01-004263BID Town Of Davie vs. Department Of Transportation Status: Closed Recommended Order on Thursday, February 7, 2002.

Summary: Petitioner who did not submit a bid cannot establish bid process illegally tainted when it failed to exercise opportunity to acquire property.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

TOWN OF DAVIE, )

)

Petitioner, )

)

and )

)

KEVIN CARMICHAEL, )

)

Intervenor, )

)

vs. ) Case No. 01 - 4263BID

)

DEPARTMENT OF TRANSPORTATION, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was held in this case

by video teleconference in Tallahassee, Florida, on November 29,

2001, with parties appearing from Fort Lauderdale, Florida,

before J. D. Parrish, a de signated Administrative Law Judge of

the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Michael T. Burke, Esquire

Johnson, Anselmo, Murdoch,

Burke & George, P.A.

790 East Broward Boule vard, Suite 400

Post Office Box 030220

Fort Lauderdale, Florida 33303 - 0220

For Respondent: Brian F. McGrail, Esquire

Department of Transportation

Haydon Burns Building, Mail Station 58

605 Suwannee Street

Tallahassee, Florida 32399 - 0458

For Intervenor: Joseph W. Lawrence II, Esquire

Vezina, Lawrence & Piscitelli, P.A.

350 East Las Olas Boulevard, Suite 1130

Fort Lauderdale, Florida 33301

STATEMENT OF THE ISSUE

Whether the decision to award the bid for Parcel No.

93S101, State Road 84 Spur, was in accordance with the governing

rules and statutes or was arbitrary, capricious, or contrary to

competit ion.

PRELIMINARY STATEMENT

On June 18, 2001, the Respondent, the Florida Department of

Transportation (Respondent or Department), issued an intent to

award the bid for Parcel No. 93S101, State Road 84 Spur, to the

Intervenor, Kevin Carmichael, Trustee (Int ervenor). Thereafter,

the Petitioner, the Town of Davie (Petitioner or Davie),

protested the intended award and sought to acquire the subject

property. The Petitioner did not submit a bid for the property,

did not intend to offer any financial compensati on for the

property, and did not challenge the sufficiency of the

Intervenor's bid.

At the hearing, the Petitioner presented testimony from

Jack R. Leonard, a contract attorney with the Florida Department

of Transportation, Turnpike District (Turnpike Dist rict); Robert

Bush, a right - of - way manager for the Turnpike District; Adam

Russell Stehly, a surplus property manager employed by Post,

Buckley, Schuh & Jernigan (PBS&J) doing contract work for the

Turnpike District; Brenda Ashe, a consultant employed by P BS&J

doing work as a property management administrator for the

Turnpike District; Thomas A. Anderson, the deputy right - of - way

manager for the Turnpike District; and Thomas J. Willi, the town

administrator for the Town of Davie. Exhibits numbered 23, 30,

3 6 - A, 38, 41 - 43, 45, 47, 56 - A, 58, 61, 65, 67, and 73 were

admitted into evidence.

The transcript of these proceedings was filed on

December 24, 2001. Thereafter the parties requested an

extension, which was granted, to allow the parties additional

time to file proposed recommended orders. All parties timely

filed proposed orders that have been considered in the

preparation of this Recommended Order.

FINDINGS OF FACT

1. In October of 1993 the Respondent declared that a spur

property located at State Road 84 (the subject matter of these

proceedings) was a surplus parcel. Such property is comprised

of two identifiable tracts identified in this record as parcel

101 - A and parcel 101 - B.

2. The Respondent utilizes a manual entitled "Disposal of

Surplus Real P roperty" as its guide for the procedures used to

comply with statutory and rule provisions regarding the disposal

of surplus parcels.

3. Since 1993 the Department has made several attempts to

market the spur property. Such attempts included offering

parc el 101 - A to the Petitioner for no consideration.

4. As recently as October of 2000 the Department offered

the spur property to the Petitioner at no cost. The offer did

include some conditions but same did not materially affect

whether or not Davie would or could accept the transfer. For

whatever reasons, the Petitioner did not accept the offer.

Subsequently, the Respondent withdrew the offer in writing.

5. Additionally, the Respondent notified the Petitioner

that it intended to make the spur property ( both parcels)

available to the public through the competitive bid process.

