S. Mathues, Esquire Department of General Services Knight Building, Suite 312 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950 Paul A. Rowell, General Counsel Department of General Services Knight Building, Suite 312 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950 William H. Lindner, Secretary Department of General Services Knight Building, Suite 307 Koger Executive Center 2737 Centerview Drive Tallahassee, Florida 32399-0950
The Issue The issue for determination in this proceeding is whether Respondent should award a contract for a new telecommunications system to Intervenor.
Findings Of Fact The Parties Petitioner is a wholly owned subsidiary of NEC, Inc., a Delaware corporation authorized to do business and doing business in Florida. Respondent is a political subdivision and agency of the state. Intervenor is a Delaware corporation authorized to do business and doing business in Florida. The System Respondent's telecommunications system lacks the capacity to meet current and future needs. Respondent seeks a new telecommunications system to serve a minimum of seven high schools, 10 middle schools, 29 elementary schools, and 12 support offices (the "system"). 1/ The Expert Respondent contracted with Omnicom, Inc. ("Omnicom") to assist Respondent in obtaining a new system that is in Respondent's best interest. Omnicom is an expert in telecommunications. The contract requires Omnicom to perform several functions. Omnicom must prepare an RFP, administer the solicitation and receipt of proposals, evaluate the proposals on a point system, issue a report of its evaluation, and recommend a selection that is in Respondent's best interest. Subjectivity There are two primary means of public procurement. One is an invitation to bid ("ITB"). The other is an RFP. The consulting contract refers to a "Request for Bid." The contract indicates that the document will establish an award to the "low fixed price bid meeting specifications." An ITB is significantly different from an RFP. An RFP is inherently more subjective than an ITB. An ITB requires bids to comply closely with the specifications prescribed in the ITB. An ITB prescribes specifications and a solution sought by the issuer. A bidder estimates the cost that the issuer will pay for the solution prescribed in the ITB. An RFP is more subjective. An RFP generally asks proposers to propose a solution to the issuer's stated needs and to estimate the cost of the proposed solution. Proposals generally describe the proposer's sense of the best solution and its cost. The criteria and procedures prescribed in an RFP are intended to minimize, but not eliminate, the subjectivity inherent in the RFP process. The procurement document Omnicom prepared is an RFP. The consulting contract does not require Omnicom to design and implement a new system for Respondent and then obtain bids for the cost of such a system. The RFP solicits solutions to Respondent's telecommunication needs. It prescribes criteria important to Respondent, and Respondent then evaluates proposals on the basis of those criteria. Those criteria include service. Intent Respondent paid Omnicom to recommend a proposal that is in Respondent's best interest. However, neither Omnicom nor Respondent intended the recommendation to usurp Respondent's authority to exercise discretion in taking final agency action. The RFP makes it clear that the proposal selected will be the system that Respondent determines to be in its best interest. The RFP states: The proposal selected will be the . . . system that meets the present and future needs of [Respondent] and is in the best interest of [Respondent]. * * * The objective of [Respondent] in soliciting and evaluating proposals . . . is to obtain a system that best meets the present and future needs of [Respondent] at a cost that is consistent with the features and services provided. * * * It should be understood that the information provided in this RFP is not to be construed as defining specific system equipment, features, or solutions, but rather is intended to present [Respondent's] needs and objectives in terms of system services and control. * * * The submission and acceptance of proposals does not obligate [Respondent] in any way. . . . [Respondent] reserves the right to reject any and all proposals received by reason of this request or to negotiate separately with any source whatsoever, in any manner necessary to serve its best interest. [Respondent] makes no representation, implied or expressed, that it will accept and approve any proposal submitted. * * * Proposals submitted may be reviewed and evaluated by any person at the discretion of [Respondent]. * * * In submitting a proposal, the proposer understands . . . [Respondent] will determine at [its] discre- tion, which proposal, if any, is accepted. RFP at 1-2, 2-1, 2-4, 2-6, 2-7, and 2-11. The RFP The evaluation criteria and procedures established in the RFP are consistent with Respondent's intent in contracting with Omnicom. The RFP establishes a fixed rule or standard by which Respondent selects the proposal that is in Respondent's best interest. Respondent paid Omnicom with public funds to formulate that fixed rule or standard. Final Decision The RFP requires the proposal with the greatest total awarded points to be selected for a contract award. The RFP does not require the proposal with the greatest total awarded points to be recommended for selection. The RFP states: Proposals will be ranked in accordance with the technical and administrative awarded points. . . . The proposal with the greatest total awarded points will be selected for a contract award. (emphasis supplied) RFP, Appendix E, E-2. Alleged ambiguities within the RFP are resolved by the clear and unambiguous meaning of the underscored words in the quoted language. The proposal with the greatest total awarded points is to be selected by Respondent for a contract award. The clear and unambiguous words in the RFP are reasonable. Respondent hired a recognized expert in telecommunications to oversee the acquisition and implementation of a new system. The evaluation criteria and procedures fixed in the RFP reflect Respondent's intent to rely on the expertise it purchased with public funds unless Respondent: rejects all proposals; rejects Omnicom's evaluation and recommendation and asks Omnicom to re-evaluate the proposals; or conducts an independent evaluation of the proposals and substitutes Respondent's own independent judgment. The underscored language in the RFP is specific. It is consistent with general language in the RFP. For example, selection of the proposal with the most points awarded by Omnicom is consistent with the following general provision: Proposals submitted may be reviewed and evaluated by any person at the discretion of [Respondent]. * * * In submitting a proposal, the proposer understands . . . [Respondent] will determine at [its] discre- tion, which proposal, if any, is accepted. RFP at 2-7, and 2-11. Other general language in the RFP authorizes Respondent to reject all proposals and either develop a new RFP, seek a system through the ITB process, or seek a system through a process that is exempt from public procurement requirements if the system or Respondent qualify for such an exemption. The RFP states: The submission and acceptance of proposals does not obligate [Respondent] in any way . . . [Respondent] reserves the right to reject any and all proposals received by reason of this request or to negotiate separately with any source whatsoever, in any manner necessary to serve its best interest. [Respondent] makes no representation, implied or expressed, that it will accept and approve any proposal submitted. RFP at 2-6. Such language is "boiler plate" in public procurement documents. Nothing in the RFP is intended to, or has the effect of, exempting Respondent from the law applicable to public procurement. The RFP states: [Respondent] reserves the right to . . . negotiate separately with any source whatsoever, in any manner necessary to serve its best interest. RFP at 2-6. Respondent can not solicit proposals and then negotiate separately with a select proposer or a third party in violation of the body of law applicable to public procurement. The language quoted in the preceding paragraph does not authorize Respondent to take final agency action in a manner that is not governed by fixed rule or standard. The fixed rule or standard that governs Respondent's determination of its best interest is prescribed in the RFP and sanctioned by Respondent. The RFP states: Proposals will be ranked in accordance with the technical and administrative awarded points. . . . The proposal with the greatest total awarded points will be selected for a contract award. (emphasis supplied) RFP, Appendix E, E-2. The quoted language is specific, clear, and unambiguous. To the extent it is inconsistent with general provisions in the RFP, the plain meaning of the specific language controls any general provisions that may be contrary to either the specific language or the law applicable to public procurement. Scope Of Review The RFP limits the scope