HomeMy WebLinkAboutSubmittal-Al Dotson-Memo-Analysis of Comm. Russell's reasons for rejecting all RFPs & Reissuing RFPDATE:
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MEMORANDUM
July 19, 2016
Submitted into the public
record for item(s) SPA & SP.2
on 07/20/2016, City Clerk
Analysis of Commissioner Russell's Reasons for Rejecting All Proposals and
Reissuing the Virginia Key RFP
On June 15, 2015, the City of Miami ("City") issued Request for Proposals (RFP) No.
12-14-077, which sought the redevelopment of the City's marina facility on Virginia Key. Over
the past 13 -plus months, the City has expended substantial time and resources managing the RFP
process and evaluating the detailed proposals submitted by three different development teams.
Now that the RFP process has run its course, with no steps remaining other than acting on the
City Administration's recommendation to award the agreement to the winning proposer,
Commissioner Ken Russell wants to start all over again.
At the June 22, 2016, Special Meeting of the City Commission ("Commission"),
Commissioner Russell stated a number of reasons for this eleventh -hour whim. However,
Florida law requires that a decision to reboot the entire competitive process be supported by both
facts and logic. Commissioner Russell's stated reasons are contrary to both and, as a matter of
Florida law, do not justify the nuclear act of throwing out the entire RFP at this late stage.
APPLICABLE LAW
Florida law is clear that a decision to reject all proposals and issue a new RFP requires a
legitimate justification. In Wood -Hopkins Contracting Co. v. Roger J. Au & Son, Inc., the First
District Court of Appeal reversed a government's decision to reject all bids, explaining that any
such decision is "subject to the requirement that its exercise be not arbitrary, unreasonable or
capricious" and "must be based upon facts reasonably tending to support the conclusions
reached." 354 So. 2d 446, 450 (Fla. 1 st DCA 1978) (quoting City of Pensacola v. Kirby, 47 So.
2d 533 (Fla. 1950)). Significantly, that legal standard applies even if the solicitation claims to
reserve the right to reject all bids "with or without" cause. See id. (citing McQuillin, Municipal
Corporations § 29.77). Rejecting all bids without an adequate justification, the court explained,
"becomes a means of allowing a favored bidder another chance to submit a low bid." Id.; accord
43 Fla. Jur. 2d Public Works & Contracts § 29 (2016) ("A public entity does not have unbridled
discretion.... to reject any and all bids with or without cause.... Indeed, rejection ... is
subject to the requirement that its exercise must not be arbitrary, unreasonable, or capricious, for
without limitation, the purpose of competitive bidding would be circumvented[.]"). r
The bottom line is that a decision to reject all bids must be supported by (1) facts, (2)
logic, and (3) a correct application of the law. See Humana Dental Ins. Co./Comp Benefits Co., v.
Cs
Sch. Bd. of Lee Cnty., Case No. 10-9846BID (Fla. Div. Admin. Hr'gs Dec. 2, 2010). For
example, in Double E Constructors, Inc. v. School Board of Palm Beach County, the
administrative law judge overturned the government's decision to reject all bids because the
government had incorrectly concluded that a proposer received an unfair competitive advantage
and premised its decision on that faulty conclusion. Case No. 91-1017BID (Fla. Div. Admin.
Hr'gs Apr. 3, 1991). A decision to reject all bids that is based on a faulty conclusion of fact and
law is arbitrary and capricious and, therefore, invalid. Id.