6. It was contemplated that the bid process would allow

any person from the public to competitively place bids for the

subject property. Nevertheless, the Petitioner was advised t hat

it would be given an opportunity to acquire the property.

7. A letter of February 7, 2001, from the Department to

the Petitioner advised the town of its right to acquire the

property but did not in any manner prohibit or prevent the Town

of Davie from bidding on the spur property.

8. In fact, the Petitioner did not bid on the subject

property.

9. Further, the Petitioner did not and does not intend to

purchase the subject property. The only way the Intervenor

seeks to acquire the property is without cost.

10. The Petitioner had actual knowledge of the

Department's intention of making the property available through

competitive bid. The Town of Davie did nothing to oppose the

bid process.

11. On May 30, 2001, the spur properties were advertised

for competitive bidding with sealed bids to be opened by the

Department on June 14, 2001.

12. On June 21, 2001, the Town of Davie by and through its

town administrator contacted the Department in order to exercise

the town's right of refusal on the property.

13. Accordingly, on June 25, 2001, the Respondent posted a

notice stating it would reject all bids.

14. On July 12, 2001, the Respondent notified the

Petitioner that it had ten days to exercise its right to

purchase the property.

15. In connection with the proposed sale the Department

offered the property to the Town of Davie at the approved

appraised value of $1.9 million. The Petitioner made no

counter - offer.

16. Instead, on July 27, 2001, the Town of Davie responded

to the offer stating it would acc ept the parcel for a public

purpose for no consideration.

17. Thereafter, the Respondent posted a "Revised Bid

Tabulation" indicating it would award the spur property to the

highest responsive bidder, the Intervenor.

18. The Petitioner has not proposed t o pay for the spur

property.

19. The Petitioner did not have an appraisal of the spur

property prepared.

20. The Petitioner did not bid on the spur property.

CONCLUSIONS OF LAW

21. The Division of Administrative Hearings has

jurisdiction over the part ies to and the subject matter of these

proceedings. Sections 120.569, and 120.57, Florida Statutes.

22. Section 120.57(3), Florida Statutes, provides, in

pertinent part:

ADDITIONAL PROCEDURES APPLICABLE TO PROTESTS

TO CONTRACT BIDDING OR AWARD. – Agencies

subject to this chapter shall utilize the

uniform rules of procedure, which provide

procedures for the resolution of protests

arising from the contract bidding process.

Such rules shall at least provide that:

(a) The agency shall provide notice of its

dec ision or intended decision concerning a

bid solicitation or a contract award as

follows:

1. For a bid solicitation, notice of a

decision or intended decision shall be given

by United States mail or by hand delivery.

2. For any decision of the Departmen t

of Management Services concerning a request

by an agency for approval of an exceptional

purchase under part I of chapter 287 and the

rules of the Department of Management

Services, notice of a decision or intended

decision shall be given by posting such

notice in the office of the Department of

Management Services.

3. For any other agency decision,

notice of a decision or intended decision

shall be given either by posting the bid

tabulation at the location where the bids

were opened or by certified Unite d States

mail or other express delivery service,

return receipt requested.

The notice required by this paragraph shall

contain the following statement: "Failure to

file a protest within the time prescribed in

s. 120.57(3), Florida Statutes, shall

constitu te a waiver of proceedings under

chapter 120, Florida Statutes."

(b) Any person who is adversely

affected by the agency decision or intended

decision shall file with the agency a notice

of protest in writing within 72 hours after

the posting of the bid ta bulation or after

receipt of the notice of the agency decision

or intended decision and shall file a formal

written protest within 10 days after filing

the notice of protest. With respect to a

protest of the specifications contained in

an invitation to bi d or in a request for

proposals, the notice of protest shall be

filed in writing within 72 hours after the

receipt of notice of the project plans and

specifications or intended project plans and

specifications in an invitation to bid or

request for proposa ls, and the formal

written protest shall be filed within 10

days after the date the notice of protest is

filed. Failure to file a notice of protest

or failure to file a formal written protest

shall constitute a waiver of proceedings

under this chapter. T he formal written

protest shall state with particularity the

facts and law upon which the protest is

based. Saturdays, Sundays, and legal

holidays shall be excluded in the

computation of the 72 - hour time periods

provided by this paragraph.