of review to information contained in the proposals submitted by the proposers. The RFP states: . . . Only the information contained in the proposal and references verifications will be used in the evaluation. RFP at E-2. Respondent fixes the scope of review by limiting it to the information contained in the proposals. Review And Approval Respondent reviewed the rule or standard fixed in the RFP. Respondent approved the RFP on July 11, 1995. On July 12, 1995, Omnicom issued the RFP. Omnicom's Evaluation And Recommendation The RFP solicits base proposals and alternate proposals that achieve Respondent's objectives for a new system. No alternate proposal is authorized without a base proposal that complies with the basic configuration prescribed in the RFP. Seven proposals were submitted to Omnicom. Omnicom determined that one proposal did not satisfy mandatory requirements. Omnicom evaluated the six proposals that satisfied mandatory requirements. They are: Petitioner's base proposal; Petitioner's alternate proposal; Intervenor's proposal; a base proposal from Bell South Business Systems, Inc. ("Bell South"); a base proposal from Orlando Business Telephone Systems ("OBTS"); and a base proposal from WilTel Communications, Inc. ("WilTel"). Omnicom awarded the following technical, cost, and total points. PROPOSAL TECHNICAL COST TOTAL NEC (Alternate) 699 200 899.0 Siemens ROLM 715.5 179 894.5 Bell South 719.5 161.1 880.6 NEC (Base) 700 172.8 872.8 WilTel(Base) 617 157.2 774.2 OBTS 595.5 158.4 753.9 Omnicom ranked Petitioner's alternate proposal highest in total points and points awarded for cost. Omnicom ranked Intervenor's proposal highest in technical merit. Omnicom conditioned its recommendation of Petitioner's alternate proposal on resolution of several concerns Omnicom expressed in its evaluation report. Those concerns are included in the discussion in paragraphs 108-124, infra. Omnicom recommended Petitioner's alternate proposal for selection if Respondent could resolve the concerns Omnicom had with Petitioner's alternate proposal and if Respondent deemed it to be in Respondent's best interest. Omnicom recommended Intervenor's proposal if Respondent either could not resolve Omnicom's concerns or if Respondent did not deem Petitioner's alternate proposal to be in Respondent's best interest. Arbitrary Selection Respondent selected Intervenor's proposal over Petitioner's alternate proposal. Respondent's selection of Intervenor's proposal was within the scope of the recommendation made by Omnicom. However, the manner in which Respondent exercised its agency discretion is arbitrary. The manner in which Respondent determined that Intervenor's proposal is in Respondent's best interest is not governed by any fixed rule or standard. Respondent did not conduct an independent evaluation and substitute Respondent's own judgment. Respondent did not apply the rule or standard fixed in the RFP to the information included in the proposals and substitute its judgment for that of Omnicom. Respondent did not substitute a fixed rule or standard different from the rule or standard fixed in the RFP. Respondent substituted a rule or standard that is not fixed but is invisible and known only to Respondent. Respondent expanded the evaluation procedure and scope of review fixed in the RFP. Respondent improperly applied criteria fixed in the RFP and applied improper criteria not established in the RFP. 6.1 Scope Of Review The RFP assignes a maximum of 800 points to criteria prescribed in six technical categories. It assigns a maximum of 200 points to cost. The maximum total score for technical and cost criteria is 1,000 points. The points Respondent fixed for the criteria in the RFP indicate the relative importance of the criteria. The RFP states: Proposals will be ranked in accordance with the technical and administrative awarded points and a short list of proposals established for further evaluation. The short listed proposals will then be evaluated on a cost basis and points awarded accordingly. Awarded cost points will then be summed with the awarded technical and administrative points. The proposal with the greatest total awarded points will be selected for a contract award. RFP, Appendix E, at E-2. 38. Omnicom evaluated the six proposals that met mandatory requirements and submitted an evaluation report in accordance with the evaluation criteria and procedures fixed in the RFP. The report recommends that the contract be awarded to Petitioner. In accordance with the evaluation procedure established in the RFP, Omnicom's evaluation report was submitted to a review committee on September 8, 1995. The committee consisted of knowledgeable representatives from the community and select employees of Respondent. The committee reviewed the evaluation report for accuracy and objectivity. The committee took no exception to any portion of the evaluation report and recommendation. In accordance with the evaluation procedure established in the RFP, the Superintendent of the Seminole County School District (the "Superintendent") recommended that Respondent award the contract to Petitioner for its alternate proposal. Respondent did not take issue with the recommendations of Omnicom, the committee, or the Superintendent. Respondent issued a notice of intent to award the contract to Petitioner on September 8, 1995. Respondent scheduled a work session for September 12, 1995, to consider the evaluation report from Omnicom and to vote on Omnicom's recommendation. 6.1(a) Intervenor's Expanded Proposal On September 11, 1995, Intervenor sent a letter to each of Respondent's members. Separately, each member obtained a report on user ratings of telecommunications equipment. The letter urged Respondent to consider Intervenor's local presence, including the local presence of Siemens Stromberg Carlson, Intervenor's corporate sibling. The letter asserted that Petitioner has no significant local presence. It claims that Intervenor is a "Tier 1" telecommunications vendor and that Petitioner is not. None of these matters were included in Intervenor's proposal even though service was one of the criteria for evaluation. Intervenor's solicitation provided Respondent with information not included in Intervenor's proposal. The additional information exceeded the scope of review and evaluation procedure fixed in the RFP. 6.2(b) Altered Procedure At the work session conducted on September 12, 1995, Respondent accepted comments from the public and from proposers. Intervenor emphasized its status as a Tier 1 vendor. One of Respondent's members expressed concern that Petitioner had only one local representative and that he worked out of his home. Petitioner has four technicians and stated in its alternate proposal that two additional technicians would be added. No member read any of the proposals. A second member stated that cost is an insignificant matter. The second member opined that cost should not be an issue considered in making the final decision. The second member is a senior management employee for Bell South. Bell South was ranked third in total points by Omnicom. The second member seconded a motion to postpone the contract award. In considering postponement of their vote, the members relied on information contained in Intervenor's expanded proposal. The members voted to postpone the award of the contract until September 20, 1995. At that meeting, each proposer was to make a twenty minute presentation to Respondent. 6.2(c) Improper Consideration Of Fixed Criteria And Consideration Of Improper Criteria The background statement in the agenda to the meeting scheduled for September 20, 1995, stated that Omnicom's point scores could not be used as the determining factor in awarding the contract because all but one of the proposals "did not meet all mandatory requirements." This was the first instance in which either Respondent or Omnicom indicated that any proposal except the alternate proposal submitted by WilTel failed to satisfy mandatory requirements in the RFP. 2/ None of Respondent's individual members read any portion of the proposals submitted to Omnicom. The members did not make independent determinations of whether the proposals submitted by Petitioner or Intervenor in fact satisfied mandatory requirements established in the RFP. On September 18, 1995, Petitioner notified Respondent that Petitioner protested the meeting scheduled for September 20, 1995. Petitioner stated that it would participate in the meeting under protest; without waiving any right it had to protest Respondent's deviation from the evaluation criteria, procedure, and scope of review fixed in the RFP. In the Notice of Public Meeting issued for the September 20 meeting, Respondent stated it may add up to 200 points to the total points awarded by Omnicom. The additional points were to be based upon the information the proposers submitted at the meeting. This was the first time Respondent disclosed the availability of points other than the 1,000 points fixed in the RFP. The Notice of Public Meeting stated no criteria upon which the additional points would be awarded. Respondent did not formulate any criteria upon which to award the additional points. 