The Issue Whether Respondent, University of Central Florida (“UCF”), engaged in a discriminatory employment practice and/or retaliated against Petitioner, Michael Flint.
Findings Of Fact UCF is a state university located in Orlando, Florida, with an enrollment of about 60,000 undergraduate students and 10,000 graduate students. Mr. Flint is a 71-year-old Vietnam combat veteran who suffers from post-traumatic stress disorder (“PTSD”), chronic fatigue, bipolar disorder, traumatic brain injury (“TBI”), and diabetes. He spent 30 years as a police officer. He graduated from Yale University with a degree in Psychology and, in 2002, obtained a master’s degree in Criminal Justice from UCF. Mr. Flint is currently a full-time instructor at UCF in the Criminal Justice Department and has held that position for over 15 years. In 2006, Mr. Flint learned that some faculty members were taking doctoral classes for free pursuant to a UCF policy. Like other state workers, UCF allowed its employees (and their spouses and children) to take up to six credit hours per semester for free so long as the course had an open seat and did not cost the school money. The privilege also applied to coursework towards a doctoral degree, though employees had to pay for their required dissertation credit hours. Mr. Flint believed that obtaining his doctorate degree would make him a better instructor and ensure he had cutting edge knowledge in his teaching field. But, he understood that pursuing this degree was both completely independent from and secondary to his full-time faculty position. Indeed, UCF neither encouraged nor required him to pursue a doctorate degree, as a condition of continued employment or for training, job security, or advancement purposes. His job as a full-time instructor would remain unaffected by the classes he took. The process for obtaining a doctorate degree is rigorous. First, students must complete their coursework, which often takes about two years, and pass a set of comprehensive exams. Then, they decide on their area of research and choose a dissertation committee, which is typically comprised of five faculty members: a chair, often with expertise in the student’s area of research, and four other faculty members, one or two within the student’s area of research and one or two outside of that area. Next, they draft a prospectus outlining the focus of the research, which has to be approved by and defended before the committee, after which they conduct intense research for about a year. Students then complete their dissertation, which must be approved by and defended before the committee. If successful, they are approved to graduate. Like most universities, UCF follows the seven-year rule, which required all doctoral students to complete their degrees within seven years of admission so as to ensure that the research and coursework does not become stale. Although exceptions could be granted, they are discretionary academic decisions based on the circumstances of the particular student. Exceptions beyond ten years are extremely rare and, of those granted such an exception, only about half ultimately graduated. Understanding that pursuing this degree would be secondary to his full-time job and that he had to complete the process in seven years, Mr. Flint applied for and was accepted into the PAF Program in the College of Health and Public Affairs (“COHPA”). He began his doctoral coursework in August 2006. From 2006 through 2009, Mr. Flint worked full-time teaching five to six courses in the Fall and Spring semesters and three to four courses in the Summer semesters. During this same period, he took about one to two substantive courses towards his degree for free each semester, although he backed off his coursework (with approval from Dr. Thomas Wan, the PAF Program director at the time) for a brief period when his wife was diagnosed with cancer. However, in late 2009, Mr. Flint developed Guillain- Barre Syndrome (“GBS”), which caused him to be hospitalized, placed on life support for almost two months, after which he spent an additional six months at home recovering. While in the hospital, he developed diabetes. He also developed chronic fatigue syndrome, from which he continues to suffer years after his recovery. UCF placed him on administrative medical leave from his teaching responsibilities for Spring and Summer 2010, but he resumed teaching a full course load in Fall 2010 and has continued to do so ever since. As for his doctorate degree, Mr. Flint requested a special leave of absence from CGS, which oversaw all of the graduate programs across the university. CGS granted the request and placed a hold on his enrollment for all of 2010. Mr. Flint returned to taking classes in Spring 2011 and completed his substantive coursework in Fall 2011. Still teaching full-time each semester, Mr. Flint moved on to the comprehensive exam phase of his studies. He studied for those exams in 2012 and passed them after one unsuccessful attempt in Fall 2013. Although the average student finished their coursework and exams in about two years, it took Mr. Flint seven years. While continuing to meet his full-time teaching obligations, Mr. Flint spent 2013 and 2014 trying to conduct dissertation research and prepare his prospectus, now having to pay for those credit hours. His dissertation committee initially consisted of Dr. Bob Langworthy, as chair, and Dr. Matt Matusiak, Dr. Jeff Rosky, and Dr. Sophia Dziegielewski. However, by Fall 2014, Mr. Flint had not yet submitted his prospectus to his committee. Ranetta Guinn, the director of Graduate Affairs for COHPA, met with him because it had been over seven years since he began the program. They created a timeline for finishing his prospectus by March 2015, defending it by May 2015, and defending his dissertation by April 2016. Ms. Guinn explained that he would need to apply for an exception from CGS to extend the deadline to ten years. Unfortunately, around the same time, Dr. Langworthy retired and Mr. Flint had to find a replacement chair for his committee. Dr. Dziegielewski ultimately agreed to serve as the chair, but that required Mr. Flint to find another faculty member in his area of expertise to serve on the committee. Dr. Cory Watkins ultimately agreed. In March 2015, Mr. Flint petitioned CGS to extend the graduation deadline to ten years based on his 2009 GBS diagnosis, chronic fatigue, diabetes, and his disability rating as a combat veteran. He did not inform CGS, or anyone else at UCF, about his PTSD, bipolar disorder, or TBI. Dr. Dziegielewski wrote a letter supporting his petition based on a Summer 2016 graduation. The director of the PAF Program also wrote a supporting letter based on his medical issues and recent setback in having to find a new committee chair. In April 2015, CGS approved the petition and extended the deadline for Mr. Flint to graduate through Summer 2016. The letter noted that no further petitions would be considered. At the time, Mr. Flint believed it was a reasonable accommodation and that he would be able to meet the timeline, but ultimately was unable to do so. He did not defend his prospectus until January 2016, though he was supposed to complete that task by May 2015. He began drafting his dissertation in the Spring 2016 (again, having to pay for those credit hours), but did not timely defend it by May 2016. Notwithstanding, he was permitted to continue working in the hopes he could defend and graduate by the end of 2016. When Mr. Flint had not yet submitted his dissertation in October 2016, he informed Dr. Dziegielewski that he was struggling with his normal workload, periodic illnesses, and chronic fatigue but would try to finish. But he did not petition CGS for another exception. He also failed to notify her or anyone else at UCF about his PTSD or bipolar disorder.2/ Because he ultimately failed to submit even a draft of his dissertation, he received an unsatisfactory dissertation grade for the Fall 2016 semester. In January 2017, CGS dismissed Mr. Flint from the PAF Program. He filed an appeal to be reinstated but the grievance committee, limited to the issue of whether CGS followed proper procedure in reaching its decision, denied relief in March 2017. While his appeal was pending, Mr. Flint submitted a draft of his dissertation. Upon review in March/April 2017, his committee members generally believed that it was almost ready and that he could complete his revisions and defend it in Fall 2017 or Spring 2018 at the latest. However, the PAF Program director confirmed nothing could be done because the draft was not then defensible, no more extensions could be given, and his appeal already had been denied. Notwithstanding his dissertation issues, Mr. Flint met his full-time teaching obligations throughout this period. He never asked for leave or a reduced schedule to have more time to devote to his studies. He taught consistently each summer to earn additional compensation, though doing so was not required, instead of focusing his attention on his studies. Even when his supervisor asked him to take a certification course on top of teaching in Fall 2016, he did not even think to ask if he could delay that course for a semester so he had more time to finish his dissertation. He also could have reduced his teaching load that semester by one course to account for the certification class, but chose not to do so. Mr. Flint was clearly a devoted employee who made his teaching position his main priority. Unfortunately, the combination of putting his studies second and the many medical conditions from which he suffered caused him to fail to meet the extended deadlines and to be dismissed from the PAF Program. Mr. Flint then filed a complaint with the Commission, alleging that UCF wrongfully dismissed him from the PAF Program and retaliated against him based on his age and handicaps. To establish that UCF discriminated against him, Mr. Flint presented the testimony of two other UCF faculty members, Robert Wood, Esquire (62 years old), and Abby Milon, Esquire (59 years old), who believed UCF had taken adverse employment actions against them and other older faculty members relating specifically to their teaching positions, such as reducing their course loads. However, neither of them were in a doctorate program like Mr. Flint and, moreover, their complaints related solely to their jobs as faculty members. Conversely, Mr. Flint suffered no such adverse actions relating to his job as a faculty member. He could not complain about the way UCF treated him in that role, even after he challenged his dismissal from the PAF Program, as that academic decision did not adversely impact his faculty position. He also is still permitted to take up to two courses for free per semester at UCF, just as he was before. Both UCF and Mr. Flint also presented the testimony of several UCF faculty members involved in Mr. Flint’s studies, from his committee members to PAF Program directors to the associate dean of CGS. Every such witness who testified about Mr. Flint’s dismissal confirmed that the decision was based on his failure to meet the agreed-upon extended deadlines and that his age and handicaps, most of which were unknown to the decision makers, had nothing to do it. Though his committee members confirmed that they were supportive of him being given a chance to graduate, they acknowledged that CGS made the final decision, that he had not adhered to the deadlines after they were extended, and that it was quite rare for any student (young or older, healthy or sick) to graduate beyond the ten-year mark.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Commission on Human Relations issue a final order finding that Petitioner, Michael Flint, failed to establish that Respondent, University of Central Florida, committed an unlawful employment practice against him and dismissing his Petition for Relief. DONE AND ENTERED this 17th day of June, 2019, in Tallahassee, Leon County, Florida. S ANDREW D. MANKO Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 17th day of June, 2019.
The Issue The issue in this de novo proceeding is whether the intended action of Respondent, University of Central Florida (University), to award a concessions and food services management contract to Ovation Food Services, L.P., d/b/a Spectra Food Services and Hospitality (Spectra), is contrary to the statutes, regulations, or policies governing the University, or contrary to competition, arbitrary, or capricious. The standard of proof for this proceeding is whether the proposed contract award is clearly erroneous, contrary to competition, arbitrary, or capricious. Petitioner, Boston Culinary Group, Inc., d/b/a Centerplate (Centerplate) bears the burden of proof.
Findings Of Fact Participants and Facilities The University is located in Orlando, Florida. In 2017, it was the nation’s second largest university by student enrollment. Florida founded the University in 1963. The University’s various campuses include a number of athletic and performance facilities. For purposes of this matter, they are the CFE Arena, The Venue (a multipurpose facility adjoining the Arena), Brighthouse Networks Stadium, the John Euliano Park Baseball Complex, the UCF Softball Complex, and the UCF Soccer and Track Complex. All of these facilities have food and drink concessions available to people attending events. For some events at some facilities, alcoholic beverages are also available. The stadium seats 45,241 persons. It has 11 concessions stands with 59 points of sale, one catering kitchen, and 15 portable carts. The baseball complex seats 2,000 persons and can accommodate 3,600 people. It has one concessions stand with two points of sale, two carts with two points of sale and one concessions trailer with six points of sale. The softball complex seats 507 people. It has one concessions stand. The soccer and track complex accommodates more than 2,000 people. The University also has a 2007 16-foot Concessions Grill Trailer. The concessionaire may use the trailer and all the concessions stands. In fiscal year 2016, University concessions generated over $2.1 million in sales. Spectra is a wholly owned subsidiary of Comcast Corporation. Spectra provides concessions, venue management, and related hosting and entertainment services in various facilities. There is no question about Spectra’s ability to provide concessions to the University. Centerplate provides food and beverage programs, including concessions, at locations throughout North America and the United Kingdom. Its customers include National Football League stadiums, Super Bowl venues, and the Hard Rock Stadium. There is no question about Centerplate’s ability to provide concessions to the University. Since 2007, Centerplate has held a ten-year contract to provide concessions and alcoholic beverages at the Arena, the Stadium, the Softball fields, and the Baseball fields. The University’s Director of Purchasing and Centerplate’s President executed the contract. It has expired. Aramark and Levy are each providers of concessions services much like those offered by Centerplate and Spectra. The UCF Stadium Corporation is an entity that the ITN identifies as a part owner of the Brighthouse Stadium. The UCF Athletic Association, Inc. (Association) is a direct support organization1/ that the ITN identifies as a part owner of the Brighthouse Stadium and overseer of all athletic events except those conducted at the Arena. However, David Hansen, the University’s Executive Associate Athletic Director and Chief Operating Officer for the Association testified that the University owns the stadium and that the Association only manages the stadium. But he also testified that the University business services unit is the concessions contract manager. The Association has a procurement process. It could have selected the Stadium concessionaire if it chose to do so. The UCF Convocation Corporation (Convocation Corporation) is also a university direct support organization. It owns and oversees operation of the Arena and events there. The Convocation Board of Directors consists mainly of University executives and University Board of Trustees members. The Convocation could have selected the Arena concessionaire if it chose to. Development of the ITN In January 2016, the University, the Athletic Association, and the Convocation Corporation began preparing for the end of the Centerplate contract and the letting of a new concessions contract. Curt Sawyer began the planning process for determining who would provide concessions services after Centerplates’ contract ended. Mr. Sawyer is the Associate Vice President for University Services. Someone, most likely Mr. Sawyer, determined that the University would use an ITN process. The Board of Governors and University rules do not define an ITN. The University’s rule for procurement services names three competitive procurement processes: Invitation to Bid, Request for Proposal, or Invitation to Negotiate. University of Central Florida (UCF) Rule 7-130(2)(a) says that all three shall state the criteria to be used for evaluating proposals. The rule prohibits using criteria not stated in the Invitation to Bid, Request for Proposal, or Invitation to Negotiate. Other parts of rule 7-130 impose notice and advertisement requirements applicable to all three processes. The rule does not expound upon the nature an ITN or how it differs from the other procurement processes. BOG Regulation 18.002, titled “Notice and Protest Procedures for Protests Related to a University’s Contract Procurement Process,” mentions ITN once. It states, In a protest to an invitation to bid or request for proposals procurement, no submissions made after the bid or proposal opening which amend or supplement the bid or proposal shall be considered. In a protest to an invitation to negotiate procurement, no submissions made after the university announces its intent to award a contact, reject all replies, or withdraw the solicitation which amend or supplement the reply shall be considered. BOG Regulation 18.002(19). This regulation also does not explain what an ITN is. The ITN’s definitions section, 2.17, does define ITN. It states: Invitation to Negotiate- A written solicitation, for goods or services, where factors other than price are to be considered in the award determination. These factors may include such items as Respondent's experience, project plan, design features of the product(s) offered, etc. ITN is used when the specifications cannot be identified; the end result is explained and we want qualified companies to offer their solutions for consideration. January 28, 2016, Mr. Sawyer e-mailed Tracy Slavik to “schedule a contracts’ planning meeting that includes the six men above [copied on the e-mail]. The primary contract to discuss is concessions, although I’d like to also briefly touch on pouring rights as well.” This meeting was to begin planning and drafting the ITN. It was the start of drafting a document to explain the result the University wanted and to develop requirements and statements of work for the ITN. The six men referred to are Gregory Robinson, Kevin Sowers, Michael Shumack, Brad Stricklin, David Hansen, and Brian Hixenbaugh. Mr. Robinson