03-002440BID Matthew Bender &Amp; Co., Inc. vs. Department Of State Status: Closed Recommended Order on Monday, September 15, 2003.

Summary: The Department`s proposed action of disqualifying Petitioner`s bid for submitting an incomplete test run is arbitrary, capricious, and contrary to the clear language of the Invitation to Bid (ITB).

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

MATTHEW BENDER & CO., INC., )

)

Petitioner, )

)

vs. ) Case No. 03 - 2440BID

)

DEPARTMENT OF STATE, )

)

Respondent. )

___________________________________)

RECOMMENDED ORDER

A formal hearing was held pursuant to notice, on July 29,

2003, in Tallahassee, Florida, before Barbara J. Staros,

assigned Administrative Law Judge of the Division of

Administrative Hearings.

APPEARANCES

For Pet itioner: Mary Piccard Vance, Esquire

Vezina, Piccard & Piscitelli, P. A.

318 West Gaines Street

Tallahassee, Florida 32301

For Respondent: Marielba Torres Delgado, Esquire

Department of State

The Collins Building, Room 110

107 West Gaines Street

Tallahassee, Florida 32399 - 0250

STATEME NT OF THE ISSUE

Whether Respondent's action of disqualifying the bid

submitted by Petitioner was clearly erroneous, contrary to

competition, arbitrary, or capricious.

PRELIMINARY STATEMENT

On June 6, 2003, the Florida Department of State

(Department) po sted its Notice of Intent to award a contract

for publication of the Florida Administrative Code pursuant to

Invitation to Bid No. 695 - 100 - (01 or 04) - 03 - 7 1/ (the ITB). The

Notice stated that four bids were received and that

Petitioner, Matthew Bender & Co. , Inc., and two other bidders

were disqualified resulting in one responsive bidder.

Petitioner timely filed a Formal Protest Petition challenging

the decision of the Department to disqualify its bid. The

Formal Protest Petition was forwarded to the Divis ion of

Administrative Hearings on or about July 2, 2003. A formal

hearing was scheduled for July 25, 2003.

The parties filed an Agreed Motion for Continuance and

Request for Expedited Consideration, which was granted. A

formal hearing was rescheduled for July 29, 2003.

The parties filed a Prehearing Stipulation. The parties

stipulated to the admission of Joint Exhibits 1 through 10.

At hearing, Petitioner presented the testimony of Leigh

Trippe, Barry Bridges, and Kathleen Hutchins. Petitioner's

E xh ibit numbered 2 was admitted into evidence. Respondent

presented the testimony of Kathleen Hutchins, Lizzie Cloud,

and Howard C. Kast. Respondent's Exhibit numbered 8 was

admitted into evidence.

A Transcript, consisting of one volume, was filed on

Au gust 12, 2003. The parties timely filed Proposed

Recommended Orders which have been considered in the

preparation of this Recommended Order. All citations are to

Florida Statutes (2002) unless otherwise indicated.

FINDINGS OF FACT

Stipulated Facts

1. Pe titioner submitted a bid in response to ITB No.

695 - 100 - (01 or 04) - 03 - 7.

2. The Department received four bids in response to the

ITB. The two lowest bidders, Weil Publishing and Municipal

Code Corporation, were disqualified due to lack of compliance

with the references requirement set forth in the ITB.

3. Petitioner has standing as the third lowest bidder

given the disqualification of the two lowest bidders.

4. Petitioner timely filed a notice of intent to protest

and a formal written protest.

Findings of Fact Based on the Evidence of the Record

5. The ITB contained a requirement that each bidder

provide three references for similar printing contracts,

including a brief description of the work performed, a

reference contact person, telephone number, and address. The

Department disqualified the two lowest bidders for failure to

meet the reference requirement.

6. When it was determined that Petitioner was the

resulting lowest bidder, Liz Cloud, Bureau Chief for the

Bureau of Administrative Code, wrote a letter to Leigh Trippe,

Vice President for Government Relations and Contracts for

Petitioner, to inform her that Matthew Bender was the apparent

low bidder. The letter was sent to Msippe along with a

package of materials on May 27, 2003.

7. In additi on to sending the letter and accompanying

materials, Ms. Cloud called Msippe on May 28, 2003, to

inquire if the letter and package had been received. While

Ms. Trippe had not yet received the letter and package at the

time of the phone call, it was re ceived by Petitioner on May

28, 2003.