6.2(d) Final Decision: Expanded Scope, Altered Procedure, Improper Consideration Of Fixed Criteria And Consideration Of Improper Criteria At the meeting conducted on September 20, 1995, the proposers gave presentations to Respondent and Omnicom. The proposers answered questions posed orally by Respondent's individual members. Omnicom responded to comments made by the proposers. Each proposer was then allowed two minutes for "surrebuttal." The majority of comments related to reasons why specific points were deducted during Omnicom's evaluation. The proposers did not have access to a specific point award matrix to which the members may have referred during the meeting. The subject matter of the inquiry included criteria established in the RFP, including service capability. The inquiry did not focus on conditions Omnicom attached to its recommendation of Petitioner's alternate proposal. See, paragraphs 108-124, infra. Intervenor repeated its representation that it is a Tier 1 vendor. Intervenor asserted that it is the number one PBX supplier in the world and the number two vendor in annual expenditures for research and development. Intervenor submitted documents substantiating its claims. None of this information was included in Intervenor's proposal. After the presentations, the Superintendent suggested the members write down three of the five proposers. The Superintended stated that the additional points would not be written down because they were for the use of the individual members. The first round of voting produced a new short list that deleted Petitioner and consisted of Intervenor and Bell South. The members then discussed the two proposals on the new short list. During the discussion, one member stated that she felt the RFP assigned too many points for cost. The members voted to award the contract to Intervenor. The member who is an employee of Bell South recused himself from the final vote. The voting members did not disclose the criteria they relied on for their vote, the weight assigned to the criteria relied on, the additional points assigned, or the fixed rule or standard which governed Respondent's determination of which proposal was in Respondent's best interest. On September 21, 1995, Petitioner received Respondent's formal notice to award the contract to Intervenor. The notice states only that Respondent's decision is based on the evaluations by Omnicom and the presentations on September 20, 1995. 3/ The manner in which Respondent determined that Intervenor's proposal is in Respondent's best interest was not governed by any fixed rule or standard. Respondent selected Intervenor's proposal in a manner contrary to the rule or standard fixed in the RFP and on the basis of criteria and procedures that are not fixed in the RFP. Major Variation Respondent's deviation from the rule or standard fixed in the RFP is a major variation. The deviation affects the price of the contract selected. It gives Intervenor a benefit not enjoyed by other proposers. It adversely impacts the interests of Respondent. 4/ Contract Price Respondent's deviation from the rule or standard fixed in the RFP affected the contract price in two ways. First, it affected the stated cost of the contract. Second, it added costs that are inherent, but not stated, in Intervenor's proposal. 7.1(a) Stated Cost The complete system is to be installed in all 58 facilities over five years. The useful life of the system is between 7 and 10 years. Omnicom valued the system included in each proposal over its 10 year life expectancy. Omnicom placed the cost for each facility on a spread sheet correlating to the anticipated time of installation. The cost of each facility was discounted to its net present value at the time of evaluation. The evaluation report rates costs through 10 years because that is the reasonable life expectancy of the system. The cost of Intervenor's system was less in years 1-5. For the total life expectancy of the system, however, the cost of Petitioner's alternate proposal was less. During the 10 year useful life of the new system, the cost of Petitioner's alternate proposal would save Respondent $1,547,726 over the cost of Intervenor's proposal. The net present value of that savings is $1,212,528. Omnicom awarded the following technical, cost, and total points for the seventh year of operation. PROPOSAL TECHNICAL COST TOTAL NEC (Alternate) 699 200 899.0 Siemens ROLM 715.5 179 894.5 Bell South 719.5 161.1 880.6 NEC (Base) 700 172.8 872.8 WilTel(Base) 617 157.2 774.2 OBTS 595.5 158.4 753.9 The total point differential between Petitioner and Intervenor widened for years 8-10. The points awarded for the cost of Intervenor's proposal dropped to 178.4, 177.8, and 177.3, respectively, in years 8-10. The corresponding total scores for Intervenor's proposal dropped to 893.9, 893.3, and 892.8. 7.1(b) Unstated Cost The RFP requires five out of eight categories of work station devices to be two-way speaker phones. Two-way speaker phones eliminate the need for ancillary intercom equipment. Two of the five categories required to be two-way speaker phones are noncompliant in Intervenor's proposal. Compliant telephones are more expensive than the telephones used by Intervenor to calculate the cost Omnicom evaluated. Compliant telephones would cost approximately $736,901 more than the cost evaluated by Omnicom; based on information available in Intervenor's proposal. 5/ Respondent will either incur additional costs to acquire compliant telephones or incur the cost of ancillary intercom equipment. Benefit Not Enjoyed By Others Intervenor enjoyed a benefit not enjoyed by others. Intervenor obtained a competitive advantage and a palpable economic benefit. 7.2(a) Expanded Scope Respondent's reliance on a rule or standard not fixed in the RFP resulted in a benefit to Intervenor. Other proposers did not enjoy a similar benefit. 6/ The proposers relied upon the point distribution, evaluation procedure, and criteria fixed in the RFP. Any of the proposers could have solicited Respondent to consider information not included in the proposals, to follow procedures not established in the RFP, to assign an undisclosed weight to criteria fixed in the RFP, and to consider undisclosed criteria. However, only Intervenor successfully solicited Respondent to do so and then enjoyed the benefit of being selected for the contract. Respondent made concessions that favored Intervenor. No other proposer enjoyed the benefit of Respondent's concessions in a manner that changed the outcome of the contract award. 7.2(b) Alternate Proposal The base proposal required in the RFP included a configuration using analog tie lines. Intervenor prepared only one proposal. It included only digital tie lines. Intervenor's proposal is an alternate proposal. It does not include the analog tie lines required in the basic configuration prescribed in the RFP. Omnicom deducted points for Intervenor's failure to include analog tie lines. However, Omnicom evaluated Intervenor's alternate proposal in the absence of a base proposal. 7/ All other proposers complied with the provision in the RFP that prohibited alternate proposals in the absence of a base proposal. The prohibition, in effect, required Petitioner to submit two proposals. Petitioner prepared a base proposal and an alternate proposal. Petitioner prepared two quotes for each of the 58 facilities contemplated in the new system. Intervenor prepared only one quote for each of the facilities contemplated in the new system. Intervenor did not invest the time, energy, and expense invested by Petitioner in its two proposals. 7.2(c) Cost By using noncompliant telephones in its proposal, Intervenor lowered the cost evaluated by Omnicom. If other proposers had proposed noncompliant telephones, they would have been able to affect their evaluation scores in a positive manner. Intervenor received a palpable economic benefit from its omission. A cost difference of $50,000 to $100,000 translates to approximately two points in the evaluation process. An increased cost of $736,901 would have lowered Intervenor's cost score between 7.36 and 14.7 points. 8/ Omnicom did deduct points from Intervenor's technical score for the failure to include compliant telephones in its proposal. However, Omnicom did not deduct points for Intervenor's failure to include unit prices for compliant telephones. 9/ Unit prices are necessary for Omnicom to accurately calculate the increased cost of compliant telephones. Omnicom could not calculate the increased cost of compliant telephones based on the information available in Intervenor's proposal. Omnicom evaluated the cost of Intervenor's proposal based on the cost stated in the proposal. Adverse Impact On Respondent Respondent's deviation from the evaluation criteria and procedures fixed in the RFP has an adverse impact on the financial interests of Respondent. The award of the contract to Intervenor will cost Respondent approximately $1,212,528 in present value. Respondent may need to purchase compliant telephones at an additional cost of up to $736,901. Alternatively, Respondent may need to purchase ancillary intercom equipment at an unknown cost. Respondent's deviation from the evaluation criteria and procedures established in the RFP has an adverse impact on the Respondent's technical needs. The award of the contract to Intervenor may result in the use of noncompliant telephones, ancillary intercom equipment, or, in the event of an unforseen budget shortfall at the time, none of the technical capabilities needed by Respondent. Public Policy There is a "strong public policy against disqualifying the low bidder for technical deficiencies. . . ." 