is the University Director of Procurement Services. Mr. Sowers is University Director of Business Services and under Mr. Sawyer on the University organizational chart. Mr. Shumack is with University Business Services. Mr. Hansen is Executive Associate Athletic Director for the University and Chief Operating Officer of the Association. Brian Hixenbaugh has been Spectra’s General Manager for the venue operations services Spectra provided for the Arena the past six years. Mr. Hixenbaugh appears on the University organization chart under Mr. Sawyer, although a dotted line borders the box containing his name. He attended Mr. Sawyer’s direct report meetings. Mr. Hixenbaugh’s email address is a University email address, Brian.Hixenbaugh@ucf.edu. Mr. Hixenbaugh has worked for Spectra since 2006. Mr. Sawyer met with Mr. Robinson, Mr. Sowers, Mr. Shumack, Mr. Hansen, Mr. Stricklin, and Mr. Hixenbaugh to discuss concessions contract planning on February 19, 2016. The fact that Mr. Hixenbaugh was directed to attend the meeting and the absence of evidence that he did not attend support an inference that he attended. After the meeting, on the same day, Mr. Sawyer emailed Ms. Slavik asking her to schedule a follow-up meeting 60 days out, around April 15, 2017. The email identified “Contract planning discussion” as its subject and listed “Takeaways and follow-ups: Concessions agreement” to include in the meeting notes. Mr. Sawyer copied Mr. Sowers, Mr. Shumack, Mr. Robinson, Mr. Stricklin, Mr. Hansen, and Mr. Hixenbaugh. This follow up email to the individuals invited to the February meeting, and its timing, are further evidence reasonably supporting an inference that the people invited to the meeting attended it, including Mr. Hixenbaugh. There is no evidence indicating that Mr. Hixenbaugh did not attend the meeting. The email copied Myrnellie Nido. Ms. Nido is the University’s Associate Director of Procurement Services. The email also copied the email address scarr@athletics.ucf.edu. This is the email address of Scott Carr. Mr. Sawyer’s “takeaways and follow-ups” were: Benchmark other schools –- DH Determination of who owns stadium stands' equipment -- DH, Kevin; Confirm separate contracts Timing of non-renewal letter (after football, during basketball?) ITN Although separate ITN's, crafted simultaneously Fan engagement and experience emphasized: tremendous customer service Brand coordination between multiple facilities, pricing, coordination between UCFCC and AA, MOU, ITN crafting teams ITN releases and timeline Other These items are all substantive considerations for an ITN to provide concessions services. Most are addressed in the ITN or the review process in one way or another. Mr. Sawyer sent another email with the subject “Contract Planning Discussion” on April 26, 2016, asking Ms. Slavik to “schedule a follow-up discussion.” Mr. Sawyer sent this email to the people, including Mr. Hixenbaugh, copied with his January 28 and February 19, 2016, emails. The wording of the email and the fact that the email is dated about 60 days after the February 19, 2016, email requesting a meeting is competent, persuasive evidence that the requested meeting occurred in April and that the people asked to participate did. It is also reasonable to infer that people asked to participate in a meeting did so, in the absence of any evidence to the contrary. There is no evidence indicating that Mr. Hixenbaugh did not attend the meeting. The April 26, 2016, email listed the following substantive subjects for the meeting, all of which figured in the ITN or its evaluation process: Stadium power needs for stands How many themed stands consultant feedback for stadium and arena pricing discussion capital needs discussion RFP timeline RFP structure Other The email asked Ms. Slavik to schedule the meeting about 45 days out, or around June 10, 2016. Mr. Sawyer copied Mr. Sowers, Mr. Shumack, Mr. Robinson, Ms. Nido, Mr. Hixenbaugh, Mr. Hansen, Mr. Stricklin, and Scott Carr. On April 27, 2016, Ms. Slavik sent the other recipients an email proposing meeting dates and times between June 6 and June 10, 2016. On June 9, 2016, Mr. Robinson sent Mr. Hixenbaugh an email, copied to Ms. Nido and Mr. Sawyer, advising of concerns raised by Spectra’s interest in seeking the concessions contract. The email states: Hi Brian: I am not sure what is the proper name: Spectra, Spectra by Comcast, or Comcast Spectacor (website not clear) but I just learned that your company is interested in submitting a proposal for the upcoming concessions contract. If true, unfortunately, we won't be able to take advantage of you and your affiliates' expertise in discussing the pending ITN because having the company involved in any way, by Fla., Statute would eliminate Spectra from being eligible to submit a proposal. We thought you would like to know that, and I can explain further if you want to call. Talk soon. Greg” Mr. Robinson’s concern was well founded. The University, in its rules, takes a strong stand against potential vendors being involved in preparing an ITN or other document soliciting bids or proposals. Mr. Hixenbaugh’s involvement in the ITN development process stimulated more emails. The emails make it clear that there were also conversations about the subject that are not part of the record. At 9:09 a.m., on July 25, 2017, Mr. Shumack emailed Mr. Robinson and Ms. Nido, with a copy to Mr. Sowers, reporting that he and Mr. Sowers had discussed the next step in the ITN process. The email advised that the next step was for a consultant the University engaged to assist with the ITN, Chris Bigelow, to come to the University and begin discussions with “Arena and Stadium stakeholders to determine their goals, objectives and expectations-regarding pricing, commissions, contract structure, fan-experience, etc.” At this point, having engaged a consultant and conducted at least two meetings about the concessions contract, the University had fully embarked on the ITN development, with Mr. Hixenbaugh’s assistance and participation. Mr. Shumack’s July 25 email stated that Mr. Sowers had raised a concern that Mr. Hixenbaugh’s company Spectra planned to pursue the concessions contract. The text of the email merits reproduction here because it conveys the University’s knowledge of the issue and desire to nonetheless continue Mr. Hixenbaugh’s participation in the ITN preparation. Mr. Shumack wrote: The concern Kevin [Sowers] has raised is the person/company (Brian Hixenbaugh with Global Spectrum) that manages the CFE Are[n]a is also planning to bid on the new Concessions contract. So if we include Brian in the discussions it may appear that Global Spectrum (now called Spectra) had some influence in the construction of the ITN/contract (which would be true). However, we would like to have Brian's feedback and involvement in the new ITN/contract since he has been involved with managing the Arena for a while and would most likely have useful information/feedback on how to improve the future contract. What is your advice on this — include Brian in the discussions or do not include? Mr. Robinson replied at 10:56 a.m., on July 2, 2016 that Mr. Hixenbaugh could not participate in “data gathering or discussions. The email continues, “He [Mr. Hixenbaugh] acknowledged understanding via phone a few days later.” The email refers to an attachment that is not part of the record. Mr. Shumack replied: “Thanks Greg. That’s what Kevin and I thought. I didn’t know Brian asked you this question too.” Further emails plainly about the same subject, despite cryptic wording, followed. For some reason the University was working to circumvent its own rules 7.130(10) and 7.130(6)(c). On July 27, 2016, at 8:36 a.m., Mr. Sowers emailed Mr. Sawyer with a copy to Mr. Shumack saying: “Mike [Schumack] and I want to meet with Greg [Robinson] and Nellie [Nido] on how best to communicate or what limits we may have in relations to the concessions contract. Do you want to be a part of that discussion?” Mr. Sawyer wasted no time. His 9:55 a.m. reply to Mr. Sowers stated: “Kevin, I’ve got my one-on-one with Greg [Robinson] this afternoon, why don’t I discuss this with him a bit at that time and lay the groundwork for you and Mike [Shumack] to have a follow-up discussion with him to nail down the specifics.” Mr. Sowers forwarded the email to Mr. Shumack. The next morning Mr. Sawyer emailed Mr. Sowers with a copy to Mr. Robinson reporting the result of his conversation. His email stated: Kevin: Greg and I had a good discussion referencing Concessions' yesterday. We think there is a way forward that would entail all relevant parties in the room for a general discussion (AA, Spectra, B.S., Purchasing, Consultant). In preparation for that discussion, however, we will need to establish the objectives of the discussion and then stick to those objectives. This will be the last discussion that Spectra will be involved with: afterwards the strategic tone of the conversations will be a bit more proprietary in nature. It would probably be a good idea for you to have a short conversation with Greg yourself; afterward let's establish the objectives, make sure Greg is supportive of the structure, then let's move forward in setting up the discussion. Once we get into the new semester and football season schedules will get much more convoluted. Nothing in the record explains why Spectra was a relevant party because it manages the venue but Centerplate, which provides concessions services at all venues, was not a relevant party. Mr. Shumack scheduled and held the next concessions contract meeting on August 29, 2016, from 1:30 p.m. to 3:30 p.m. The email scheduling the meeting at the Business Services Conference Room identified Mr. Sawyer, Mr. Sowers, Mr. Hansen, Mr. Carr, Mr. Robinson, Ms. Nido, Mr. Bigelow, and Mr. Hixenbaugh as participants. Mr. Bigelow, the consultant, prepared a comprehensive five-page agenda for the meeting. Agenda items included the “Mission of Food and Beverage,” current and future customer experience, all-inclusive food and beverage ticket sales with all-inclusive pricing, local brands as subcontractors, catering kitchen, sponsorship versus popular foods, staffing, training, the number of points of sale, point of sale systems, digital signage, planned Stadium and Arena renovations, insurance, minimum commissions, reserve accounts and much more. The agenda also contained a two-page chart of action items with target dates for completion. On August 30, 2016, Mr. Shumack emailed Mr. Sowers a detailed three-page summary of the August 29, 2016, meeting that Mr. Hixenbaugh attended. It identified a wide ranging number of issues covered and conclusions reached. They include, but are not limited to, a preference for a “management fee contract,” breaking the services sought into a base contract with two optional, additional contracts, the term of the contract, the amount of capital investment wanted from the vendor, the contract management structure, upgrades to power sources, upgrades to communications, upgrades to point of service terminals, and additional food stand locations. These agenda items and more would resurface in the ITN and would be discussed with the Final Decision Maker in meetings of the evaluators considering the responses to the ITN and serving as a negotiating team. Mr. Shumack forwarded the email to Mr. Robinson later that day. A November 2016 series of emails also supports finding that Mr. Hixenbaugh attended the meeting. The series starts with a November 2016 email from Mr. Sawyer to University counsel, Jordan Clark, ostensibly asking if contracting with two subsidiaries of Spectra, one managing the Arena and one providing concessions, created any issues. Mr. Clark replied to clarify the question as asking if the question was, is it “legal (in Florida) for an affiliated/related company of Spectra to be awarded the concessions contract?” Mr. Sawyer replied, “I don’t think I have much doubt that it would be legal, I’m just trying to figure out if there’s a perception or optics or ‘other’ type of lens for this particular structure that I should be careful of before we go down the road of issuing an RFP.” Mr. Sawyer did not disclose Mr. Hixenbaugh’s involvement in creating the ITN or that his involvement was the real subject of concern.2/ Mr. Clark sent an email setting forth the limited facts provided him and identifying possible risks and liabilities. He concluded, “Big picture, if the selection is done by the book, then there is not much that is out of the ordinary for this structure.” Mr. Sawyer forwarded Mr. Clark’s email to Mr. Robinson. Mr. Robinson emailed back asking if Mr. Sawyer thought Mr. Jordan’s opinion was “enough.” Mr. Robinson’s response included this understatement, Jordan states everything will be fine if we have a by-the-books selection process, but the perfect process may have already been somewhat tainted because Spectra was at the table during some of the strategy meetings. His opinion has me more concerned than assured and I feel we are on a thin limb without clear cut legal support. Mr. Robinson suggests reviewing the issue with a “high placed” individual in “Audit” with a lawyer and Mr. Sowers present. The record does not reveal how all that went. Why including Mr. Hixenbaugh in the ITN development was so compelling is a mystery. The persistent push to keep Mr. Hixenbaugh involved contrasts markedly with the absence of any sign of efforts to involve a Centerplate representative. Using the stated rationale for Mr. Hixenbaugh’s involvement, Centerplate’s involvement would have been very helpful since it had ten years of experience providing concessions at the facilities. What is not a mystery is that Mr. Sawyer, Mr. Sowers, and Mr. Shumack demonstrated an affinity for Mr. Hixenbaugh and his participation in the ITN process that could only have favored his employer, Spectra. Two reasonable inferences follow from the facts proven by a preponderance of the evidence. One is that several people involved in development of the ITN favored or depended upon Mr. Hixenbaugh. The other is that Mr. Hixenbaugh participated substantively in preparing the ITN and that the University knew this was a problem. Participating in the ITN development would provide a vendor the competitive advantages of having a hand in shaping the ITN, a head start on preparing a proposal, and a fuller understanding of the University’s desires and priorities. Mr. Hixenbaugh participated in the meetings and gained a competitive advantage for Spectra. To the extent that a participant in the ITN development meetings served as an ITN evaluator, attending the development meetings would give a vendor with a representative involved in the development meetings significant competitive advantages. Those advantages include insight into how the evaluators viewed the various items discussed and an opportunity to establish a trusting relationship with the future evaluators in a collegial activity with a shared objective. Mr. Sowers, Mr. Shumack, Mr. Hansen, and Mr. Carr served on the ITN drafting committee, working with and relying on Mr. Hixenbaugh. They were four of the six evaluation committee members (67 percent) evaluating a proposal by Mr. Hixenbaugh’s company in which Mr. Hixenbaugh figured prominently. The proposed timeline from Ms. Nido contemplated distributing the ITN November 1, 2016, and posting the intent to award on March 3 or 6, 2017. Instead, the University posted the ITN on February 28, 2017, and posted the intent to award on July 20, 2017. The record is silent about further ITN development activities between August 29, 2016, and February 28, 2017, when the University issued the ITN. The ITN crafting meetings were not publicly noticed or open to the public. Terms of the ITN The ITN begins with a statement of the University’s goal for the concessions contracts, an explanation of the “base contract” plus two optional contracts structure, and an exposition about the facilities and their affiliated entities. The ITN identifies the University’s goal as creating “an innovative, state-of-the-art concessions program.” The University wanted the program to focus on several facets including customer service, quality, affordability, increased market share, creative concepts that include local and national brands, facility investment, and “a Commission structure commensurate to the University’s stature.” The ITN sought proposals for a base contract to provide concession services to general admission areas. The University intended to award a single base concession contract for all of the identified facilities. The ITN also created two optional contracts that vendors could seek. One was for catering/premium services at the Arena. The other was for catering/premium services at the Stadium. The ITN makes clear that the optional contracts may be awarded separately, in conjunction with the base contract, or not at all. The ITN described the University’s relationships with other entities like this: Note that the Stadium and Arena facilities are owned and operated by two different organizations within the University. The UCF Stadium Corporation and the Athletics Association (a.k.a. Stadium) oversees all of the athletic events except for those events at the Arena which are overseen by the UCF Convocation Corporation (a.k.a. Arena). Concessionaire will be required to track and report sales data and commissions separately for each organization. The University intends that the Concessionaire operate in a manner that recognizes and maintains the distinction between these two University organizations. The ITN provided general information about the University, its services, enrollment, social clubs, service organizations, the student body, and its football team. The ITN stated that the University intended to award the contract around August 1, 2017. It established May 3, 2017, as the date for submitting and opening proposals. The ITN required submission of all communications or inquiries during the ITN process to Ms. Nido. The ITN set up a pre-proposal conference for interested parties that included visits to all of the concessions locations. The ITN created weighted criteria for evaluation of the base contract award. Appendix I, the evaluation scoring sheet reproduced below, listed the criteria and maximum points that could be awarded for each. The ITN goes on to elaborate about each of the criteria. This is the scoring sheet. The ITN established procedures for the ITN process from the publication date until the University took final agency action. They included information about the posting procedure, statements about public records obligations, statements emphasizing that the University was not bound to accept any offer, a general description of the evaluation committee functions, licensing requirements, and parking registration. ITN Section 2.13 prohibited any responding vendor from discussing its offer or communicating with “any UCF employees, agents, representatives, Evaluation Committee members or representatives of UCF except as expressly requested by UCF in writing.” It warned that violation of the communication restriction might result in rejection of the vendor’s offer. Section 2.17 defined words and