* * *

(f) In a competitive - procurement

protest, no submissions made after the bid

or proposal opening amending or

supplementing the bid or proposal shall be

considered. Unless otherwise provided by

statute, the burden of proof shall rest with

the party protesting the p roposed agency

action. In a competitive - procurement

protest, other than a rejection of all bids,

the administrative law judge shall conduct a

de novo proceeding to determine whether the

agency's proposed action is contrary to the

agency's governing statut es, the agency's

rules or policies, or the bid or proposal

specifications. The standard of proof for

such proceedings shall be whether the

proposed agency action was clearly

erroneous, contrary to competition,

arbitrary, or capricious. In any bid -

protest proceeding contesting an intended

agency action to reject all bids, the

standard of review by an administrative law

judge shall be whether the agency's intended

action is illegal, arbitrary, dishonest, or

fraudulent.

23. In this case the Petitioner bear s the burden of proof

to establish that the purpose of competitive bidding has been

subverted or that the department acted fraudulently,

arbitrarily, illegally, or dishonestly in the proposed award of

the subject bid. The Petitioner must establish that th e

department's proposed action is contrary to the department's

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

bid or proposal specifications. As to this burden, the

Petitioner has failed to establish any violation of statute or

rule and ha s further failed to show the department acted

erroneously, contrary to competition, arbitrarily, or

capriciously. Thus the Petitioner has not met its burden.

24. In this case the Petitioner has been afforded ample

opportunity to purchase the subject prop erty, has delayed the

competitive process without legal justification, and has failed

to exercise its right to acquire the property as provided by

law. Accordingly, the Respondent is entitled to award the bid

as contemplated by the "Revised Bid Tabulation ." Nothing in the

law pertaining to the Petitioner's right of first refusal or the

bid process entitles the Petitioner to acquire the subject

property without consideration.

25. Section 337.25(4), Florida Statutes, provides in part:

The department may se ll, in the name of the

state, any land, building, or other

property, real or personal, which was

acquired under the provisions of subsection

(1) and which the department has determined

is not needed for the construction,

operation, and maintenance of a

tra nsportation facility. With the exception

of any parcel governed by paragraph (c),

paragraph (d), paragraph (f), paragraph (g),

or paragraph (i), the department shall

afford first right of refusal to the local

government in the jurisdiction of which the

p arcel is situated. When such a

determination has been made, property may be

disposed of in the following manner:

* * *

(b) If the value of the property exceeds

$10,000 as determined by department

estimate, such property may be sold to the

highest bidde r through receipt of sealed

competitive bids, after due advertisement,

or by public auction held at the site of the

improvement which is being sold.

* * *

(e) If the department begins the process

for disposing of the property on its own

initiative, either by negotiation under the

provisions of paragraph (a), paragraph (c),

paragraph (d), or paragraph (i), or by

receipt of sealed competitive bids or public

auction under the provisions of paragraph

(b) or paragraph (i), a department staff

appraiser may deter mine the fair market

value of the property by an appraisal.

* * *

(h) If property is to be used for a public

purpose, the property may be conveyed

without consideration to a governmental

entity.

26. The statute does not require the Department

to convey the property without consideration to Davie.

Once the Respondent determined to sell the property at

competitive bid, the Petitioner was obligated to show

its public purpose for the property. It had waived

its right to acquire the property previously.

2 7. Rule 14 - 19.004, Florida Administrative Code,

provides:

Real Property Conveyances.

(1) In the event the Department is

disposing of surplus property not governed

by the exceptions in Section 337.25(4),

Florida Statutes, the Department must first

offer s uch property to the local government

in the jurisdiction in which the parcel is

situated, prior to either negotiation or

competitive sale of the property. The local

government shall be allowed 10 working days

to determine if there is a need for the

subjec t parcel. If a public purpose is

identified by the local government, the

property may be conveyed to the local

government for no consideration; otherwise,

the property shall be sold at the

Department's approved appraised value. If

an independent appraisa l has been performed,

the acquiring local government shall

reimburse the appropriate party for the cost

of the appraisal.

