18-000485BID Liberty Square Phase Two, Llc vs. Florida Housing Finance Corporation Status: Closed Recommended Order on Thursday, April 19, 2018.

Summary: Petitioner failed to prove that Florida Housing's intended award of funding to Intervenor was erroneous, contrary to competition, arbitrary or capricious. Florida Housing was authorized to waive an error as a "Minor Irregularity."

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

HTG OSPREY POINTE, LLC,

Petitioner,

vs. Case No. 18 - 0479BID

FLORIDA HOUSING FINANCE

CORPORATION,

Respondent,

and

SP LAKE, LLC,

Intervenor.

_______________________________/

N ORTHSIDE PROPERTY II, LTD,

Petitioner,

vs. Case No. 18 - 0484BID

FLORIDA HOUSING FINANCE

CORPORATION,

Respondent,

and

SIERRA BAY APARTMENTS, LTD.,

Intervenor.

_______________________________/

LIBERTY SQUARE PHASE TWO, LLC,

Pe titioner,

vs. Case No. 18 - 0485BID

FLORIDA HOUSING FINANCE

CORPORATION,

Respondent,

and

WOODLAND GROVE APARTMENTS, LLC,

Intervenor.

_______________________________/

RECOMMENDED ORDER

The final hearing in this matter was conducted be fore

J. Bruce Culpepper, Administrative Law Judge of the Division of

Administrative Hearings, pursuant to sections 120.569, and

120.57(1) and (3), Florida Statutes (2017), 1/ on February 28,

2018, in Tallahassee, Florida.

APPEARANCES

For Petitioner HTG Ospr ey Pointe, LLC ( Ð Osprey Pointe Ñ):

Maureen McCarthy Daughton, Esquire

Maureen McCarthy Daughton, LLC

Suite 304

1725 Capital Circle Northeast

Tallahassee, Florida 32308

For Petitioner Northside Property II, LTD (ÐNorthside IIÑ):

Donna Elizabeth Blanton, Esquire

Radey Law Firm, P.A.

Suite 200

301 South Bronough Street

Tallahassee, Florida 32301

For Petitioner Liberty Square Phase Two, LLC (ÐLiberty SquareÑ):

Alvin D. Lodish, Esquire

Duane Morris LLP

200 South Biscayne Boulevard

Miami, Florida 33131

Mic hael P. Donaldson, Esquire

Carlton Fields Jorden Burt, P.A.

215 South Monroe Street, Suite 500

Post Office Drawer 190 Tallahassee,

Florida 32302 - 0190

For Respondent Florida Housing Finance Corporation (ÐFlorida

HousingÑ):

Betty Zachem, Esquire

Florida Ho using Finance Corporation

Suite 5000

227 North Bronough Street

Tallahassee, Florida 32301

For Intervenor SP Lake, LLC (ÐSP LakeÑ):

Lawrence E. Sellers, Jr., Esquire

Holland and Knight, LLP

Suite 600

315 South Calhoun Street

Tallahassee, Florida 32301

For Intervenor Sierra Bay Apartments, LTD (ÐSierra BayÑ):

Anthony L. Bajoczky, Jr., Esquire

Ausley McMullen

Post Office Box 391

Tallahassee, Florida 32301

For Intervenors Woodland Grove Apartments, LLC (ÐWoodland

GroveÑ) ; and Harbour Springs, LLC (ÐHarb our SpringsÑ):

Thomas Porter Crapps, Esquire

Meenan, P.A.

Suite 410

300 South Duval Street

Tallahassee, Florida 32301

STATEMENT OF THE ISSUE

The issue to be determine d in this bid protest matter is

whether Respondent, Florida Housing Finance Corporatio n Ós ,

intended award of funding under Request for Applications 2017 -

108 , entitled ÐSAIL Financing of Affordable Multifamily Housing

Developments To Be Used In Conjunction With Tax - Exempt Bond

Financing And Non - Competitive Housing CreditsÑ was clearly

errone ous, contrary to competition, arbitrary, or capricious.

PRELIMINARY STATEMENT

This matter involves a protest to a Notice of Intent to

Award issued by Respondent Florida Housing. On August 31, 2017,

Florida Housing, through Request for Applications 2017 - 10 8

(ÐRFA 2017 - 108Ñ), solicited applications for an allocation of

State Apartment Incentive Loan program funds, Multifamily

Mortgage Revenue Bonds, and non - competitive housing credit

financing for affordable housing.

On December 8, 2017, Florida Housing pos ted notice of its

intent to award funding to 16 applicants. The applicants

selected for funding included Intervenors SP Lake, Sierra Bay ,

Woodland Grove, and Harbour Springs.

Florida Housing also determined that Petitioners Osprey

Pointe , Northside II a nd Liberty Square were eligible for

consideration under RFA 2017 - 108. However, Florida Housing did

not select these entities for funding. All three Petitioners

timely filed formal written protests with Florida Housing. 2/

On January 29, 2018, Florida Ho using referred the protests

in this matter to the Division of Administrative Hearings

(ÐDOAHÑ) for assignment to an Administrative Law Judge (ÐALJÑ)

to conduct a chapter 120 evidentiary hearing. 3/

The final hearing was held on February 28, 2018. 4/ Joint

Exhibits 1 through 14 were admitted into evidence. Included in

the Joint Exhibits is the deposition testimony of Alberto Milo

(a principal of Petitioner Liberty Square) (Joint Exhibit 13)

and the deposition testimony of Heather Green (the Florida

Housing employee who scored the ÐProximityÑ component for

RFA 2017 - 108) (Joint Exhibit 14). Liberty Square Ó s Exhibit 1

was admitted into evidence. Florida Housing Ó s Exhibits 1 and 2

were admitted into evidence. Florida Housing and Woodland Grove

presented the testimony of Marisa Button (the Director of

Multifamily Allocations for Florida Housing).

A one - volume Transcript of the final hearing was filed at

DOAH on March 7, 2018. At the close of the hearing, the parties

were advised of a ten - day timeframe after receipt of the hearing

transcript to file post - hearing submittals. Liberty Square

subsequently requested an additional two days to file its post -

hearing submittal, which was granted. 5/ All parties filed

Proposed Recommended Orders which were duly consid ered in

preparing this Recommended Order.