phrases used in the ITN. They include the ITN definition above, “Sole Point of Contact,” equipment, costs, facilities, branded products, university provided equipment, and “Smallwares.” The ITN defines “sole point of contact” thus: “The Procurement Services department Representative or designee to who Respondents shall address any questions regarding the solicitation or award process.” For this project, Ms. Nido was the sole point of contact. The ITN defined “smallwares” as “the servicewares, utensils, crockery, glassware, dishware and cutlery used in the Concessionaire operation.” Section 2.21 set the contract term at ten years, beginning around August 1, 2017. Section 4 of the ITN stated the program requirements. Section 4.1a sets the concessionaire’s duties and responsibilities as operating the program on its own credit, providing all needed merchandise and equipment at its own expense, engaging necessary labor, obtaining needed supplies, ensuring proper sanitation, and obtaining needed services. The products and services section (4.2) required, among other things, use of local and branded products, working with local not-for-profit organizations, surveys and reporting of pricing at comparable venues, obtaining needed permits and licenses, marketing, employee training, and quality control. The ITN stated that the concessionaire was required to work directly with the Athletics Association and the Convocation Corporation. It also outlined an allocation of responsibilities between the University and the concessionaire for a range of things, including utilities, equipment, premises maintenance, trash removal, and equipment maintenance. The ITN required would-be concessionaires to indicate how they intended to develop and promote their marketing plan; indicate strategies to highlight new products; indicate customer development and retention plans; propose a quantitative mechanism to evaluate the level of services, menu and overall quality; and provide an organization chart with staffing levels. Further, the ITN required responding vendors to, at a minimum, submit a commissions structure proposal; a financial investment proposal; a technology investment proposal; a branded and other subcontracted products proposal; an organization and staffing plan; a description of available training programs; a proposed impartial quantitative mechanism to evaluate services, menu, and quality; proposed menus; a description of a detailed transition plan; financial projections; a company history and statement of qualifications; samples of event information reports; and a description of proposed concessionaire area design concepts. The ITN included a number of attachments. They included the scoring chart reproduced previously, a financial offer form seeking commissions for each year of operation, a form for listing intended branded products, a form for describing and valuing facility investment, a list of university-supplied equipment, the current Centerplate menu and pricing, and diagrams of the facilities. ITN Evaluation Process Sections 2.1 through 2.9 of the ITN created a process for evaluating and selecting a proposal. As noted earlier, the ITN identified Ms. Nido as the sole point of contact for vendors. It allowed for vendor questions and disagreements with some of the ITN requirements and set forth a timeline. The ITN set up a pre-proposal conference for interested parties that included visits to all of the concessions locations. The ITN set the date and time for opening proposals as Wednesday, May 3, 2017, at 2:00 p.m. The ITN made clear that a person chosen by the University would be the Final Decision Maker with sole authority to determine what was in the best interest of the university and then “make the final decision . . . .” The Decision Maker had the authority to assign individuals to provide advice and assistance. The ITN required the Decision Maker to establish an evaluation committee and required the committee to review and rank all responsive offers. Committee members were required to evaluate the proposals using the weighted criteria in the table reproduced in paragraph 77 above. Once responses were opened, evaluators were not permitted to meet as a group or consult with others about their evaluation. They were to function independently during the evaluation. Once their initial evaluations had been concluded and reviewed by the Decision Maker, he could convene the committee to discuss their evaluations. The ITN did not bind the Decision Maker to follow the committee’s evaluations. The ITN broadly empowered the Decision Maker. His authority included the right to negotiate with vendors “whose proposals(s) may represent the best interest of the university.” Centerplate’s assertion that the University could not negotiate until after it had concluded which proposal was in the best interest of the University is not correct. The Decision Maker could convene a negotiating team made up of the evaluators or others. He also could, as he did, seek the advice of others such as Mr. Bigelow. Final authority to select the successful vendor rested with the Decision Maker. Evaluation and Decision Making The University issued the ITN on February 28, 2017. Mr. Sawyer designated Rick Falco, the director of the University's Student Union, as the Decision Maker. Centerplate and Spectra representatives attended a pre-proposal meeting at UCF on March 14, 2017. Centerplate, Aramark, Spectra, and Levy all timely responded to the ITN with proposals to provide base concessions for all of the University facilities, catering/premium services at the Arena, and catering/premium services at the Stadium. The proposals of Aramark and Levy did not provide for separating the base and premium proposals. Mr. Sowers, Mr. Shumack, Michelle Foote, Mr. Hansen, Ronnie Lamkin, and Mr. Carr formed the proposal evaluation committee. All but Ms. Foote and Mr. Lamkin had served on the drafting committee with Mr. Hixenbaugh. On May 8, 2017, Ms. Nido conducted an orientation meeting for the evaluators, followed by a confirming email, providing guidance on how to perform their task. The evaluators completed their ITN scoring sheets and submitted them to Ms. Nido. In turn, she provided them to Mr. Falco. The evaluators gave Spectra an aggregate score of 1,043. They gave Centerplate an aggregate score of 857. According to Mr. Hansen, the two proposals were not that far apart. Mr. Falco decided to meet with the evaluation committee, morphing it into an evaluation/negotiation committee. The consultant, Mr. Bigelow, prepared an “evaluation Matrix of the Proposals” and provided it to Mr. Falco and Ms. Nido on May 17, 2017. Ms. Nido or Mr. Falco provided it to the evaluation/negotiation committee members on May 26, 2017, after the committee members completed and submitted their scoring sheets. Consequently, it could not have affected their scoring. However, Mr. Falco, who was the Decision Maker, considered the matrix when deciding which vendor to negotiate with. Mr. Bigelow’s matrix included an evaluation of the net present value of the proposals that he described as “Shows the Net Present Value of each offer that creates an ‘apples to apples’ comparison leveling the investment and commissions.” The ITN required all respondents to present their financial offers in a chart identified as Attachment A-1 to the ITN seeking commission revenue projections for each year of the contract and proposed annual investments. Spectra completed the chart. Centerplate chose to present a tiered commission proposal that did not fit into the chart categories. This made the concept of an “apples to apples” comparison sensible. However, Mr. Bigelow’s report does not explain how he calculated his comparison. There is also no testimony explaining it. Mr. Bigelow’s chart for the revenue projections does not present an “apples to apples” comparison. It presents “adjusted” revenue columns for years one through ten. For reasons unknown, the chart for Spectra, but not for Centerplate, includes a column titled “Original Year.” This resulted in Mr. Bigelow, and therefore Mr. Falco, using 11 years of revenue for Spectra and only ten years of revenue for Centerplate. The total gross receipts amount in the Spectra “Original Year” column is $2,486,453. This amount is more than the $2,446,453 difference between the total gross receipts amount of $31,613,424 for Spectra and $29,166,971 for Centerplate. Subsequent use of the values that included the “original year” amount flawed the report’s evaluation of the revenue proposals to the benefit of Spectra. Mr. Falco and the evaluation/negotiation team were not aware of this error. Mr. Bigelow’s report contains another revenue calculation error. In calculating revenue from subcontractor sales, he failed to account for the reduction in commissions paid to the University caused by payment of a commission to subcontractors. This too made the revenue figures for the Spectra proposal considered by Mr. Falco artificially high. The unrebutted testimony of Salvatore Ferrulo on the subject of the financial projection errors in Mr. Bigelow’s report was persuasive, credible, and supported by a review of the documents. Mr. Ferrulo’s work experience qualified him to analyze the report. The University did not offer rebuttal evidence, such as the testimony of Mr. Bigelow, to explain his report. The University’s response to the errors in the revenue analysis is to say they do not matter because the evaluators did not see them until after they scored the proposals. The response is not persuasive. The evaluators saw Mr. Bigelow’s report before their post-scoring negotiating team discussions with Mr. Falco. More importantly, Mr. Falco saw and considered the flawed report. This means that the decision about which vendor to negotiate with was informed by an error in Spectra’s favor of nearly 2.5 million dollars. Mr. Falco and the evaluation/negotiation committee met on May 31, 2017. The group agreed that the University would only engage a concessionaire for the base concessions contract. This decision eliminated Aramark and Levy from consideration because their proposals indicated they would not accept an award of only a base contract. This left Spectra and Centerplate competing for the base contract. At the May 31, 2017 meeting, Mr. Falco, after discussions with the evaluation/negotiation committee, concluded that he had questions for Spectra and wanted to enter negotiations with Spectra. At this meeting, the participants first discussed their desire to avoid extending the Centerplate contract and allow Spectra to begin services before the contract was approved and final. At the May 31, 2017, meeting, Mr. Falco decided that for strategic purposes he did not want to publicly eliminate Centerplate from the ITN process. However, Mr. Falco did not choose to negotiate with Centerplate. The group discussed time pressures created by the delays in the ITN process and July schedule for the Board of Trustees and its committees. Mr. Shumack pointed out that the University could extend the existing contract if they ran out of time. A participant identified as “Person X” in the transcript opposed the idea saying, “I’m not interested in that.” Most likely Mr. Sowers is Person X. He is the only participant who is not otherwise identified as speaking during the meeting. On June 1, 2017, University Procurement Services sent Spectra a list of questions and topics about its proposal and invited Spectra to negotiate. Also on June 1, 2017, the University notified Spectra that it had decided to award only a base concessions contract. The University did not tell Centerplate about this decision until July 5, 2017. On June 16, 2017, University Procurement Services sent Spectra another email inviting it to a June 23 in-person meeting, providing additional information about the meeting, and submitting questions. They included a request to lower some menu prices, a request for resumes of other general manager candidates, an explanation of how Spectra intended to share staff between concessions and venue management, and an inquiry about the branded foods it intended to offer. On June 21, 2017, Spectra representatives who came for the meeting asked University Athletics and Arena staff for walk- through tours of the facilities. The staff obliged. Mr. Hansen knew of the planned tour and saw no issue with it. He provided the keys needed to conduct the walk-through. There is no record of the tour or testimony about what was said. Inferring that the tour participants did not conduct the entire tour in complete silence with no communications between the University staff and the Spectra representatives is reasonable. The tour violated the prohibition of ITN Section 2.13. It should not have happened. The tour concerned Ms. Nido and Mr. Robinson because it violated ITN communication restrictions. In a June 21, 2017, email Mr. Hansen asked Mr. Falco to see if Spectra was “willing to work with us at-risk before their contract is approved by the BOT in late July. I don’t think either side wants to wait until late July to begin planning." Mr. Falco, Mr. Bigelow, Ms. Nido, Procurement Services staff, and the evaluation/negotiation committee met with Spectra representatives on June 23, 2017, for about an hour and a half. Mr. Hixenbaugh played a prominent role in the discussions. He said that he would be the main contact for the contract. Mr. Hixenbaugh advocated the Spectra proposal to a group that included four of the people he worked with during development of the ITN. Committee members voiced their concerns about the quick transition selecting Spectra would require. In the meeting, Spectra emphasized the synergies, including shared staff and expertise, with its Arena management that its proposal offered. During the meeting, the University told Spectra it was going to request best and final offers. At some point, after the meeting with Spectra, Ms. Nido, Mr. Shumack, Mr. Hansen, Mr. Carr, and Mr. Lamkin met to the discuss the contract. The meeting transcript does not provide a date. Their wide ranging discussions included concerns about the time pressure, questions about the accuracy of the Spectra financial projections involving branded items, Spectra’s ability to transition into the contract in August, and concerns about Spectra’s ability to have its point of sale systems operating. Mr. Shumack raised the option of extending the existing contract again. Again, Person X was adamantly opposed. In this meeting, Person X was probably Mr. Carr, since the other participants are identified by name when they speak. In this meeting, Mr. Hansen reveals that he knew of the unauthorized walk-through of the facilities an hour before it happened and provided someone named Julian the keys to conduct the walk-through. He did nothing to stop it. Mr. Falco did nothing about it. None of the negotiation sessions were publicly noticed or open to the public. Neither was the facility walk-through. On July 5, 2017, University Procurement Services sent Centerplate a series of questions about its proposal, for appearances’ sake. Centerplate responded on July 7, 2017. On July 7, 2017, the University's Procurement Services solicited a best and final offer from Spectra and Centerplate. Both responded with proposals that increased the contract’s financial benefit to the University. Mr. Falco evaluated the best and final offers from Spectra and Centerplate without consulting further with the evaluation committee. Mr. Falco decided that the University should award the Contract to Spectra. On July 20, 2017, Mr. Falco presented his decision to the University's Board of Trustees' Finance Committee and to the full Board. Also on July 20, 2017, University Procurement Services posted its Intent to Award, indicating that Spectra had made the successful proposal. On July 21, 2017, Centerplate filed and served the University with its notice of intent to protest. On July 31, 2017, Centerplate filed and served its formal protest. After the Protest Sometime after July 31, 2017, Convocation Corporation and the Association entered into short-term contracts with Spectra. The contracts provide for goods and services very similar to those proposed in Spectra’s response to the ITN. This fact is further evidence of the bias toward Spectra in the process. The University maintains that the short-term contracts are of no moment because it is not a party to them. The murky relationships among the University, the Association, and the Convocation Corporation make the contracts relevant to the issue of fairness in the process. Throughout the ITN development and evaluation process, the three entities functioned as one and as if they had authority to bind each other in contracts. The indicia of the gestalt of the three organizations include the uncertainty about whether the Association or the University owns the Stadium, this ITN where the University is selecting and contracting with the concessionaire for facilities the other two may own and do operate, and the fact that the University signed the last contract, although the Association and Stadium Corporation owned the Stadium at the time. The ITN’s statement that the University must maintain fire and extended coverage on the facilities, which it may or may not own, is further indicia of the organizations viewing themselves as one and acting as one. The fact that the Association and the Convocation Corporation have a procurement process and could have contracted for concessions for the Stadium and the other University facilities they own or manage without the University is further evidence of blurred lines between the organizations. The University had three, more straightforward, options for securing concession services while this matter pends. First, UCF Rule 7.130(3)(h)1. gives the University authority to make emergency procurements. Second, UCF rule 7.130(6)(c) allows the University to extend an existing contract for as long as 12 months while a bid dispute pends. Third, BOG Regulation 18.002(7), which requires that the University stop the contract award process when it receives a formal protest until the protest is resolved, permits the University to continue the award process if the President states in writing that continuing the award process without delay is necessary to avoid an immediate and serious danger to the public health, safety or welfare. The fact that the University eschewed these options for an artifice buttresses the determination that the process was biased in Spectra’s favor and contrary to competition.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent, the University of Central Florida, enter a final order declaring the Intent to Award invalid and rejecting all proposals to Invitation to Negotiate Number ITN1617NCSA. DONE AND ENTERED this 21st day of November, 2017, in Tallahassee, Leon County, Florida. S JOHN D. C. NEWTON, II Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 21st day of November, 2017
The Issue The issue is whether Petitioner is entitled to receive an allocation of affordable housing funds from the Florida Housing Finance Corporation as a result of the alleged improper scoring of another applicant's application during the 2001 funding cycle.