8. The language of the ITB is clear in informing

potential bidders that the apparent low bidder will be

required to show ability to perform by participating in a test

run of the Florida Administrative Code. Page 11 o f the ITB

provides in pertinent part:

EVALUATION AND AWARD

Award will be made to the bidder meeting

all requirements of the bid offering the

lowest aggregate pricing using the formula

on the price sheet.

Prior to posting the intended award, the

appar ent low bidder will be required to

show ability to perform by participating in

a test run of the Florida Administrative

Code.

The Department will provide the bidder with

the material necessary (a hard copy of rule

text for the Code) to print the test run of

the Code.

The apparent low bidder shall provide the

Department with one 25 page sample volume

of the Code, containing pages from rule

text, statutory cross reference tables,

tables of repealed rules and subject matter

indexes. The 8 1/2 X 11 inch sample Code

shall include at least two (2) sample three

and one - half inch, three ring swing hinge

binders of the type that will be used for

all subscriptions. The Department will

chose from the binder samples submitted by

the apparent low bidder. The sa mple

binders submitted must be of equal or

higher quality as compared to the ones

currently used for publication of the Code.

The bidder will be expected to provide

copies to the Department within two days of

receipt of the sample work. All samples

shall be next day mail or courier service,

to the Division of Elections for approval.

If the apparent low bidder fails to perform

as required, the Department shall proceed

to the next low bidder and so on, until

either a responsive bidder is found or the

Depar tment decides to post for no award.

[emphasis added]

9. The May 27, 2003, letter from Ms. Cloud to Msippe

reads as follows:

Pursuant to the requirements of Invitation

to Bid No. 695 - 100 - 01 - 03 - 7, enclosed is a

copy of the documents necessary to prin t a

test run of the Florida Administrative

Code, including a disk containing the rule

text in ascii format; and a disk containing

amendments to the rule text in Adobe

FrameMaker 7.0.

More specifically, the documents enclosed

are a copy of Chapter 62 - 782, Florida

Administrative Code, as filed with the

Department of State, with editorial changes

marked, and a copy of this chapter as

currently printed in the Florida

Administrative Code for your information

and review. The text provided in ascii

format inclu des Rules 62 - 782.100 thru 62 -

782.790. The text provided in Adobe

Framemaker 7.0 as amendments to Chapter 62 -

782 consists of Rules 62 - 782.800 and 62 -

782.900.

In accordance with the "Evaluation and

Awards" section on page 11 of 25 of the

aforementioned bi d, this office must

receive the finalized sample publication no

later than noon Monday, June 2, 2003. If

you have any questions please do not

hesitate to contact me at (850) 245 - 6270.

10. The materials provided to Petitioner by the

Department did not co ntain any repealed rules or information

regarding a subject matter index or a cross - reference table.

The cover letter from Ms. Cloud did not reference repealed

rules, a subject matter index, or cross - reference tables or

any instruction regarding these ite ms.

11. Petitioner prepared the test run of the publication

which was timely delivered to the Department on June 2, 2003.

The sample submitted by Petitioner to the Department did not

include a table of repealed rules, a subject matter index, or

a cross - r eference table.

12. Along with the sample publication, Petitioner

enclosed three binders which were described in a cover letter:

"The binders provided are representative of our available

selections. Any of these selections may be customized to your

desi red color, size, stamping, etc."

13. Ms. Cloud was not in the office on June 2, 2003,

when Petitioner's sample publication was received by the

Department. Her assistant and Kathleen Hutchins, Purchasing

Director for the Department, opened the box contain ing the

submission submitted by Petitioner. The following day, Ms.

Cloud examined the box and its contents. She determined that

the test run of the publication did not include a table of

repealed rules, a subject matter index, or a cross - reference

table. Moreover, she determined that only one of the three

sample binders was compliant with the type and size

requirement of the binders referenced in the Evaluation and

Award Section of the ITB.

14. The Department determined that Petitioner's

submission of o ne compliant binder and two non - compliant

binders constituted a minor irregularity. But it was decided

to disqualify Petitioner based on Petitioner's test run

publication which the Department deemed to be materially

noncompliant with the ITB for failure t o include statutory

cross references tables, tables of repealed rules, and subject

matter indexes.

15. When asked under cross examination about the

materials sent to Petitioner to perform the test run, Ms.

Cloud responded in part:

Q Do you know wheth er there were any

repealed rules in the material you

provided?

A There was not.

Q How were they supposed to create a table

of repealed rules?

A They could have taken some of the rules

and did the table as if they were repealed,

or they could have provided a table saying

no rules were repealed in this rule.