FINDING S OF FACT

1. Florida Housing is a public corporation created

pursuant to section 420.504 , Florida Statutes . Its purpose is

to provide and promote public welfare by administering the

governmental function o f financing affordable housing in

Florida.

2. Florida Housing is designated as the housing credit

agency for Florida within the meaning of section 42(h)(7)(A) of

the Internal Revenue Code. As such, Florida Housing is

authorized to establish procedures to distribute low income

housing tax credits and to exercise all powers necessary to

administer the allocation of these credits. § 420.5099, Fla.

Stat. For purposes of this administrative proceeding, Florida

Housing is considered an agency of the State o f Florida.

3. To promote affordable housing in Florida, Florida

Housing offers a variety of programs to distribute housing

credits. (Housing credits, also known as tax credits, are a

dollar - for - dollar offset of federal income tax liability.) One

of thes e programs is the State Apartment Incentive Loan program

(ÐSAILÑ) , which provides low - interest loans on a competitive

basis to affordable housing developers. SAIL funds are

available each year to support the construction or substantial

rehabilitation of m ultifamily units affordable to very low -

income individuals and families. See § 420.5087, Fla. Stat.

Additional sources of financial assistance include the

Multifamily Mortgage Revenue Bond program (ÐMMRBÑ) and non -

competitive housing credits.

4. Florida Housing administers the competitive

solicitation process to award low - income housing tax credits,

SAIL funds, nontaxable revenue bonds, and other funding by means

of request for proposals or other competitive solicitation.

Florida Housing initiates the c ompetitive application process by

issuing a Request for Applications. §§ 420.507( 48) and

420.5087(1), Fla. Stat. ; and Fla. Admin. Code R. 67 - 60.009(4).

5. The Request for Application at issue in this matter is

RFA 2017 - 108 , entitled ÐSAIL Financing of Af fordable Multifamily

Housing Developments to B e U sed in Conjunction with Tax - Exempt

Bond Financing and Non - Competitive Housing Credits.Ñ Florida

Housing issued RFA 2017 - 108 on August 31, 2017. Applications

were due by October 12, 2017. 6/

6. The purpos e of RFA 2017 - 108 is to distribute funding to

create affordable housing in the State of Florida. Through

RFA 2017 - 108, Florida Housing intends to award approximately

$87,000,000 for proposed developments serving elderly and family

demographic groups in s mall, medium, and large counties.

RFA 2017 - 108 allocates $46,279,600 to large

counties, $32,308,400 to medium counties,

and $8,732,000 to small counties.

7. RFA 2017 - 108 established goals to fund:

a. Two Elderly, new construction

Applications located in Large Counties;

b. Three Family, new construction

Applications located in Large Counties;

c. One Elderly, new construction Application

located in a Medium County; and

d. Two Family, new construction Applications

located in Medium Counties.

8. Th irty - eight developers submitted applications in

response to RFA 2017 - 108. Of these applicants, Florida Housing

found 28 eligible for funding, including all Petitioners and

Intervenors in this matter.

9. Florida Housing received, processed, deemed eligibl e or

ineligible, scored, and ranked applications pursuant t o the

terms of RFA 2017 - 108 , Florida Admin istrative Code C hapters 67 -

48 and 67 - 60 , and applicable federal regulations.

10. RFA 2017 - 108 provided that applicants were scored based

on certain demo graphic and geographic funding tests. Florida

Housing sorted applications from the highest scoring to the

lowest. Only applications that met all the eligibility

requirements were eligible for funding and considered for

selection.

11. Florida Housing c reated a Review Committee from

amongst its staff to review and score each application. On

November 15, 2017, the Review Committee announced its scores at

a public meeting and recommended which projects should be

awarded funding.

12. On December 8, 2017, the Review Committee presented

its recommendations to Florida Housing Ó s Board of Directors for

final agency action. The Board of Directors subsequently

approved the Review Committee Ó s recommendations and announced

its intention to award funding to 16 appl icants.

13. As a preliminary matter, prior to the final hearing,

Florida Housing agreed to the following reassessments in the

scoring and selection of the applications for funding under

RFA 2017 - 108:

a. SP Lake and Osprey Pointe : In the selection proce ss,

Florida Housing erroneously determined that SP Lake was eligible

to meet the funding goal for the ÐFamilyÑ demographic for the

Family, Medium County, New Construction Goal. (SP Lake

specifically applied for funding for the ÐElderlyÑ demographic.)

Con sequently, Florida Housing should have selected Osprey Pointe

to meet the Family, Medium County, New Construction Goal.

Osprey Pointe proposed to construct affordable housing in Pasco

County, Florida. Florida Housing represents that Osprey Pointe

is full y eligible for funding under RFA 2017 - 108. (While Osprey

Pointe replaces SP Lake in the funding selection for the

ÐFamilyÑ demographic, SP Lake remains eligible for funding for

the ÐElderlyÑ demographic.)

b. Sierra Bay and Northside II : In the scoring process,

Florida Housing erroneously awarded Sierra Bay proximity points

for Transit Services. Upon further review, Sierra Bay should

have received zero proximity points. Consequently, Sierra Bay Ó s

application is ineligible for funding under RFA 2017 - 108 . By

operation of the provisions of RFA 2017 - 108, Florida Housing

should have selected Northside II (the next highest ranked,

eligible applicant) for funding to meet the Elderly, Large

County, New Construction Goal. Florida Housing represents that

Norths ide II is fully eligible for funding under RF A 2017 - 108.

c. Harbour Springs : Florida Housing initially deemed

Harbour Springs eligible for funding under RFA 2017 - 108 and

selected it to meet the Family, Large County, New Construction

Goal. However, beca use Harbour Springs and Woodland Grove are

owned by the same entity and applied using the same development

site, under rule 67 - 48.004(1), Harbour Springs is ineligible for

funding. (Florida Housing Ó s selection of Woodland Grove for

funding for the Family, Large County, New Construction Goal, is

not affected by this determination.)

14. The sole disputed issue of material fact concerns

Liberty Square Ó s challenge to Florida Housing Ó s selection of

Woodland Grove to meet the Family, Large County Goal.

