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14 th Annual Florida Government Purchasing Conference September 14, 2006 . Karen D. Walker, Partner Holland & Knight LLP 315 S. Calhoun St., Suite 600 Tallahassee, Florida 32312 (850) 425-5612 email@example.com. A DIFFERENT POINT OF VIEW: Bid Protests from the Vendor’s Perspective.
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September 14, 2006
Karen D. Walker, Partner
Holland & Knight LLP
315 S. Calhoun St., Suite 600
Tallahassee, Florida 32312
Whether the proposed agency action is clearly erroneous, contrary to competition, arbitrary or capricious.
Advocacy Ctr. for Persons With Disabilities, Inc. v. Dep't of Children & Family Servs., 721 So. 2d 753 (Fla. 1st DCA 1998).
Hadi v. Liberty Behavioral Health Corporation, 927 So. 2d 34 (Fla. 1st DCA 2006).
Challenge to specifications in a RFP by the incumbent operator of a sexually violent predator facility.
Challenged specifications required potential vendors to realize a substantial portion of their annual revenues from managing American Correctional Association ("ACA") accredited private correctional facilities, and that the sexually violent predator facility be designed to meet the ACA prison standards for security.
DCF conducted an informal administrative hearing and upheld the specifications as drafted. The First DCA affirmed finding that DCF's decision to include the challenged RFP specifications was rational and supported by logic and reason even if the specifications may preclude the protesting vendor from bidding.
Miami-Dade County School Board v. School Food Service Systems, Inc., DOAH Case No. 05-4571BID, 2006 WL 352220 (Fla. Div. Admin. Hrgs. Feb. 13, 2006).
Challenge to specifications in ITB for dry cereal.
Challenged specifications: (1) requiring a manufacturer to offer at least eight varieties of cereal that meet Nutritional Standards, and (2) specifying certain approved brands.
ALJ found that there was a rational basis for the Board selecting a specified number of flavors that met Nutritional Standards.
ALJ concluded that the ITB was not intended to mean that the approved brands specifically identified in the specifications were the only responsive brands. However, the ALJ noted that if the specifications did require certain brand name cereals to be responsive, the specifications might violate federal procurement standards as restrictive of competition.
Bay Point Schools, Inc. v. Department of Juvenile Justice, DOAH Case No. 05-1540BID, 2005 WL 2477499 (Fla. Div. Admin. Hrgs. Oct. 4, 2005).
Challenge to RFP for an 88-slot conditional release program.
Protest alleged that provisions in RFP vested unbridled discretion in the agency allowing it to apply hidden conditions and arbitrarily award the contract.
ALJ found that RFP did not comply with legislative directives requiring success criterion based on recidivism. For the same reason, the ALJ found that the RFP was contrary to competition.
ALJ found that the RFP was clearly erroneous, contrary to competition, arbitrary, and capricious by delegating the scoring of the financial responsibility section of the RFP to Dun & Bradstreet pursuant to an undisclosed formula and undisclosed weighting of factors.
Standard of review is higher than in other protests. The protesting vendor must show that the agency's intended decision to reject all bids is illegal, arbitrary, dishonest or fraudulent. § 120.57(3)(f), Fla. Stat. (2005); Department of Transportation v. Groves-Watkins Constructors, 530 So. 2d 912 (Fla. 1988).
Case law recognizes that agencies are afforded wide discretion to reject all bids. See Gulf Real Properties, Inc. v. Department of Health and Rehabilitative Services, 687 So. 2d 1336 (Fla.1st DCA 1997) (rejection of all bids must stand unless protestor shows that the purpose or effect of the rejection of all bids is to defeat the object and integrity of competitive bidding).
HB 1369 – In a procurement involving the rejection of all bids, proposals or replies in which the agency concurrently notices its intent to reprocure (and in the case of an ITN reissues an ITN within 90 days), the rejected bids, proposals or replies remain exempt from the Public Records Act until: (1) the agency provides notice of a decision or intended decision concerning the reissued solicitation, or (2) the agency withdraws the reissued solicitation.
For this exemption to apply with respect to ITBs or RFPs, it appears that the rejection of all bids must occur prior to 10 days after bid or proposal opening when the bids or proposals will otherwise become public record.