10/ Although an RFP inherently demands more subjectivity than an ITB, Respondent disqualified the low proposer for reasons that are not governed by any fixed rule or standard. Respondent could have rejected all six proposals and sought to obtain its system through a new RFP, the ITB process, or a process exempt from public procurement requirements; if the system or Respondent qualifies for such an exemption. 11/ However, Respondent did not reject all proposals and start over or seek to obtain its system through an exempt process. Respondent paid public funds for Omnicom's expert advice. Respondent paid Omnicom to evaluate Respondent's technical needs, formulate criteria, develop an evaluation procedure, prepare an RFP, evaluate proposals, and recommend the proposal that was in Respondent's best interest. Respondent approved the RFP prepared by Omnicom, including the rule or standard fixed in the RFP. Respondent then deviated from the fixed rule or standard. Respondent added points to change the relative importance of the technical and cost criteria fixed in the RFP. Respondent awarded up to 200 points in addition to the 1,000 points fixed in the RFP. The members neither disclosed the criteria they used to award additional points nor disclosed the number of points awarded. The members did not reveal, explain, or define either the weight assigned to each fixed criteria or any other fixed rule or standard used to evaluate the oral presentations made by the proposers. Respondent did not conduct an independent evaluation of the proposals and substitute its own judgment for that of Omnicom. None of Respondent's members read any of the proposals. Omnicom evaluated the proposals fairly, objectively, and reasonably. Omnicom's evaluation and recommendation was an honest exercise of agency discretion by the agency's own expert. 12/ Respondent neither rejected Omnicom's evaluation of the proposals nor rejected the proposals. Respondent did not request that Omnicom re-evaluate the proposals and did not request that Omnicom start over with a new RFP, an ITB, or pursue a system through an exempt process. Respondent neither explained its exercise of agency discretion on the record in this proceeding nor disclosed a fixed rule or standard Respondent used to govern its action. Respondent made an arbitrary decision. Illegal Respondent made an emergency award of a portion of the contract to Intervenor during the pendency of this proceeding. The award is limited to a purchase order for one switch out of 52 switches that will comprise the complete system. The single switch is necessary for Respondent to occupy its new administrative offices. Occupancy of the new administrative offices has always been a critical element in procurement of the entire system. Respondent is currently engaged in accomplishing this critical element. Respondent's award of part of the contract is not required by an immediate and serious threat to the public health, safety, or welfare. Respondent awarded part of the contract to Intervenor for public convenience. Installation of the system at the new administrative offices is necessary to occupy the new building. Occupancy is necessary so that various administrative offices of the School District can be consolidated. The School District has incurred costs since October, 1995, for utilities and maintenance associated with the unoccupied building. The reasons evidenced by Respondent constitute neither an immediate nor serious threat to the public health, safety, and welfare. It is not necessary to award any portion of the contract prior to final agency action in this proceeding. Minor Irregularities Omnicom conditioned its recommendation of Petitioner's alternate proposal on resolution of four concerns. Petitioner's alternate proposal failed to include detailed price information for one of the elementary schools in the new system ("Elementary School D"). Petitioner failed to separate its installation price from the price for hardware and software. Petitioner conditioned the mandatory commitment to discounted pricing beyond July, 1997, on a requirement that Respondent accept Petitioner's full contract. Finally, Petitioner failed to base its cost on required response times. Elementary School D Petitioner failed to include information for Elementary School D on the individual system detail price sheet. Petitioner's failure does not affect the contract price, does not result in a palpable economic benefit to Petitioner, and does not adversely affect Respondent's interest. Omnicom sent out approximately six addenda to the RFP before completing its evaluation. One of the addenda failed to include Elementary School D. Omnicom discovered the error and evaluated the cost of all proposals with Elementary School D excluded. The omission of Elementary School D was an honest exercise of agency discretion by Omnicom and did not result in disqualification of the low proposal for technical reasons. Combined Pricing The detailed price sheets for each school and support office includes a space for the price of hardware and software. A separate space is provided for the price of installation. Petitioner did not provide separate prices but provided one price for hardware, software, and installation. The purpose of the separate pricing requirement is twofold. Separate pricing allows Omnicom to determine if individual prices are out of line with industry standards. It also provides information needed for additional purchases of separate items. Petitioner's deviation from separate pricing requirement did not violate the strong public policy against disqualifying the low bidder for technical reasons. Omnicom awarded Petitioner the highest number of points and recommended Petitioner for the contract. Petitioner's deviation did not result in a competitive advantage for Petitioner. The purpose of the separate pricing requirements was informational. Petitioner's deviation did not adversely impact the interests of Respondent. It did not impact the lowest price posed or the technical capability of the proposal. Discounted Pricing The RFP instructs proposers to base their pricing on the assumption that the proposer would install the entire system. Petitioner's conditional commitment to discount pricing through July, 1997, merely restates the assumption mandated in the RFP. The RFP instructs all proposers to assume they will be awarded the contract for the entire system in preparing their proposals. Even if Petitioner's conditional commitment were a deviation from the RFP, it would not be a major variation. It does not violate the strong public policy against disqualifying the low bidder for technical reasons. It does not result in a competitive advantage for Petitioner. It does not adversely impact the interests of Respondent. Response Time The RFP requires an emergency service response time of two hours. It mandates damages for violation of the response time of $250 per hour up to $2,500 a month. Petitioner's alternate proposal does not conform with this requirement. It proposes a four hour response time. Petitioner took exception to the liquidated damages provision and proposed a maximum damage of $500. Petitioner's deviation is a minor irregularity. Omnicom adequately addressed the deviation in the evaluation report so that the deviation will not affect contract price, afford Petitioner a palpable economic benefit, or adversely impact Respondent's interest. Honest Exercise Of Agency Discretion Omnicom's response to the deviation's in Petitioner's proposal is an honest exercise of agency discretion by Omnicom. Omnicom applied the same methodology in a consistent manner for all of the proposals. Omnicom's decision is a reasonable exercise of its expertise in telecommunications based on independent knowledge and experience. Respondent did not reject Omnicom's evaluation of the proposals or reject the proposals. Respondent did not request that Omnicom re-evaluate the proposals. Respondent stated in its notice of intent to award the contract to Intervenor that its decision is based on the presentations at the September 20 meeting and on Omnicom's evaluation.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a Final Order granting Petitioner's protest of the selection of Intervenor. RECOMMENDED this 29th day of December, 1995, in Tallahassee, Florida. DANIEL S. MANRY, 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 December, 1995.
The Issue The issue is whether Kelly Services is the lowest responsive bidder on Bid No. 89-23 and should be awarded the bid.