15. Li berty Square and Woodland Grove applied to serve the

same demographic population under RFA 2017 - 108. If Liberty

Square successfully challenges Woodland Grove Ó s application,

Liberty Square, as the next eligible applicant, will be selected

for funding to me et the Family, Large County Goal instead of

Woodland Grove. (At the hearing on December 8, 2017, Florida

Housing Ó s Board of Directors awarded Woodland Grove $7,600,000

in funding.)

16. The focus of Liberty Square Ó s challenge is the

information Woodland G rove provided in response to RFA 2017 - 108,

Section Four, A.5.d., entitled ÐLatitude/Longitude Coordinates.Ñ

Liberty Square argues that Woodland Grove Ó s application is

ineligible because its Development Location Point, as well as

the locations of its Commu nity Services and Transit Services,

are inaccurate. Therefore, Woodland Grove should have received

zero ÐProximityÑ points which would have disqualified its

application for funding.

17. RFA 2017 - 108, Section Four, A.5.d(1), states, in

pertinent part:

Al l Applicants must provide a Development

Location Point stated in decimal degrees,

rounded to at least the sixth decimal place.

18. RFA 2017 - 108 set forth scoring considerations based on

latitude/longitude coordinates in Section Four, A.5.e, entitled

ÐPro ximity.Ñ Section Four, A.5.e, states, in pertinent part:

The Application may earn proximity points

based on the distance between the

Development Location Point and the Bus or

Rail Transit Service . . . and the Community

Services stated in Exhibit A. Prox imity

points will not be applied to the total

score. Proximity points will only be used

to determine whether the Applicant meets the

required minimum proximity eligibility

requirements and the Proximity Funding

Preference . . . .Ñ

In other words, the Deve lopment Location Point identified the

specific location of an applicant Ó s proposed housing site. 7/

Applicants earned Ðproximity pointsÑ based on the distance

between its Development Location Point and selected Transit and

Community Services. Florida Hous ing also used the Development

Location Point to determine whether an application satisfied the

Mandatory Distance Requirement under RFA 2017 - 108, Section Four

A.5.f. To be eligible for funding, all applications had to

qualify for the Mandatory Distance Re quirement.

19. The response section to Section Four, A.5.d., is found

in Exhibit A, section 5, which required each applicant to submit

informat ion regarding the ÐLocation of p roposed Development.Ñ

Section 5 specifically requested:

a. County;

b. Add ress of Development Site;

c. Does the proposed Development consist of

Scattered Sites?;

d. Latitude and Longitude Coordinate;

e. Proximity;

f. Mandatory Distance Requirement; and

g. Limited Development Area.

20. Section 5.d. (Latitude and L ongitude Coordinates) was

subdivided into:

(1) Development Location Point

Latitude in decimal degrees, rounded to

at least the sixth decimal place

Longitude in decimal degrees, rounded

to at least the sixth decimal place

21. In its application, Woodla nd Grove responded in

section 5.a - d as follows:

a. County: Miami - Dade

b. Address of Development Site: NE corner

of SW 268 Street and 142 Ave, Miami - Dade, FL

33032 .

c. Does the proposed Development consist of

Scattered Sites? No.

d. Latitude an d Longitude Coordinate;

(1) Development Location Point

Latitude in decimal degrees, rounded to at

least the sixth decimal place: 25.518647

Longitude in decimal degrees, rounded to at

least the sixth decimal place: 80.418583

22. In plotti ng geographi c coordinates, a Ð - Ñ (negative)

sign in front of the longitude indicates a location in the

western hemisphere ( i.e. , west of the Prime Meridian , which is

aligned with the Royal Observatory, Greenwich, England). A

longitude without a Ð - Ñ sign places the co ordinate in the

eastern hemisphere. (Similarly, a latitude with a negative

value is south of the equator. A latitude without a Ð - Ñ sign

refers to a coordinate in the northern hemisphere.)

23. As shown above, the longitude coordinate Woodland

Grove list ed in section 5.d(1) did not include a Ð - Ñ sign.

Consequently, instead of providing a coordinate for a site in

Miami - Dade County, Florida, Woodland Grove entered a Development

Location Point located on the direct opposite side of the planet

(apparently, i n India).

24. At the final hearing, Florida Housing (and Woodland

Grove) explained that, except for the lack of the Ð - Ñ sign, the

longitude Woodland Grove recorded would have fallen directly on

the address it listed as its development site in section 5.b. ,

i.e. , the Ð NE corner of SW 268 Street and 142 Ave , Miami - Dade,

FL 33032. Ñ

25. In addition to the longitude in section 5.d., Woodland

Grove did not include a Ð - Ñ sign before the longitude

coordinates for its Transit Services in section 5.e(2)(b) or for

any of the three Community Services provided in section 5.e(3).

Again, without a Ð - Ñ sign, the longitude for each of these

services placed them in the eastern hemisphere (India) instead

of the western hemisphere (Miami - Dade County).

26. In its protest, Liberty Square contends that, because

Woodland Grove Ó s application listed a Development Location Point

in India, Florida Housing should have awarded Woodland Grove

zero proximity points under Section Four, A.5.e. Consequently,

Woodland Grove Ó s applicatio n failed to meet minimum proximity

eligibility requirements and is ineligible for funding.

Therefore, Liberty Square, as the next eligible applicant,

should be awarded funding for the Family, Large County Goal,

under RFA 2017 - 108. 8/

27. Liberty Square as serts that a correct Development

Location Point is critical because it serves as the beginning

point for assigning proximity scores. Waiving an errant

Development Location Point makes the proximity scoring

meaningless. Consequently, any such waiver by Fl orida Housing

is arbitrary, capricious, and contr ary to competition.

28. At the final hearing, Woodland Grove claimed that it

inadvertently failed to include the Ð - Ñ sign before the

longitude points. To support its position, Woodland Grove

expressed tha t, on the face of its application, it was obviously

applying for funding for a project located in Miami - Dade County,

Florida, not India. In at least five places in its application,

Woodland Grove specified that its proposed development would be

located in Miami - Dade County.

