01-002717BID Assessment Systems, Inc. vs. Department Of Health, Board Of Nursing Status: Closed Recommended Order on Friday, September 28, 2001.

Summary: Petitioner protested intent to award contract by Respondent. Held: decision to award bid to Intervenor was not contrary to statute rule, policy, or Request for Proposal, and was not arbitrary or capricious. Contract should be awarded to Intervenor.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ASSESSMENT SYSTEMS, INC., )

)

Petitioner, )

)

vs. ) Case No. 01-2717BID

)

DEPARTMENT OF HEALTH, BOARD OF )

NURSING, )

)

Respondent. )

)

and )

)

CHAUNCEY GROUP INTERNATIONAL )

AND EXPERIOR ASSESSMENTS, LLC ., )

)

Intervenor. )

)

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in

Tallahassee, Florida, on August 24, 2001, before

Harry L. Hooper, Administrative Law Judge with the Division

of Administrative Hearings.

APPEARANCES

For Petitioner : Paul R. Ezatoff, Esquire

Katz, Kutter, Haigler, Alderman,

Bryant & Yon, P.A.

106 East College Avenue, 12th Floor

Post Office Box 1877

Tallahassee, Florida 32302-1877

For Respondent : William W. Large, General Counsel

Amy M. Jones, Esquire

Department of Health

Office of the General Counsel

4052 Bald Cypress Way, Bin A02

Tallahassee, Florida 32399-1703

For Intervenor : Douglas A. Mang, Esquire

Wendy R. Wiener, Esquire

Mang Law Firm, P.A.

660 East Jefferson Street

Tallahassee, Florida 32302

STATEMENT OF THE ISSUE

Whether the proposed decision of the Department of Health

(Department) to award a contract to the Intervenor, Chauncey

Group International and Experior Assessments, LLC (Chauncey

Group), is contrary to governing statutes, rules, or policies of

the Board of Health (Board), or the specifications of RFP-DOH00-

015 (RFP).

PRELIMINARY STATEMENT

An Request for Proposal (RFP) was prepared by the

Department on behalf of the Board with a mailing date of

March 16, 2001. Addenda were sent on April 7, 2001, and

April 24, 2001. The RFP sought responses from providers of

certified nursing assistant testing services. Two entities

responded to the RFP, Petitioner, Assessment Systems, Inc.

(ASI), and Intervenor, the Chauncey Group. The Department

evaluated the responses and presented their conclusions with

regard to them to the Board with a recommendation that the Board

enter into a contract with the Chauncey Group. The Board issued

a Notice of Intent to award the contract to the Chauncey Group

on June 19, 2001.

On June 29, 2001, Petitioner filed a formal written protest

and petition for formal administrative hearing with the

Department. On July 11, 2001, the Department filed the case

with the Division of Administrative Hearings. The case was set

for hearing on August 9, 2001. At the request of the parties,

the hearing was continued until August 24, 2001.

On August 10, 2001, Petitioner filed ASI's Motion for

Summary Recommended Order or Motion to Remand to the Board of

Nursing. On August 17, 2001, the Chauncey Group filed a

response to the motion. Petitioner filed a request for oral

argument on August 15, 2001, and oral argument was held on

August 23, 2001.

In the motion, Petitioner asserted generally that the

Department failed to accurately advise the Board as to the

responses to the RFP; that there were no facts in dispute; that

the Chauncey Group should have been rejected for failure to

comply with mandatory requirements; that the Department

incorrectly reported the scores for the reference checks; that

the Department failed to accurately report Petitioner's minority

business participation points; and claimed that the Department

erroneously told the Board that they must award the contract to

the responder with the most points. Because resolution of the

matters contained in Petitioner's motion required the

determination of facts which were in dispute, the motion was

denied.

At the hearing, ASI presented the testimony of Richard

Soule, vice-president of business development, and JoAnne

Cahill, who is also an employee of ASI. The Department

presented the testimony of Eunice Filar, an employee of the

Department; Jim Brewer an employee of the Department; and Ruth

Stiehl, Ph.D., Executive Director of the Florida Board of

Nursing. Intervenor presented the testimony of Robin

Stackhouse, a program manager for the Chauncey Group, and Mark

Caulfield, who during the time pertinent to his testimony, was

an employee of Experior Assessments, LLC.

A joint exhibit was admitted into evidence. Additionally,

ASI had 25 exhibits admitted into evidence. The Chauncey Group

offered six exhibits which were admitted, and the Department

offered two exhibits which were admitted. Two of ASI's exhibits

were identical to exhibits offered by the Chauncey Group.