Whether the proposed agency action is clearly erroneous, contrary to competition, arbitrary or capricious. §120.57(3)(f), Fla. Stat. (2005).
Legislative Update: HB 755 – Different standard of proof for protests to Department of the Lottery procurements. Standard for all competitive procurement protests involving the Department of the Lottery is now whether the intended agency action is "illegal, arbitrary, dishonest, or fraudulent."
To succeed in a protest of an intended award, the protesting bidder must show that the procuring agency's proposed action is contrary to:
§ 120.57(3)(f), Fla. Stat. (2005).
A responsive bid, proposal or reply is "a bid, or proposal, or reply submitted by a responsive and responsible vendor that conforms in all material respects to the solicitation." § 287.012(25), Fla. Stat. (2005).
In evaluating possible protest grounds based on responsiveness, a vendor will look to see if there were material deviations in the winning vendor's response to the solicitation.
Agencies can waive minor irregularities, but cannot waive material deviations. A minor irregularity is an irregularity which does not:
Intercontinental Properties, Inc. v. Department of Health and Rehabilitative Services, 606 So. 2d 380 (Fla. 3d DCA 1992).
A responsible vendor is "a vendor who has the capability in all respects to fully perform the contract requirements and the integrity and reliability that will assure good faith performance." § 287.012(24), Fla. Stat. (2005).
Things that may render a vendor not responsible:
Vendors typically know that it is very difficult to prevail at a bid protest hearing when the protest is essentially a request that the proposals/replies be re-scored. SeeSouth Fla. Limousines, Inc. v. Broward County Aviation Dep't, 512 So. 2d 1059, 1062 (Fla. 4th DCA 1987) (a judge will not substitute his or her judgment for that of a public agency when it exercises its discretion in a procurement in good faith).
Examples of scoring issues raised in protests:
Several recent DOAH decisions suggest that actual bias or favoritism need not be shown, but that proof of an appearance of impropriety may be sufficient to overturn an intended contract award.
Compass Environmental, Inc. v. Department of Environmental Protection, DOAH Case No. 05-0007BID, 2005 WL 678870 (Fla. Div. Admin. Hrgs. March 21, 2005) (Recommended Order found that there was an appearance of impropriety where an evaluator had a professional relationship with a proposed subcontractor) (recommendation not adopted by agency in Final Order).
Transportation Management Services of Broward, Inc. v. Commission for the Transportation Disadvantaged, Case No. 05-0920BID, 2005 WL 1210021 (Fla. Div. Admin. Hrgs. May 20, 2005) (appearance of impropriety where evaluator had on-going business, personal and professional relationship with the principal of a proposed subcontractor).
Legislative Update: SB 2518: All solicitations under Chapter 287 must now include the following provision: "Respondents to this solicitation or persons acting on their behalf may not contact, between the release of the solicitation and the end of the 72-hour period following the agency posting the notice of intended award, excluding Saturdays, Sundays and state holidays, any employee or officer of the executive or legislative branch concerning any aspect of this solicitation, except in writing to the procurement officer or as provided in the solicitation documents. Violation of this provision may be grounds for rejecting a response."
Open questions as to whether DOAH has jurisdiction to address Sunshine Law issues. Clearly, action for violation of the Sunshine Law can be brought in circuit court.
If the protesting vendor is successful in a Sunshine Law claim, the result is that the procuring agency's action taken out of the sunshine is void.
HB 1369: A meeting at which a negotiation with a vendor is conducted in an ITN is exempt from the Sunshine Law. A complete recording must be made of the meeting. The recording remains exempt from the Public Records Act until the agency posts a notice of decision or intended decision or 20 days after the final competitive sealed replies are opened.
If the protesting vendor has endured the cost of discovery, the protesting vendor likely will not spare any expense at the administrative hearing.
Because the protesting vendor has the burden of proof, the protesting vendor will frame the issues and evidence for hearing.
Winning vendor will be reacting to case presented by protesting vendor.
Stipulated exhibits are helpful to the winning vendor.
Winning vendor will want its case to be consistent with that presented by the procuring agency.