Findings Of Fact On June 2, 1988, the School Board of Bay County issued Bid Request No. 89-23 for garbage collection services at thirteen locations. A quotation sheet was included in the bid package. The quotation sheet indicated the thirteen locations with a blank next to each location and a dollar sign in front of each blank where each bidder was to indicate its average monthly total charge for each location. There was also a quotation schedule where the bidder was to indicate the calculations which went into the total bid for each location. The bid request provided: The Board reserves the right to waive formalities and to reject any and all bids or to accept any bid or combination of bids deemed in the Board's best interest and the decision of the Board will be final. Bidders desiring that their bid be considered on an all-or-none basis, either in whole or part, shall so indicate. It is the intent of this bid request to secure prices and establish contracts for garbage collection services for the twelve schools specified herein and the District Maintenance Department. Awards will be made by location and will be based on an average monthly total charge as calculated on the quotation sheet. The bids were opened at 10:00 am., June 13, 1988, at the offices of the Bay County School Board. Three completed bid packages were submitted. Kelly Services, Argus and M&O each submitted a completed bid quotation sheet containing the bid for each location. M&O also submitted a letter which stated: We would like to submit this bid on an all- or-nothing basis as specified in paragraph four of the cover letter to the bid. For an estimated cost of $3,391.84. The quotation sheet and quotation schedule submitted by M&O did not reflect the all-or-nothing bid amount. Instead, the quotation sheet and quotation schedule showed a total bid of $3,738.24 when calculated by location. Based on the bids submitted by each bidder as shown on the quotation sheet add quotation schedules, Kelly Services was low bidder on five locations (Callaway, Tyndall, Waller, Southport, and Cedar Grove) ; Argus was low bidder on six locations (Parker, Hiland, Haney, Mosley, Beach and Merritt Brown); and M&O was low bidder on two locations (West Bay and the District Maintenance Department). Prior to the deadline for submitting bids, John Harrison, Purchasing Agent for the Board, responded to an inquiry from M&O by advising M&O that it could submit two bids, one as specified in the Bid Request by location and one as an all-or- nothing bid. No other bidders were advised that they could submit two bids. At the bid opening, M&O did not submit a quotation sheet or schedule for its all-or-nothing bid. A bid which did not have a breakdown per dump per container per facility would not be acceptable to the Board and does not meet the specifications in the Bid Request. The breakdown per dump per container per location is necessary to verify proper invoicing for specific locations on months when there is a change in the number of dumps or containers at that location. After opening the bids, the Board compiled the low bid for each location and then totaled that list. That total of $3,606.09 was greater than the all-or-nothing bid by M&O. Because M&O's all-or-nothing bid failed to meet the specifications by not having a location breakdown the Board contacted M&O to determine if its "estimated" bid was firm and to request a breakdown on the quotation schedule form for the all- or-nothing bid. On June 15, 1988, two days after the bid opening, M&O submitted a letter to the Board clarifying that its all-or- nothing bid was a firm bid for each location and M&O submitted a quotation schedule for each location per dump per container (see page 7 of Joint Exhibit 1 and the last page of Joint Exhibit 2). The charge for each location in this quotation schedule is different than the quotation schedule submitted by M&O at the bid opening and is for the most part lower per location than either M&O's first quotation schedule or the low bids taken from the quotation schedules submitted at the bid opening. Based on the letter and all-or-nothing quotation schedule filed by M&O on June 15, 1988, the Board determined to award the bid for garbage collection services to M&O for the all- or-nothing bid of $3,391.84.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law it is RECOMMENDED that The School Board of Bay County enter a Final Order rejecting all bids and readvertising the bid request for garbage collection services as specified in Bid Request No. 89-23. DONE and ENTERED this 13th day of September, 1988, in Tallahassee, Florida. DIANE K. KIESLING Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 13th day of September, 1988. APPENDIX TO THE RECOMMENDED ORDER IN CASE NO. 88-3768BID The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on the proposed findings of fact submitted by the parties in this case. Specific Rulings on Proposed Findings of Fact Submitted by Petitioner, Kelly Services: 1. Each of the following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 1-3(1-3); 4-6(3); 7-11(7-11); and 12 (9) Specific Rulings on Proposed Findings of Fact Submitted by Respondent, School Board of Bay County: Each of the following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 1(2); 3(10&11); and 5(8). Proposed findings of fact 6, 7, and 9 are irrelevant. The first sentence of proposed finding of fact 2 is unsupported by the competent, substantial evidence. The remainder of proposed finding of fact 2 is adopted in substance as modified in Finding of Fact 3. Proposed finding of fact 4 is rejected as being unsupported by the competent, substantial evidence. The last sentence of proposed finding of fact 5 is rejected as being argumentative, conclusory and unsupported by the competent, substantial evidence. Proposed finding of fact 8 is unnecessary. Specific Rulings on Proposed Findings of Fact Submitted by Intervenor, Argus Services, Inc.: Each of the following proposed findings of fact are adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 2-4(1-3); 6-8(5); 9 & 10(6) 11(3); and 12(11). Proposed findings of fact 1 and 5 are unnecessary. Proposed findings of fact 13-17 are rejected as constituting argument and not findings of fact. COPIES FURNISHED: Jeffrey P. Whitton Attorney at Law Post Office Box 1956 Panama City, Florida 32402 Franklin R. Harrison Attorney at Law 304 Magnolia Avenue Panama City, Florida 32401 Scott W. Clemons Attorney at Law Post Office Box 860 Panama City, Florida 32402 School Board of Bay County Post Office Drawer 820 Panama City, Florida 32402-0820 M&O Sanitation, Inc. 266 N. Star Avenue Panama City, Florida 32404
The Issue Whether the Department of General Services should award state contracts for "walk-up convenience copiers" to Xerox Corporation in categories where Xerox was the only responsive bidder, or should reject Xerox's bid and solicit new bids on grounds that competitive bids were not received and there is no basis or excepting the award from competitive bid requirements; Whether the Department should disqualify Xerox's bid in one category for alleged material deviation from bid specifications where Xerox failed to initial a change in its bid price.
Recommendation Based on the foregoing, it is RECOMMENDED: That DGS reject Xerox's single responsive bids and readvertise; and That Xerox's bid for category Group-I, Type 3, Class 12, monthly rental acquisition plan, be rejected as nonconforming. DONE and ENTERED this 11th day of July, 1984, in Tallahassee, Florida. R. L. CALEEN, JR. Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904)488-9675 FILED with the Clerk of the Division of Administrative Hearings this 11th day of July, 1984.
The Issue The issue for determination is whether Respondent acted fraudulently, arbitrarily, illegally, or dishonestly in selecting Intervenor as the lowest bidder for a contract to supply the state with lamps valued at $3,692,499.