29. Moreover, several attachments to Woodland Grove Ó s

application specifically reference a development site in

Florida. Woodland Grove attached a purchase agreement for

property located in Miami - Dade County (Attachment 8). To

satisf y the Ability to Proceed requirements in RFA 2017 - 108,

Woodland Grove included several attachments which all list a

Miami - Dade address (Attachments 9 - 14). Further, Woodland Grove

submitted a Local Government Verification of Contribution Î Loan

Form execut ed on behalf of the Mayor of Miami - Dade County, which

committed Miami - Dade County to contribute $1,000,000.00 to

Woodland Grove Ó s proposed Development (Attachment 15) . Finally,

to qualify for a basis boost under RFA 2017 - 108, Woodland Grove

presented a le tter from Miami - Dade County Ó s Department of

Regulatory and Economic Resources, which also referenced the

address of the proposed development in Miami - Dade County

(Attachment 16) .

30. In light of this information, Woodland Grove argues

that its applicati on, taken as a whole, clearly communicated

that Woodland Grove intended to build affordable housing in

Miami - Dade County. Nowhere in its application, did Woodland

Grove reference a project in India other than the longitude

coordinates which failed to incl ude Ð - Ñ signs. Accordingly,

Florida Housing was legally authorized to waive Woodland Grove Ó s

mistake as a Ðharmless error.Ñ Thus, Florida Housing properly

selected the Woodland Grove Ó s development for funding to meet the

Family, Large County Goal .

31. Florida Housing advocates for Woodland Grove Ó s

selection to meet the Family, Large County Goal, under RFA 2017 -

108. Florida Housing considers the omission of the Ð - Ñ signs

before the longitude coordinates a ÐMinor IrregularityÑ under

rule 67 - 60.002(6). T herefore, Florida Housing properly acted

within its legal authority to waive, and then correct, Woodland

Grove Ó s faulty longitude coordinates when scoring its

application.

32. In support of its position, Florida Housing presented

the testimony of Marisa B utton, Florida Housing Ó s current

Director of Multifamily Allocations. In her job, Ms. Button

oversees the Request for Applications process; although, she did

not personally participate in the review, scoring, or selection

decisions for RFA 2017 - 108.

33. Ms. Button initially explained the process by which

Florida Housing selected the 16 developments for funding under

RFA 2017 - 108. Ms. Button conveyed that Florida Housing created

a Review Committee from amongst its staff to score the

applications. Florida Housing selected Review Committee

participants based on the staff member Ó s experience,

preferences, and workload. Florida Housing also assigned a

backup reviewer to sepa rately score each application.

34. The Review Committee members independently evalu ated

and scored their assigned portions of the applications based on

various mandatory and scored items. Thereafter, the scorer and

backup reviewer met to reconcile their scores. If any concerns

or questions arose regarding an applicant Ó s responses, the

scorer and backup reviewer discussed them with Florida Housing Ó s

supervisory and legal staff. The scorer then made the final

determi nation as to each application.

35. Ms. Button further explained that applicants

occasionally make errors in their applica tions. However, not

all errors render an application ineligible. Florida Housing is

authorized to waive ÐMinor Irregularities.Ñ As delineated in

RFA 2017 - 108, Section Three, A.2.C., Florida Housing may waive

ÐMinor IrregularitiesÑ when the errors do not provide a

competitive advantage or adversely impact the interests of

Florida Housing or the public. See Fla. Admin. Code R. 67 -

60.002(6) and 67 - 60.008.

36. Such was the case regarding Woodland Grove Ó s

application. Heather Green, the Florida Housing st aff member

who scored the ÐProximityÑ portion of RFA 2017 - 108, waived the

inaccurate longitude coordinates as ÐMinor Irregularities.Ñ

Ms. Green then reviewed Woodland Grove Ó s application as if the

proposed development was located in Miami - Dade County, Fl orida.

37. Florida Housing assigned Ms. Green, a Multifamily

Loans Manager, as the lead scorer for the ÐProximityÑ portion of

RFA 2017 - 108 , which included the Development Location Point

listed in Exhibit A, section 5.d. Ms. Green has worked for

Florida Housing since 2003 and has scored proximity points for

Request for Applications for over ten years. At the final

hearing, Florida Housing offered the deposition testimony of

Ms. Green.

38. In her deposition, Ms. Green testified that she is

fully aware that, to be located in the western hemisphere ( i.e. ,

Miami - Dade County), a longitude coordinate should be marked with

a negative sign or a ÐW.Ñ Despite this, Ms. Green felt that the

longitude coordinates Woodland Grove used without negative

signs, partic ularly its Development Location Point, were clearly

typos or unintentional mistakes. Therefore, Ms. Green waived

the lack of a negative sign in front o f the longitude

coordinates in s ection 5.d. and s ection 5.e. as ÐMinor

Irregularities.Ñ Ms. Green under stood that she was authorized

to waive ÐMinor IrregularitiesÑ by rule under the Florida

Administrative Code.

39. Ms. Green felt comfortable waiving the inaccurate

longitude coordinates because everywhere else in Woodland

Grove Ó s application specifically showed that its proposed

housing development was located in Miami - Dade County, not India.

Accordingly, when scoring Woodland Grove Ó s application,

Ms. Green corrected the longitude entries by including a

negative sign when she plotted the coordinates with her mapping

software. Ms. Green then determined that, when a Ð - Ñ was

inserted before the longitude, the coordinate lined up with the

address Woodland Grove listed for the Development Location

Point. Therefore, Woodland Grove received proximity points an d

was eligible for funding under RFA 2017 - 108. ( See RFA 2017 - 108,

Section Five.A.1.) However, Ms. Green acknowledged that if she

had scored the application just as it was presented, Woodland

Grove would not have met the required q ualifications for

eligib ility.

40. Ms. Button relayed that Florida Housing fully accepted

Ms. Green Ó s decision to waive the missing negative signs in

Woodland Grove Ó s response to s ection 5.d. and 5.e. as ÐMinor

Irregularities.Ñ Ms. Button opined that Woodland Grove Ó s

failure t o place a Ð - Ñ mark before the longitude was clearly an

unintentional mistake.

