In Florida, competitive bidding is statutorily mandated so as to ensure the best interests of the public. The Administrative Procedure Act (APA) of 1961, codified as Florida Statutes Ch. 120 is the state’s main mechanism to ensure visibility and accountability in the public procurement process. The related statutes are designed to ensure fair pricing on the part of contractors and to prevent collusion, favoritism, and fraud from playing a role in the outcome of procurement decisions. The four main statutes that govern competitive bidding are Florida Statutes § 112.08, Ch. 255, Ch. 287, and as mentioned Ch. 120.
Importantly, Chapter 255 provides the procurement process for public construction works covering both solicited and unsolicited bids. It is important to note that this statute regulates Florida state procurement requirements. Municipalities in the state are not automatically bound by this statute or any part of the APA. However, they have adopted many relevant parts of these statutes under their own ordinances and codes. When addressing legal matters related to county or municipal bids it is essential that you hire a local construction lawyer who has the experience to advise on county and municipal level bidding ordinances and codes.
Types of Invitations and Requests
Florida statute sets out three main competitive solicitation processes, each with its own statutorily designated criteria:
1) invitation to bid (ITB)
2) request for proposals (RFP)
3) invitation to negotiate (ITN)
An ITB is used when the agency can develop precise specifications or scope of work. Price is the controlling factor in an ITB and award is made to the lowest responsive and responsible bidder.
An RFP is used when it is not practicable for the agency to use an ITB. An RFP must include all of the relevant specifications, including the evaluation criteria to be used in determining the acceptability of the proposals received. While a contract resulting from an ITB is awarded based solely on price, in an RFP the evaluators may consider “technical excellence as well as cost.” Price must be a factor in the evaluation criteria, but other factors like the vendor’s technical expertise, financial capacity, etc., may also be evaluated. The award is made to the vendor determined to be the most advantageous to the state, considering all of the evaluation criteria.
Finally, an ITN is appropriate when an agency determines that neither an ITB nor an RFP will result in the best value to the state. § 287.057(1)(c), Fla. Stat. The ITN was added by the 2000 Florida Legislature and refined several times in recent years. The main difference between an RFP and an ITN is that the ITN is used when the state agency determines that negotiations with one or more vendors may be necessary in order for the state to receive the best value. Similar to an RFP, evaluation criteria must be included in the specifications by which the agency evaluation committee will evaluate and rank the vendor replies. Based on this ranking and the ITN’s specifications, an agency will pick one or more vendors with whom to negotiate. At the conclusion of the negotiations, an award is based on the agency’s determination of which vendor will provide the “best value” to the state. “Best value” is defined in statute as “the highest overall value to the state based on objective factors that include, but are not limited to, price, quality, design, and workmanship.”
There are other, rarer, forms of solicitation including an Invitation to Quote (ITQ) and request for information (RFI). However, in the realm of construction, nearly every solicitation will be a ITB.
The Mechanism for Protest
Under §120.569 and §120.57(1) and (3), the Division of Administrative Hearings (DOAH) has jurisdiction to hear procurement protests and issue recommended orders that can change the decision of a state procurement office to award a bidder (or not to award any bidders). The DOAH conducts what is called a de novo proceeding to decide whether a public agency acted “contrary to the agency’s governing statutes, the agency’s rules or policies, or the [procurement] specifications.” Although DOAH has the authority to contradict state agencies in a narrow subset of situations, in nearly every case deference is given to the procurement agency’s decision. In other words, DOAH does not typically override or substitute its ultimate decision for that of the agency.
Making a Protest
Per §120.57(3)(b), any person adversely affected by an agency decision, or intended decision, can protest by first filing a notice of protest within 72 hours after the decision, or intended decision. In addition to a notice of protest, a formal written protest must also be filed within 10 days.
There must also be a substantial interest on the part of the party filing a bid protest. This means that entities that did not participate in the bidding process, or even those that participated but did not achieve the penultimate position to the awarded party cannot generally protest. One such example in Florida of this situation was in Westinghouse Elec. Corp. v. Jacksonville Transportation Authority, 491 So. 2d 1238 (Fla. 1st DCA 1986), when a non-bidding company Westinghouse Electric Corporation protested against the Jacksonville Transportation Authority for awarding a bid to a bidder that went through its procurement process. The court held that a party must have a “substantial interest” in order to have standing to protest the decision. Westinghouse, being a non-bidder, lacked such standing.
There are two possible outcomes to a construction ITB. Either a recommendation for award is made or there is a rejection of all bids. Each scenario presents differing probabilities of success should a bidder decide to protest the decision.
In the first scenario, that of an award being given to the lowest levelled bidder, the filing of a bid protest operates as a stay of the contract award process and prevents final agency action from being taken until after the protest proceeding is concluded. In such a case, there may be scope for the bids to be rewarded to the originally unsuccessful bidder.
In the second scenario, where all bids are rejected by the government agency, a bidder has a right to protest the agency’s decision to reject all bids. However, no bidder has a statutory right to a contract award when the agency rejects all bids.
“…any person adversely affected by an agency decision, or intended decision, can protest…”
Florida has Sunshine laws that are designed to make state government transparent to the public. As such all bids that have been part of a public entity procurement process become records that are subject to public disclosure at the time the agency provides notice of an intended decision or 30 days after opening proposals, whichever is earlier. It is worth noting however, that rejected proposals are not considered public records and are thus exempt from disclosure. This remains the case until the agency withdraws the reissued solicitation or gives notice of its intended decision on the solicitation for a period of up to 12 months from the agency’s first decision to reject all bids.
The Importance of Legal Counsel
The complex practice area of construction law is one where it is incredibly risky to to “go it alone” and attempt self representation. This is especially the case when participants in bids protest the decision of procurement departments. A legal counsel with experience in handling state, county and municipal-level procurement disputes will be able to understand the nuances of the statutes, ordinances and codes that govern the specific construction ITB in question.
If you are involved with a bidding process and are considering making a formal protest, seek out experienced legal counsel to ensure your greatest chances of success.
South Florida Law
When preparing to protest a decision to award a bidder or to reject all bids, be sure to do so with the assistance of a local attorney that has extensive construction law experience. With South Florida Law, you benefit from both big firm resources and small firm attention-to-detail and service. We have the construction law experience and local knowledge necessary to protect your business’ interests in a variety of situations – including at the end of a competitive bidding process. Considering filing a protest against a competitive bid decision? Reach out to South Florida Law today on (954) 900-8885 or via our contact form.