Findings Of Fact Based upon the testimony and evidence received at the hearing and the parties' stipulations, the following findings are made: Parties Petitioner is a Florida limited partnership that is engaged in the business of developing affordable housing projects. FHFC is a statutorily-created public corporation. It is the State's designated "housing credit agency," and it is responsible for the allocation of tax credits and the distribution of other funds for the development of affordable housing projects. FHFC is administratively housed in the Department of Community Affairs (DCA), and it is governed by a nine-member board. Eight members of the board are appointed by the Governor; the ninth member of the board is the Secretary of DCA, who serves in an ex officio capacity. FHFC Programs The programs administered by FHFC include the State Apartment Incentive Loan (SAIL) Program and the Low-Income Housing Tax Credits Program (Housing Credits Program). The funds from the SAIL Program are used to provide low-interest loans to developers. The funds come from various sources of state revenue, and the loans are typically secured by a second mortgage on the property on which the affordable housing project is developed. The Housing Credits Program is governed by federal law, namely Section 42 of the Internal Revenue Code. The program provides dollar-for-dollar federal tax credits to developers that can be used over a 10-year period so long as the related affordable housing project satisfies the requirements of the Internal Revenue Code throughout that period. The tax credits can be, and often are sold or "syndicated" by the developer in order to generate the funds necessary to construct the project. Each state receives an annual allotment of tax credits from the federal government to be used in its Housing Credits Program. For 2001, Florida's allocation of tax credits was approximately $23.9 million, of which approximately $20.7 million was available for allocation. FHFC received requests totaling approximately $81.3 million in the 2001 funding cycle for the available $20.7 million in tax credits Some of the available tax credits are apportioned by FHFC into a "set-aside" for projects in small counties. Only projects located in small counties compete for the tax credits in the small county set-aside. For 2001, the small county set-aside was $1,739,586.90, and FHFC received requests for those funds totaling approximately $5.5 million. FHFC Evaluation Process Because the funds requested from the SAIL Program and the Housing Credits Program typically exceed the available funds (as was the case in 2001), FHFC has established a competitive application process through which the applications are evaluated, scored, and ranked. The applications are first reviewed for all of the "threshold" items identified in the application forms and FHFC’s rules. If an application does not have all of the threshold items, it is rejected. By contrast, the failure to include non- threshold items or the failure to provide complete, consistent, and accurate information in the format and location prescribed in the application forms results in the application not receiving the full amount of points available or the imposition of a penalty that reduces the overall score given to the application. Next, FHFC staff reviews all of the applications that were not rejected for omitting a threshold item. That review results in a “preliminary score” for each application, which is provided to all of the applicants. Then, there is a 10-day period in which applicants may challenge FHFC's preliminary scoring of their application or the preliminary scoring of any other applicant's application. Such a challenge is called a Notice of Possible Scoring Error (NOPSE). FHFC provides each applicant the NOPSEs relating to its application as well as a statement of FHFC's position on the NOPSE. The applicants are then given a period of time -- referred to as the "cure period" -- to submit additional documentation, revised forms or other information they deem appropriate to address the issues raised in the NOPSEs, FHFC's comments on the NOPSEs, and/or FHFC's preliminary scoring of the application. The additional submittals are referred to as "cures." After the cures are submitted, the applicants again have an opportunity to bring deficiencies in competing applications to FHFC's attention. The mechanism for doing so is a Notice of Alleged Deficiency (NOAD). After reviewing the cures and any NOADs, FHFC staff prepares a revised score for each application. This score is referred to as the “pre-appeal score.” Along with the pre-appeal scores, each applicant is given notice of its right to challenge its score through a formal administrative proceeding at the Division or through an informal proceeding before a hearing officer appointed by FHFC. Most applicants opt for an informal hearing because, as a result of the time constraints imposed by the funding cycle, those who opt for a formal hearing will not be funded until a subsequent cycle if they prevail at the hearing. After all of the informal hearings are completed and any scoring adjustments are made based upon the results of those hearings, the applications are ranked based upon their “post- appeal scores.” The post-appeal scores and rankings are approved by the FHFC board and are used to award the available funds. The standards and procedures for ranking applications for tax credits are set forth in the Qualified Allocation Plan (QAP). The QAP is required by the Internal Revenue Code and it is adopted and incorporated by reference in FHFC's rules. Among other things, the QAP establishes the priority of applications which receive the same scores. That priority is established through two "tie-breakers." The first tie-breaker is whether the application is in Group A or Group B, and the second tie-breaker is a random lottery number assigned to the application prior to the final rankings. The group into which the application falls is determined based upon the Corporation Funding per Set-aside Unit (CFSU) amount identified on Form 10 of the application. Group A includes the 65 percent of the applications that have the lowest CFSU amounts. Applications in Group A receive priority over applications in Group B in the event that the applications receive the same final score. For applications in the same group with the same score, priority is given to the application with the lower lottery number. 2001 Combined Cycle Generally The 2001 funding cycle was referred to as a "combined cycle" because it combined the SAIL Program, the Housing Credits Program, and another program not implicated in this case called the Home Investment Partnership Program (HOME Program), into a single application and review process. The application package for the 2001 Combined Cycle included 23 numbered forms, not all of which were applicable to every applicant. The applications submitted in the 2001 Combined Cycle, including those submitted by Petitioner and TWC, were reviewed and scored in accordance with the procedures described above. Relevant Forms Form 1 of the application is entitled "Applicant and Development Data." Page 10 of Form 1 includes the following statements: The Applicant and all Financial Beneficiaries understand and agree that full points will be awarded only in the event that all information required by each form is provided in accordance with the Application requirements. Failure to provide complete, consistent and accurate information in the format and location prescribed by the Application will result in a REDUCTION OF POINTS OR REJECTION OF THE APPLICATION as indicated on each form. Only information contained within the Application will be considered for purposes of points awarded or appealed. . . . . Form 5 of the application is entitled "Local Government Contributions." Page 1 of Form 5 states that: Each applicable verification form must have an Original signature by one of the designated signatories indicated on the appropriate verification form. Zero points will be awarded if Applicant uses the incorrect form or if the form is not signed by one of the designated signatories. Separate verification forms are included in Form 5 for the different types of local government contributions. There are separate verification forms for grants (Form 5, page 6), fee waivers (Form 5, page 7), loans (Form 5, page 8), tax exempt bond financing (Form 5, page 9), “other contributions” (Form 5, page 10), and exemptions from ad valorem taxation (Form 5, page 11). The verification form for fee waivers states that “[n]o credit will be given for fee waivers unless the computations by which the total amount of each waiver is determined accompanies this verification form in the Application.” That same language is not included on the verification form for "other contributions”; however, that verification form includes a sentence stating that “[t]he amount of this contribution was calculated as shown behind the tab labeled ‘Form 5, Exhibit .’” The verification form for “other contributions” also includes the following statement: THIS FORM MUST BE SIGNED BY THE MAYOR, CITY MANAGER, COUNTY MANAGER/ADMINISTRATOR, CHAIRPERSON OF THE CITY COUNCIL/COMMISSION OR CHAIRPERSON OF THE BOARD OF COUNTY COMMISSIONERS. . . . . OTHER SIGNATORIES ARE NOT ACCEPTABLE. THE APPLICANT WILL NOT RECEIVE CREDIT FOR THIS CONTRIBUTION IF THE VERIFICATION FORM IS IMPROPERLY SIGNED AND/OR DOES NOT HAVE AN ORIGINAL SIGNATURE IN THE ORIGINAL APPLICATION. Form 6 of the application is entitled "Local Government Planning Efforts." Pages 2 and 3 of Form 6 are the verification forms for any affordable housing incentives being offered for the project by the applicable local government. Both pages include the following statement: This form must be signed by the MAYOR, CITY MANAGER, COUNTY MANAGER/ADMINISTRATOR, OR CHAIRPERSON of the CITY COUNCIL/COMMISSION OR CHAIRPERSON of the BOARD OF COUNTY COMMISSIONERS. OTHER SIGNATORIES ARE UNACCEPTABLE. ZERO POINTS WILL BE AWARDED. . . . . The application and all of these forms are adopted and incorporated by reference in FHFC's rules. Applications Submitted by Petitioner and TWC Petitioner submitted an application for an allocation of $561,000 in tax credits and for an award of funding under the SAIL Program for its proposed Ochlocknee Pointe development in Gadsden County. Petitioner's application was designated by FHFC as No. 01-131CS. A competing application for $890,000 in tax credits was filed by TWC for its proposed Windsong II development in Columbia County. TWC's application did not seek funding under the SAIL Program. TWC’s application was designated by FHFC as No. 01-125C. Neither Petitioner nor TWC applied for funds under the HOME Program. Because of their locations, the applications submitted by Petitioner and TWC were competing for the tax credits available in the small county set-aside. There were also seven other applicants competing for the tax credits in the small county set-aside. Alleged Deficiencies in TWC's Application and Initial Scoring by FHFC Staff Form 5 of TWC's original application indicated that the project had not received any local government contributions. As a result, the original application did not include any executed local government contribution verification forms. Form 6 of TWC's original application did not identify any affordable housing incentives being offered by the local governments. As a result, the original application did not include any executed verifications forms for such incentives. As part of its cure submittals, TWC submitted a revised Form 5 and a revised Form 6. The revisions were made because TWC had received verification of local government contributions and affordable housing incentives. The revisions included executed verification forms for Form 5 (page 10)1 and for Form 6 (pages 2 and 3). The verification forms at issue in this proceeding were executed by Dale Williams; the title listed for Mr. Williams was County Coordinator. A letter signed by Mr. Williams was included along with the “other contributions” verification form (Form 5, page 10). The letter was on the letterhead of the Board of County Commissioners of Columbia County and includes the words "County Coordinator" under Mr. Williams name and signature. The letter was designated as and included in the cure submittal behind a tab marked "Form 5, Exhibit A." The letter states that "Columbia County will provide the installation of roadway turn lanes at Branford Highway to service Windsong II Apartments for a contribution equivalent to a total value of $102,000." The letter does not include any calculations showing how the “total value of $102,000” was computed, and no such calculation was included elsewhere in TWC's cure submittals. There is nothing in TWC’s cure submittals that explained the nature of the County Coordinator position or stated that Columbia County does not have a County Manager/Administrator designated as such. TWC was not awarded four points on Form 6 because County Coordinator was not specifically listed along with “City Manager, County Manager/Administrator, or Chairperson of the City Council/Commission or Chairperson of the Board of County Commissioners” as an authorized signatory for that form. For that same reason, TWC also was not awarded any points on Form 5 for the $102,000 local government contribution referred to in Mr. Williams' letter. That contribution was worth 7.64 points. TWC was also penalized 1.5 points on Form 5 because no documentation was provided showing how the "total value of $102,000" was calculated for the local government contribution described in Mr. Williams' letter. These scoring determinations were made by Debra King, the FHFC staff person who reviewed TWC’s application and cure submittals, and they were concurred in by Ms. King’s “scoring partner.” Scoring Appeals by Petitioner and TWC FHFC completed the scoring process for the 2001 Combined Cycle on August 1, 2001, when it advised the applicants of their pre-appeal scores. TWC's pre-appeal score was 608.86, which included the penalty and point reductions described above. Petitioner's pre-appeal score was 620.5, which included a 1.5 point penalty for Petitioner’s failure to specify a unit of measurement on Form 7. TWC and Petitioner both requested informal hearings to challenge their pre-appeal scores. Those hearings, which are commonly referred to as “scoring appeals,” were conducted by hearing officers appointed by FHFC. At the informal hearing on TWC’s scoring appeal, FHFC conceded that Mr. Williams was an authorized signatory for Forms 5 and 6 because, as the "County Coordinator," Mr. Williams was the de facto County Manager/Administrator for Columbia County. FHFC also conceded that documentation relating to the computation of the $102,000 in roadway improvement being contributed by Columbia County was not necessary because it was a lump-sum contribution. FHFC agreed to re-score TWC's application in light of those concessions. The concession that Mr. Williams was an authorized signatory was based upon FHFC staff's review of the job description for the County Coordinator position and the organizational chart for Columbia County attached to TWC's Petition for Informal Administrative Hearing as well as phone calls that FHFC staff made to Columbia County after receiving that information to confirm that the county did not have a County Manager/Administrator designated as such. The concession that a document showing how the local government contribution was calculated was based upon FHFC staff’s review of excerpts from prior applications that were attached to TWC’s Petition for Informal Administrative Hearing. Those applications apparently received full points for their “other contributions” even though they did not include detailed calculations for the contributions; however, almost all of the excerpts showed at least a general breakdown of the items which made up the total shown on the verification form. As a result of FHFC's concessions, the hearing officer concluded that the TWC’s scoring appeal was "moot" and she issued a Recommended Order which contained no findings of fact or conclusions of law. The hearing officer's Recommended Order, which FHFC adopted in toto as its Final Order, recommended that TWC's application "be rescored to reflect the removal of the 1.5-point penalty to Form 5; to add 7.64 points to Form 5; and to add 4 points to Form 6." The net effect of that rescoring was that TWC's application received a post-appeal score of 622. Petitioner did not fare as well in its scoring appeal. The hearing officer made the following findings of fact with respect to the 1.5-point penalty assessed based upon Petitioner's failure to specify the unit of measure on Form 7: Form 7, Page 11, is entitled "Local Government Verification that Development is Consistent with Zoning and Land Use Regulation." On Page 11 of Form 7, there is a requirement to state the "Size of Parcel (acreage, number of lots, or square footage)." In its Revised Page 11 of Form 7 [Petitioner], in response to that requirement entered the numbers "9.99" without any accompanying unit of measure. It is clear from a review of other pertinent parts of the application that the appropriate unit of measure to accompany the number "9.99" is "acres." Further, its [sic] reasonable to conclude on the face of [Petitioner's] Revised Page 11 of Form 7, when read in conjunction with the entire application . . . , that the number "9.99" refers to acres. (Citations omitted). Despite those findings, the hearing officer recommended that the 1.5-point penalty be affirmed. That recommendation was based primarily on the following conclusion of law: The instructions on Page 11 of Form 7 require a unit of measure be appended to the number of units placed in the answer blank. While it may be true that such a result is particularly frustrating to the applicant in light of the reality that its omission has created no confusion or inconsistency nor diminished the accuracy of the application, [FHFC] has nevertheless adopted rules requiring strict compliance with regard to providing complete information in the format and location prescribed by the instructions on the forms. That rule cannot be ignored. Thus, the failure of [Petitioner] to include a unit of measure on its Revised Page 11 of Form 7 is an error that does result in a single 1.5-point penalty. FHFC adopted the hearing officer's findings of fact, conclusions of law, and recommendation in toto as its Final Order, and Petitioner did not seek judicial review of the Final Order. As a result, Petitioner's pre-appeal score of 620.5 became its post-appeal score. Petitioner's application was in Group B, and its lottery number was 68. TWC's application was in Group A, and its lottery number was 27. Thus, in the event that Petitioner and TWC received the same final score, priority for funding would be given to TWC. If Petitioner's application had received a higher score than TWC's application, then Petitioner's application would have been in the "funding range" and Petitioner would have received an allocation of tax credits for its project. If Petitioner had received the tax credits, it would have also received SAIL funding. The record does not reflect the total amount of tax credits and SAIL funding that Petitioner would have received; however, if TWC's application was moved below Petitioner's application on the final funding list (Exhibit R2), then $339,164.90 in tax credits would have been available to Petitioner after the higher-ranked applicants were fully funded.2 Additional Facts Established at the De Novo Final Hearing in this Case The $102,000 “total value” for the roadway improvements referred to in Mr. Williams' letter is reasonable. Indeed, the itemized cost-estimate prepared by professional engineer Greg Bailey in the design phase for the improvements was $106,064. The $102,000 in roadway improvements cannot be characterized as a lump-sum contribution. As Mr. Bailey’s cost- estimate shows, the improvements include 16 components such as paving, grading, and drainage; and a cost-per-unit and an estimated quantity is listed for each component. At the time Mr. Bailey prepared the cost-estimate, he was working for C&W Land Trust. Accordingly to one of the documents in TWC’s application (Form 7, Exhibit A), C&W Land Trust was the landowner from whom TWC acquired the property where its Windsong II project will be located. Mr. Bailey provided the cost-estimate to the county engineer for Columbia County for his use in evaluating bids submitted for the construction of the roadway improvements. The county engineer forwarded a memo to Mr. Williams on June 14, 2001, stating that the construction cost for the improvements “is estimated to be $102,000.00.” Requiring documentation to support the calculation of a local government contribution is important because it helps prevent an applicant from “gaming” the system in order gain an advantage in the scoring of its application. For example, where the contribution is based upon a per-unit amount, the calculations help to ensure that the number of units committed by the applicant as a basis for the local government contribution is the same number of units committed by the applicant in the application to FHFC. Documentation showing the calculation of the $102,000 local government contribution referenced in Mr. Williams letter is equally important because without such documentation there was no way for FHFC to determine during its review whether that figure is a reasonable estimate of the cost of the roadway improvements which are being contributed by Columbia County. It is necessary for FHFC to be able to make such a determination because the points awarded to the applicant for the contribution are based in large part on the amount of the contribution. At the time that TWC submitted the verification forms and letter signed by Mr. Williams, Columbia County did not have a position called County Manager or County Administrator. The County Coordinator position was the de facto County Manager/Administrator. The County Coordinator was appointed by the Board of County Commissioners to "administer all programs and to ensure that County government operates efficiently and effectively." The County Coordinator reported directly to the Board of County Commissioners and, among other duties, the position supervised all department heads (except the head of Public Works Department) and provided "direction, leadership and supervision to all County Department heads." Presently, Columbia County has a County Manager and Mr. Williams serves in that position. The job duties for the County Manager position are virtually identical to those of the County Coordinator position. Indeed, even though text of the position description no longer excepts the Public Works Department from Mr. William’s supervision, the county’s organizational chart still shows the Public Works Department outside of Mr. Williams chain of command.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Florida Housing Finance Corporation issue a final order which determines that Petitioner is entitled to an allocation/award of tax credits and SAIL funds in the next available cycle. DONE AND ENTERED this 30th day of March, 2004, in Tallahassee, Leon County, Florida. S T. KENT WETHERELL, II Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of March, 2004.