Findings Of Fact The Parties Respondent is the state agency responsible for soliciting bids to establish a contract for the purchase of large lamps by state agencies and other eligible users. Petitioner is a Florida corporation and the incumbent vendor under similar contracts for the preceding 10 years. Petitioner does not manufacture lamps. Petitioner sells lamps manufactured by Osram-Sylvania ("Sylvania"). Intervenor is an Ohio corporation doing business in Florida. Intervenor manufactures the lamps it sells. The ITB On March 15, 1996, Respondent issued Invitation To Bid Number 39-285- 400-H, Lamps, Large, Photo and STTV (the "ITB"). The purpose of the ITB is to establish a 24 month contract for the purchase of Large Lamps (fluorescent, incandescent, etc.), Photo Lamps (audio visual, projection, flash), and Studio, Theatre, Television, and Video Lamps ("STTV") by state agencies and other eligible users. The contract runs from July 10, 1996, through July 9, 1998. The ITB estimates the contract price at $3,692,499. The ITB contains General and Special Conditions. General Conditions are set forth in 30 numbered paragraphs and elsewhere in DMS Form PUR 7027. Special Conditions are set forth in various unnumbered paragraphs in the ITB. General Conditions Paragraphs 5, 11, and 24 of the General Conditions are at issue in this proceeding. The terms of each paragraph are: 5. ADDITIONAL TERMS AND CONDITIONS: No additional terms and conditions included with the bid response shall be evaluated or considered and any and all such additional terms and conditions shall have no force and effect and are inapplicable to this bid. If submitted either purposely through intent or design or inadvertently appearing separately in transmittal letters, specifications, literature, price lists, or warranties, it is understood and agreed the general and special conditions in this bid solicitation are the only conditions applicable to this bid and the bidder's authorized signature affixed to the bidder's acknowledgment form attests to this. 11. QUALITY ASSURANCE: The contractor, during the contract term, upon mutual agree- ment with the Division of Purchasing, will provide reasonable travel and lodging accommodations for one (1) to three (3) government employees to perform an on-site inspection of the manufacturing process(es) and review of the manufacturer's product quality control(s) and total quality manage- ment program(s). The contractor will reim- burse the State for actual transportation cost, per diem and incidental expenses as provided in Section 112.061, F.S. It is the State's desire that the contractor provide demonstration of quality control for improvement rather than post production detection. 24. FACILITIES: The State reserves the right to inspect the bidder's facilities at any reasonable time with prior notice. Included Items Special Conditions in the ITB require bidders to submit prices for "Item 1" and "Item 2" lamps ("included items"). 1/ Item 1 lamps consist of Group 1 and 2 lamps. Group 1 lamps are Large Lamps such as fluorescent, incandescent, quartz, mercury vapor, metal halide, and high-pressure sodium lamps. Group 2 lamps are Photo Lamps such as audio visual, projection, flash, and STTV lamps. The total price for each group is multiplied by a weighted usage factor. The product calculated for Group 1 is added to the product calculated for Group 2 to determine the total price for Item 1 lamps. Item 2 consists of a category of lamps described as "T- 10 Lamps." The total price for Item 2 lamps is determined without application of the weighted usage factor used for Item 1 lamps. The total price for Item 2 lamps is a de minimis portion of the contract price. Special Conditions in the ITB require Respondent to award a single contract for included items to a single bidder. Special Conditions state that, "During the term of the contract established by this bid, all purchases of items will be made from the successful bidder." 2/ Excluded Items Special Conditions require that, "The bidder shall offer a fixed discount from retail prices on all excluded items." Excluded items include high technology lamps. The requirement for a fixed discount on excluded items is not considered in evaluating bid prices for included items. Rather, the requirement is intended to reduce the state's cost for both included and excluded items by assuring a meaningful discount on excluded items. Formatting Requirements Special Conditions prescribe the format in which bids must be submitted. Price lists and authorized dealers' lists are required to be submitted in hard copy and on computer diskette. The format prescribed for computer diskette includes requirements for font and graphics. The Special Conditions state that, "Failure to comply with this requirement will result in disqualification of your bid." The Bids The ITB prohibits the alteration of bids after they are opened. Respondent opened bids on April 10, 1996. Seven vendors submitted bids in response to the ITB. Included Items Four vendors, including Petitioner, submitted a bid for both Item 1 and Item 2 lamps. Intervenor and two other bidders did not submit a bid for Item 2 lamps. General Conditions Intervenor deleted paragraphs 11 and 24 of the General Conditions from its bid. At the direction of Intervenor's legal department in Cleveland, Ohio, Intervenor's regional sales manager struck through paragraphs 11 and 24 and initialed the deletions. The deletions are consistent with Intervenor's corporate policy. Intervenor routinely objects to contract provisions requiring inspection of Intervenor's facilities. Excluded Items Petitioner's bid includes a fixed discount of 44 percent on excluded items. Intervenor's bid includes a fixed discount of 0 percent. Formatting Requirements Intervenor included the information required by the ITB on the diskette it submitted with its bid. However, Intervenor supplied the information in Courier 12 characters per inch ("cpi") font, not the Courier 10 cpi font prescribed in the ITB. Proposed Agency Action Respondent determined that Intervenor's bid was responsive. The purchasing specialist for Respondent who reviewed each bid to determine if it was responsive failed to observe the deleted paragraphs in Intervenor's bid. The purchasing specialist forwarded those bids determined to be responsive to the purchasing analyst assigned by Respondent to: determine if the lamps offered in each bid met the specifications prescribed in the ITB; and evaluate bid prices. The purchasing analyst noted that paragraphs 11 and 24 were deleted from Intervenor's bid. The purchasing analyst and purchasing specialist conferred. They determined that paragraph 5 of the General Conditions cured Intervenor's deletions without further action. The purchasing analyst correctly determined: that lamps offered by Petitioner and Intervenor met ITB specifications; that Intervenor's bid is the lowest bid for Item 1 lamps; that Petitioner's bid is the second lowest such bid; and that Petitioner's bid is the lowest bid for Item 2 lamps. Petitioner's bid for Item 1 lamps is approximately five percent greater than Intervenor's bid. Respondent proposes to award one contract for Item 1 lamps to Intervenor. Respondent proposes to award a second contract for Item 2 lamps to Petitioner. At 4:00 p.m. on May 20, 1996, Respondent posted its intent to award the contract for Item 1 lamps to Intervenor. Petitioner timely filed its formal protest on June 3, 1996. Respondent did not award a contract for excluded items. Respondent's failure to award a contract for excluded items is not at issue in this proceeding. Arbitrary Respondent's proposed award of a contract to Intervenor for substantially all of the items included in the ITB is a decisive decision that Respondent made for reasons, and pursuant to procedures, not governed by any fixed rule or standard prescribed either in the ITB or outside the ITB. Respondent's proposed agency action is arbitrary. Excluded Items The requirement for bidders to offer a fixed discount on excluded items operates synergistically with the requirement for Respondent to award a single contract on included items to a single bidder. The combined action of the two requirements operating together has greater total effect than the effect that would be achieved by each requirement operating independently. The requirement for a fixed discount on excluded items, operating alone, may not induce a bidder who could receive a contract solely for Item 2 lamps to offer a discount that is as meaningful as the discount the bidder might offer if the bidder were assured of receiving a contract for Item 1 and 2 lamps upon selection as the lowest bidder. 3/ By assuring bidders that a single contract for Item 1 and 2 lamps will be awarded to a single bidder, the ITB creates an economic incentive for bidders to provide a meaningful discount on excluded items. Respondent frustrated the synergy intended by the ITB by applying the requirements for a fixed discount and for a single contract independently. Respondent penalized the bidder conforming to the requirement for a fixed discount on excluded items by awarding only a de minimis portion of the contract to the bidder. Respondent rewarded the bidder not conforming to the requirement for a fixed discount on excluded items by awarding substantially all of the contract to that bidder. If Respondent elects to purchase all excluded items from Petitioner, Respondent will have used the contract for Item 1 lamps to induce a meaningful discount from Petitioner without awarding Petitioner with the concomitant economic incentive intended by the ITB. Such a result frustrates the ITB's intent. Paragraph 5 Respondent's interpretation of paragraph 5 fails to explicate its proposed agency action. Respondent's interpretation of paragraph 5: leads to an absurd result; is inconsistent with the plain and ordinary meaning of the terms of the ITB; and is inconsistent with Respondent's actions. Respondent's interpretation imbues paragraph 5 with limitless curative powers. Respondent's interpretation empowers paragraph 5 to cure the deletion of all General Conditions in the ITB whether stricken by pen or excised with scissors. Respondent's interpretation of paragraph 5 would transform a bid containing no General Conditions into a