A Transcript was filed on September 10, 2001. All of the

parties timely filed Proposed Recommended Orders which were

considered in the preparation of this Recommended Order.

FINDINGS OF FACT

1. The Board of Nursing is a state board which regulates

the practice of nursing in the state.

2. The Department of Health is the state Department which,

among other things, is charged with the provision of general

health services to the citizens of the state.

3. ASI is a corporation with headquarters in Bala Cynwyd,

Pennsylvania.

4. The Chauncey Group is located in Princeton, New Jersey.

5. Both ASI and the Chauncey Group have experience in

administering tests to determine whether applicants may be

designated certified nursing assistants.

6. The Board determined that it required the development

and administration of its nursing assistant certification

program competency examination in accordance with applicable

federal and state guidelines for the development of valid,

reliable, and legally defensible examinations. It further

determined that this could best be accomplished by contracting

with a private vendor.

7. The Board designated Dr. Ruth Stiehl as its

representative for the preparation of the RFP.

8. The Board employed the services of the Department in

the preparation and evaluation of the RFP.

9. Jim Brewer, a purchasing analyst for the Department,

was designated administrative lead in the preparation of the

RFP.

10. Eunice E. Filar, an employee of the Department, was

the person who was in charge of assembling the RFP. Dr. David

Paulson, the Department's Manager for Testing Services, was her

supervisor.

11. The RFP required written questions to be submitted

before March 28, 2001, and set the mandatory pre-proposal

conference for April 11, 2001. It provided that additional

questions identified at the pre-proposal conference would be

answered by email or fax until April 18, 2001. Proposals were

due at 2:00 p.m. on May 9, 2001, according to Subsection 2.10 of

the RFP, or 2:00 p.m. on May 10, 2001, according to

Subsection 2.4 of the RFP, and Jim Brewer. The addendum of

April 7, 2001, stated that they were due on May 10, 2001, at

2:00 p.m. That time and date, being the last, is the time and

date which is operative. Proposals were to be evaluated

beginning May 15, 2001.

12. Evaluation training was on May 23, 2001, and was

conducted by Juan Trujillo, a psychometrician with the

Department. Evaluation training had originally been scheduled

for May 16, 2001, but had to be cancelled because Mrujillo

was ill.

13. The proposals were submitted in boxes which were

opened by Jim Brewer on May 10, 2001. This was reflected by a

document signed by Mr. Brewer and Diane Harper. The proposed

services portion was reviewed first. The cost proposal was not

opened until on or about May 24, 2001.

14. Section 5 of the RFP provided instructions to

prospective offerors. It included such information as to the

composition of the title page, required a brief narrative

indicating the responder's understanding of the project,

addressed mandatory requirements, and addressed other matters.

15. Subsection 5.4, specifically addressed mandatory

requirements. The section listed 11 mandatory requirements and

recited that the failure to comply with each and every mandatory

requirement would render a bid non-responsive and that non-

responsive bids would not be evaluated. The requirements

included such things as the number of copies of the proposal

required to be submitted, whether or not the submission was in

the required format, and whether the submission included sample

scheduling and administration manuals as provided elsewhere in

the RFP.

16. Subsection 5.4.3 was a mandatory requirement which

read as follows: "Was the bid accompanied by a surety bond or

certified check as specified in 2.12."

17. Subsection 2.12, recited, in part, as follows: "All

proposals shall be accompanied by a surety bond or certified

check in the amount of ten percent (10%) of the submitted bid

price's annual total and conditioned upon successful offeror

submitting the specified performance bond within ten (10)

calendar days following notice of award, in the form and manner

required by the offeror. Failure by an offeror to provide the

required bid guarantee in the manner stated, shall cause the

proposal to be considered non-responsible [sic] to this

solicitation."

18. Department personnel certified mandatory criteria

compliance on May 18, 2001. The signatures of Ms. Filar and

Dr. Paulson on the form entitled "Part 1: Proposal Mandatory

Criteria (amended)" indicated that both responders had met the

mandatory requirements.

19. When the proposals were submitted, the business

relationship between Chauncey Group International and Experior

Assessments, LLC ., was in the nature of joint adventurers. Each

provided the Department with a cover sheet reflecting that they

were separate business entities and each entity signed the

mandatory forms required by the RFP but, in fact, they had

joined together to provide the service sought. There was no

prohibition in the RFP against responses from partners or joint

adventurers.