41. Ms. Button further commented that Florida Housing did

not believe that scoring Woodland Grove Ó s development as if

located in the western hemisphere (instead of India), pro vided

Woodland Grove a competitive advantage. Because it was evident on

the face of the application that Woodland Grove desired to develop

a housing site in Miami - Dade County, Ms. Green Ó s decision to

overlook the missing Ð - Ñ sign did not award Woodland Gr ove

additional points or grant Woodland Grove an advantage over other

applicants. Neither did it adversely impact the interests of

Florida Housing or the public. However, Ms. Button also conceded

that if Ms. Green had scored the application without addin g the

Ð - Ñ sign, Woodland Grove would have received zero proximity

points. This result would have rendered Woodland Grove Ó s

appli cation ineligible for funding.

42. Ms. Button also pointed out that Ms. Green waived the

omission of Ð - Ñ signs in two other applications as ÐMinor

Irregularities.Ñ Both Springhill Apartments, LLC, and Harbour

Springs failed to include negative signs in front of their

longitude coordinates. As with Woodland Grove, Ms. Green

considered the development sites in those application s as if

they were located in Miami - Dade County ( i.e. , in the western

hemisphere).

43. Ms. Green also waived a mistake in the Avery Commons

application as a ÐMinor Irregularity.Ñ The longitude coordinate

for the Avery Commons Development Location Point (section

5.d(1)) was blank. However, Ms. Green determined that Avery

Commons had placed the longitude in the blank reserved for

Scattered Sites coordinates (section 5.d(2)). When scoring

Avery Commons Ó application, Ms. Green considered the coordinate

in the appropriate section. According to Ms. Button, Florida

Housing felt that this variation did not provide Avery Commons a

competitive advantage. Nor did it adversely impact the

interests of Florida Housing or the public.

44. Finally, Ms. Button explain ed that the application

Florida Housing used for RFA 2017 - 108 was a relatively new

format. In previous Request For Applications, Florida Housing

required applicants to submit a Surveyor Certification Form. On

the (now obsolete) Surveyor Certification For m, Florida Housing

prefilled in a n ÐNÑ in front of all the latitude coordinates and

a ÐWÑ in front of all the longitude coordinates. However, the

application used in RFA 2017 - 108 did not place a n ÐNÑ or ÐWÑ

before the Development Location Point coordinate s.

45. Based on the evidence presented at the final hearing,

Liberty Square did not establish, by a preponderance of the

evidence, that Florida Housing Ó s decision to award funding to

Woodland Grove for the Family, Large County Goal, under

RFA 2017 - 108 w as clearly erroneous, contrary to competition,

arbitrary, or capricious. Florida Housing was within its legal

authority to waive, then correct, the missing Ð - Ñ sign in

Woodland Grove Ó s application as ÐMinor Irregularity.Ñ

46. Therefore, the undersigned concludes, as a matter of

law, that Petitioner did not meet its burden of proving that

Florida Housing Ó s proposed action to select Woodland Grove for

funding was contrary to its governing statutes, rules or

policies, or the provisions of RFA 2017 - 108.

CONC LUSIONS OF LAW

For want of a Ð - Ñ sign;

Is the Application lost?

47. DOAH has jurisdiction over the subject matter and the

parties of this competitive procurement protest pursuant to

sections 120.569, 120.57(1), and 120.57(3), Florida Statutes.

See also Fla. Admin. Code R. 67 - 60.009(2).

48. Liberty Square challenges Florida Housing Ó s selection

of Woodland Grove to meet the Family, Large County Goal, under

RFA 2017 - 108. Pursuant to section 120.57(3)(f), the burden of

proof in this matter rests with Liber ty Square as the party

protesting the proposed agency action. State Contracting &

Eng Ó g Corp. v. Dep Ó t of Transp. , 709 So. 2d 607, 609 (Fla. 1st

DCA 1998). Section 120.57(3)(f) further provides that in a

competitive - procurement protest:

[T]he administrat ive law judge shall conduct

a de novo proceeding to determine whether

the agency Ó s proposed action is contrary to

the agency Ó s governing statutes, the

agency Ó s rules or policies, or the

solicitation specifications. The standard

of proof for such proceedin gs shall be

whether the proposed agency action was

clearly erroneous, contrary to competition,

arbitrary, or capricious.

49. The phrase Ð de novo proceeding Ñ describes a form of

intra - agency review. The purpose of the ALJ Ó s review is to

Ð evaluate the act ion taken by the agency. Ñ J.D. v. Fla. Dep Ó t

of Child. & Fams. , 114 So. 3d 1127, 1132 (Fla. 1st DCA 2013);

and State Contracting , 709 So. 2d at 609. A de novo proceeding

Ð simply means that there was an evidentiary hearing . . . for

administrative review purposes Ñ and does not mean that the ALJ

Ð sits as a substitute for the [agency] and makes a determination

whether to award the bid de novo . Ñ J.D. , 114 So. 3d at 1133;

Intercontinental Props., Inc. v. Dep Ó t of Health & Rehab.

Servs . , 606 So. 2d 380, 386 (F la. 3d DCA 1992). Ð The judge may

receive evidence, as with any formal hearing under section

120.57(1), but the object of the proceeding is to evaluate the

action taken by the agency. Ñ State Contracting , 709 So. 2d at

609.

50. Accordingly, Liberty Square , as the party protesting

Florida Housing Ó s intended award, must prove, by a preponderance

of the evidence, that Florida Housing Ó s proposed action is

either: (a) contrary to its governing statutes ; (b) contrary to

its rules or policies ; or (c) contrary to the specifications of

RFA 2017 - 108. The standard of proof Liberty Square must meet to

establish that the award to Woodland Grove violates this

statutory standard of conduct is whether Florida Housing Ó s

decision was: (a) clearly erroneous, (b) contrary t o

competition ; or (c) arbitrary or capricious. §§ 120.57(3) (f)

and 120.57(1)(j), Fla. Stat .