Findings Of Fact Respondent James L. Sponheim is licensed as a Limited Surety Agent to represent Cotton Belt Insurance Company, Inc., and was so licensed at all times relevant to this proceeding. His office is located in Dade City, Florida. (Testimony of Respondent, Petitioner's Exhibit 2). Respondent's wife, Bonnie L. Sponheim, is qualified, but not currently licensed, as a bail bond runner. She was previously licensed as a runner, but her license was cancelled on April 3, 1980. Thereafter, she has served as a secretary in her husband's Dade City office. (Testimony of B. Sponheim, Petitioner's Exhibit 1) The following findings relate to Count I of the Administrative Complaint. On August 6, 1980, Stephen W. Sissitka, of Zephyrhills, Florida, made application to the Cotton Belt Insurance Company for appearance bends B6A095951- 52 to effect his release from the custody of the Pasco County Sheriff's office. The application contained provisions as to events which would constitute a breach of the obligations under the bond, including the applicant's change from one address to another without notifying the Cotton Belt Insurance Company or its agent in writing prior to any such move. On the reverse of the application, Glenna Lilly and Spurgeon Phillips executed an indemnity agreement whereby they agreed to bind themselves to produce Sissitka in court at the required time. The application further identified Glenna Lilly as Sissitka's mother. Phillips executed a separate indemnity agreement on August 30, 1980. He is the father- in-law of Sissitka and resides in Dade City. (testimony of Respondent, S. Sissitka, Respondent's Exhibits 1,2). On August 6, 1980, Respondent, as agent for Cotton Belt Insurance Company, issued the requested bonds in the total amount of $2,500.00 (Testimony of Respondent, Petitioner's Composite Exhibit 4) Although Sissitka had listed his address as Zephyrhills, Florida, he was living at the home of his father-in- law Spurgeon Phillips, in Dade City at the time he was released on bond. However, he was having difficulties with his wife and did not remain in Dade City on a continuous basis. On several occasions, he went over night to his mother's house in Zephyrhills, and another time he visited his wife's mother for several days in Pasco County. He did not tell Respondent about the latter visit, nor did Phillips know where he was. In fact, he stayed only sporadically with Phillips, during the period August to October, 1980, and sometimes would be gone for a week or two. Phillips complained to Respondent about his inability to keep up with Sissitka's whereabouts, and wanted to have him returned to custody. As a result, Respondent and Phillips had a meeting with Sissitka on October 7, 1980, at which time the Respondent reminded Sissitka of his obligations to report any changes of address or employment and imposed the requirement that Sissitka "check in" with Respondent's office once a week. Sissitka was also told to stay at Phillips' house in the future. Sissitka agreed to follow the conditions imposed and keep Respondent and Phillips notified of his whereabouts. (Testimony of Respondent, B. Sponheim, Phillips, Harrelson, S. Sissitka, M. Sissitka, Petitioner's Exhibit 3, Stipulation) On October 15, 1980, Mrs. Sponheim discovered Sissitka was no longer employed at a restaurant in Dade City. Respondent was out of the state at the time. Mrs. Sponheim was under the impression that Sissitka was living at Zephyrhills, and so she drove out to Phillips' house to talk to his wife in an attempt to ascertain his current situation. When she knocked on the door, Sissitka answered and told her that he had been living there. Mrs. Sponheim told him that they needed to talk. She waited in her car while he put on a shirt and some shoes, and joined her in the car. They then drove to Respondent's office. On the way, she asked him about his job and where he was living, but Sissitka indicated that it was none of her business, that Respondent had no control over him, and that as long as he showed up in court that was all that mattered. He asked her if he was going to jail, and she told him that was between him and Respondent. When they arrived at the office they discussed the conditions of the bond and the arrangements which had been made at the previous meeting with Phillips and Respondent on October 7. Sissitka told her that he was tired of being harassed not only by Respondent, but by Phillips, and that everyone was giving him a hard time, and he wanted it stopped. Mrs. Sponheim inferred from this statement that Sissitka wished to terminate the bond relationship and told him that if he wanted to "end it" he was free to go to the jail and surrender himself at any time. At that point, Sissitka said "fine, let's go" but Mrs. Sponheim told him that they needed to talk to Respondent about it first. She went into the adjoining private office of Respondent, telephoned him and informed him of the situation. Respondent told her that Sissitka could either go ahead and surrender himself, or otherwise they would have to wait until he returned to the city to settle the matter. He further told her that if Sissitka wanted to turn himself in that she should make sure to get the surrender documents to the jail so that he couldn't walk out again. Respondent made a practice of pre-signing the appropriate surrender forms for each person he bonded out at the time the bond was written, therefore, a signed surrender form had been previously prepared for Sissitka. The Pasco County Sheriff's Department requires that the surrender document be filed with that office prior to permitting an individual to surrender himself. Otherwise, the individual would be free to leave the jail because the bond would still be valid. After talking to Respondent, Mrs. Sponheim informed Sissitka of the conversation and he asked to use the phone to call his mother. After he completed the call, he said "o.k. let's go" Mrs. Sponheim then filled in the date on the "off bond" form and they walked across the street to the jail. Sissitka went up to the jail door and said "here I am again" and opened the metal door and went on in. Mrs. Sponheim handed the surrender forms to the official at the booking office and said that she was coming off the bond. She then returned to Respondent's office and later that day Sissitka called her and inquired about the possibility of being bonded out again because he did not have enough money to post a cash bond. Mrs. Sponheim told him that Respondent was not there and he asked if she could bond him out. She replied that she didn't have a license, but gave him the name of another bondsman. (Testimony of Respondent, B. Sponheim, Kelly, Brown, Shytle, Petitioner's Exhibits 5,6) The following findings relate to Counts III through XXII and are based solely upon the testimony of witnesses contained in the transcript of proceedings before the Pasco County Court in Case No. 800995MMAES: For several years prior to December, 1979, Respondent had had an oral agreement with the student government association of St. Leo College under which he agreed to provide bonds for arrested students of the college upon his verification with college authorities that they were students in good standing. During the three years prior to December 11, 1979, Respondent had bonded about 31 students pursuant to his agreement. In the fall of 1979, Respondent renewed the agreement with the then president of the student government association, Curt Reilly. The agreement provided that Respondent would bond out any student from St. Leo College who was arrested and contacted the Respondent's office, provided that Respondent determined then from Reilly, or in his absence, from Charles Gordon, the college chief of security, that the student attended St. Leo College and was in good standing. The association agreed to guarantee or underwrite the bond premium if not paid by the arrested individual or someone in his behalf. Although the testimony of Respondent and Reilly was conflicting with respect to the terms of the bonding arrangement, the above version is based on Respondent's testimony which was corroborated, and is deemed credible. It is not uncommon in the bail bond business for a relative or friend of an arrested individual to make a request for bond to a bondsman, or for a bondsman to have an arrangement with an organization to provide bonds for members. (Testimony of Respondent, Reilly, Gordon, Taylor, Roche (Hearing Officer Exhibit 1) On December 11, 1979, a large number of student arrests were made at the St. Leo College campus as a result of an investigation initiated by the security officer of the college and the St. Leo Police Department. The charges involved various offenses involving possession and sale of controlled drugs. On December 11, Respondent was approached by several students who asked him to bond out several of the arrested students who were their friends. Thereafter, during the course of the day, other students requested that friends be bonded out of jail by Respondent. These requests came primarily to Respondent's wife who had been called into the office to make the appropriate contacts with St. Leo College. Although she tried to reach Curt Reilly to verify the student status, she was unable to reach him and thereafter dealt with the security office. Respondent went back and forth from the jail bonding out students as he received verification of their status from his wife. He was assisted in this regard by Andy Anderson, another bondsman employed in his office. All but two of the arrested students were bonded out at the request of others, and not by requests to Respondent by the students themselves. In one instance, the personnel at the security office told Respondent's wife that the individual was not in good standing. As a consequence, he was not bonded out pursuant to the arrangements with the college, but was later bonded based on the request of his brother who made the necessary arrangements for collateral. (Testimony of Gordon, Respondent, B. Sponheim, Anderson (Hearing Officer's Exhibit l)) St. Leo College students who were bonded out by Respondent on December 11th included Margaret O'Connell, Sally Sciulli, Gina Catalano, John Conte, David Ruiz, Susan Halpin, Daniel Kenyon, John Bennis, John Curci, Jr., Daniel Fontaine, and Steven Long. In all cases except that of Long, the students, after being booked, were informed by jail personnel that they were being bonded out. At that point, they were met by either Respondent or Anderson in or about the jail, and were taken to Respondent's office. John Conte saw Respondent as he was entering the jail and Respondent asked if he was "John." When Conte replied that he was, Respondent said "I'll have you out in a couple of hours", and Conte said "o.k., fine." Susan Halpin had inquired of jail personnel as to how she was going to get out of jail, and saw Respondent standing in the vicinity. He stated "don't worry about that, I'm getting you out of here right now. John Curci had made arrangements with a friend to bail him out, but prior to the friend's arrival, jail personnel released him and he met Respondent who proceeded to take him to his office for bonding arrangements. Steven Long asked Mr. Gordon, the college security officer, at the jail as to how he was going to be released and Gordon said "don't worry about it, we'll take care of it." At the jail, an official gave Long the telephone numbers of Respondent and another bondsman. Long then called Respondent's office to arrange for bond. The person who answered the phone in Respondent's office told him that Respondent was on his way over to the jail at that time. (Testimony of Gordon, O'Connell, Sciulli, Catalano, Conte, Ruiz, Halpin, Kenyon, Bennis, Curci, Kuzdale, Fontaine, Long (Hearing Officer's Exhibit 1))
Recommendation That the Department of Insurance dismiss the complaint against Respondent James Leroy Sponheim. DONE and ENTERED this 23rd day of June, 1982, in Tallahassee, Florida. THOMAS C. OLDHAM Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of June, 1982. COPIES FURNISHED: Clark R. Jennings, Esquire Department of Insurance 413B Larson Building Tallahassee, Florida 32301 Ben W. Thompson, Esquire Post Office Box 466 Dade City, Florida 33525 Honorable Bill Gunter Insurance Commissioner The Capitol Tallahassee, Florida 32301
The Issue Whether Respondent's award for RFP 09-36 is contrary to law, against the University's governing statutes, rules or policies or the terms of the Request for Proposal.
Findings Of Fact UNF published its Request for Proposal in reference to RFP 09-36, entitled "Pest Control Services at UNF Campus" (hereafter, "Project") with a March 10, 2009, Mandatory Pre-Bid Date and a March 30, 2009, Opening Date. (Joint Stipulation 1.) There was one addendum to the RFP 09-36 Project. (Joint Stipulation 2.) Petitioner Turner Pest Control and Terminix submitted proposals in response to the RFP 09-36 Project. (Joint Stipulation 3.) There were seven other responsive proposers besides Terminix and Petitioner. Addendum No. 1, RFP 09-36 Section 6, included a heading in bold font, entitled "Rating Criteria." The third criterion, which for scoring purposes was assigned a maximum of 20 points, reads as follows: Provide the names and contact information to at least three (3) references to support past performance of a similar size University and/or commercial type business. Paragraph 8, of the RFP provided: For the purpose of this project, Doug Nelson, or his/her duly appointed successor or assigned representative, shall be authorized Contract Administrator . . . It shall be the Contract Administrator's responsibility to supervise the receipt and handling of proposals, to respond to all inquiries relating to the proposal or submittal procedures, to coordinate and provide required support information necessary for committee review and evaluation of proposals received and to be responsible for all contractual matters. . . . UNF Contract Administrator, Doug Nelson, drafted Section 6, of the RFP and facilitated the meeting of the full evaluation committee, which analyzed the responsive proposals. In his opinion, Section 6, only required the submission of three suitable references; it permitted the committee to accept the three names and contact information at face value; and it did not presume that letters of reference from those named must be attached to the proposal, although it was acceptable to attach them. Also in Mr. Nelson’s opinion, the foregoing language of the RFP did not contemplate that the evaluation committee must contact or otherwise verify the references provided. The evaluation committee was carefully selected and qualified. The committee was provided a matrix that contained evaluation criteria and identified the number of points that could be assigned to each proposer for each criterion. On the evaluation matrix, one column heading reads "Three (3) References and Past Performance," in the conjunctive. (Emphasis supplied.) On April 7, 2009, the evaluation committee met to review all responsive proposals received pursuant to RFP 09-36. (Joint Stipulation 4, modified for detail.) What the committee did with regard to scoring references could be characterized as first separately rating proposers on their references and secondly, separately rating proposers on their past performance. Utilizing the evaluation matrix provided, the committee assigned a total of 12 points to Terminix and a total of 20 points to Petitioner for their respective references. The evaluation committee allocated 10 points to Petitioner and 10 points to Terminix simply because each had submitted three references and contact information. Terminix did not submit a testimonial letter from a reference and did not have a history with committee members, so Terminix was awarded only two more points, beyond the first 10 points, for a total score of 12, on “references.” Two other proposers received a total of 20 points for their references because they had submitted three names with contact information which evaluators considered "strong" references; because the proposer had a history familiar to members of the committee; or because the proposer submitted actual testimonial letters from one or more of the proposer’s listed references. The committee added 10 more points to Petitioner's score for references (totaling the entire 20 points available for that category) because of committee members' personal knowledge of Petitioner's past quality performance at UNF, even though Petitioner had not submitted UNF as a reference with contact information as part of its proposal. The ultimate result was that the evaluation committee rated Terminix only two points out of a possible 10 points due to Terminix’s lack of direct experience with UNF, and some other proposers were rated lower than Petitioner for similar reasons. On some prior UNF RFPs and ITBs, evaluation committees have gone behind the face value of references and on some they have not. On this occasion, the committee was not told either to rate references as they did or to calculate differently in rating the references provided by respective proposers. Petitioner was the highest-ranked proposer overall. Terminix was the second highest-ranked proposer overall. The parties have stipulated that, "The University of North Florida awarded RFP 09-36 Project to Turner Pest Control on April 9, 2009." (Joint Stipulation 5; emphasis supplied.) UNF's April 9, 2009, letter to all proposers read, in pertinent part: Please be advised that on Thursday April 9, 2009, the University of North Florida awarded Request for Proposal 09-36 "Pest Control Services at UNF" to Turner Pest Control. The University of North Florida is providing notice to all respondents [proposers] by copy of this letter and is required to include in this notice the following statement: Failure to file a protest in accordance with UNF Regulation 13.0020R, or failure to post the bond or other security as required in UNF Regulation 13.0030R, shall constitute a waiver of protest proceedings. (Bracketed material provided for clarity; emphasis supplied.) Paragraph 12 of the RFP provided: Any qualified offeror who is adversely affected by the University's decision may file a written notice of intent to protest within 72 hours after the University posting of the award of intent to award notice. The protesting firm must reduce its complaint to written petition and file it with the President of the University within ten (10) calendar days from registration of the original complaint. If the competitive solicitation documents require the posting of a bond with the protest, the bond shall be included with the protest. A Bond, payable to the University of North Florida, in an amount equal to: 10% of the estimated value of the protestor's proposal; 10% of the estimate of the University's estimate of the total volume of the contract, or $10,000, whichever is less. The bond shall be conditioned upon the payment of all costs which may be adjudged against the vendor. Failure to file a notice of protest or the written petition, including posting of the required protest bond shall constitute a waiver of the right to protest proceedings. Upon receipt of the formal written petition filed in accordance with this regulation, the President or the President’s designee shall delay the execution of the contract until the protest is resolved by mutual agreement between the parties or by final presidential action . . . (Emphasis supplied.) On April 10, 2009, Terminix filed a Notice of Intent to Protest award of RFP 09-36 to Petitioner. (Joint Stipulation 6.) It was filed with Doug Nelson within 72 hours of UNF's April 9, 2009, letter. It was not inappropriate or non- compliant because only the written protest is required to be filed with the University President. The thrust of Terminix's April 10, 2009, notice of intent to protest was that Terminix had submitted a proposal for a lower total cost of doing the work than had Petitioner. After receiving Terminix's Notice of Intent to protest, Kathy G. Ritter, UNF's Director of Purchasing and Mr. Nelson's superior, reviewed the file. After her review, she notified UNF's General Counsel's Office (OCG) that she wanted to rescind the award to Petitioner due to an error. At that time, her concerns were based on the RFP language seeking three references for an analysis of past performance and the matrix used by the evaluation committee and also the committee’s deliberations which had separated the scoring of three references from the scoring of past performance Ms. Ritter felt the RFP criteria required the evaluators to check up on all references provided in each proposal and they had not done so. She also was not satisfied that the evaluation committee had fully considered pricing issues. Paragraph 10 of the RFP provided: No interpretation of the meaning of any part of this RFP, nor corrections of any apparent ambiguity, inconsistency or error herein, will be made to any Proposer orally. All requests for written interpretation or corrections MUST be in writing. Paragraph 15 of the RFP provided: In the event that any of the provisions of the contract are violated by the successful vendor(s), the University may serve written notice upon vendor(s) of its intention to terminate the contract. Paragraph 16 of the RFP provides: . . . the University may