20. In a letter dated May 30, 2001, the Chauncey Group

informed Jim Brewer that the ownership structure had changed and

that Chauncey Group International had purchased 100 percent of

Experior Assessments, LLC. Mr. Brewer testified that he did not

view this to be of any consequence and he did not consider this

to be a supplemental response to the RFP. The letter did not

give the Chauncey Group an advantage over ASI.

21. The check which was provided to the Department for the

joint venture was provided only by Experior Assessments, LLC.

This was done despite ambiguous and inappropriate email advice

from Jim Brewer that, "Yes, vendors responding as partners to

our RFP should each submit a bond. The bond could represent

each vendor's responsibility or share as long as this is clearly

defined in the proposal."

22. The advice from Mr. Brewer was contrary to the

requirements of RFP Subsection 2.12. It was also contrary to

the RFP because the time for asking questions of the Department,

and receiving answers, had expired. However, this did not give

the Chauncey Group any advantage and, in fact, the Chauncey

Group failed to make the submission as suggested by Mr. Brewer.

23. The check, submitted by Chauncey Group International

was in the proper amount, and included funds from both Chauncey

Group International and Experior Assessments, LLC. This

submission complied with RFP Subsection 2.12 because there was

only one proposal from the two entities, despite the submission

of two cover sheets. Consequently, the certification by

Ms. Filar and Dr. Paulson, that both responders met the

mandatory requirements, was correct.

24. Once it was determined that mandatory requirements had

been met, then the four other major areas addressed in the RFP

could be evaluated. This is provided by Subsection 6.3. These

other areas were proposed services, which had a weight of 45.1

percent; reference checks, which had a weight of 9.9 percent;

minority vendor participation, which had a weight of 5.1

percent; and cost, which had a weight of 39.9 percent.

25. The proposed services portion of the RFPs was

evaluated by Rosemarie Erwin, Cheryl O'Donoghue, Betty Hurley,

Raquel Bassett, and Carrie Harris. The evaluators used a form

entitled, "Revised RFP Evaluation Criteria-for CAN Services."

They were not permitted to see the cost proposals. The proposed

services portion of the evaluation could have generated up to

615 points for each proposer.

26. All of the forms used by the proposed service

evaluators were dated May 23, 2001. The last proposed service

evaluation was turned in on May 31, 2001.

27. The evaluators' background experience and knowledge of

the areas and requirements of the RFP were sufficient; the

evaluators were qualified, fair, and experienced. The

evaluators arrived at varying conclusions, as would be expected.

None of the evaluators' scores were arbitrary, capricious, or

contrary to the requirements of the RFP.

28. The reference checks were accomplished by Lee Skinner,

a psychometrician who was an employee of the Department. The

reference checks could have generated as many as 135 points for

each proposer. The reference checks resulted in ASI attaining

125.6 points and the Chauncey Group receiving 118.3 points.

29. The minority vendor participation was evaluated by

Dr. Paulson, Mr. Brewer, and Ms. Filar on May 25, 2001. Neither

the Chauncey Group nor ASI properly completed the minority

vendor participation form. No points for minority vendor

participation were awarded to either proposer. The minority

vendor portion could have generated up to 70 points for each

proposer.

30. The cost proposals were evaluated by Dr. Paulson and

Ms. Filar on May 25, 2001. The cost proposals could have

generated up to 545 points for each proposer.

31. The ASI cost proposal was zero for the line which

stated: "5. Per applicant cost for written examination in

Spanish (excluding audio tape)." Located by the zero in the

space provided were two asterisks which were repeated below the

authorized signature line. The sentence following the two

asterisks stated as follows: "Please note : Spanish

examinations are provided in oralformat [sic] only and include a

test booklet."

32. Subsection 3.9.5 of the RFP states, "Administer both a

written portion and a skills-demonstration portion of the

examination to eligible candidates."

33. Subsection 3.9.5b of the RFP, at the tenth bullet, or

"k" if the alphabet is continued after "b," states that the

responder must, "Provide a Spanish language examination to a

candidate requesting the translated exam. (Currently a Spanish

written, oral and skills demonstration examination are provided

at no additional cost)."

34. ASI's response in the proposed services portion, at

Subsection 4.5.K, which corresponds to Subsection 3.9.5b (tenth

bullet) of the RFP, stated as follows: "ASI will continue to

provide a written, oral and skills demonstration examination in

Spanish when requested in advance by the candidate. A candidate

who wants to take examination in Spanish must indicate such on

their application and submit the appropriate fee. Under our

current contract, ASI answered the State's additional needs by

providing bilingual Nurse Aide Evaluators (over 15% of all

Florida NAEs speak Spanish), allowing candidates to take the

written and skills examinations in Spanish."

