01-001443BID Children`s Home Society Of Florida vs. Department Of Children And Family Services Status: Closed Recommended Order on Wednesday, July 25, 2001.

Summary: Petitioner`s response to ITN failed to include a mandatory requirement and was thus non-responsive. Petitioner`s protest to the ITN should be dismissed.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

CHILDREN'S HOME SOCIETY )

OF FLORIDA , )

)

Petitioner , )

)

vs. ) Case Nos. 01-1443BID

) 01-1444BID

DEPARTMENT OF CHILDREN )

AND FAMILY SERVICES , )

)

Respondent , )

)

and )

)

THE DEVEREUX FOUNDATION, INC. , )

)

Intervenor. )

_________________________________)

RECOMMENDED ORDER

A hearing was he ld pursuant to notice, on May 16, 2001, by

Barbara J. Staros, assigned Administrative Law Judge of the

Division of Administrative Hearings, in Tallahassee, Florida.

APPEARANCES

For Petitioner : Peter Antonacci, Esquire

Michael E. Riley, Esquire

Gray, Harris, & Robinson, P.A.

301 South Bronough Street, Suite 600

Tallahassee, Florida 32302-3189

For Respondent : John R. Perry, Esquire

Department of Children

and Family Services

2639 North Monroe Street, Suite 525A

Tallahassee, Florida 32399-2949

For Intervenor : Michael J. Cherniga, Esquire

David C. Ashburn, Esquire

Sonya C. Penley, Esquire

Greenberg, Traurig, P.A.

Post Office Drawer 1838

Tallahassee, Florida 32302

STATEMENT OF THE ISSUE

Whether the decision of the Department of Children and

Family Services to reject the proposals submitted by the

Children's Home Society in response to ITN No. 01-FSD2A/01 and

ITN No. 01-FSD2B/01 as non-responsive was contrary to the

Agency's governing statutes, the Agency's rules or policies, or

the specifications of the ITNs?

PRELIMINARY STATEMENT

On or about February 1, 2001, the Department of Children and

Family Services (DCF) issued ITN No. 01-FSD2A/01 and No. 01-

FSD2B/01 for the delivery of foster care licensure, retention and

recruitment contracts in DCF's Districts 2A and 2B. Petitioner,

Children's Home Society (CHS), responded to both ITNs.

On March 6, 2001, DCF informed CHS by letter that its

responses to the ITNs were determined to be non-responsive.

On March 9, 2001, CHS filed a Notice of Protest of DCF's

decision determining that CHS' responses to the ITNs were non-

responsive.

On March 14, 2001, DCF posted the results of its evaluations

of the ITN responses submitted by two other proposers or

applicants, one of which was the Devereux Foundation, Inc.

On March 19, 2001, CHS filed two Formal Written Protests

requesting a formal administrative hearing and protesting DCF's

decision that CHS's responses to the ITNs were determined to be

non-responsive and ineligible for further evaluation. CHS also

filed a Motion for Consolidation of the two protests. The

Devereux Foundation Inc. (Devereux) filed a Petition to Intervene

in the Formal Written Protest involving ITN No. 01-FSD2B/01.

Devereux alleged that CHS was ineligible to respond to the ITNs

as a matter of law and should have been disqualified from the

competitive procurement process.

CHS's Formal Written Protests were forwarded to the Division

of Administrative Hearings on or about April 16, 2001.

Devereux's Motion to Intervene in case No. 01-1444BID was

granted. CHS’s Motion for Consolidation was granted

consolidating Case Nos. 01-1443BID and 01-1444BID and a formal

hearing was scheduled for May 16, 2001.

Devereux filed a Motion for Summary Recommended Order of

dismissal, which was denied.

The parties filed a Prehearing Stipulation. At hearing, the

parties stipulated to the admission of Joint Exhibits 1 through

9. Petitioner presented the testimony of John Haines, William

Frieder and Dr. John Awad. Petitioner proffered the testimony of

Professor Jeffrey Davis. Petitioner offered Exhibits 1-5.

Petitioner's Exhibit 5 was admitted into evidence but

Petitioner's Exhibits 1-4 were not admitted into evidence.