terminate this RFP process at any time up to notice of award, without prior notice, and without liability of any kind or amount. (Emphasis supplied.) Nonetheless, Ms. Ritter felt her only option was to rescind the award or throw out all responses and re-bid the proposal. Because she believed the flaw in scoring was limited to the references, which flaw could be corrected, and possibly the pricing, she elected to "re-do" a portion of the evaluation and notified the evaluation committee accordingly. She considered rescission and topical reconsideration to be within the authority of her position. However, Ms. Ritter referred to no specific "authority" (rule, regulation, RFP, or statute) by which she could "rescind" a notice of award or part thereof, and she did not rescind the award until after a written formal protest was filed. See infra. Terminix made an oral request to Ms. Ritter for an extension of time to file a written protest. On or about April 15, 2009 (six calendar days after Terminix’s notice of intent to protest), Ms. Ritter orally granted Terminix until April 24, 2009, to file its formal protest. April 24, 2009, was 14 days from UNF's receipt of Terminix's notice of intent to protest. Terminix never submitted a written request for extension and ever received a written extension, but it relied upon Ms. Ritter’s oral extension. In a letter dated April 20, 2009, and received by UNF on April 23, 2009, Terminix filed a written formal protest, challenging the award of RFP 09-36, to Petitioner, Turner Pest Control. (Joint Stipulation 7, amplified for detail.) The thrust of Terminix's formal petition was that UNF had failed to contact the references provided by each bidder and that UNF had failed to properly evaluate Terminix's proposed costs. With its written formal protest filed appropriately with UNF's President, Terminix submitted a protest bond that was less than that required by the RFP and by University Regulation No. 13.0030R(II)(3), which provides: Solicitation Protest Bond. Any entity filing an action protesting a decision or intended decision pertaining to a competitive solicitation shall, at the time of filing of the formal protest, post with the University a bond payable to the University in an amount equal to the lesser of the following: 10% of the estimated value of the protestor's bid or proposal; 10% of the estimated expenditure during the contract term or $10,000. The bond shall be conditioned upon the payment of all costs, which may be adjudged against the entity filing the protest action Failure of the protesting entity to file the required bond, . . . at the time of filing the formal protest shall result in a dismissal of the protest. Terminix's proposal had been for $32,076.00, annually, for three years, totaling $96,028.00. Terminix posted a protest bond for only $3,200.80, instead of for ten percent of its bid, or even for $3,207.60 for ten percent of its bid on an annual basis. There is no evidence whatsoever that Ms. Ritter's April 15, 2009, oral extension of the time to file Terminix's formal written protest in any way included a waiver of the requirements for posting a bond; that it specified a bond amount different than 10 percent of Terminix’s proposal; or that it included any reduction of the amount of the required bond or security. On April 24, 2009, a day after receiving Terminix's written protest, UNF rescinded its award of Project RFP 09-36 to Petitioner. (Joint Stipulation 8, amplified for detail.) A letter of that date, authored by Ms. Ritter, stated: . . . the notice of award dated April 9, 2009, is rescinded and the evaluation committee is instructed to reopen its evaluations in this RFP for the purpose of contacting all references supplied by all bidders and assigning points based upon an average of their responses supporting the bidders’ past performance. Following determination of the points to be assigned for Rating Criteria 3, the evaluation committee will re-tally the total points assigned to each bidder for all rating criteria and identify the successful bidder, by issuing a new notice of award. (Emphasis supplied.) The "re-evaluation" involved eight questions drafted by Ms. Ritter, a previously uninvolved employee of UNF’s Purchasing Department, UNF's OCG, and possibly Mr. Nelson. The previously uninvolved Purchasing Department employee put the same eight questions (five yes/no questions and three questions which were each to be rated on a scale of 1-10) to at least three references listed by each responsive bidder.2/ She unilaterally rated the three scaled questions at between 1 and 10 points. Thereafter, she deleted the evaluation committee's previous scores based on references, and the average of the three new scores per reference were substituted on the original RFP evaluation matrix. These scores were then factored into a final total score per proposer. Apparently, some adjustments were made, based on Terminix's original provision of 14 (not just three) references, and some weighting of questions also was involved, but how these latter adjustments were mathematically accomplished is not entirely clear. Therefore, even the final mathematical tabulation, ranking Terminix No. 1 and Petitioner No. 2, cannot be relied upon. The final numerically altered RFP score matrix was presented to some of the evaluation committee members. Some committee members were not present when it was presented, and the members present were only permitted to approve the new scores. On May 15, 2009, UNF awarded RFP 09-36 to Terminix. (Joint Stipulation 9.) On May 18, 2009, Petitioner filed its Notice of Intent to Protest Award of RFP 09-36 to Terminix (Joint Stipulation 10). It is found to be timely. On May 27, 2009, Petitioner filed its Bid Protest of Award RFP 09-36 to Terminix. (Joint Stipulation 11.) This item is found to be the timely written protest herein. It was correctly filed with UNF's President and was accompanied by an appropriate bid protest bond. Among the issues raised were the insufficiency of Terminix's original protest bond and the new scoring of references for past performance.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the President of the University of North Florida, pursuant to his authority under the Board of Governors Regulation 18.002, enter a final order rescinding the award to Terminix and awarding the contract to Petitioner. DONE AND ENTERED this 8th day of December, 2009, in Tallahassee, Leon County, Florida. S ELLA JANE P. DAVIS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 8th day of December, 2009.
Findings Of Fact On February 7, 14 and 21, 1989, respondent, School Board of Pinellas County (Board), published a legal advertisement in an area newspaper inviting prospective bidders to submit proposals for certain construction work to be performed on two elementary schools, Walsingham and Cross Bayou, located in Largo and Pinellas Park, Florida, respectively. The bidders were advised that their bids must be "prepared and submitted in accordance with the drawings and specifications" and that such drawings and specifications could be obtained from the Board. Such bids were to be filed with the Board no later than 2:00 p.m. on March 6, 1989. The notice also provided that the bids would be opened the same day. Bids were timely filed by at least five contracting firms, including petitioner, Prelude Construction Company, Inc. (Prelude), and intervenors, Lincoln Construction Company (Lincoln) and Bandes Construction Company (Bandes). In filing these proposals, each bidder represented he had "thoroughly examined all of the contract documents." After the bids were opened and reviewed by Board personnel, Lincoln, Prelude and Bandes were ranked first, second and fourth, respectively, based upon the dollar amount of their proposals. 2/ Thereafter, the Board issued its notice of intended action on March 7, 1989, wherein it advised all parties of its intention to award the contract to Lincoln. In doing so, the Board concluded that, although a bid bond accompanying Lincoln's proposal was not dated March 5 or 6 as required by the specifications, the deviation was minor and could be waived. That action prompted Prelude to file its protest. Through testimony of Lincoln's vice-president, it was established that the Board staff intended to change its initial position and to recommend to the Board that Lincoln's bid proposal be rejected and the contract awarded to Bandes. This change was prompted by the Board staff's discovery on the day of hearing (April 3) that, with the exception of Bandes, all bidders had failed to list the, roofing subcontractor on their bid proposals. The Board staff accordingly concluded that all bidders except Bandes should be disqualified. The bid specification upon which the Board relies to award the contract to Bandes is found in Part One, paragraph 1.1 of section 07511 of the bid specifications. The requirement is a relatively new one and imposes the following requirement upon bidders: NOTE: The contractor is required to list the name of the roofing subcontractor on the form of proposal, Section 1C. Section 1C is entitled "Form of Proposal" and includes the following section on page 1C-3 to be filled in by the bidder: The following subcontractors will be contracted with on this project. Type of Subcontractor Name of Subcontractor (Trade Specialty) (Company/Firm) The column on the left side is intended to identify the subcontractor by specialty, such as plumbing or roofing, while the blank spaces in the right hand column are to be filled in by the bidders with the name of the subcontractor who will perform the specialty. The Board has not been consistent in requiring bidders to list the name of subcontractors on the bid documents. According to the uncontroverted testimony of Lincoln, the Board requires the listing of subcontractors on some projects but not on others. For example, on the specifications for the recently let contract for the prototype new media center at four elementary schools, the left hand column on the above form was filled in by the Board with five types of subcontractors who were required on the project, including roofing. This meant that the bidder was to fill in the blanks in the right hand column with the name of the subcontractor who he intended to use on each specialty. However, on other contracts, including the one under challenge, both columns in the Form for Proposal have been left blank, and Lincoln construed this to mean that the name of the subcontractor was not required. Indeed, Lincoln pointed out, without contradiction, that on a recent contract which left both columns blank, as was true in this case, it was awarded the contract even though it did not identify the roofing subcontractor on its proposal. Because of this prior agency practice, Lincoln assumed the same policy would be used again. However, Lincoln conceded it had failed to read the requirement in paragraph 1.1 of section 07511 before preparing its proposal. There was no evidence that Lincoln gained any substantial advantage over other bidders by this omission. Also relevant to this controversy is Paragraph 10A of the General Requirements. This item is found on page 1B-11 and reads as follows: Each bidder shall indicate the names of specific major Subcontractors if called for on the form of proposal. If listing of Subcontractors is required and the Bidder fails to list them, the bid may, at Owner's option, be disqualified. (Emphasis added) This authority to waive the requirement is reinforced by language in Paragraph 21 of the General Requirements which provides in part that "(t)he owner reserves the right to waive minor technicalities." According to the Board's outside architectural consultant, who was the author of a portion of the contract specifications including section 07511, the omission of the name of the roofing subcontractor is a "minor" technicality that can be waived. However, the consultant had no personal knowledge as to whether the provision had actually been waived by the Board on prior contracts.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a Final Order be entered awarding the contract in question to Bandes Construction Company. DONE AND ORDERED this 20th day of April, 1989, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER 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 20th day of April, 1989.
Findings Of Fact At all times relevant hereto, respondent, Toledo Realty, Inc. (TRI), was a corporation registered as a real estate broker having been issued license number 0133053 by petitioner, Department of Professional Regulation, Division of Real Estate (Division or petitioner). Respondent, Ramiro J. Alfert, holds real estate broker license number 0223005 also issued by petitioner. Alfert, who has been a broker for eleven years, was licensed and operating as a qualifying broker and officer for TRI when the events herein occurred. The firm is located at 7175 Southwest 8th Street, Suite 210, Miami, Florida. Approximately three years ago, the Federal National Mortgage Association (FNMA) began foreclosing on a number of residential properties on which the owners had defaulted. Wishing to dispose of these repossessed properties in an expedited manner, FNMA selected at random a number of brokers in the Miami area who were given exclusive listings and agreed to advertise the properties, and take such other steps as were necessary to make a quick sale. Futrell Realty (Futrell) in Kendall, Florida was one such broker, and it had the exclusive listing on the two properties relevant to this proceeding. According to established FNMA procedure, a broker who obtained an offer on a FNMA property was obliged to send the original contract to the listing broker who then mailed it to FNMA area headquarters in Atlanta, Georgia. Marie J. Pardo was a salesperson for TRI, having worked there for almost six years. Pardo represented two potential buyers, Lazara Rouco and Artemia Delgado, an unmarried couple, who were interested in purchasing a FNMA property at 794 Southwest 97th Court Circle, Miami. On March 19, 1986, Pardo prepared a purchase/sales contract on behalf of Rouco and Delgado in which the couple offered to buy the property for $65,000. A $4,000 deposit was given by Rouco to Pardo and then placed in TRI's trust account. In accordance with established procedure, the original contract was sent to Futrell which forwarded it by express mail to FNMA in Atlanta. Four days after the contract was executed, Pardo was advised by Rouco that she and her boyfriend had separated, and she could no longer afford such an expensive house. But by now, the offer had been accepted by FNMA, and Rouco's $4,000 deposit was at risk. In an effort to save Rouco's deposit, Pardo, with FNMA's approval, secured another buyer for the property, and had Rouco assign the contract to the new buyer. The house was thereafter sold by FNMA to the new purchaser on an undisclosed date. Pardo did not advise Alfert or other TRI personnel that this action had been taken. Knowing that Rouco still wished to buy a home, but one that was less expensive, Pardo obtained Rouco's agreement for TRI to retain the $4,000 deposit pending efforts to find another property. In June or July, Pardo located another FNMA property at 100 Southwest 110th Avenue, unit 138, Miami. Because Pardo considered Rouco to be a credit risk, Pardo decided to have Rouco prequalify for a loan before a formal contract was submitted to FNMA. Accordingly, Pardo obtained (presumably from TRI files) another FNMA contract executed on June 10, 1986, by three buyers (Julio Ugarto, and Patricia and Ernesto Duarte) on a different FNMA property. She made a copy of that contract, scratched out the existing names, address and price, and inserted a new price ($47,500), address and Rouco's name. The altered contract was dated July 10, 1986. Although Pardo showed Alfert a copy of the contract that day, he did not notice anything unusual about it, and sent a letter to the mortgage company confirming that TRI had an escrow deposit of $4,000. Pardo stated she did not disclose the alterations to Alfert since she feared being fired if respondents learned of her actions. Pardo sent a copy of the altered contract to a mortgage broker friend to see if Rouco could qualify for a loan. Before she heard from the lender, Pardo left Miami in early September for a three-week vacation in the Dominican Republic. She asked another salesman with whom she shared a desk, Carlos Cachaldora, to hold the contract while she was gone. Cachaldora was a long-time employee of TRI, having worked there for some twelve or thirteen years. The two had worked as "partners" for four years with Pardo securing the client and Cachaldora doing the follow-up work. Although Pardo told Carlos about the alterations, Carlos did not advise Alfert or any other TRI employee of Pardo's actions. At hearing, Paido stated she did not know who sent the altered contract to FNMA but "believes" it was Carlos. However, Carlos denied mailing the contract to FNMA, and testified he received it in early September. Since the evidence shows that FNMA received the contract prior to September, it is found that Pardo mailed the contract to FNMA in July or August without advising Futrell or respondents. By fortuitous circumstances FNMA happened to receive from Futrell a validly executed contract on the same property at 100 Southwest 110th Avenue. This contract and the altered July 10 contract were sent to the FNMA attorney in Miami for review in preparing the closing documents. When FNMA's attorney began checking the documents, she noted there were some discrepancies in the two contracts and brought this to the attention of FNMA. Thereafter, a FNMA area supervisor in Atlanta, Paul Buechele, compared the July 10 contract with the other contract and noted that the names on the contracts did not match, that the July 10 contract had the initials of a FNMA employee who no longer worked at FNMA, and that he did not have the original July 10 contract in his files. Buechele telephoned Alfert on Friday, September 5 and briefly told him he had a "problem," and followed up with a letter the same day advising that FNMA "(had) no record of this sales contract," and for Alfert to express mail the original within 48 hours or else FNMA would "consider any such contract null and void." Although Buechele suspected the second contract might be an altered document or a forgery, he did not tell this to Alfert. During their conversation, Alfert looked in the office file, but could not find the original contract. He then advised Buechele that he would have to check with the salesman involved with the sale and get back in touch after he learned what had happened. There were no further communications between the two. The following Monday, Alfert met with Cachaldora who told Alfert he thought the original copy had been sent to FNMA and it must have been misplaced. Alfert was not overly concerned since it was not unusual for the selling broker to have only a copy of a contract in its files, particularly since the listing broker is given the original on FNMA transactions. At no time did Carlos advise Alfert that the July 10 contract was an alteration of the June 10 contract. Carlos telephoned Buechele the same day and advised him TRI had a copy, but no original, of the contract, and it was being express mailed that day to FNMA in Atlanta. On September 11, 1986, Rouco wrote TRI a letter requesting the immediate return of her $4,000 deposit because she had just been advised she could not qualify for a loan. Alfert mailed her a refund check the same day. He gave no further thought to the matter since he felt the contract at that point was "terminated." This was because Rouco had requested a return of her deposit, and more than forty-eight hours had passed since receiving Buechele's letter. On December 2, 1986, a Division investigator visited Alfert to discuss the July 10 contract. His visit was prompted by a complaint from Buechele about the altered contract. For the first time, Alfert learned what Pardo had done. Alfert immediately sent her written notice that she was fired. He also advised the Division that she was no longer an employee of TRI. Cachaldora, who had worked for TRI for some twelve years, also left TRI a few months later, albeit voluntarily. He was not fired because Alfert considered Pardo, and not Cachaldora, to be the guilty party. TRI is a relatively large realty office having three brokers and approximately seventy-five salesmen. Alfert holds the position of manager and has biweekly meetings with sales personnel to go over office procedures and to discuss sales. According to office procedure, Alfert is, whenever practicable, supposed to review all contracts before they are presented or mailed. This advice was conveyed to Pardo and Cachaldora but they did not follow office procedure. Except for the activities of Pardo and Cachaldora, there is no evidence that any other employee was involved in the Rouco matter.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that respondents be found not guilty of violating Subsection 475.25(1)(b), Florida Statutes (1985), as alleged in the administrative complaint. DONE AND ORDERED this 7th day of December, 1987, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER 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 7th day of December, 1987.