responsive bid. Respondent's interpretation of paragraph 5 is inconsistent with the plain and ordinary meaning of its terms. Paragraph 5 operates to cure "additional" terms. It does not operate to restore deleted terms. Respondent's interpretation of paragraph 5 is inconsistent with Respondent's actions. Respondent did not rely on paragraph 5 to cure Intervenor's deletions without further action. Respondent took further action to cure the deletions. Further Action On the morning of May 20, 1996, the purchasing analyst for Respondent telephoned Intervenor's regional sales manager. The purchasing analyst demanded that Intervenor accept the conditions Intervenor had deleted from its bid by submitting a letter of acceptance before the bid tabulations were posted at 4:00 p.m. on the same day. The regional sales manager contacted Intervenor's corporate headquarters in Cleveland, Ohio. Intervenor authorized the regional sales manager to accept the deleted paragraphs. By letter faxed to Respondent at approximately 3:20 p.m. on May 20, 1996, Intervenor accepted the paragraphs it had previously deleted. The letter stated that, "GE Lighting [will accept] the Contract Conditions noted in Paragraphs 11 and 24 of the Lamp Quotation." [emphasis not supplied] At 4:00 p.m. on May 20, 1996, Respondent posted the bid tabulation form. The bid tabulation form stated that the "award is contingent upon General Electric's acceptance of all the terms in conditions (sic)" in the ITB. Respondent argues that the purchasing analyst who contacted Intervenor on the morning of May 20, 1996, exceeded her authority. Respondent characterizes the word "contingent" in the bid tabulation form as "poorly written" and a "bad word." Agency Construction Of ITB Terms Respondent construes terms in the ITB in a manner that is inconsistent with their plain and ordinary meaning. The ITB requires that, "The bidder [shall] offer a fixed discount from retail price list on all excluded items." [emphasis supplied] Respondent interprets the quoted provision as meaning the bidder may offer such a fixed discount if the bidder elects to do so. The purpose of the ITB is to establish "[a] 24 month contract" to supply large lamps to the state. [emphasis supplied] Respondent interprets the quoted provision as meaning that the purpose of the ITB is to establish two contracts. The ITB states that, "During the term of the contract established by this bid, all purchases of items [will] be made from [the] successful bidder." [emphasis supplied] Respondent interprets the quoted provision as meaning that purchases of some items will be made from one successful bidder and that purchases of other items will be made from a second successful bidder. The ITB states that the contract "[shall] be made statewide on an all or none basis" to the responsive bidder who satisfies the conjunctive requirements for: "[the] lowest "Award Figure Item (1; [and] lowest Award figure for Item (2." [emphasis supplied] Respondent interprets the quoted provision as meaning that separate contracts may be made statewide on less than an all or none basis to separate responsive bidders who satisfy the disjunctive requirements for either the lowest bid for Item 1 lamps or the lowest bid for Item 2 lamps, or both. The ITB requires offers to be submitted for all items listed within a group for a bid to qualify for evaluation. Respondent interprets the requirement as meaning that a bidder who does not qualify for evaluation for all of the groups in the contract nevertheless qualifies for evaluation for the contract. Finally, the ITB states that failure to comply with the formatting requirements for the diskette "[will] result in disqualification of your bid." [emphasis supplied] Respondent interprets the quoted language to mean that failure to comply with prescribed formatting requirements may result in disqualification of a bid. The interpretations of the quoted terms proposed by Respondent, individually and collectively, frustrate the purpose of the ITB. They also ignore material requirements of the ITB. Material Deviation Respondent deviated from the rule or standard fixed in the ITB in several respects. First, Respondent altered the bid evaluation procedure prescribed in the ITB. Second, Respondent ignored the requirement to award a single contract to a single bidder. Third, Respondent ignored the requirement that bidders provide a fixed discount on excluded items. Fourth, Respondent ignored the requirement to comply with the formatting requirements prescribed in the ITB. Each deviation from the rule or standard fixed in the ITB is a material deviation. Each deviation gives Intervenor a benefit not enjoyed by other bidders. Each deviation affects the contract price and adversely impacts the interests of Respondent. 4/ 5.5(a) Benefit Not Enjoyed By Others Intervenor enjoyed a benefit not enjoyed by other bidders. Intervenor obtained a competitive advantage and a palpable economic benefit. Respondent altered the bid evaluation procedure prescribed in the ITB. On the morning of May 20, 1996, Respondent disclosed the bid tabulations to Intervenor alone, 5/ gave Intervenor an opportunity that lasted most of the business day to determine whether it would elect to escape responsibility for its original bid, allowed Intervenor to cure the defects in its bid, accepted Intervenor's altered bid, and conditioned the bid tabulations on Intervenor's altered bid. Respondent used a bid evaluation procedure that is not prescribed in the ITB and did not allow other bidders to participate in such a procedure. 6/ In effect, Respondent rejected Intervenor's initial bid, with paragraphs 11 and 24 deleted, and made a counter offer to Intervenor to accept a bid with paragraphs 11 and 24 restored. Intervenor accepted Respondent's counter offer. Respondent excluded other bidders from that process. Respondent gave Intervenor an opportunity to determine whether it would elect: to escape responsibility for its original bid by declining Respondent's counter offer; or to perform in accordance with an altered bid by restoring paragraphs 11 and 24. A bidder able to elect not to perform in accordance with its bid has a substantial competitive advantage over other bidders unable to escape responsibility for their bids. 7/ Respondent awarded substantially all of the contract to Intervenor even though Intervenor failed to provide a meaningful discount on excluded items. Respondent provided Intervenor with a palpable economic benefit. 5.5(b) Bid Price And Adverse Impact On The State Respondent did not award a contract for excluded items. Respondent's proposed agency action allows Respondent to purchase excluded items from either Intervenor or Petitioner. If Respondent were to purchase all of the excluded items it needs from Intervenor, Respondent could pay substantially more for excluded items than Respondent would save from the five percent price advantage in Intervenor's bid for Item 1 lamps. In such a case, Respondent's proposed agency action would effectively increase costs to the state that are inherent, but not stated, in the ITB. 8/ Conversion of incorrectly formatted data to the required font shifts prices to incorrect columns and causes other problems in accessing information in the diskette. Such problems can not be rectified easily but require substantial time and effort. Responsive Bidder Respondent did not award the contract intended by the ITB to the lowest responsive bid. Although Intervenor's bid is the lowest bid for Item 1 lamps, it is not the lowest responsive bid for Item 1 and 2 lamps. Petitioner's bid is the lowest responsive bid for Item 1 and 2 lamps. 9/ Respondent is statutorily required to award the contract to the lowest responsive bidder. 10/ Illegal Intervenor's bid is not responsive within the meaning of Sections 287.012(17), Florida Statutes (1995). 11/ It does not conform in all material respects to the ITB. Intervenor's unaltered bid deletes paragraphs 11 and 24. It does not include a fixed discount on excluded items, does not include a bid for Item 2 lamps, and does not conform to the formatting requirements in the ITB. Section 287.057 requires Respondent to award the contract to the bidder who submits the lowest responsive bid. Respondent has no authority either: to consider bids that are not responsive; or to award the contract to a bidder other than the lowest responsive bidder. Respondent's attempt to engage in either activity is ultra vires and illegal. Minor Irregularities The ITB encourages, but does require, bidders to include quantity discounts for Item 1 and 2 lamps. Petitioner's bid does not include quantity discounts. Petitioner's bid does not fail to conform to material requirements in the ITB. Petitioner does not manufacture Item 1 and 2 lamps. Sylvania manufactures the lamps Petitioner sells. Petitioner has no legal right to require Sylvania to allow inspection of its facilities pursuant to paragraph 11 of the General Conditions. Petitioner's ability to provide the requisite inspections requires the cooperation of Sylvania. Petitioner's bid requires payment by the state within 30 days of an invoice. Section 215.422 and the ITB provide that Respondent has 40 days to issue warrants in payment of contract debts and that interest does not accrue until after 40 days. The defects in Petitioner's bid are minor irregularities within the meaning of Florida Administrative Code Rule 60A-1.001(16). 12/ They neither affect the bid price, give Petitioner a competitive advantage, nor adversely impact Respondent's interests. Petitioner has the practical ability to arrange inspection's of Sylvania's facilities. Petitioner is legally responsible for failing to do so. Respondent's employees have never visited Sylvania's facilities during the 10 years in which Petitioner has been the contract vendor to the state. The requirement for payment within 30 days does not obviate the provisions of Section 215.422. Private contracts can not alter mutually exclusive statutory provisions.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a Final Order granting Petitioner's protest of Respondent's proposed agency action. RECOMMENDED this 26th day of September, 1996, in Tallahassee, Florida. DANIEL S. MANRY, 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 26th day of September, 1996.