51. The Ð clearly erroneous Ñ standard has been defined to

mean Ð the interpretation will be upheld if the agency Ó s

construction falls within the permissible range o f

interpretations. Ñ Colbert v. Dep Ó t of Health , 890 So. 2d 1165,

1166 (Fla. 1st DCA 2004); see also Holland v. Gross , 89 So. 2d

255, 258 (Fla. 1956)(when a finding of fact by the trial court

Ð is without support of any substantial evidence, is clearly

agai nst the weight of the evidence or . . . the trial court has

misapplied the law to the established facts, then the decision

is Ò clearly erroneous. Ó Ñ ). However, if Ð the agency Ó s

interpretation conflicts with the plain and ordinary intent of

the law, judicia l deference need not be given to it. Ñ

Colbert , 809 So. 2d at 1166 .

52. An agency action is Ð contrary to competition Ñ if it

unreasonably interferes with the purpose of competitive

procurement. As described in Wester v. Belote , 138 So. 721, 722

(Fla. 1931 ):

The object and purpose [of the bidding

process] . . . is to protect the public

against collusive contracts; to secure fair

competition upon equal terms to all bidders;

to remove not only collusion but temptation

for collusion and opportunity for gain at

public expense; to close all avenues to

favoritism and fraud in its various forms;

to secure the best values . . . at the

lowest possible expense; and to afford an

equal advantage to all desiring to do

business . . . , by affording an opportunity

for an e xact comparison of bids.

In other words, the Ð contrary to competition Ñ test forbids

agency actions that: (a) create the appearance and opportunity

for favoritism ; (b) reduce public confidence that contracts are

awarded equitably and economically ; (c) cau se the procurement

process to be genuinely unfair or unreasonably exclusive ; or

(d) are abuses, i.e. , dishonest, fraudulent, illegal, or

unethical. See § 287.001, Fla. Stat. ; and Harry Pepper &

Assoc., Inc. v. City of Cape Coral , 352 So. 2d 1190, 1192 (F la.

2d DCA 1977) .

53. Finally, section 120.57(3)(f) requires an agency

action be set aside if it is Ð arbitrary, or capricious. Ñ An

Ð arbitrary Ñ decision is one that is Ð not supported by facts or

logic, or is despotic. Ñ Agrico Chemical Co. v. Dep Ó t of E nvtl.

Reg. , 365 So. 2d 759, 763 (Fla. 1st DCA 1978), cert. denied , 376

So. 2d 74 (Fla. 1979). A Ð capricious Ñ action is one which is

Ð taken without thought or reason or irrationally. Ñ Id.

54. To determine whether an agency acted in an Ð arbitrary,

or ca pricious Ñ manner involves consideration of Ð whether the

agency: (1) has considered all relevant factors; (2) given

actual, good faith consideration to the factors; and (3) has

used reason rather than whim to progress from consideration of

these factors to its final decision. Ñ Adam Smith Enter. v.

Dep Ó t of Envtl. Reg. , 553 So. 2d 1260, 1273 (Fla. 1st DCA 1989).

The standard has also been formulated by the court in Dravo

Basic Materials Co. v. Department of Transportation , 602 So. 2d

632, 632 n.3 (Fla. 2d DCA 1992), as follows: Ð If an

administrative decision is justifiable under any analysis that a

reasonable person would use to reach a decision of similar

importance, it would seem that the decision is neither arbitrary

nor capricious. Ñ

55. Turning to the protest at hand, t he central question

is whether Florida Housing was legally aut horized to waive the

missing Ð - Ñ sign in the Woodland Grove application as a ÐMinor

Irregularity.Ñ If Florida Housing Ó s scoring of Woodland Grove Ó s

application did not follow its governing statutes, rules,

policies, or the solicitation specifications ( i.e. , by making a

determination that is clearly erroneous, contrary to competition,

or arbitrary, or capricious), then its decision to select

Woodland Grove for funding must be s et aside.

56. Section 420.5087(1) instructs Florida Housing to make

SAIL funds available through a competitive solicitation process

in a manner that meets the need and demand for very - low - income

housing throughout the state. Pursuant to its rulemaking

au thority under section 420.507(12), Florida Housing adopted

chapter 67 - 60 to administer the competitive solicitation process.

See Fla. Admin. Code R. 67 - 60.001(1).

57. The governing rules authorize Florida Housing to waive

ÐMinor IrregularitiesÑ in an ap plication submitted in a

competitive solicitation for funding. As provided in rule 67 -

60.008:

[Florida Housing] may waive Minor

Irregularities in an otherwise valid

Application. Mistakes clearly evident to

[Florida Housing] on the face of the

Application , such as computation and

typographical errors, may be corrected by

[Florida Housing]; however, [Florida

Housing] shall have no duty or obligation to

correct any such mistakes.

58. ÐMinor IrregularityÑ is defined in rule 67 - 60.002(6)

as:

[A] variation in a term or condition of an

Application pursuant to this rule chapter

that does not provide a competitive advantage

or benefit not enjoyed by other Applicants,

and does not adversely impact the interests

of [Florida Housing] or the public.

59. According t o these rules, Ms. Green was authorized to

treat the longitude coordinates in Woodland Grove Ó s application

as ÐMinor IrregularitiesÑ if they constituted ÐvariationsÑ that,

1) did not provide a competitive advantage over other applicants,

and 2) did not adv ersely impact the interests of Florida Housing

or the public. At that point, if Ms. Green did conclude that the

inaccurate coordinates were ÐMinor Irregularities,Ñ she was

permitted to both waive, and correct, the longitude points if she

determined that t hey were Ðmistakes clearly evident . . . on the

face of the Application, such as . . . typographical errors.Ñ 9/

60. Based on the evidence of record, Liberty Square did not

prove that Ms. Green improperly considered the errant longitude

coordinates in Woo dland Grove Ó s application as ÐMinor

Irregularities.Ñ Initially, Liberty Square did not show that

Ms. Green Ó s award of proximity points to Woodland Grove gave it a

competitive advantage over other applicants. By synchronizing

the longitude coordinates wi th the Miami Dade County addresses in

its application, Ms. Green did not provide Woodland Grove the

opportunity to modify its proposed housing site or recalculate

location of nearby Transit or Community Services. Further,

Woodland Grove did not receive an y scoring advantage or benefit

by omitting the Ð - Ñ sign in its application or ÐmisrepresentingÑ

that its proposed development was located in India. Ms. Green

scored Woodland Grove Ó s application using the exact same

methodology and standards as all other a pplications for

development sites with addresses in Florida. Finally, Ms. Green

was consistent in that she treated three other applications that

failed to include a negative sign before a longitude coordinate

just the same as Woodland Grove Ó s application.

