94-004890BID Preferred Services, Inc. vs. Department Of Health And Rehabilitative Services Status: Closed Recommended Order on Thursday, December 29, 1994.

Summary: Where reasonable minds can disagree and there is no proof of fraud, illegality; no basis to reverse agency discretion in rejecting a bid.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

PREFERRED SERVICES, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 94-4890BID

)

DEPARTMENT OF HEALTH AND )

REHABILITATIVE SERVICES, )

)

Respondent. )

and )

)

WEKIVA CENTER PARTNERSHIP, )

)

Intervenor. )

_________________________________)

RECOMMENDED ORDER

A prehearing conference in the above styled case was heard based upon the

joint request and agreement of the parties before the Division of Administrative

Hearing Officer, Daniel. Kilbride, on December 16, 1994, by video-conference

from Tallahassee and Orlando, Florida. The following appearances were entered:

APPEARANCES

For Petitioner: Terrence W. Ackert, Esquire

Law Offices of Terrence Wm.

Ackert Professional Association

23 South Osceola Avenue

Orlando, Florida 32801

400 West Robinson Street

Orlando, Florida 32801

For Respondent: James A. Sawyer, Esquire

Eric D. Dunlap, Esquire

District 7 Assistant District Legal

Counsel

Department of Health and

Rehabilitative Services

400 West Robinson Street, Suite S827

Orlando, Florida 32801

For Intervenor: Ladd Fassett, Esquire

Warlick, Fassett, Divine & Anthony

Professional Association

Post Office Box 3387

Orlando, Florida 32802-3387

STATEMENT OF THE ISSUES

Whether the Department of Health and Rehabilitative Services' rejection of

the Petitioner's bid, based on the facts and figures available on August 12,

1994, was a proper exercise of the Agency's discretion and was not arbitrary,

fraudulent, illegal, or dishonest as to HRS lease No. 590:2500.

PRELIMINARY STATEMENT

This matter arose when Petitioner filed an initial formal notice of

protest, pursuant to Section 120.53, Florida Statutes (1993), and Chapter 10-13,

Florida Administrative Code, challenging the rejection of Petitioner's bid as

non-responsive. Petitioner filed a timely Notice of Intent to Protest and a

timely Formal Protest. Prior to the hearing originally scheduled for September

20, 1994, the Petitioner and the Respondent agreed to an abeyance so that the

Respondent could evaluate and rank the Petitioner's bid, while at the same time

preserving its initial position that the Petitioner's bid was non-responsive.

Subsequently, the Intervenor was announced as the winning bidder. The

Petitioner timely filed an Amended Protest of the award of the bid to the

Intervenor, alleging additional and further grounds as set forth therein. For

the purposes of the prehearing conference, the parties filed a joint prehearing

stipulation as follows:

STIPULATION for the purposes of the Dec. 16, 1994 video hearing

1. Preferred Services submitted a bid to the Agency reflecting 14, 463 as

the net square feet proposed.

2. 14,463 is the absolute minimum net square footage that could be

submitted to meet the bid specifications.

3. Preferred Services provided no calculations reflecting how they reached

this 14,463 figure submitted in their initial bid submittal. HRS occupied the

building since 1986.

4. Following the bid opening but prior to the rejection of the Preferred

Services bid, Preferred was asked to provide calculations which would reasonably

provide assurances to the Agency that Preferred in fact had the minimum net

square footage available.

5. One day prior to rejection of the Preferred Services bid, Preferred

faxed the attached calculation to the Agency.

6. The bid specifications regarding restrooms are set forth on page 25 and

page 81 (Attachment N) of the bid submittal.

7. Based on these representations from Preferred, the Agency rejected the

Preferred Services bid on August 12, 1994, as non-responsive based on the

Agency's interpretation concluding that the bid submitted failed to meet the

minimum square footage requirements and the proper number of bathrooms as set

forth in the bid specifications. The Agency's evaluation concluded that the

Preferred Services bid only proposed two sets of restrooms at 355.823 sq. ft.

and that deducting another two sets of restrooms at the same size in order to

comply with the bid specifications would cause the Preferred Services bid to

fall below the minimum sq. ft. requirements as set forth in the bid submittal.

8. In preparation for the Dec. 20, 1994, hearing, Preferred Services

provided the Agency with an architectural drawing on Dec. 15, 1994, which shows

that the required restrooms can be located within the Preferred Services Bldg.

and there are sufficient minimum sq. ft. available per the bid specifications.

9. The Agency disputes the calculations contained in paragraph 8, and

further contends that the calculation submitted by Preferred Services on Dec.

15, 1994, constitutes an improper modification of the bid.

10. Although not in its bid or argued prior to rejection of its bid,

Preferred now asserts that restrooms can be either in or out of the building.

Issue

11. Whether the Agency's rejection of the Preferred Services bid based on

the facts and figures available on August 12, 1994, was a proper exercise of the

Agency's discretion and was not arbitrary, etc.