Respondent presented the testimony of Terry DeCerchio and offered

no exhibits into evidence. Petitioner requested official

recognition of Chapter 99-168, Laws of Florida, and this request

was granted. Intervenor presented no witnesses and offered one

exhibit into evidence. Petitioner presented the testimony of

Terry DeCerchio and Patricia Phillips in rebuttal.

A Transcript of the hearing, consisting of one volume, was

filed on June 4, 2001. On July 5, 2001, the parties timely filed

Proposed Recommended Orders which have been considered in the

preparation of this Recommended Order.

FINDINGS OF FACT

1. On or about February 1, 2001, DCF issued ITN No. 01-

FSD2A/01, and No. 01-FSD2B/01 for the delivery of foster care

licensure, retention and recruitment contracts in both District

2A and District 2B of DCF.

2. Each ITN included a form entitled "Appendix M Statement

of Assurances" with the ITN number clearly printed at the top of

the page as well as this identifying language, "FOSTER CARE

LICENSURE, RETENTION AND RECRUITMENT SERVICES." Appendix M

consists of 7 paragraphs of requirements and conditions.

3. Section 6.4 of the ITNs reads as follows:

6.4 RESPONSE TO INVITATION TO NEGOTIATE

MANDATORY REQUIREMENTS

The mandatory requirements are described as

FATAL CRITERIA on the Invitation to Negotiate

Rating Sheet. Failure to comply with all

mandatory requirements will render an

application non-responsive and ineligible for

further evaluation.

1. Was application received by the time and

date specified in the Invitation to

Negotiate?

2. Was one (1) original and seven (7) copies

of application supplied?

3. Did the application include the signed

State of Florida Invitation to Negotiate

Contractual Services Acknowledgement

Form, PUR 7105?

4. Did the application include a title page

(section 6.2)?

5. Did the application include the singed

Statement of No Involvement?

6. Did the application include the signed

Acceptance of Contract Terms and

Conditions form?

7. Did the application include a signed

Statement of Assurances?

8. Did the application include a line budget

with narrative justification of the

included items? ( emphasis in original)

4. Section 6.13 of the ITNs is entitled, "HOW TO SUBMIT AN

APPLICATION" and includes the following language:

6.13 HOW TO SUBMIT AN APPLICATION

Faxed applications will not be accepted. All

seven (7) copies of application packages must

be delivered sealed and clearly marked on the

outside of each of the packages: ' RESPONSE

TO INVITATION TO NEGOTIATE' and contain the

respondent's name and address. The applicant

is free to use any means of delivery it

wishes. The applicant is responsible for

ensuring the Department receives all required

material prior to the deadline, in the manner

required , and at the place requested in this

Invitation to Negotiate. Any untimely

application will be rejected and returned

unopened and unevaluated.

* * *

. . . A completed application consists of the

following:

1) Cover Page (signed and dated PUR 7105

form indicating the total number of pages

in the application, included in this

document as Appendix B.)

2) Completed Title Page and Table.

3) Responses to each of the requirements of

Sections 6.3 to 6.8.

4) Signed and dated Appendix M, Statement of

Assurances . ( emphasis supplied)

5. CHS submitted proposals to both ITNs.

6. The proposals submitted by CHS for both ITNs did not

include the Statement of Assurances found in Appendix M of ITN

Nos. 01-FSD2A/01 and 01-FSD2B/01. Instead, both proposals

contained a different Statement of Assurances which CHS had

previously used in a response to another ITN in a different

district of DCF. The statement of assurances which CHS attached

contained 11 paragraphs of requirements and conditions.

7. By letters of March 6, 2001, the Department informed CHS

that CHS's proposals to the two ITNs did not meet the mandatory

requirements listed in the ITNs and that this failure to comply

with all mandatory requirements renders their proposals non-

responsive and ineligible for further evaluation.

8. The Department made the determination that CHS's

proposals were non-responsive in both districts under the same

legal and factual analysis.

9. Dr. John Awad, the District Administrator, made this

decision on behalf of the Department after consulting staff and

legal counsel.