The Issue The threshold issue in this case is whether the decisions giving rise to the dispute, which concern the allocation and disbursement of funds appropriated to Respondent by the legislature and thus involve the preparation or modification of the agency's budget, are subject to quasi-judicial adjudication under the Administrative Procedure Act. If the Division of Administrative Hearings were possessed of subject matter jurisdiction, then the issues would be whether Respondent is estopped from implementing its intended decisions to "de- obligate" itself from preliminary commitments to provide low- interest loans to several projects approved for funding under the Community Workforce Housing Innovation Pilot Program; and whether such intended decisions would constitute breaches of contract or otherwise be erroneous, arbitrary, capricious, or abuses of the agency's discretion.
Findings Of Fact Petitioners Pasco CWHIP Partners, LLC ("Pasco Partners"); Legacy Pointe, Inc. ("Legacy"); Villa Capri, Inc. ("Villa Capri"); Prime Homebuilders ("Prime"); and MDG Capital Corporation ("MDG") (collectively, "Petitioners"), are Florida corporations authorized to do business in Florida. Each is a developer whose business activities include building affordable housing. The Florida Housing Finance Corporation ("FHFC") is a public corporation organized under Chapter 420, Florida Statutes, to implement and administer various affordable housing programs, including the Community Workforce Housing Innovation Pilot Program ("CWHIP"). The Florida Legislature created CWHIP in 2006 to subsidize the cost of housing for lower income workers performing "essential services." Under CWHIP, FHFC is authorized to lend up to $5 million to a developer for the construction or rehabilitation of housing in an eligible area for essential services personnel. Because construction costs for workforce housing developments typically exceed $5 million, developers usually must obtain additional funding from sources other than CWHIP to cover their remaining development costs. In 2007, the legislature appropriated $62.4 million for CWHIP and authorized FHFC to allocate these funds on a competitive basis to "public-private" partnerships seeking to build affordable housing for essential services personnel.1 On December 31, 2007, FHFC began soliciting applications for participation in CWHIP. Petitioners submitted their respective applications to FHFC on or around January 29, 2008. FHFC reviewed the applications and graded each of them on a point scale under which a maximum of 200 points per application were available; preliminary scores and comments were released on March 4, 2008. FHFC thereafter provided applicants the opportunity to cure any deficiencies in their applications and thereby improve their scores. Petitioners submitted revised applications on or around April 18, 2008. FHFC evaluated the revised applications and determined each applicant's final score. The applications were then ranked, from highest to lowest score. The top-ranked applicant was first in line to be offered the chance to take out a CWHIP loan, followed by the others in descending order to the extent of available funds. Applicants who ranked below the cut-off for potential funding were placed on a wait list. If, as sometimes happens, an applicant in line for funding were to withdraw from CWHIP or fail for some other reason to complete the process leading to the disbursement of loan proceeds, the highest-ranked applicant on the wait list would "move up" to the "funded list." FHFC issued the final scores and ranking of applicants in early May 2006. Petitioners each had a project that made the cut for potential CWHIP funding.2 Some developers challenged the scoring of applications, and the ensuing administrative proceedings slowed the award process. This administrative litigation ended on or around November 6, 2008, after the parties agreed upon a settlement of the dispute. On or about November 12, 2008, FHFC issued preliminary commitment letters offering low-interest CWHIP loans to Pasco Partners, Legacy, Villa Capri, Prime (for its Village at Portofino Meadows project), and MDG. Each preliminary commitment was contingent upon: Borrower and Development meeting all requirements of Rule Chapter 67-58, FAC, and all other applicable state and FHFC requirements; and A positive credit underwriting recommendation; and Final approval of the credit underwriting report by the Florida Housing Board of Directors. These commitment letters constituted the necessary approval for each of the Petitioners to move forward in credit underwriting, which is the process whereby underwriters whom FHFC retains under contract verify the accuracy of the information contained in an applicant's application and examine such materials as market studies, engineering reports, business records, and pro forma financial statements to determine the project's likelihood of success. Once a credit underwriter completes his analysis of an applicant's project, the underwriter submits a draft report and recommendation to FHFC, which, in turn, forwards a copy of the draft report and recommendation to the applicant. Both the applicant and FHFC then have an opportunity to submit comments regarding the draft report and recommendation to the credit underwriter. After that, the credit underwriter revises the draft if he is so inclined and issues a final report and recommendation to FHFC. Upon receipt of the credit underwriter's final report and recommendation, FHFC forwards the document to its Board of Directors for approval. Of the approximately 1,200 projects that have undergone credit underwriting for the purpose of receiving funding through FHFC, all but a few have received a favorable recommendation from the underwriter and ultimately been approved for funding. Occasionally a developer will withdraw its application if problems arise during underwriting, but even this is, historically speaking, a relatively uncommon outcome. Thus, upon receiving their respective preliminary commitment letters, Petitioners could reasonably anticipate, based on FHFC's past performance, that their projects, in the end, would receive CWHIP financing, notwithstanding the contingencies that remained to be satisfied. There is no persuasive evidence, however, that FHFC promised Petitioners, as they allege, either that the credit underwriting process would never be interrupted, or that CWHIP financing would necessarily be available for those developers whose projects successfully completed underwriting. While Petitioners, respectively, expended money and time as credit underwriting proceeded, the reasonable inference, which the undersigned draws, is that they incurred such costs, not in reliance upon any false promises or material misrepresentations allegedly made by FHFC, but rather because a favorable credit underwriting recommendation was a necessary (though not sufficient) condition of being awarded a firm loan commitment. On January 15, 2009, the Florida Legislature, meeting in Special Session, enacted legislation designed to close a revenue shortfall in the budget for the 2008-2009 fiscal year. Among the cuts that the legislature made to balance the budget was the following: The unexpended balance of funds appropriated by the Legislature to the Florida Housing Finance Corporation in the amount of $190,000,000 shall be returned to the State treasury for deposit into the General Revenue Fund before June 1, 2009. In order to implement this section, and to the maximum extent feasible, the Florida Housing Finance Corporation shall first reduce unexpended funds allocated by the corporation that increase new housing construction. 2009 Fla. Laws ch. 2009-1 § 47. Because the legislature chose not to make targeted cuts affecting specific programs, it fell to FHFC would to decide which individual projects would lose funding, and which would not. The legislative mandate created a constant-sum situation concerning FHFC's budget, meaning that, regardless of how FHFC decided to reallocate the funds which remained at its disposal, all of the cuts to individual programs needed to total $190 million in the aggregate. Thus, deeper cuts to Program A would leave more money for other programs, while sparing Program B would require greater losses for other programs. In light of this situation, FHFC could not make a decision regarding one program, such as CWHIP, without considering the effect of that decision on all the other programs in FHFC's portfolio: a cut (or not) here affected what could be done there. The legislative de-appropriation of funds then in FHFC's hands required, in short, that FHFC modify its entire budget to account for the loss. To enable FHFC to return $190 million to the state treasury, the legislature directed that FHFC adopt emergency rules pursuant to the following grant of authority: In order to ensure that the funds transferred by [special appropriations legislation] are available, the Florida Housing Finance Corporation shall adopt emergency rules pursuant to s. 120.54, Florida Statutes. The Legislature finds that emergency rules adopted pursuant to this section meet the health, safety, and welfare requirements of s. 120.54(4), Florida Statutes. The Legislature finds that such emergency rulemaking power is necessitated by the immediate danger to the preservation of the rights and welfare of the people and is immediately necessary in order to implement the action of the Legislature to address the revenue shortfall of the 2008-2009 fiscal year. Therefore, in adopting such emergency rules, the corporation need not publish the facts, reasons, and findings required by s. 120.54(4)(a)3., Florida Statutes. Emergency rules adopted under this section are exempt from s. 120.54(4)(c), Florida Statutes, and shall remain in effect for 180 days. 2009 Fla. Laws ch. 2009-2 § 12. The governor signed the special appropriations bills into law on January 27, 2009. At that time, FHFC began the process of promulgating emergency rules. FHFC also informed its underwriters that FHFC's board would not consider any credit underwriting reports at its March 2009 board meeting. Although FHFC did not instruct the underwriters to stop evaluating Petitioners' projects, the looming reductions in allocations, coupled with the board's decision to suspend the review of credit reports, effectively (and not surprisingly) brought credit underwriting to a standstill. Petitioners contend that FHFC deliberately intervened in the credit underwriting process for the purpose of preventing Petitioners from satisfying the conditions of their preliminary commitment letters, so that their projects, lacking firm loan commitments, would be low-hanging fruit when the time came for picking the deals that would not receive funding due to FHFC's obligation to return $190 million to the state treasury. The evidence, however, does not support a finding to this effect. The decision of FHFC's board to postpone the review of new credit underwriting reports while emergency rules for drastically reducing allocations were being drafted was not intended, the undersigned infers, to prejudice Petitioners, but to preserve the status quo ante pending the modification of FHFC's budget in accordance with the legislative mandate. Indeed, given that FHFC faced the imminent prospect of involuntarily relinquishing approximately 40 percent of the funds then available for allocation to the various programs under FHFC's jurisdiction, it would have been imprudent to proceed at full speed with credit underwriting for projects in the pipeline, as if nothing had changed. At its March 13, 2009, meeting, FHFC's board adopted Emergency Rules 67ER09-1 through 67ER09-5, Florida Administrative Code (the "Emergency Rules"), whose stated purpose was "to establish procedures by which [FHFC would] de- obligate the unexpended balance of funds [previously] appropriated by the Legislature " As used in the Emergency Rules, the term "unexpended" referred, among other things, to funds previously awarded that, "as of January 27, 2009, [had] not been previously withdrawn or de-obligated . . . and [for which] the Applicant [did] not have a Valid Firm Commitment and loan closing [had] not yet occurred." See Fla. Admin. Code R. 67ER09-2(29). The term "Valid Firm Commitment" was defined in the Emergency Rules to mean: a commitment issued by the [FHFC] to an Applicant following the Board's approval of the credit underwriting report for the Applicant's proposed Development which has been accepted by the Applicant and subsequent to such acceptance there have been no material, adverse changes in the financing, condition, structure or ownership of the Applicant or the proposed Development, or in any information provided to the [FHFC] or its Credit Underwriter with respect to the Applicant or the proposed Development. See Fla. Admin. Code R. 67ER09-2(33). There is no dispute concerning that fact that, as of January 27, 2009, none of the Petitioners had received a valid firm commitment or closed a loan transaction. There is, accordingly, no dispute regarding the fact that the funds which FHFC had committed preliminarily to lend Petitioners in connection with their respective developments constituted "unexpended" funds under the pertinent (and undisputed) provisions of the Emergency Rules, which were quoted above. In the Emergency Rules, FHFC set forth its decisions regarding the reallocation of funds at its disposal. Pertinent to this case are the following provisions: To facilitate the transfer and return of the appropriated funding, as required by [the special appropriations bills], the [FHFC] shall: * * * Return $190,000,000 to the Treasury of the State of Florida, as required by [law]. . . . The [FHFC] shall de-obligate Unexpended Funding from the following Corporation programs, in the following order, until such dollar amount is reached: All Developments awarded CWHIP Program funding, except for [a few projects not at issue here.] * * * See Fla. Admin. Code R. 67ER09-3. On April 24, 2009, FHFC gave written notice to each of the Petitioners that FHFC was "de-obligating" itself from the preliminary commitments that had been made concerning their respective CWHIP developments. On or about June 1, 2009, FHFC returned the de- appropriated funds, a sum of $190 million, to the state treasury. As a result of the required modification of FHFC's budget, 47 deals lost funding, including 16 CWHIP developments to which $83.6 million had been preliminarily committed for new housing construction.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that FHFC enter a Final Order dismissing these consolidated cases for lack of jurisdiction. DONE AND ENTERED this 18th day of February, 2010, in Tallahassee, Leon County, Florida. JOHN G. VAN LANINGHAM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 18th day of February, 2010.
The Issue Whether Miami-Dade Community College (hereinafter referred to as the "College") should sustain Petitioner's challenge to the Evaluation Committee's recommendation to award the contract advertised in Request for Proposal 956-34 ("Aviation Program Flight Training Provider, Kendall-Tamiami Executive Airport, Homestead Campus") to Intervenor, as the proposer submitting the proposal considered to be "in the best interest of the College?"