Particularly relevant here, in School Food Service Systems v. Broward, Case No. 01-
0612BID (Fla. Div. Admin. Hr'gs May 31, 2001), the administrative law judge overturned the
government's decision to reject all bids based upon a claimed ambiguity in the specifications
that, in the government's view, created an unfair competitive advantage, and a belief that the
legal prohibition against "material changes" would require it to purchase goods that it may not
desire to purchase. The administrative law judge, however, found that the government was on all
counts incorrect: the specifications were not ambiguous and the solicitation permitted the
government to arrange for the purchase of substitute products, thereby avoiding the possibility
that it would be forced to purchase unwanted goods and creating no issue under the "material
change" doctrine. Because the government's justifications were not consistent with fact, logic,
and law, it's decision to reject all bids was overturned, with the administrative law judge
explaining:
Letting authorities must be mindful that rejecting all bids discourages competitive
bidding and hence should be the exception in public procurement rather than the
rule. Disregarding this maxim, the Board here acted precipitately and without
sufficient justification in fact or logic when it decided to reject the bids received
on this substantial contract.
Id.
Similarly, in Lauderdale Market Place Inv., LLC v. Florida Department of Juvenile
Justice, the administrative law judge overturned the government's decision to reject all bids
because the government's stated reason—that a departmental reorganization required a
reassessment of its needs—was not supported by the facts or by logic and was thus an invalid
justification. Case No. 00-3520BID (Fla. Div. Admin. Hr'gs July 27, 2001). In that case, the
administrative law judge explained that no reorganization was required, and any uncertainty
about the department's needs existed during earlier phases of the procurement, when the
department had continued to move forward. Id. Thus, a newly found desire to reassess the
government's needs does not justify the rejection of all bids.
And in ICF Kaiser Engineers, Inc. v. Department of Transportation, the administrative
law judge overturned the government's decision to reject all bids because the government's stated
reason—an inability to adequately investigate and resolve accusations of impropriety raised by a
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losing bidder within the protest period—was premised upon a misunderstanding of the amount of
time provided by law for the agency to resolve the issues raised. Case No. 93-3034BID (Fla.
Div. Admin. Hr'gs Dec. 16, 1993). Misunderstandings of law, too, do not justify rejecting all
bids.
Commissioner Russell's stated reasons suffer from the very same factual, logical, and
legal flaws that have in the past resulted in judicial intervention and reversal of a government's
decision to reject all bids. As explained in more detail below, Commissioner's Russell's reasons
misstate the facts, and in reliance on incorrect facts, Commissioner Russell reaches faulty,
illogical conclusions. Commissioner Russell's reasons also grossly misunderstand the applicable
law and thus invite the City to take the drastic step of throwing out the entire RFP process based
upon nothing more than legal error, bundled with factual misrepresentations, and bound by
illogical conclusions. Such an action would not likely survive judicial review.
ANALYSIS
I. Mere Disagreement with the RFP Process Does Not Justify Reiecting All Bids
Commissioner Russell has stated several reasons related to the RFP issuance and
evaluation process that, in his view, would justify the rejection of all proposals and reissuance of
the RFP. These reasons, however, are unmoored from the facts of this RFP and are premised
upon a misunderstanding of applicable legal requirements. In fact, the City proceeded "by the
book," in full compliance with all applicable legal requirements and the RFP itself. In light of
the actual facts, Commissioner Russell's reasons do not manifest a failure by the City to comply
with any applicable requirements, but rather the Commissioner's own disagreement with the
substance of the City's applicable requirements. There is, however, no right to "jury
nullification" in government procurement—an elected official's disagreement with the law is not
a valid reason to throw out the entire process. Commissioner Russell's factual, logical, and legal
errors with respect to the RFP process are explained below.
Claim: The were too many addenda to the RFP.
"There w[ere] 30 Addenda to this RFP, which .. . seems like an awfully huge changing of
everything once we've issued the RFP, which ... basically customizes the RFP for those who are
currently bidding. . . . [T/here's so many changes that we can just start from scratch. "
(Transcript p. 204-05)
Reality: There were only a handful of changes to the RFP; and the number of addenda has
no legal or practical significance.
Although there were 30 documents labelled as addenda, very few actually modified the
RFP. In fact, a review of all thirty "addenda" manifests only a handful of changes to the RFP,
and that many of the so-called addenda are not really addenda at all.