The Issue The issue for determination is whether Respondent's intent to award a contract for bridge-tending services (RFP DOT 92/93 2088 REBID) to Intervenor constitutes fraudulent, arbitrary, capricious, illegal or dishonest action.
Findings Of Fact The parties stipulated to findings of fact set forth in paragraphs 1.-12., below. Stipulated Facts Respondent issued the RFP for bridge-tending services on May 14, 1993. Proposals submitted in response to the RFP were opened on June 16, 1993. Proposals were submitted by five firms, including Petitioner and Intervenor. All proposals were determined at the time to be responsive. A Technical Review Committee (TRC) was appointed to review the technical portion of the proposals. The three members of the TRC were Alan Hyman, J. L. Gillis, and Yingyong Sujjavanich. The members reviewed the technical portion of the proposals on June 17, 1993. The evaluation forms completed by the TRC and a summary score sheet were delivered to Respondent's purchasing office on the morning of June 18, 1993. The price proposal was evaluated by Respondent's purchasing office. The price evaluation of each proposal was performed by applying a formula which compared the submitted price quotations. After the scores for the technical proposal and the cost proposals were totalled, it was determined that Intervenor's proposal had earned the highest number of points. This result was presented to Respondent's District 2 Executive Committee and a recommendation was communicated by the Purchasing Director to award the RFP to Intervenor. The Executive Committee accepted the recommendation and directed that the contract be awarded to Intervenor. On June 18, 1993, at 4 p.m., the bid tabs were posted noticing Respondent's intent to award the contract to Intervenor. On or about July 6, 1993, Petitioner requested a meeting with Respondent's representatives regarding the RFP. That meeting was held on July 9, 1993. At the meeting, Petitioner raised an issue regarding an arithmetic error in the scoring of the technical proposals. Intervenor remained the proposer with the highest number of points. However, another proposal formerly ranked as number two was lowered to number three status and Petitioner, previously ranked number three, was raised to number two rank. On July 12, 1993, Respondent posted an amended bid tab indicating its intent to award the contract to Intervenor. Other Facts Respondent chose to score the bid pricing, a non- subjective task, in Respondent's District 2 office. Technical portions of the proposals were reviewed by the TRC, comprised of members from Respondent's District 5 office. This unusual step was taken by Respondent in order to reduce prejudice to any proposal in view of previous accusations made against District 2 employees. Bud Rosier, Respondent's employee, has overall responsibility for bridge determination that District 5 employees chosen as committee members were qualified to evaluate the proposals. Each response to the RFP contained a technical proposal and a price proposal. Intervenor's technical proposal received 1.33 points less than Petitioner's technical proposal. The price proposals, as noted above, were scored in accordance with a mathematical formula that compares price proposals to each other and does not take any subjective factors into consideration. Intervenor was awarded 5.55 points, compared to Petitioner who received no points for a proposal more than $140,000 higher for the initial year of the contemplated contract. Although members of the TRC were not given any background information by Respondent regarding the competing proposals, beyond that contained in the submitted bid packages, no information was withheld from the committee. The members were given adequate time to review the proposals and do any desired independent background checking regarding past performance of any proposer, although no requirement in the RFP mandated such a background review. At least one of the TRC members, Sujjavanich, chose not to independently research past performance of the Intervenor. No evidence was offered at hearing with regard to whether the other two members independently researched any of the proposers' past performances. Even if review of past performance, apart from the materials submitted by the proposers, were required by provisions of the RFP, failure of the evaluators to accomplish that task would result only in the loss to Intervenor of the 3.66 points awarded for past performance and Intervenor, with a remaining total of 81.89 points, would remain the highest ranked proposer. In view of the objective process used to arrive at the results of the evaluation of the prices of the competing proposals, there was no need to provide this information to the members of the TRC who were doing the technical proposal evaluation. Although the RFP provided that the TRC would be given such results, the failure of Respondent's personnel to provide this information to the evaluators could not have made any difference in the final result since the committee, using the objective price evaluation criteria, would have arrived at the same result as the purchasing office on cost scores. The admitted failure to provide the superfluous cost information to the TRC is inadequate to show that such omission resulted in prejudice to the final scores of any of the competing proposals and must be considered to be only a minor variation from the RFP by Respondent. Contrary to Petitioner's allegations, there is no competent substantial evidence to support any finding that the members of the TRC (Hyman, Gillis, and Sujjavanich) did not possess required background, experience or professional credentials adequate for evaluating proposals for bridge-tending services. All three members of the TRC were familiar with the RFP, attachments to the RFP, bridge-tending procedures and bridge-tending qualification procedures. There is no competent substantial evidence to establish that Intervenor's proposal is not financially feasible. Proposed utilization of 72 bridge-tenders by Intervenor for a total price of $673,333.44 does not mean that 72 bridge-tender positions would be established or filled, or that the positions would be paid at the rate proposed by Petitioner of $8.40 per hour. The evidence establishes that a proposer would need an optimum number of bridge requirements.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered granting the award of the bid in RFP DOT 92/93 2088 Rebid to Intervenor. DONE AND ENTERED this 4th day of October, 1993, in Tallahassee, Leon County, Florida. DON W. DAVIS Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 4th day of October, 1993. APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-4271BID The following constitutes my specific rulings, in accordance with Section 120.59, Florida Statutes, on findings of fact submitted by the parties. Petitioner's Proposed Findings. 1.-12. Accepted. 13.-16. Rejected, relevancy. 17. Accepted. 18.-19. Rejected, relevancy. 20.-25. Accepted. 26.-27. Rejected, cumulative. 28. Rejected, credibility. 29.-33. Rejected, relevancy. 34.-35. Accepted. 36.-37. Rejected, argumentative and mischaracterization. 38.-46. Rejected, subordinate to HO findings. 47.-51. Rejected, relevancy. Intervenor's Proposed Findings. 1.-2. Rejected, cumulative. 3.-4. Accepted. 5.-6. Rejected, unnecessary. Rejected, cumulative. Rejected, unnecessary. Rejected, argumentative. 10.-11. Rejected, unnecessary. 12.-13. Adopted by reference. 14.-16. Accepted, but not verbatim. 17.-22. Adopted by reference. 23. Rejected, unnecessary. 24.-30. Adopted, but not verbatim. 31. Rejected, narrative. 32.-35. Rejected, cumulative. Respondent's Proposed Findings. 1.-11. Adopted. 12. Rejected, unnecessary. 13.-17. Adopted, not verbatim. 18.-19. Rejected, cumulative. 20.-22. Adopted. 23. Rejected, recitation of RFP. 24.-26. Adopted. 27. Rejected, recitation of RFP. 28.-29. Adopted in substance. COPIES FURNISHED: Thomas Cassidy, III, Esquire. John O. Williams, Esquire Renaissance Square 1343 East Tennessee Street Tallahassee, Florida 32308 Carolyn S. Holifield, Esquire Mark D. Tucker, Esquire Department of Transportation Haydon Burns Building, Mail Station 58 605 Suwanee Street Tallahassee, Florida 32399-0458 Timothy G. Schoenwalder, Esquire 204-B South Monroe Street Tallahassee, Florida 32302-3068 Ben G. Watts, Secretary Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399 Thornton J. Williams General Counsel Department of Transportation Haydon Burns Building # 562 605 Suwannee Street Tallahassee, Florida 32399
