Business and Legal Insights

I am often asked by potential clients if there is any real point to filing bid protests, by which they mean is there ever any real shot at winning? I tell them the key to winning is to show your competitor’s proposal failed to meet specific Request For Proposal (“RFP”) criteria, or how the agency did not follow a specific provision of the RFP.

A good example is a recent decision from the Florida Division of Administrative Hearings (“DOAH”), Jani-King Gulf Coast Region v. Escambia County Sch. Distr., DOAH No. 16-2762BID (Fla. Div. Admin. Hrgs. Aug. 26, 2016) (RO). The RFP stated that any proposal that did not include all of the requested items would be rejected as non-responsive. However, the RFP also expressly reserved to the School Board the right to waive any conditions or criteria in the RFP, and to waive any technical irregularities or deficiencies in the proposal.

In order to ensure that the selected firm would have the financial ability to handle the contract’s start-up costs, the RFP provided:

 Responder must provide the last two (2) years’ audited financial statements for the Responder. (emphasis added).

The highest-ranked firm was American Facility Services (“AFS”), and the School Board recommended that the award be made to AFS. However, AFS’s proposal only included reviewed financial statements from the last two years, not audited ones. The second-ranked firm, Jani-King, protested alleging that AFS’s proposal should have been rejected.

Florida courts allow agencies to waive immaterial deficiencies in proposals, such as when a bidder includes a certified check in its bid instead of a bid bond. Because a certified check is the legal equivalent of cash, there is no material difference between a bid bond and a certified check, therefore the deviation confers no competitive advantage. E.g., Robinson Electrical Co., Inc. v. Dade County, 417 So. 2d 1032 (Fla. 3d DCA 1982).

In Jani-King, the School Board argued that it had the right to accept reviewed statements, and waive the requirement for audited statements as a technical irregularity, because the reviewed statements gave the School Board adequate assurances as to AFS’s financial stability.

The DOAH rejected the School Board’s argument because:

(1) audited financial statements provided a much higher indicia of reliability than reviewed financial statements;
(2) audited financial statements are substantially more expensive to obtain than reviewed financial statements; and
(3) it was impossible to know how many potential offerors did not bid because of the requirement that firms submit audited financial statements.

The School Board’s waiver of the requirement for financial statements therefore gave AFS an improper competitive advantage, and the DOAH recommended that the School Board award the contract to Jani-King.

If you ever find yourself in a Florida procurement where your competitor won the contract even though its proposal fails to meet a specific RFP criteria, you should probably consult with your attorney to discuss taking your shot and filing a bid protest.