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record for item(s) SPA & SP.2
on 07/20/2016, City Clerk
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For example, five different addenda simply provided information related to the two pre -
proposal conferences. Addenda IV and XVI were sign -in sheets from the conferences,
Addendum XIII contained notice for the second conference, and Addenda VII and XVII were the
transcripts from the two conferences. Similarly, Addendum VI provided interested parties with
an environmental site assessment, and Addendum XXX provided the list of proposals received at
to the submission deadline. None of these seven documents modified the RFP in any way and
were merely informational documents of the type that are often not even labeled addenda.
Further, several additional addenda contained only questions from potential proposers
and the City's answers. The City generously committed itself to a 15 -day response time to all
questions received and permitted proposers to submit questions until January 4, 2016, thereby
necessitating the division of these questions and answers into multiple addenda.
Indeed, only 18 of the 30 addenda issued contained any revisions to the RFP whatsoever,
and the bulk of these "revisions" were purely technical in nature or duplicative. See Addenda I,
II, III, V, IX, X, XI, XII, XIV, XV, XVIII, XXI, XXII, XXIII, XXIV, XXV, XXVI, XXVII. The
only change made by Addendum II, for example, was a change to the time and location of the
first pre -proposal conference, Addendum XII changed only the background -screening consent
form, and Addendum XXVI merely reduced the number of required copies of illustrative
drawings from 27 to 22. Furthermore, several of the addenda made the exact same change, but
each related document was released as its own numbered addendum. For example, Addenda
XXI, XXII, and XXIII were released the same day, each of which contained a document
detailing the boundaries of the submerged lands in the basin made available to the proposers, and
Addendum XXV changes the parcel size in the executive summary of the RFP to reflect the
added submerged lands. Similarly, both Addenda XXVIII and XXIX tweak the language in a
single section of the draft lease agreement.
Furthermore, even ignoring the reality that very few of the issued addenda actually
modified the RFP, Commissioner Russell's statement is premised upon incorrect assumptions—
that issuing multiple addenda is aberrational for a project of this type or has any practical or legal
consequence. The reality is that dozens of addenda are commonly issued for solicitations for the
development of government property. The City of Miami Beach, for example, issued 26
addenda to its RFP for the North Beach Oceanfront Center. See
http://web.miamibeachfl.gov/procurement/scro11.aspx?id=56706. Commissioner Russell also
incorrectly concludes that the addenda "customized" the RFP for the proposers and that the
issuance of a certain number of addenda justifies the issuance of a brand-new solicitation. The
addenda, however, were issued prior to the proposal due date, not after, and were posted on the
City's website for the world to see. The universe of potential proposers was therefore open, not
closed, at the time the addenda were issued, and any interested firm—located anywhere in the
world—could have either prepared and submitted a compliant proposal or filed a protest
challenging any problematic addenda. No such protests were ever filed, and for good reason—
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none of the limited changes to the RFP can be said to have customized the specifications for any
particular firms.
Furthermore, there is no logical connection between the number of addenda issued and
the proposed cancellation and re -issuance of the underlying solicitation. Commissioner Russell
may well have an aesthetic preference for a single document rather than a document combined
with several addenda, but there is no legal distinction between the two. In both cases, the RFP,
as modified by its addenda, is what governs the procurement, and proposers to the RFP were
given ample additional time to review and consider any substantive changes made by the
addenda issued—the proposal due date was pushed back from September 28, 2015, to February
1, 2016, in order to facilitate the review and consideration of the addenda. It defies both fact and
logic to suggest that the number of addenda, let alone the minimal changes actually effectuated
by those addenda, justifies throwing out the entire process and starting anew.
Claim: The bid -protest period was too short.
"I would absolutely give a longer period for a protest, so they're not scrambling to throw
together whatever they can in just a couple days, whereas the points that might have been
brought in where there more time are very signficiant. " (Transcript p. 198)
Reality: The protest period complied with the RFP and the City Code, was more generous
than that used by other local jurisdictions, and did not restrict the protest proceedings,
where were ponderous.