61. Further, no evidence indicates that Ms. Green Ó s

decision to award Woodland Grove proximity points adversely

impacted the interests of Florida Housing or the public. Adding

a Ð - Ñ sign before the Development Location Point did not change

the actual location of Woodland Grove Ó s proposed development

(based on the street address) or modify any material

representations in its application. Neither did it interfere

with the goals or purposes of RFA 2017 - 108.

62. Because the evidence establishes that Ms. Green was

justified in considering Woodland Grove Ó s inaccurate longitude

coordinates as ÐMinor Irregularities,Ñ the next question becomes

whether she was authorized to waiv e, then correct, the missing

Ð - Ñ signs. Rule 67 - 60.008 instructs that Florida Hous ing may

correct mistakes that are Ðclearly evident . . . on the face of

the Application, such as . . . typographical errors.Ñ

63. The undersigned finds that Woodland Grove Ó s application

ÐclearlyÑ indicates, on its face, that it applied for funding for

a housing development located in Miami - Dade County, despite the

fact that the longitude coordinates in section 5.d and 5.e placed

the site in India. Florida Housing (and Woodland Grove) present

the more persuasive arg ument that the omission of a Ð - Ñ sign

b efore the longitude was an inadvertent error. Thereafter,

Ms. Green reasonably used her experience and the abundance of

information contained in Woodland Grove Ó s application to

ÐcorrectÑ the longitude coordinates and plot the develop ment in

Miami - Dade Co unty.

64. Liberty Square asserts that Ms. Green could not

accurately determine Woodland Grove Ó s Development Location Point

because an errant longitude coordinate cannot be verified by

simply using a street address. RFA 2017 - 108 required both

addresses a nd coordinates for a distinct purpose. Therefore,

Woodland Grove Ó s failure to designate its longitude coordinates

in the western hemisphere was a material deviation that could not

be corrected.

65. Liberty Square also presses the point that, with a

Dev elopment Location Point in India, Woodland Grove Ó s application

should have garnered zero proximity points. Therefore, had

Ms. Green not corrected the error, Woodland Grove would have been

ineligible for any funding under RFA 2017 - 108. Consequently,

waiv ing the missing negative sign is contrary to competition

because it made an otherwise ineligible application become

eligible.

66. However, Florida Housing credibly testified that

Ms. Green was able to accurately determine, then plot, the

Woodland Grove d evelopment location based on the information

contained within the four corners of an application. Further, as

discussed above, Woodland Grove did not enjoy a competitive

advantage, either material, substantial, or otherwise, over

other applicants because of Ms. Green Ó s decision to ÐcorrectÑ

the development Ó s longitude coordinate to reflect the Miami - Dade

County address. See Trop abest Foods, Inc. v. State, Dep Ó t of

Gen. Servs. , 493 So. 2d 50, 52 (Fla. 1st DCA 1986)(Ðalthough a

bid containing a material var iance is unacceptable, not every

deviation from the invitation to bid is material. It is only

material if it gives the bidder a substantial advantage over the

other bidders and thereby restricts or stifles competition.Ñ);

and Harry Pepper , 352 So. 2d at 1 193 (ÐThe test for measuring

whether a deviation in a bid is sufficiently material to destroy

its competitive character is whether the variation affects the

amount of the bid by giving the bidder an advantage or benefit

not enjoyed by the other bidders.Ñ) .

67. In sum, the evidence in the record demonstrates that

Ms. Green Ó s consideration of the longitude coordinates in

Woodland Grove Ó s application as ÐMinor IrregularitiesÑ fell

within a permissible interpretation and application of rule s 67 -

60.002(6) and 6 7 - 60.008. No evidence indicates that Ms. Green

co rrected the missing Ð - Ñ signs because she colluded with or

favored Woodland Grove, or that she acted in a dishonest,

fraudulent, illegal, or unethical manner. Neither did her

decision cause the procurement to be Ðgenuinely unfair or

unreasonably exclusive.Ñ On the contrary, Ms. Green scored all

applications on identical terms and afforded an equal

opportunity for all applicants to earn proximately points. As

such, Florida Housing Ó s selection of Woodland G rove for funding

was not Ðcontrary to competition.Ñ Finally, Liberty Square did

not establish that Ms. Green Ó s decision was Ðarbitrary or

capricious.Ñ Ms. Greene rationally and reasonably used her

experience, as well as the numerous references in Woodlan d

Grove Ó s application, to plot the proposed development in Miami -

Dade County as opposed to India.

68. Accordingly, the undersigned c oncludes that, for want

of a Ð - Ñ sign, Woodland Grove Ó s application is not lost. Liberty

Square did not meet its burden of proving, by a preponderance of

the evidence, that Ms. Green Ó s decision to waiv e, then correct,

the missing Ð - Ñ signs in Woodland Grove Ó s application as ÐMinor

IrregularitiesÑ was Ðclearly erroneous, contrary to competition,

or arbitrary, or capricious.Ñ Therefore, Liberty Square failed

to establish that Florida Housing Ó s selection of Woodland Grove

for funding is contrary to its governing statutes, rules, or

policies, or RFA 2107 - 108 Ó s terms or provisions. Florida

Housing Ó s award of funding to Woodland G rove should not be set

aside.

RECOMMENDATION S

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that Florida Housing Finance Corporation

enter a final order dismissing the protest by Liberty Square. It

is further recommende d that Florida Housing Finance Corporation

rescind the intended awards to Sierra Bay, SP Lake, and Harbour

Springs, and instead designate Northside II, Osprey Pointe, and

Pembroke Tower Apartments as the recipients of funding under

RFA 2017 - 108. 10/

DONE A ND ENTERED this 19th day of April , 2018 , in

Tallahassee, Leon County, Florida.

S

J. BRUCE CULPEPPER

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Flor ida 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 19th day of April , 2018 .