10. The decision of the Department to determine CHS's

applications to be non-responsive and ineligible for further

evaluation resulted in five eligible applicants in District 2A,

and two applicants in District 2B.

11. CHS's failure to include Appendix M, which was a

mandatory requirement of the ITNs, and mistakenly including a

Statement of Assurances from a different ITN, constitutes a major

irregularity. The failure to sign and include this document,

which was clearly and expressly required in Section 6.4 of the

ITNs, is sufficient to support DCF's position to consider CHS's

proposals to be non-responsive and ineligible for further

evaluation.

12. In further support of DCF's decision that CHS's

proposals were non-responsive, there are significant differences

between the Statement of Assurances contained in Appendix M

and the Statement of Assurances which was submitted by CHS.

The Statement of Assurances that was submitted by CHS expressly

referenced services to be provided in Volusia and Flagler

Counties which are not within the geographical boundaries of

DCF's District Two.

13. Additionally, the Statement of Assurances supplied by

CHS guarantees the provision of a plan by December 1, 2000,

regarding how it will meet accreditation standards. Appendix M

has no such provision.

14. Finally, Appendix M requires the applicant to assure

that the applicant has the ability to provide directly, or

through contract, all services described in "this Invitation to

Negotiate and resulting contract" which are specified as foster

care licensure, retention, and recruitment services. The

Statement of Assurances which was submitted by CHS assured that

it would provide "foster care and related services." This

assurance constitutes a different scope of services than

contemplated in the ITNs at issue here.

15. The ITNs define foster care recruitment as, "[t ]he

process of finding foster parent resources for waiting children,

using either formal media-based campaigns, or informal procedures

recognized as effective by the selected applicant agency."

Foster care retention is defined in the ITNs as, "[t ]he act of

maintaining a base of licensed family foster homes."

16. "Related services" as defined in Section

409.1671(1)(a), Florida Statutes (2000), means "family

preservation, independent living, emergency shelter, residential

group care, therapeutic foster care, intensive residential

treatment, foster care supervision, case management,

postplacement supervision, permanent foster care, and family

reunification."

17. Moreover, the phrase "foster care and related services"

is not defined in the ITNs at issue here and it cannot be

inferred that this general phrase encompasses the specific

services in the ITNs to which a proposer or an applicant must

assure that it will provide.

18. CHS’s failure to sign and include Appendix M, the

Statement of Assurances attached to the ITNs at issue, resulted

in a failure to meet the mandatory requirement in Section 6.4 of

the ITNs. CHS’s use of a form associated with a different

invitation to negotiate which specified a different scope of

services for a different geographic area than contemplated by the

ITNs at issue does not satisfy the mandatory requirement in

Section 6.4.

19. Appendix N, which explains the scoring criteria and

procedure of the ITNs further referenced the Statement of

Assurances as one of the "FATAL CRITERIA" and emphasized in bold

type that, if not met, the response could not be considered

further.

20. CHS’s failure to meet this mandatory requirement

constitutes a material deviation from the ITNs.

Needs Assessment

21. Prior to the development of the ITNs at issue here, DCF

asked CHS to provide a needs assessment and plan related to the

need for services relating to foster care licensure, relicensure,

recruitment, training and retention in District Two, Subdistrict

2B. Intervenor Devereux asserts that CHS should have been

declared ineligible to submit proposals to the ITNs because of

this needs assessment in which it participated.

22. On May 26, 2000, DCF awarded a purchase order to CHS to

conduct a needs assessment and develop a plan for recruitment and

retention of foster parents. Initially, the purchase order was

for $20,000.00. However, this purchase order was amended in

August 2000 by reducing the scope of the agreement and reducing

the amount to be paid to CHS to approximately $10,000.00. The

amended purchase order still called for CHS to develop a needs

assessment, but no longer called for the development of a plan.

CHS did not develop a plan as contemplated by the original

agreement nor was it paid for anything more than the needs

assessment.

23. The original purchase order between DCF and CHS did not

reference procurement of a feasibility study. The weight of the

evidence does not support Intervenor’s assertion that the plan

contemplated by the original purchase order signed May 26, 2000,

necessarily would have constituted a feasibility study.