The protestors were granted 3 business days to file their notice of intent to protest, plus
another five days to file their full, written protest. This procedure was also required by Section
XI of the RFP, and no proposers complained of the procedure when given the opportunity to do
so after the RFP was issued.
And nor should they have. The applicable bid -protest timeline was, in fact, quite
generous. The RFP's timeline is consistent with the procedure ordinarily used by the City for
procurements of goods and services, and is substantially more generous than that used by Miami -
Dade County, which affords a protestor 3 days to file a written intent to protest (that states the
facts and grounds upon which the protest is based), plus only 3 additional days to file the full
written protest. City of Miami Code § 18-104; Miami -Dade Cnty. Implementing Order 3-21.
Miami -Dade County has heard hundreds of bid protests using this procedure, and the length of
the protest period has not stood in the County's way of awarding billions of dollars in contracts.
And the protest timeline is vastly more generous than that used by the City of Miami Beach,
which requires that the full protest—not merely a notice—be filed within two business days after
the posting of the challenged recommendation. City of Miami Beach Code § 2-371(a)(2). The
timeline used here is therefore not only consistent the RFP and the City Code, but it is more
generous than the timeline employed by other area jurisdictions.
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Furthermore, it cannot possibly be claimed that the length of the protest period had any
impact on the protest proceedings. Suntex filed a detailed, 14 -page protest, together with 86
pages of exhibits, by the relevant deadline, and also a supplemental protest after the deadline that
forms the basis of another of Commissioner Russell's stated reasons to throw out all bids. And
Tifon filed a 26 -page protest, together with 23 exhibits, by the deadline. Both protestors also had
ample opportunity to present their arguments, in detail, at three different City Commission
meetings, totaling at least ten hours of debate. If the protestors were somehow prejudiced by the
City's protest timeline (which, again, is dictated by the City Code and the RFP and is more
generous than that used by other local jurisdictions), then it certainly did not manifest in the
protest proceedings, which were as prolonged as can be imagined.
Claim: The Selection Committee should have provided reasons for their scores.
"I would absolutely require the judging panel to do commentary, so I know why they judged
what they judged. " (Transcript p. 197-98)
Reality: The Selection Committee was not required to provide reasons for their scores, yet
did so orally during oral presentations.
The RFP did not require that Selection Committee members provide written reasons for
their scoring. Nor are Selection Committee members required by the City Code or any other
applicable law to justify their scoring, either orally or in writing. Nor, in fact, is it even standard
practice in other local jurisdictions to require Selection Committee members to provide written
reasons for their scoring. More to the point, a failure to explain scores has been held not to
violate Florida law even when the RFP requires such an explanation. See Juvenile Svcs.
Program, Inc. v. Fla. Dept of Juvenile Justice, Case No. 96-5982BID (Fla. Div. Admin. Hr'gs
Apr. 23, 1996). Any failure to explain scores cannot begin to justify the drastic step of rejecting
all bids here, where no explanation was required.
Not only is Commissioner Russell's complaint not substantiated by the RFP, the law, or
common practice, but in this procurement, it is also not substantiated by the facts. The record
does reflect Selection Committee members engaged in verbal dialogue with the proposers during
oral presentations, thus insight into their scoring was provided orally, if not in written form on
their scoresheets. Therefore, even if the imaginary requirement that Selection Committee
members must state their reasons for their scores were to be retroactively applied to the RFP, the
oral discussions substantially complied with that requirement.
Claim: Mr. Rotenberg potentially has a conflict of interest.
"Where Mr. Rotenberg has a conflict of interest or not, I don't know the answer. I trust him to
be a man of good standing, absolutely, but whether he had a past relationship with one of the
bidders ... should he be on the judging panel? " (Transcript p. 199)
Submitted into the public
record for item(s) SP.1 & SP.2
on 07/20/2016, City Clerk
M.