35. ASI's response to item 5 in the cost proposal was not

responsive because it provided only for oral examinations, and

quoted no cost figure. Clearly, what was being solicited was

the cost for written examinations. This resulted in the

Chauncey Group's receiving ten more points in the cost category

than ASI.

36. The cost proposal figures, and the results of all of

the other evaluations were put into a computer program by

Ms. Filar and Dr. Paulson. The computer program generated the

final results. Ms. Filar and Dr. Paulson were not, as

previously noted, on the team which evaluated the proposed

services. Ms. Filar and Dr. Paulson did not refer to the

proposed services portion of ASI's response when addressing the

cost proposals and they were not required to do so.

37. Though it is clear what Richard Soule, vice-president

of business development for ASI, meant to say in the cost

proposal, the response must be evaluated only on what it

actually says.

38. On June 4, 2001, Dr. Paulson, by memorandum, forwarded

the result of the evaluations to the Board. The memorandum had

an attachment entitled "Evaluation of Proposals for RFP #DOH00-

051." The attachment elucidated the evaluation methodology used

and provided details as to how the results were obtained.

39. At a public meeting of the Board on June 13, 2001, the

memorandum with the attachment was discussed. Ms. Filar was

there to answer questions. Questions by board members were

posed to Ms. Filar and she responded to them. A motion was made

to award the contract as recommended by Dr. Paulson's memorandum

with attachment and the motion was passed unanimously.

40. The Board issued a Notice of Intent to award the

contract to the Chauncey Group, five days later on June 19,

2001.

41. The attachment considered by the Board reported that

the Chauncey Group received a total of 1101.5 points and that

ASI received 1060.9 points and asserted that the Chauncey Group

was the winner. The point total was incorrect because in

arriving at that figure, the attachment reported that the

Chauncey Group received 125.6 on the reference checks and that

ASI received 118.3. As noted above, it should have reflected

that ASI received 125.6 and that the Chauncey Group received

118.3. Correcting this error, by adding 7.3 points to ASI's

total, and deducting 7.3 points from the Chauncey Group score,

results in final scores of 1094.2 for the Chauncey Group, and

1068.2 for ASI.

42. This error alone would not affect the outcome of the

recommendation to award the contract to the Chauncey Group or

the Board's decision. However, the span between the scores, 26,

is less than the 70 points which might have been awarded for

minority vendor participation.

43. As noted above, Dr. Paulson, Mr. Brewer, and

Ms. Filar decided not to award points to either responder in the

case of minority vendor participation.

44. The standard for obtaining minority vendor

participation points was set forth in the RFP as Part IV as the

"Minority Vendor Participation Form." This form required the

following: "(1) the name of the offeror company; (2) a

statement as to whether or not the offeror qualified as a

minority vendor; (3) a statement as to whether or not the

offeror planned to use a minority business as a subcontractor;

(4) the name and address of the subcontractor; and (5) how the

minority subcontractor was to be used.

45. In the case of ASI, Part IV, the "Minority Vendor

Participation Form," was properly completed except for the

question, "How do you plan to use the minority vendor." This

question was not answered at all in the Part IV form. Even

though Part IV was the only place in the RFP in which minority

vendor participation was noted, the form itself is presented as

an evaluation tool. There was no requirement that responders

complete the form so long as the information was provided.

Accordingly, it was of no consequence where the information was

reported.

46. ASI responded to the question as to how they would

utilize minority vendors in Subsection 4.5.C of their technical

response. This response was buried deep in ASI's proposed

services response, and its location caused the Department to

miss it entirely. Nevertheless, it is responsive and should

have been considered for what it was worth.

47. In the case of the Chauncey Group, Part IV, the

"Minority Vendor Participation Form," was not provided at all.

Instead, a document entitled Minority Business Enterprises was

included. It provided the name of the offeror company, the

Chauncey Group. The submission failed to note whether the

Chauncey Group was or was not a qualifying minority vendor,

although the overall context of the submission made it clear

that the Chauncey Group was not a qualifying minority vendor.

The submission stated that the Chauncey Group, was, "negotiating

in good faith with the Minority Business Enterprise vendors

listed below, and will select one to use on this contract."