Findings Of Fact Based upon the evidence adduced at hearing, and the record as a whole, the following Findings of Fact are made: The College offers an academic program of flight instruction to its students. Such instruction is provided by independent contractors under contract with the College. Petitioner, a Florida corporation, provided such instruction from January 1, 1992, to December 31, 1995, pursuant to an agreement with the College that was executed on November 26, 1991, and amended July 28, 1995. 1/ Through Request for Proposal 956-34, entitled "Aviation Program Flight Training Provider, Kendall-Tamiami Executive Airport, Homestead Campus" (hereinafter referred to as the "RFP"), the College requested the submission of proposals from prospective providers interested in providing students of the College with flight training instruction at Kendall-Tamiami Executive Airport. The College's Director of Purchasing, Linda Pagliaro, sent the following letter to prospective providers along with the RFP: The College is accepting proposals from flight training providers to provide flight training instruction to students of Miami- Dade Community Colleges's Aviation Program. This proposal shall be submitted on the form(s) which are included in this package and returned in the enclosed envelope. The College shall evaluate all proposals submitted and shall award the contract for the proposal which the College determines to be in its best interest. The completed proposal shall be submitted to the Purchasing Dept., Room 9254, Miami-Dade Community College, 11011 S.W. 104 Street, Miami, FL 33176, before opening time of 3:00 p.m. on October 26, 1995. Proposals received after this opening time will be returned to the vendor unopened. Vendors may attend a pre-proposal conference, to be held October 17, 1995, at 9:00 a.m., at the Kendall Campus, 11011 S.W. 104 Street, Room 9254, Miami, Florida. The College reserves the right to accept any proposal deemed to be in the best interest of the College, to waive any irregularities in any proposal, and may reject any and all proposals. Any questions regarding this proposal may be directed to Mr. Edward Vasquez, Buyer, at (305) 237-2231. The College's "intent" in issuing the RFP was explained as follows in Section 1.0 of the RFP: The intent of this Request for Proposal is to obtain an agreement with a flight training provider to provide flight training instruction at the Kendall-Tamiami Executive Airport for students of Miami-Dade Community College. Provider must currently at at least one location possess a FAAR Section 141 Pilot School Certifi- cate for Flight and Ground (see Section 7.4.4). The term of the Contract shall be for an initial period of two years. By written agreement of the parties, the agreement may be extended for three additional one year terms. Flight training providers may propose service for Kendall-Tamiami Executive Airport only. Another provider has already been recom- mended to provide service at Opa-Locka Airport. It is anticipated that approximately 75 percent of the flight training hours will be flown from Kendall-Tamiami Executive Airport. The successful proposer shall enter into an agreement acceptable to the College to provide Flight Training Instruction for Miami-Dade Community College Students "Contract," the minimum terms of which are incorporated into this Request for Proposal document. (see Section 7.0.) Section 3.0 of the RFP informed prospective providers that they had the opportunity (but were not required) to attend a pre- proposal conference at which they would be able to "ask questions regarding the College's requirements as contained in this Request for Proposal." Section 4.0 described, as follows, the "required information" that had to be provided to the College: Vendors submitting proposals must completely fill in all information requested on the attached PROPOSAL COVER SHEET (ATTACHMENT "A"). Vendors submitting proposals must completely fill in all information requested on the attached PROPOSAL SCHEDULE OF FEES (ATTACHMENT "B"). Providers submitting proposals must supply a brief history of the firm/organization submitting the proposal. This history should include: How long the company has been in business under the present management/ownership. Identity and background of the principals, including the position/title of each principal. Current number of employees. Certification(s) currently held by proposer. List and attach copies. Description and location of all current facilities operated by proposer. List of at least five customers, preferably public or governmental organizations, for which you have provided a similar service. List must include reference name, address, telephone number, contact person, and a description of the service provided. In addition, the College reserves the right to contact current or former customers of the proposer not provided as part of the proposal. Label this part of the proposal Response to Section 4.3. Providers submitting proposals must supply a list of all aircraft which will be made available for performance of the Contract. This list must include the make, model number and equipment included in each aircraft proposed. The Provider should also indicate if the aircraft is leased or owned and the age of the aircraft. Label this part of the proposal Response to Section 4.4. Proposers submitting proposals must supply a narrative description of the flight training program proposed for each location. This descrip- tion must include: Number of flight training instructors and other personnel (by category) available for per- formance of the contract, including re[l]e[v]ant experience, certificates, qualifications and ratings held. Proposed facilities to be made available for performance of the contract, including maintenance and repair facilities, classrooms and offices. Description of the intended flight training curriculum for the four courses indicated in Attachment "B." The description of the flight training curriculum must include, but is not limited to, course outlines or training stages, lesson objectives, and evaluation criteria. The College prefers the Jeppesin Sanderson ground and flight training curriculum. If the provider intends to use the Jeppesin Sanderson curriculum, only a brief statement of that fact is necessary. Label this part of the proposal Response to Section 4.5. Providers submitting proposals must provide a narrative description of their safety record, including a list of all safety violations, incidents/accidents, fines, penalties, investi- gations, suits, claims and judgments, which have occurred during the last three years, or which are pending. Label this part of the proposal Response to Section 4.6. Providers submitting proposals must supply a financial statement audited by a public accountant certified by the State of Florida, or by the provider's financial officer, for the most recent fiscal or calendar year. Label this part of the proposal Response to Section 4.7. In addition to the required information noted in Sections 4.1 through 4.7, providers submitting proposals may include any additional information which may be helpful to the College in analyzing the vendor[']s ability to provide the service described in the Request for Proposal documents. Label this part of the proposal Response to Section 4.8. Section 5.3 of the RFP established 3:00 p.m. on October 26, 1995, as the deadline for the submission of responses to the RFP. Sections 5.4 and 5.5 discussed the subject of prospective providers' questions concerning the RFP. These sections of the RFP provided as follows: Any questions concerning this Request for Proposal shall be directed to Mr. Edward Vasquez, (305) 237-2231, and not to any other person or department at the College. Contacting other members of the Evaluation Committee will result in vendor disqualification. The Purchasing Department will determine whether an addendum should be issued as a result of any questions or other matters raised. If issued, the addendum will be incorporated into the Request for Proposal and will become part of the purchase agreement. The last date for vendors to submit written questions relative to this Request for Proposal will be October 18, 1995, (see Tentative Time Schedule). Questions must be received in the Purchasing Department by 3:00 p.m. and shall be sent to Mr. Edward Vasquez. Questions may also be submitted via facsimile machine, (305) 237-2895. Section 6.0 of the RFP described the proposal evaluation and recommendation process. It provided as follows: An Evaluation Committee will review and evaluate all proposals received and will recommend award to the provider(s) whose proposal is considered to be in the best interest of the College. Providers may be asked to meet with members of the Evaluation Committee for the purpose of clarifying or expanding upon any information contained in their proposal. In addition, the Evaluation Committee may require a visit to the proposer's current place of business for the purpose of observing the business operation, specifically as it relates to the proposed aircraft and maintenance facilities. The College reserves the right to accept any proposal deemed to be in the best interest of the College, to waive any irregularities in any proposal, and to reject any all proposals. The criteria to be used for evaluation shall include the following (not necessarily in order of importance): 2/ Cost Vendor Experience Available Aircraft Proposed Training Program Vendor Safety Record Vendor Financial Condition 3/ Notices of decision or intended decision to recommend or reject proposals shall be posted in the Purchasing Department on November 3, 1995. In the event that an unsuccessful bidder desires to protest the College's notice of intended decision to award or reject proposals, the adversely affected bidder shall be required to comply with Miami-Dade Community College Bid Protest Procedures, a copy of which is available from the Purchasing Department, including, without limitations, filing a notice of protest with the Director of Purchasing in writing within seventy-two (72) hours after the posting or, in the case of a mailing or hand delivery, within 72 hours after receipt of the notice of intended decision, and filing a formal written protest within 10 calendar days after the date the notice of protest is filed. Failure to file a protest within the time prescribed herein, which complies with Section 120.53(5), Florida Statutes, shall constitute a waiver of proceedings under Chapter 120, Florida Statutes. According to Section 2.1 of the RFP, the "[e]valuation of [p]roposals" would take place "October 27-November 2, 1995." Article I of the College's Bid Protest Procedures for Purchasing Department (which procedures were referenced in Section 6.5 of the RFP) addresses the subject of "protest of invitations to bid and requests for proposal." It provides as follows: All bidders and proposers are required thoroughly to review invitations to bids and requests for proposals ("RFP's") within a reasonable time after receipt. Any concerns or comments relating to the bidding or RFP documents shall be brought to the attention of the Director of Purchasing, Miami-Dade Community College (the "College"), or a designated person in the Purchasing Department, in writing promptly after receipt; provided, however, that should the bidder or proposer desire to protest the bid solicitation or RFP, or any of the bidding or RFP documents, including without limitation, the specifications, requirements or procedures thereof, the bidder or proposer shall (i) file a Protest Notice (in accordance with Article III of these Procedures) with the Director of Purchasing of the College, within 72 hours after the initial date (set forth in the public advertisement by the Board) in which the bidding or RFP documents, as the case may be, shall be made available to the bidders or proposers, or, in the case where the bidding or RFP documents are mailed to the bidders or proposers, within 72 hours after the bidding or RFP documents are received by the applicable bidder or proposer (provided that in the case where such documents are mailed, failure to receive such documents shall not be cause for rejection of all bids or proposals and rebidding); and (ii) file a Formal Protest (in accordance with Article III of these Procedures) with the Director of Purchasing of the College within 10 days after the date the Protest Notice is filed. The failure to comply with the foregoing procedures shall be a waiver by the bidder or proposer of any right to later protest on the basis of the form, content and substance, including without limitation, the specifications, requirements or procedures, of the bidding or RFP documents. For the purposes of the procedures contained herein, the capitalized term "Bidder" shall refer to a bidder or proposer and the capitalized term "Bid" shall refer to a bid or proposal as applicable. Article III of the College's Bid Protest Procedures sets forth "bid protest filing requirements." Section 3.1 of Article III provides as follows: Any bidder adversely affected by the decision or intended decision to award, recommend or reject Bids of the College shall file a notice of protest (the "Protest Notice") in writing with the Director of Purchasing of the College, within seventy-two (72) hours after the posting of the Bid tabulation or receipt of written notice of the intended decision (if such written notice is given), and shall file a formal written protest (the "Formal Protest") with such person within ten (10) calendar days after the date the Protest Notice was filed. The failure to file a Protest Notice or failure to file a Formal Protest within the time periods specified above shall constitute a waiver of proceedings under Chapter 120, Florida Statutes. Section 3.2 of Article III provides as follows: Except as otherwise expressly provided herein, in calculating time periods if the last day of the period is a Saturday, Sunday or legal holiday (as designated in Section 110.117, Florida Statutes) or any other day on which the College is closed, the period will run until the close of business on the next day which is not a Saturday, Sunday, legal holiday or on which the College is open for business. A Protest Notice or Formal Protest which is not received within the time periods specified in this Article III shall not be valid, and the failure to so file a Protest Notice and/or Formal Protest in accordance with these time periods shall constitute a waiver of proceedings under Chapter 120, Florida Statutes. Section 3.3 of Article III provides as follows: A Protest Notice or Formal Protest shall be effective and deemed filed upon receipt by the Director of Purchasing of the College. Accordingly, a Notice of Protest or Formal Protest is not valid and shall not be considered unless it is received by such a person within the times specified in Section 3.1 above. Section 3.5 of Article III prescribes the contents of a Protest Notice. It provides as follows: A Protest Notice shall at least contain the following information: (i) the Project Number or other Bid identification and a brief descrip- tion of the Bid solicitation involved, (ii) the protesting Bidder's name, address and telephone number, (iii) the name of the authorized repre- sentative of the protesting Bidder to whom all communications should be directed, and (iv) a brief factual summary of the bases for the protest. Section 3.6 of Article III prescribes the contents of a Formal Protest. It provides as follows: A Formal Protest shall state with particularity the facts and law upon which the protest is based and shall contain the following information: (i) the Project Number or other Bid identification and a brief description of the Bid solicitation involved, (ii) a clear and comprehensive statement explaining the grounds for the protest, (iii) the applicable statutes, rules, regulations and other legal authority supporting the protest, and (iv) the relief sought by the protesting Bidder. Section 4.1 of Article III provides that "[w]ithin seven (7) calendar days following receipt of the Formal Protest (excluding Saturdays, Sundays, legal holidays or days [o]n which the College is closed), the College shall provide an opportunity to resolve the protest by mutual agreement between the parties." Section 4.3 of Article III provides that "[w]hen a protest cannot be resolved by mutual agreement in accordance with the provisions of Section 4.1 above within such 7-day period and if there is a disputed issue of material fact, then the matter shall be referred to the Florida Department of Administration, Division of Administrative Hearings, 4/ for formal proceedings in accordance with Section 120.57(1), Florida Statutes, and Chapter 22I-6 [now Chapter 60Q-2] and 28, Florida Administrative Code, unless the parties agree by written stipulation to resolve the dispute by informal proceedings as provided herein." The pre-proposal conference referenced in Section 3.0 of the RFP was held, as scheduled, on October 17, 1995. Petitioner sent a representative to the conference. Intervenor did not. At the conference, Petitioner's representative, Juan Naranjo, delivered a letter from Petitioner's President and sole shareholder, Thomas Shaffer, to the College's contact person (as designated in Sections 5.4 and 5.5 of the RFP), Edward Vasquez. The letter read as follows: After a thorough review of the aforementioned RFP, we hereby submit the following requests for modification and clarification of the terms contained therein: Section 7.3.1.1.8(d) Not all Silver Express Flight Instructors are "employees" as defined by the Internal Revenue Service. Some are employed as independent contractors. Section 7.3.1.1.8(f) Not all Flight Instructors have an Associate's Degree. Section 7.3.1.1.9(a) and (g) Mike Smithers, Chief Instructor of Silver Express does not have either an ATP rating, or an Associate's Degree. Section 7.3.1.2.1(a), (iii) Although appendix C(7) requests the number or percentage of aircraft to incorporate an ADF receiver, the above referenced section specifies that all aircraft shall contain an ADF. Nine of our 14 aircraft are so equipped. Section 7.3.3.1(a) Silver Express is insured for $1,000,000.00 under our commercial lines policy and $1,000,000.00/ $100,000.00 per seat for the aircraft liability. The coverage you request is not available to the company. Section 7.5.2 Include cost of living increases; and Silver Express offers aircraft that fall outside of the fee schedule as set forth in Appendix D. Should a student choose to fly one of the more expensive aircraft, the Board will not deny payment of invoices for such services. Section 7.5.2.1 Clarify (duplication of records). Specifically list the software and equipment required. Include as Section 7.5.2.2 The Board shall provide Contractor with real time access to Student account balances via electronic link on a seven day per week basis. If you have any questions, please feel free to call. Shaffer arrived at the conference site as the conference was ending. He did not sign the conference sign-in sheet. After the conference, Shaffer met with Vasquez, at Vasquez's invitation, to discuss in detail the contents of the letter Nananjo had delivered earlier that day on Shaffer's behalf. At the end of the meeting, Vasquez suggested that Shaffer include in Petitioner's proposal the issues raised in the letter. Four prospective providers submitted proposals in response to the RFP: Avionics Parts and Service Corporation (hereinafter referred to as "Avionics"); 5/ Florida Institute of Technology (hereinafter referred to as "FIT"); Petitioner; and Intervenor. 6/ On the "proposal cover sheet" ("Attachment A"), which was referenced in Section 4.1 of the RFP, Intervenor indicated that the "legal name of the entity" submitting its proposal was "Husta International Aviation, Inc." In its response to Section 4.3a. of the RFP, Intervenor stated the following in its proposal: The Joe Husta Aircraft Corporation was formed in September 1986. Later on the company was renamed Husta Aviation, Inc. Due to the relocation from Kendall Tamiami Executive Airport to the Opa Locka Airport on May 8, 1995, the company is now known as Husta International Aviation. The flight school and charter service are currently doing business as Husta Aviation, Inc. The entire time the company has been owned by Joseph Husta. In its response to Section 4.3d. of the RFP, Intervenor stated the following in its proposal: Currently Husta International Aviation holds a Part 135 charter certificate and a Part 141 Flight school certificate. Photocopies of these certificates are contained in the back of this section. The Part 141 certificate to which Intervenor referred in its response to Section 4.3d. of the RFP (Certificate Number MNLS307B) was actually issued to Joe Husta Aircraft Corporation, the entity which, according to Intervenor's response to Section 4.3a. of the RFP, was later renamed Husta Aviation, Inc. Husta International Aviation, Inc., and Husta Aviation, Inc., are now, and were at the time Intervenor submitted its proposal, separate and distinct corporate entities. 7/ The two corporations are "in the process" of merging, but the merger has not yet been finalized. On November 20, 1995, Certificate Number MNLS307B was reissued to Intervenor in anticipation of the merger. In its response to Section 4.3e. of the RFP, Intervenor stated the following in its proposal: The facilities currently in use by Husta Inter- national Aviation at our Kendall-Tamiami Executive facility located at 14160 S.W. 129th Street, Miami, Florida 33186, include an establishment of approximately 1440 square feet. The facilities are located at the departure end of runway 9R, immediately next to the United States Customs office. This allows quick access to the runway, meaning shorter taxi times for students. There are four private briefing areas, in addition to a large lounge and dining areas. Maintenance will be available on an on call basis from our Opa Locka based maintenance staff. (Intervenor made this very same statement in its response to Section 4.5B. of the RFP.) The "establishment" at Kendall-Tamiami Executive Airport referred to in Intervenor's response to Section 4.3e. of the RFP was leased from Metro-Dade County by Husta Aviation, Inc., not by Intervenor. In its response to Section 4.3f. of the RFP, Intervenor stated, in pertinent part, the following in its proposal: f. List of Customers . . . 5. Universidad Aerovias Contact: Ricardo H. Schoer Diestal, Flight School Director AV Tahel Esq. Ruiz Cortines S/N Col Pensador Mexicano 15520 Mexico, D.F. Miami phone (305)362-1493 From January 1993 through August 1994, Husta Aviation provided Initial, Instrument, Commercial, and Multiengine Instruction to over 100 University of Mexico Graduates. The instruction to which Intervenor referred in its response to Section 4.3f. of the RFP was actually provided to students from Aeromexico. The instruction was provided at the Universidad Aerovias. In its response to Section 4.6 of the RFP, Intervenor stated the following in its proposal: During the past three years at Husta Aviation, Inc., there has been only one safety related incident. On July 15, 1994, an Universidad Aerovias student pilot, during a crosswind landing, hit the wingtip on a C-152. The total damage to the aircraft was less than $12,000. During the last three years at Husta Aviation, Inc., there have been no other safety violations, incidents/accidents, fines, penalties, investiga- tions, suits, claims, and judgments levied against Husta Aviation, Inc. In its response to Section 4.7 of the RFP, Intervenor provided, as part of its proposal, a Statement of Operations (including revenue and costs, as well as expenses) for the period from May 8, 1995 through August 31, 1995, of the Husta Aviation Flight School, and a Balance Sheet reflecting the assets and liabilities of the Husta Aviation Flight School as of August 31, 1995. These documents were prepared, but not certified, by Intervenor's chief financial officer. Petitioner, in its response to Section 4.7 of the RFP, advised the College of the following: Audited financial statements are unavailable for the fiscal year ending May 31, 1995. The enclosed statements are uncorrected and intended to be used as a reference only. In its response to 4.8 of the RFP, Intervenor stated the following in its proposal:
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the College enter a final order dismissing, for lack of standing, Petitioner's protest of the Evaluation Committee's recommendation that the contract advertised in Request for Proposal 956-34 be awarded to Intervenor. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 29th day of February, 1996. STUART M. LERNER, 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 February, 1996.