Reality: Mr. Rotenberg has no conflict of interest.
The facts make abundantly clear that Mr. Rotenberg, the Director of the City Department
of Real Estate & Asset Management, has never had a business relationship with RCI, as alleged
by a losing proposer. It is unfortunate that Commissioner Russell latched onto these accusations
because they are utterly untrue. Although counsel for Suntex stated that Mr. Rotenberg has a
business relationship with the principals of RCI through Tate Capital, the facts say otherwise.
As confirmed by Tate Capital, Mr. Rotenberg worked for a Tate subsidiary from 2009 until
2012, and Tate Capital did not begin doing any business with the principals of RCI until 2014,
long after Mr. Rotenberg left the organization. There is absolutely no connection between Mr.
Rotenberg and RCI, let alone a connection that could establish a conflict of interest. To suggest
otherwise flies in the face of the uncontroverted facts and therefore cannot lawfully justify a
decision to throw out all bids.
II. A Desire to Preserve Virginia Key and Ensure Compliance with the Virginia
Key Master Plan Does Not Justify Reiecting All Bids
Commissioner Russell provided several reasons for rejecting all bids that are related to
the need to preserve Virginia Key and restrict certain development thereon. These reasons,
however, have absolutely nothing to do with the RFP process or the recommended proposer, and
thus no logical connection to the rejection of all bids. The preservation of Virginia Key is a
given, no matter who is awarded the contract under this RFP or under any future RFP. No matter
how many times the RFP is issued, the awardee will still have to comply with the City's
development requirements related to the preservation of land. Regardless of what is contained in
RCI's proposal, or in any other proposal, the City still retains its authority to act on development
applications and ensure their compatibility with the area. Furthermore, many of Commissioner
Russell's claims are inconsistent with RCI's proposal, which went to great lengths to respect the
Virginia Key Master Plan and natural state of the area.
Claim: Virginia Key needs to be protected.
"Virginia Key is a an absolute gem that we are charged with protecting. " (Transcript p. 19 1)
"[T]he makeup of what Virginia Key would look like is going to be affected by this bid. "
(Transcript p. 194)
Reality: RCI's proposal respects the natural character of Virginia Key. In any event, the
City must approve all new development.
The City retains its authority to review and approve new development under the RFP. In
any event, RCI went to great lengths in its proposal to respect the natural character of Virginia
Key. RCI's plan calls for preservation and restoration of the existing landscape at the site (RCI's
Proposal, Section IV, p.17). Many existing trees will be preserved and mangroves would be
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restored. There would be native plantings of plants specific to Virginia Key (RCI's Proposal,
Section IV, p.6; Section IV, p.17). RCI's plan will supplement and preserve existing landscape
buffers (RCI's Proposal, Section IV, p.4 and 38). And RCI's Preferred Plan eliminates the need
for a parking garage, which allows for maximum green -space and less disturbance of the natural
habitat (RCI's Proposal, Section IV, p.8-9).
Furthermore, RCI's plan does not propose new recreational activities. RCI made a
commitment to support and help host fishing tournaments, sailing regattas, and recreational
activities that are already taking place at the marina and on Virginia Key. And again, proceeding
with the lease under the RFP does not mean that the City abdicates its authority to review all
applications of new development. The RFP makes clear that no development proposals are
guaranteed, and that all are expressly subject to all applicable regulatory requirements and
review.
Claim: The development does not comply with the Master Plan.
"The scope and scale of this RFP is far beyond, in my opinion, what was intended by the
public. " (Transcript p. 193).
Reality: RCI's plan does comply with the Master Plan. In any event, the City must
approve all new development.
Again, the City retains the authority to review and approve all development application.