Moreover, the plan contemplated by the original purchase order

was never created and CHS was never compensated for anything

beyond the needs assessment.

24. The needs assessment produced by CHS was attached to

the ITN for District 2B. Thus, all prospective applicants were

provided with the needs assessment.

25. DCF held a prospective applicants conference on

February 16, 2001. At this conference, Intervenor asked whether

the provider who participated in the preparation of the needs

assessment would be ineligible to submit a proposal in response

to the ITNs. DCF replied that the provider who participated in

the preparation of the needs assessment is not excluded from

submitting a proposal and noted that the information that was

gathered and the results were included in the ITNs.

26. CHS completed, signed, and attached to its proposal to

ITN#01-FSD2B/01 a Statement of No Involvement which assured that

neither CHS nor any member of that firm had been awarded a

contract by DCF on a noncompetitive basis to develop the ITN ;

perform a feasibility study concerning the scope of work

contained in this ITN; or develop a program similar to what is

contained in the ITN.

CONCLUSIONS OF LAW

27. The Division of Administrat ive Hearings has

jurisdiction over the parties and subject matter in this case

pursuant to Sections 120.569, 120.57(1), and 120.57(3), Florida

Statutes.

28. The burden of proof on the issue of DCF’s proposed

agency action of determining that CHS’s proposal is non-

responsive resides with the Petitioner. See Section

120.57(3)(f), Florida Statutes. The burden of proof on the issue

of whether CHS is ineligible to contract with DCF because of the

prior purchase order resides with Intervenor Devereux.

29. The underlying findings of fact in this case are based

on a preponderance of the evidence. Section 120.57(1)(j),

Florida Statutes. The standard of proof is whether the proposed

agency action was clearly erroneous, contrary to competition,

arbitrary, or capricious.

30. The de novo proceeding in this case was conducted to

examine DCF’s proposed action in an attempt to determine whether

that action is contrary to the agency’s governing rules or

policies, or the ITN specifications. See Section 120.57(3)(f),

Florida Statutes, and State Contracting and Engineering

Corporation v. Department of Transportation , 709 So. 2d 607

(Fla. 1st DCA 1998).

31. The language of Sections 6.4, 6.13, and Appendix N of

the ITNs is clear and unambiguous. Section 6.4 and Appendix N

identify the statement of assurances as a mandatory requirement

and one of the fatal criteria. Section 6.13 instructs all

proposers how to submit an application and enumerates four

elements necessary for an application to be complete. One of the

elements expressly references a signed-and-dated Appendix M,

Statement of Assurances.

32. DCF’s determination that CHS’s proposal was non-

responsive was consistent with the clear, express language of the

ITNs which informed proposers of mandatory requirements and that

proposals found to be non-responsive would not be further

evaluated.

33. CHS argues that it attached a Statement of Assurances,

albeit from the wrong ITN, and that its failure to attach the

correct statement of assurances constitutes a minor irregularity

that should have been waived by DCF.

34. In situations in which a state agency seeks to procure

a provider of services and/or commodities through a competitive

process, the agency in question has the right to waive minor

irregularities in an otherwise valid bid or proposal or offer to

negotiate. Variations which are not minor cannot be waived.

Rule 60A-1.002(10), Florida Administrative Code.

35. The ITNs defined a minor irregularity as a variation

from the ITN terms and conditions that does not affect the price

of the application, or give the prospective applicant an

advantage or benefit not enjoyed by other prospective applicants,

or does not adversely impact the interests of DCF. See also

Harry Pepper & Associates, Inc. v. City of Cape Coral , 352 So. 2d

1190, 1193 (Fla. 2nd DCA 1977).

36. A "responsive offeror" is a person who has submitted a

proposal which conforms in all material respects to an invitation

to bid or a request for proposals. Section 287.012(17), Florida

Statutes (2000).