Also filed with the stipulation was an attachment which consisted of a

single hand written page which was the document submitted by the Petitioner to

the Respondent prior to the rejection of his bid but not included with his

original submittal referenced in paragraph 5 of the stipulation noted above.

The handwritten note read as follows:

HRS 590-2500 No 5

Bld Size 117'10" x 130'8"

Gross Space 115 x 10" x 12810"

115.833 x 128.833 = 14,923.113

deduct 2-sets

Bath Rooms - 355.873

Net Rentable 14,567.240

Jim we have calculated our space based on your

standard measurements

The parties also filed a ninety-two (92) page joint exhibit consisting of

the entire Invitation to Bid (ITB) and the Bid Submittal submitted by the

Petitioner. The joint exhibit did not include a 1986 blueprint of the

Petitioner's building which the parties agreed is not necessary for

determination of the instant issue. Both the stipulation and attachment and the

ITB and Bid Submittal form a part of the record in these proceedings.

Alan Taylor, another bidder for Lease Number 590:2500, did not file a

petition to intervene as required by the prehearing orders, and was not made a

party to the proceeding.

A request for attorney's fees and costs was filed by Intervenor on December

13, 1994. Fees and costs are not recommended here as there is no evidence of

the "improper purpose" described in Section 120.59(6), F.S.

FINDINGS OF FACT

1. The Respondent Department issued an Invitation to Bid (ITB) for Lease

Number 590:2500 for office space in an existing building in a geographic area

near Apopka, Florida for a ten (10) year lease with options.

2. The ITB called for net square footage of 14,910 3 percent, measured

in accordance with the Standard Method of Space Measurement.

3. The ITB and Bid Submittal, including at page 16, Paragraph 10(c) of the

Bid Submittal Form lists the documentation that is to be provided to the

Respondent at the time of the bid submittal. Included in this list is a

requirement that a bidder provide the calculation of the proposed net rentable

square feet. Paragraph 10(c) indicates that the square footage calculations are

to be based on measurements from the floor plan.

4. Sealed bids were received until 10:00 a.m. on August 5, 1994.

5. Petitioner submitted a completed Bid Submittal form in a timely manner.

6. Petitioner's Bidder Response reflected 14,463 as the net square feet

proposed. Respondent Department has occupied the building being offered since

1986.

7. 14,463 is the absolute minimum net square/footage that could be

submitted to meet the bid specifications.

8. Petitioner provided no calculations indicating how the net square

footage proposed in their bid submittal was calculated, other than page 85 which

contained the exterior dimensions of the building bid.

9. The Respondent was entitled to know how the Petitioner calculated the

net square feet proposed to determine whether the Petitioner's bid was

responsive.

10. Following the bid opening but prior to the rejection of the

Petitioner's bid, Petitioner was asked to provide calculations which would

provide reasonable assurances to the Department that Petitioner in fact had the

minimum net square footage available.

11. The Respondent had no obligation to go back to the Petitioner and ask

for such calculations.

12. One day prior to the rejection of the Petitioner's bid, Petitioner

faxed a handwritten note to the Department which read as follows:

HRS 590-2500 No 5

Bld Size 117'10" x 130'8"

Gross Space 115 x 10" x 12810"

115.833 x 128.833 = 14,923.113

deduct 2-sets

Bath Rooms - 355.873

Net Rentable 14,567.240

Jim we have calculated our space based on your

standard measurements

13. The bid specifications called for a minimum of 2 sets of restrooms for

public and 2 sets of restrooms for staff use, for a total of 4 separate sets of

restrooms, each set to provide for male and female and meet other requirements.

14. Based on these representations from Petitioner, the Department

rejected its bid on August 12, 1994, as non-responsive. This decision was based

on the Department's interpretation which concluded that the bid submitted failed

to meet the minimum square footage requirements and to provide for the proper

number of bathrooms as set forth in the bid specifications.

15. The Department's evaluation concluded that the Petitioner's bid only

proposed two sets of restrooms at 355.823 square feet. Deducting another two

sets of restrooms at the same size in order to comply with the bid

specifications would cause the Petitioner's bid to fall below the minimum square

foot requirements as set forth in the bid submittal.

16. Petitioner asserts that the required restrooms can be located within

the Petitioner's building, and that there are sufficient minimum square feet

available per the bid specifications. In the alternative, Petitioner would show

that, under the bid specifications, restrooms could be located either in or out

of the building.

17. The Department's decision to seek clarification prior to rejecting the

Petitioner's bid was reasonable.

18. The Department having done so, the subsequent submittal by Petitioner

of calculations in response to the request for clarification was considered as

an addendum to the original bid.

CONCLUSIONS OF LAW

19. The Division of Administrative Hearings has jurisdiction over the

subject matter of this proceeding, and the parties thereto, pursuant to Sections

120.53(5) and 120.57(1), Florida Statutes.