But the Commissioner also misstates the requirements of the Virginia Key Master Plan. The
Master Plan identifies new and improved restaurants and a marina as development options for
Virginia Key. (Master Plan p. 48). It also calls for casual restaurants and public walks. (Master
Plan p. 77). The Master Plan's parking structure called for a retail liner in the marina basin area
(Master Plan p. 79, 87, 90). The Master Plan specifically identifies "passive and active
recreational uses, as well as, marinas, food service establishments, open air retail, community
facility, recreational facility, religious facility, infrastructure and utilities, general commercial
and learning center" as uses that can be developed in the marina basin area. This is far more
development than RCI is proposing in its plan. (Master Plan p. 106).
Claim: Boats do not belong in the basin.
"[B]oats in the basin are what a lot of the people are here to protest... which would basically
block half of the waterway in front of the Marine Stadium. "
"[T]his is a violation of the historical designation of the basin, and we shouldn't even be asking
for them to bid on this. " (Transcript pgs. 196-97).
Reality: The RFP did not require wet slips in the basin, and RCI agrees to remove them.
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The RFP merely permitted proposers to propose wet slips in the basin. The RFP did not
require proposers to place boats in the basin, and the RFP permits the City to exclude wet slips
from the basin before or after award, thus mooting the issue completely.
Claim: The City must change applicable historic and zoning designations.
"In order for this RFP, once it's granted, to actually come to fruition, we need to change
historical designations that are in place. We need to change a Master Plan, which is in place.
We need to change planning and zoning, which is in place. " (Transcript p. 195)
Reality: The RFP requires the awardee to comply with all applicable designations and does
not require that the City change anything.
The RFP does not require any particular zoning changes, but rather demands that the
awardee comply with all applicable development regulations. And because the City can award
the contract without any wet slips in the basin, there is no issue with respect to the historic
designation. But even if certain changes were required to support a particular development plan,
it is common practice for governmental entities to issue RFPs for development, prior to
conducting certain land use and zoning modifications because such changes will be dependent on
what will be developed. Even the master plan anticipates this and states, "Some uses require
additional processes to obtain approval." (Master Plan p. 106). Approvals are site -plan specific
and will be based on the project design and proposed uses, thus certain efficiencies are gained
when a project is chosen before land use, zoning, and historic preservation modifications are
made (e.g., Miami -Dade County's Liberty Square Rising project solicited a proposer prior to the
rezoning and changing of the land use designations of the County property).
Claim: More community input is required.
"I, as the Commissioner of this district, would have loved to have been involved at the beginning
of this RFP, so that what we're tasking the bidders with is what we believe and understand that
the community truly wants and deserves. " (Transcript p. 194)
"[W]e [should] throw out the RFP and ... direct the administration to work closely with the
Virginia Key Advisory Board, the Waterfront Advisory Board, and even the Sea Level Rise
Committee, to craft a new RFP with community involvement. . . . " (Transcript p. 202)
Reality: There is ample opportunity for community input prior to the consideration of any
development approvals. RCI is committed to working with the community.
RCI has incorporated the community's concerns into its plan and is willing to negotiate
further with the City and community and make additional changes as required. (See attached
letter from RCI to the Miami Rowing Club.) Furthermore, all of the relevant and applicable City
boards and advisory bodies can/will participate in the approval process of the plan and RCI is
willing to incorporate their feedback into the plan's design and implementation.
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There are countless members of the community who support the plan, particularly the
large and growing community of boaters who are desperately in need of safe, reliable, and user-
friendly state-of-the-art facilities. (See letter from Miami Rowing Club and copies of Facebook
page.)
III. Removing the Basin Slips is not a Material Chane to the RFP and Does Not Justify
Reiecting all Bids and Starting Over.