16. Ms. Cloud informed Ms. Hutchins that she determined

the sample publication submitted by Petitioner to be lacking

required elements and was, therefore, non - responsive. She

instructe d Ms. Hutchins to prepare a cover letter and send the

same test run to the next apparent low bidder which was also

the only remaining bidder and the current publisher of the

Florida Administrative Code. Ms. Hutchins did so. 2/

17. On June 6, 2003, the Dep artment posted its Notice of

Intent to Award a contract to the remaining bidder, Darby

Publishing. The Notice of Intent stated that Petitioner was

disqualified because the test run required by the Evaluation

and Award section of the ITB was returned incom plete.

CONCLUSIONS OF LAW

18. The Division of Administrative Hearings has

jurisdiction over the parties and subject matter in this case

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

19. Petitioner has challenged the Department's proposed

a gency action determining that Petitioner's submission of a

test run of the Florida Administrative Code was incomplete,

thereby rendering Petitioner's submission non - responsive.

20. The burden of proof resides with the Petitioner.

The standard of proof i n this proceeding is whether the agency

action was clearly erroneous, contrary to competition,

arbitrary, or capricious. Section 120.57(3)(f).

21. The underlying findings of fact in this case are

based on a preponderance of the evidence. Section

120.57( 1)(j).

22. This de novo proceeding was conducted for the

purpose of evaluating the action that was taken by the agency

in an attempt to determine whether that action is contrary to

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

policies, or the IT B specifications. See Section

120.57(3)(f), and State

Contracting and Engineering Corporation v. Department of

Transportation , 709 So. 2d 607 (Fla. 1st DCA 1998).

23. An agency action is capricious if the agency takes

the action without thought or rea son or irrationality. 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).

24. The Evaluation and Award section of the IT B informed

prospective bidders that the apparent low bidder will be

required to show ability to perform by participating in a test

run of the Florida Administrative Code and that the Department

will provide the bidder with the material necessary to print

t he test run.

While the Department provided material necessary to produce a

sample volume of the Code containing pages from rule text, it

did not provide Petitioner with material necessary to create

statutory cross reference tables, tables of repealed rul es, or

subject matter indexes.

25. Illustrative of the Department's failure to provide

necessary materials or instructions is Ms. Cloud's testimony

regarding creation of a fictitious table of repealed rules.

The Department's expectations that a bidder w ould create a

fictitious table of repealed rules from non - existing

information or provide a table stating that no rules were

repealed without any instruction to do so is arbitrary,

capricious, and contrary to

the clear language of the ITB that the Departm ent would

provide the necessary materials to perform the test run.

26. Petitioner has met its burden of proving by a

preponderance of the evidence that the Department's proposed

action of disqualifying its bid for submitting an incomplete

test run is arbitrary, capricious, and contrary to the clear

language of the ITB.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions

of Law set forth herein, it is

RECOMMENDED:

That the Department of State enter a final order

reversing its decisi on that Petitioner's test run submission

was incomplete, and, therefore, non - responsive.

DONE AND ENTERED this 15th day of September, 2003, in

Tallahassee, Leon County, Florida.

S

______________ _____________________

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 (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 15th day of September, 2003.

ENDNOTES

1/ The ITB references its number as 695 - 100 - 01 - 03 - 7. However,

the mailing instruction s referenced it as 695 - 100 - 04 - 03 - 7.

Bids were accepted with either number and the parties refer to

the ITB at issue as 695 - 100 - (01 or 04) - 03 - 7.

2 / According to Ms. Hutchins, the next apparent lowest bidder

submitted a test run publication that was ful ly compliant with

the requirements of the Evaluation and Award section of the

ITB. The test run submitted by the next apparent lowest bidder

is not in evidence and the proposed winning bidder is not a

party to this action.

COPIES FURNISHED:

Mary Piccard Vance, Esquire

Vezina, Piccard & Piscitelli, P. A.

318 West Gaines Street

Tallahassee, Florida 32301

Marielba Torres Delgado, Esquire

Department of State

The Collins Building, Room 110

107 West Gaines Street

Tallahassee, Florida 32399 - 0250

Gerry York, General Counsel

Department of State

The Collins Building, Room 100

107 West Gaines Street

Tallahassee, Florida 32399 - 0250

Glenda E. Hood, Secretary

Department of State

R. A. Gr ay Building

500 South Bronough Street

Tallahassee, Florida 32399 - 0250

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.