20. The burden of proof and going forward with the evidence is upon the

Petitioner to establish that the Respondent's decision to reject its bid as

unresponsive was arbitrary, capricious, illegal, or violative of established

procedures. Department of Transportation v. Grove-Watkins Constructors, 530 So.

2d 912 (Fla. 1988); J.W.C. Co., Inc. v. Department of Transportation, 396 So.2d

778 (Fla. 1st DCA 1981). The Petitioner did not satisfy this burden.

21. Reasonable people can disagree as to the documentation provided, in

regard to the bid submittal and the attachment to the stipulation. The

handwritten not submitted after the bid opening either reflects, or not, a

deduction of only two sets of restrooms (as opposed to 4 sets of restrooms) from

the gross square feet. The bid specifications clearly called for four (4) set

of restrooms and clearly defined the minimum square footage that could be

proposed. The documentation provided by the Petitioner only indicates that two

sets of restrooms have been deducted from the calculations.

22. It was reasonable for the Respondent to conclude that the Petitioner's

bid was unresponsive by failing to provide the minimum number of restroom sets,

or that by deducting another two sets of restrooms, the bid was unresponsive as

not meeting the minimum square footage requirements.

23. There is no proof that the Respondent's interpretation was fraudulent,

illegal, arbitrary, or capricious regardless of whether the placement of the

restrooms could be constructed inside or outside the walls of the proposed

space.

24. Reasonable minds could disagree as to the interpretation to be given

the documentation provided by the Petitioner, but the Respondent's

interpretation was not arbitrary or capricious. Therefore, the Respondent's

determination that the Petitioner's bid was non-responsive was not illegal,

arbitrary, fraudulent, or dishonest.

25. This ruling is dispositive of the other issues in this case since the

Respondent cannot award a bid to an unresponsive bidder. Sections 255.249,

Florida Statutes and Chapter 10-13, Florida Administrative Code.

26. The other issues raised by Petitioner in the Formal Protest and

Amended Protest are therefore moot, and not addressed herein.

RECOMMENDATION

Based on the foregoing findings of fact and conclusions of law, it is

RECOMMENDED that the Secretary of the Department of Health and

Rehabilitative Services enter a Final Order dismissing the Petitioner's protest

and proceed with the award of bid for HRS Lease No. 590:2500.

DONE AND ENTERED this 29th day of December, 1994, in Tallahassee, Leon

County, Florida.

___________________________________

DANIEL M. KILBRIDE

Hearing Officer

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

[phone]

Filed with the Clerk of the

Division of Administrative Hearings

this 29th day of December, 1994.

COPIES FURNISHED:

Terrence William Ackert, Esquire

P. O. Box 2548

Winter Park, Florida 32790

Ronald M. Schirtzer, Esquire

Foley & Lardner

111 North Orange Avenue

Suite 1800

Orlando, Florida 32801

James A. Sawyer, Jr., Esquire

District 7 Legal Counsel

Hurston Tower, Suite S-827

400 W. Robinson Street

Orlando, Florida 32801-1782

Ladd H. Fassett, Esquire

Warlick, Fassett, Divine

& Anthony, P.A.

Post Office Box 3387

Orlando, Florida 32802-3387

Robert L. Powell

Agency Clerk

Department of Health and

Rehabilitative Services

1323 Winewood Boulevard

Tallahassee, Florida 32399-0700

Kim Tucker, Esquire

Department of Health and

Rehabilitative Services

1323 Winewood Boulevard

Tallahassee, Florida 32399-0700

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to the Recommended

Order. All agencies allow each party at least 10 days in which to submit

written exceptions. Some agencies allow a larger period within which to submit

written exceptions. You should consult with the agency that will issue the

final order in this case concerning their rules on the deadline for filing

exceptions to this Recommended Order. Any exceptions to this Recommended Order

should be filed with the agency that will issue the final order in this case.

=================================================================

DISTRICT COURT OPINION

=================================================================

IN THE DISTRICT COURT OF APPEAL OF THE STATE Of FLORIDA

FIFTH DISTRICT JULY TERM 1995

PREFERRED SERVICES, INC., NOT FINAL UNTIL THE TIME

etc., TO FILE REHEARING MOTIONS AND

IF FILED, DISPOSED OF.

Appellant,

Case No. 95-461

v. DOAH Case No. 94-4890BID

DEPARTMENT 0F HEALTH AND

REHABILITATIVE SERVICES,

Appellee.

____________________________/

Decision filed December 5, 1995

Administrative Appeal from the Department of Health and Rehabilitative Services.

Terrence William Ackert of Law Offices of Terrence William Ackert, P.A., Winter

Park, for Appellant.

Eric D. Dunlap, Assistant District Legal Counsel, Department of Health and

Rehabilitative Services, Orlando, for Appellee.

PER CURIAM.

AFFIRMED.

GOSHORN, HARRIS and GRIFFIN JJ., concur.