(2) In the event the Department is

disposing of surplus property not governed

by the exceptions in Section 337.25(4),

Florida Statute s, such property will be sold

in accordance with Section 337.25(4)(b),

Florida Statutes.

(3) When disposing of surplus property by

public bid or auction, a minimum bid will be

specified when appropriate to ensure that

bids received will reflect the fair m arket

value of the property. The Department

reserves the right to withdraw the property

if the minimum bid is not reached. If a

minimum bid is specified, it shall be the

amount determined pursuant to Rule 14 -

19.012(2). If the highest bid is below the

sp ecified minimum bid, acceptance of the bid

will require the approval of the District

Secretary.

(4) For properties valued in excess of

$10,000, the appraisal which is procured by

a prospective buyer or lessee is not

approved until the Department has exami ned

the appraisal and verified that it is in

compliance with Section 475.628, Florida

Statutes.

(5) If real property is disposed of through

negotiation, sealed bid, or public auction,

the buyer or successful bidder shall pay all

costs associated with the closing. The

Department shall prepare all necessary

closing documents.

(6) The buyer shall record the conveyance

of the property in the county of record and

provide a copy of the recorded deed, showing

the book and page number and the date of

recordation , to the Department within 30

days of the closing date.

(7) A governmental entity may request

conveyance of real property or personal

property for a public purpose in accordance

with Section 337.25(4)(h), Florida Statutes,

unless legislation or bond provi sions

provide otherwise. If property is to be

conveyed for no monetary consideration, an

appraisal is not required.

(8) When transfers are made to a

governmental entity for a public purpose,

the governmental entity shall furnish a

letter identifying the public purpose for

the property from the agency head, or, if

the public entity consists of a group

requiring consensus to take such action, a

copy of the resolution confirming such

consensus. This documentation shall be

furnished to the Department at the time of

application for purchase or lease of the

Department - owned property.

(9) If real property is conveyed for a

public purpose, the governmental entity to

which the property will be conveyed shall

pay all closing costs associated with the

conveyance. The Department shall prepare

all necessary closing documents.

(10) If the property transferred is used

for other than the identified public purpose

by the governmental entity, all property

rights shall revert to the Department.

28. In this case it is co ncluded the Respondent complied

with the provisions of Rule 14 - 19.004, Florida Administrative

Code. The Petitioner was afforded all opportunities afforded by

the rule and statutes to acquire the subject property. It

failed to offer a bid on the property, it failed to timely

exercise its rights to acquire the property for public purpose,

and it failed to offer any financial consideration to the

Department for the property. Accordingly, it cannot now claim

the Department acted illegally or contrary to the rules

governing these proceedings.

29. Finally, it is concluded the Petitioner failed to

timely challenge the competitive bid process. Davie had actual

knowledge of the Department's intention to make the property

available through competitive bid. The P etitioner failed to

timely challenge that process, the terms of the proposed sale or

any specification of the proposed process. It has waived the

ability to do so.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMM ENDED that the Respondent enter a final order

confirming the award of the spur property to the Intervenor.

DONE AND ENTERED this 7th day of February, 2002, in

Tallahassee, Leon County, Florida.

_________________________ __________

J. D. PARRISH

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 7th day of February, 2002.

COPIES FURNISHED:

Michael T. Burke, Esquire

Johnson, Anselmo, Murd och,

Burke & George, P.A.

790 East Broward Boulevard, Suite 400

Post Office Box 030220

Fort Lauderdale, Florida 33303 - 0220

Joseph W. Lawrence, II, Esquire

Vezina, Lawrence & Piscitelli, P.A.

350 East Las Olas Boulevard

Suite 1130

Fort Lauderdale, Flor ida 33301

Brian F. McGrail, Esquire

Department of Transportation

Haydon Burns Building, Mail Station 58

605 Suwannee Street

Tallahassee, Florida 32399 - 0450

Thomas F. Barry, Secretary

Department of Transportation

Haydon Burns Building

605 Suwannee Stree t

Tallahassee, Florida 32399 - 0450

Pamela Leslie, General Counsel

Department of Transportation

Haydon Burns Building, MS 58

605 Suwannee Street

Tallahassee, Florida 32399 - 0450

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit w ritten 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.