ENDNOTE S

1/ Unless otherwise stated, all citations to the Florida

Statutes and Florida Administrative Code are to the 2017

versions .

2 / No protests were made to the specifications or terms of

RFA 2017 - 108.

3 / Initially, all protests were consolidated at DOAH. Prior to

the final hearing, Florida Housing resolved protests involvi ng

Oasis at Renaissance Preserve I, LP (DOAH Case No. 18 - 0476BID);

SP West LLC and Southport Development, Inc., d/b/a Southport

Development Service, Inc. (DOAH Case No. 18 - 0483BID); as well as

HTP Anderson Terrace, LLC, and The Village Miami Phase II, LTD.

4 / Prior to the final hearing, all parties agreed that, except

for the specific issues identified and discussed below, there

were no disputed issues of material fact requiring resolution at

an evidentiary hearing. Towards this en d, the parties submitte d

a Pre - h earing Stipulation agreeing to a number of facts regarding

Florida Housing Ó s review and scoring of RFA 2017 - 108. Unless

other wise set forth in the Findings o f Fact section, the

undersigned adopts t he stipulated facts in the Pre - h earing

Stipulati on into this Recommended Order.

5 / By requesting a deadline for filing post - hearing submissions

beyond ten days after the final hearing, the 30 - day time period

for filing the Recommended Order was waived. See Fla. Admin.

Code R. 28 - 106.216.

6 / RFA 201 7 - 108 was modified on September 13, 2017 ;

September 15, 2017 ; and October 3, 2017. The October 3, 2017,

modification extended the application due date to October 12,

2017.

7 / See Rule 67.48.002(33) , which defines ÐDevelopment Location

PointÑ to mean:

[A] single point selected by the Applicant on

the proposed Development site that is located

within 100 feet of a residential building

existing or to be constructed as part of the

proposed Development.

8/ Liberty Square Ó s longitude coordinates in s ecti on 5 of its

application were all preceded by a negative sign.

9/ Liberty Square does not dispute that Woodland Grove Ó s

application was Ðotherwise validÑ aside from the longitude

coordinates.

10/ In the Pre - h earing Stipulation, all parties agreed to a

s pecific ranking and scoring scenario if SP Lake is not selected

for funding in the ÐFamilyÑ demographic, and both Sierra Bay and

Harbour Springs are ineligible for funding under RFA 2017 - 108.

In light of this agreement, the undersigned recommends Florida

Housing select the following proposed developments for funding:

a. Two Elderly, Lar ge County, New Construction

Applications:

1) Brisas del Rio Apartments, Application #2018 - 030BS

2) Northside Transit Village II, Application #2018 -

047BS

b. Three Fam ily, Large County, New Construction

Applications:

1) The Waves, Application #2018 - 039S

2) Palmetto Pointe, Application #2018 - 024S

3) Woodland Grove, Application #2018 - 044BS

c. One Elderly, Medium County, New Construction

Application:

1) Providenc e Reserve Seniors, Application #2018 - 032BS

d. Two Family, Medium County, New Construction

Applications:

1) Parrish Oaks, Application #2018 - 041BS

2) Hibiscus Apartments, Application #2018 - 035BS

e. Small County Application:

1) Springhill Apartments (currently known as Madison

Heights Apartments), Application #2018 - 026S

f. Medium County Applications:

1) Osprey Pointe, Application #2018 - 050BS

2) Lofts on Lemon, Application #2018 - 029BS

3) Choctaw Village, Application #2018 - 019BS

4) Venetian W alk II, Application #2018 - 017S

g. Large County Applications:

1) Pembroke Tower Apartments, Application #2018 - 040BS

2) Water Ó s Edge Apartments, Application #2018 - 025BS

3) Citadelle Village, Application #2018 - 033BS

COPIES FURNISHED:

Hugh R. Brow n, General Counsel

Florida Housing Finance Corporation

Suite 5000

227 North Bronough Street

Tallahassee, Florida 32301 - 1329

(eServed)

Betty Zachem, Esquire

Florida Housing Finance Corporation

Suite 5000

227 North Bronough Street

Tallahassee, Florida 323 01

(eServed)

Maureen McCarthy Daughton, Esquire

Maureen McCarthy Daughton, LLC

Suite 304

1725 Capital Circle Northeast

Tallahassee, Florida 32308

(eServed)

Lawrence E. Sellers, Jr., Esquire

Holland and Knight, LLP

Suite 600

315 South Calhoun Street

Tall ahassee, Florida 32301

(eServed)

Alvin D. Lodish, Esquire

Duane Morris LLP

200 South Biscayne Boulevard

Miami, Florida 33131

(eServed)

Kirsten H. Matthis, Esquire

Meenan P.A.

Suite 410

300 South Duval Street

Tallahassee, Florida 32301

Tiffany A. Rodd enberry, Esquire

Holland & Knight, LLP

Suite 600

315 South Calhoun Street

Tallahassee, Florida 32301

(eServed)

Donna Elizabeth Blanton, Esquire

Radey Law Firm, P.A.

Suite 200

301 South Bronough Street

Tallahassee, Florida 32301

(eServed)

Michael P. Dona ldson, Esquire

Carlton Fields Jorden Burt, P.A.

215 South Monroe Street, Suite 500

Post Office Drawer 190

Tallahassee, Florida 32302 - 0190

(eServed)

Thomas Porter Crapps, Esquire

Meenan, P.A.

Suite 410

300 South Duval Street

Tallahassee, Florida 32301

(e Served)

Michael J. Glazer, Esquire

Ausley and McMullen

123 South Calhoun Street

Post Office Box 391

Tallahassee, Florida 32302

(eServed)

Tim G. Schoenwalder, Esquire

Meenan, P.A.

Suite 410

300 South Duval Street

Tallahassee, Florida 32301

(eServed)

A nthony L. Bajoczky, Jr., Esquire

Ausley & McMullen

Post Office Box 391

Tallahassee, Florida 32302

(eServed)

Corporation Clerk

Florida Housing Finance Corporation

Suite 5000

227 North Bronough Street

Tallahassee, Florida 32301 - 1329

(eServed)

NOTICE OF R IGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

1 0 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 cas e.