This responded to the requirement that the offeror plan to use a

minority business as a subcontractor. The names and addresses

of the proposed subcontractors were provided. The Chauncey

Group met the final requirement by explaining that the minority

vendor selected would provide printing and mailing services.

48. As noted above, 70 points were available for minority

vendor participation. There were no standards provided in the

RFP for awarding points in this category.

49. The efforts of both proposers were so minimal in the

area of minority vendor participation that it was not arbitrary

for the Department to assign no points in this category.

Subsequently, the Department properly informed the Board that

neither proposer received any points for minority vendor

participation.

50. The error which changed the point totals, involving

the reference checks, doe not change the fact that the Chauncey

Group received the most points. The Board was correct when it

decided to issue a Notice of Intent to award the contract to the

Chauncey Group.

CONCLUSIONS OF LAW

51. The Division of Administrative Hearings has

jurisdiction over the parties and the subject matter presented

herein, pursuant to Section 120.57(3), Florida Statutes.

52. ASI has standing to bring this action. The Chauncey

Group had standing to intervene.

53. In the context of this proceeding, the review by the

Division of Administrative Hearings is de novo . Section

120.57(3), Florida Statutes. As such, the determination to be

made is "whether the Department's proposed action is contrary to

the Department's governing statutes, the Department's rules or

policies, or the bid or proposal specifications." When

conducting a de novo hearing on a bid protest the phrase " de

novo hearing" is used to describe a form of intra-Department

review. In this type of hearing the Administrative Law Judge

may receive evidence, but the object of the proceeding is to

evaluate the action taken by the Department. State Contracting

and Engineering Corp. v. Department of Transp. , 709 So. 2d 607

(Fla. 1st DCA 1998).

54. In order for ASI to prevail, it must establish a

ground for invalidating the award. The standard of proof for a

bid protest involving the rejection of a competitive bid is

whether the proposed action by the Board was clearly erroneous,

contrary to competition, arbitrary, or capricious.

Section 120.57(3)(f), Florida Statutes. ASI must meet that

standard by a preponderance of the evidence. Section

120.57(1)(f), Florida Statutes.

55. An arbitrary decision is one not supported by facts or

logic, or one that is despotic. To act capriciously is to act

without thought or reason or to act irrationally. Agrico

Chemical Co. v. State, et. al. , 365 So. 2d 759 (Fla. 1st DCA

1978).

56. In determining whether the Board's actions were

clearly erroneous, the appearance of error and the fact that

reasonable persons may disagree with the actions do not

constitute clear error . Capeletti Bros., Inc. v. State, Dept.

of Transp. , 432 So. 2d 1359 (Fla. 1st DCA 1983).

57. The decision of the Board to award the contract to the

Chauncey Group was not contrary to the Department's governing

statutes, the Department's rules or policies, the bid or

proposal specifications and was not clearly erroneous, contrary

to competition, arbitrary, or capricious. See Information

Systems of Florida, Inc. v. Dept. of Business and Professional

Regulation , DOAH Case No. 96-3774BID ( adopted in toto by Final

Order entered November 12, 1996) and G. H. Johnson Construction

v. Pinellas County School Board , DOAH Case No. 96- 1942BID.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions

of Law set forth herein, it is

RECOMMENDED:

That the contract be awarded to the Chauncey Group.

DONE AND ENTERED this 28th day of September, 2001, in

Tallahassee, Leon County, Florida.

___________________________________

HARRY L. HOOPER

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 28th day of September, 2001.

COPIES FURNISHED:

Paul R. Ezatoff, Esquire

Jeffrey L. Frehn, Esquire

Katz, Kutter, Haigler, Alderman,

Bryant & Yon, P.A.

106 East College Avenue, 12th Floor

Post Office Box 1877

Tallahassee, Florida 32302-1877

Douglas A. Mang, Esquire

Wendy R. Wiener, Esquire

Mang Law Firm, P.A.

660 East Jefferson Street

Tallahassee, Florida 32302

Ruth R. Stiehl, Executive Director

Board of Nursing

Department of Health

4080 Woodcock Drive, Suite 202

Jacksonville, Florida 32207-2714

Theodore M. Henderson, Agency Clerk

Department of Health

4052 Bald Cypress Way, Bin A02

Tallahassee, Florida 32399-1701

William W. Large, General Counsel

Amy Jones, Esquire

Department of Health

4052 Bald Cypress Way, Bin A02

Tallahassee, Florida 32399-1701

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 Department

that will issue the Final Order in this case.