37. The term "responsive bid" means a bid which is

submitted on the correct forms and contains all required

information. Intercontinental Properties, Inc. v. Department of

Health and Rehabilitative Services , 606 So. 2d 380, 381 (Fla. 3d

DCA 1992) . 1/

38. The Statements of Assurances submitted by CHS were not

on the required form. Further, they did not contain the correct

information, and did not guarantee the ability to perform the

services set forth in the ITNs.

39. DCF’s determination that CHS’s proposal was non-

responsive was consistent with the clear, express language of the

ITNs which informed proposers of mandatory requirements and that

proposals found to be non-responsive would not be further

evaluated. CHS failed to meet its burden to show that DCF’s

proposed action is clearly erroneous, contrary to competition,

arbitrary or capricious.

40. An agency action is capricious if the agency takes the

action without thought or reason or irrationally. An agency

decision is arbitrary if it is not supported by facts or logic.

Agrico Chemical Co. v. State Department of Environmental

Regulation , 365 So. 2d 759, 763 (Fla. 1st DCA 1978).

41. CHS failed to prove by a preponderance of the evidence

that DCF an acted arbitrarily or capriciously. DCF’s actions

were consistent with the plain meaning of the language contained

in the ITNs. Further, actions taken by DCF administration were

taken after careful consideration and were in no way arbitrary or

capricious.

42. CHS also failed to meet its burden that DCF’s decision

was contrary to competition. DCF acted in a manner which secured

fair competition to all applicants by ensuring an exact

comparison of proposals. The CHS proposals were not entitled to

further review since they materially deviated from a mandatory

requirement of the ITN. To have conducted a comparison and

analysis of the incorrect Statement of Assurances submitted by

CHS would have given CHS a competitive advantage not afforded to

other proposers. See Harry Pepper & Associates v. City of Cape

Coral , supra .

43. Section 287.057(16), Florida Statutes, provides that no

person who receives a contract non-competitively to perform a

feasibility study or the potential implementation of a subsequent

contract, or participated in the drafting of an invitation to bid

or request for proposal, or developed a program for future

implementation shall be eligible to contract with the agency for

any other contracts dealing with that specific subject matter.

44. Intervenor has not met its burden of proving that DCF

should have disqualified CHS from the ITN process. Intervenor

has not proven that DCF's determination that CHS was not

disqualified from participating in the ITN process was clearly

erroneous, contrary to competition, arbitrary, or capricious.

The evidence does not support Intervenor’s proposition that the

needs assessment constituted any kind of feasibility study or

that the plan contemplated by the original purchase order

necessarily would have constituted a feasibility study or that it

constituted any act which might reasonably be construed as

development of a program for future implementation of such a

contract. Further, there is no evidence that CHS was involved in

preparing the ITNs.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of

Law set forth herein, it is

RECOMMENDED:

That the Department of Children and Families enter a final

order dismissing the bid protest filed by Children’s Home

Society.

DONE AND ENTERED this 25th day of July, 2001, in

Tallahassee, Leon County, Florida.

BARBARA J. STAROS

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 [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 25th day of July, 2001.

ENDNOTE

1. It is reasonable to extend this definition to a responsive

proposal in response to an Invitation to Negotiate.

COPIES FURNISHED:

Michael J. Cherniga, Esquire

David C. Ashburn, Esquire

Sonya C. Penley, Esquire

Greenberg, Traurig, P.A.

Post Office Drawer 1838

Tallahassee, Florida 32302

John R. Perry, Esquire

Department of Children

and Family Services

2639 North Monroe Street, Suite 525A

Tallahassee, Florida 32399-2949

Peter Antonacci, Esquire

Michael E. Riley, Esquire

Gray, Harris, & Robinson, P.A.

301 South Bronough Street, Suite 600

Tallahassee, Florida 32302-3189

Virginia A. Daire, Agency Clerk

Department of Children

and Family Services

1317 Winewood Boulevard

Building 2, Room 204B

Tallahassee, Florida 32399-0700

Josie Tomayo, General Counsel

Department of Children

and Family Services

1317 Winewood Boulevard

Building 2, Room 204

Tallahassee, Florida 32399-0700

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

10 days from the date of this recommended order. Any exceptions to

this recommended order should be filed with the agency that will

issue the final order in this case.