Commissioner Russell appeared persuaded by the losing proposers' self-serving claims
that the proposed removal of the wet slips from the Marine Stadium Basin would constitute a
"material" change to the requirements of the RFP and therefore require the resolicitation of the
entire project --conveniently giving those proposers a second bite at the apple, with the benefit of
having seen RCI's winning proposal. We have prepared an exhaustive memorandum on the
issue and will not repeat that entire argument here. However, it is worth repeating that, without
question, the proposed removal of wet slips from the basin would not constitute a material
change to the RFP and can be accomplished by the City without the need to throw the baby out
with the bath water.
First, the City may always negotiate changes that are consistent with the RFP, so long as
those changes are in the City's interest and do not unfairly benefit the selected proposer. In this
case, the RFP did not require the placement of any wet slips in the basin, and their removal is
thus within the scope of the RFP. To boot, the RFP expressly contemplated the removal of the
wet slips at a later date, which is precisely what the City seeks to do. It is equally clear that the
removal of the wet slips is in the City's best interest (and, in fact, was proposed by the City, not
by RCI) and is obviously to the economic detriment of RCI, whose entire business model is
premised upon building and operating wet slips for a profit.
The removal of the wet slips is therefore clearly permitted by Florida law, and in fact,
when the Broward County School Board attempted to reject all bids based on the exact same
theory of "material change" espoused here, that decision was resoundingly rejected by the
administrative law judge. In School Food Service Systems, Inc. v. Broward County School
Board, Case No. 01-0612BID, the government rejected all bids in part because it believed that
the solicitation required that it purchase certain goods that it did not want. The School Board
argued that, even though the solicitation stated that the government had the discretion to later add
or delete items, an exercise of that authority would constitute an impressible material change.
The administrative law judge's response to the School Board's application of the material -change
doctrine to a change contemplated by the solicitation itself is instructive:
The argument of the Board and Sysco that the Board's exercise of its right to
add and delete items would constitute an impermissible material alteration of
the bid specifications is, in the context of the present circumstances, plainly
wrong in fact and illogical.
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To explain why this is so, let us stipulate that it would be arbitrary for the Board,
say, to delete several items from each bidder's proposal because, for example, one
or more bidders had mis-bid those items, and then to re -tabulate the bids to
determine which bidder would now be the low bidder. Similarly, it would be
arbitrary for the Board, under the guise of adding items, to designate as approved
branded products certain non -conforming goods offered by a bidder as
Distributor's Choices, thereby allowing a bid that otherwise would be disqualified
to be considered responsive. As a final example, it would be arbitrary for the
Board to delete an approved branded product from the product list and use such
deletion as the basis for disqualifying a bidder that had quoted the now -deleted
item. Each of these hypothetical situations involves a material change to the
specifications on which the bidders based their proposals, which is not allowed,
for good reason.
It is a different kettle of fish, however, for the Board to add or delete items
after making an award to the lowest responsive, responsible bidder in
accordance with the terms and conditions of the ITB. When the bids are
judged pursuant to the rules clearly spelled out in advance in the ITB —
which would not be the case in the examples set forth in the immediately
preceding paragraph — there is simply no change in the specifications,
material or otherwise.
Id. at ¶ 79-81 (emphasis added.)
School Food Services is on all fours with the situation here. Here, all three proposers
were evaluated pursuant to the rules of the RFP, and RCI came out on top. The City may now,
after having completed the evaluation process, exercise its unambiguous right under the RFP to
prohibit the construction of wet slips in the basin. Such a decision, just as was the case in School
Food Services, would effectuate "simply no change in the specifications, material or otherwise,"
and any decision to reject all bids premised upon such a change would be "plainly wrong in fact
and illogical." Id.
Second, even assuming, for the sake of argument, that the wet slips in the basin were
required by the RFP and their removal would be inconsistent with the RFP, Florida law still
permits that change so long as it does not confer an unfair competitive advantage. Clearly, the
removal of the wet slips does not undermine competition in any form. The basin property was
not initially included in the RFP, and because the firms interested in the RFP were the same
before and after the basin property was added, the City can be certain that the change would have
no impact on competition. Further, RCI benefitted from the inclusion of the basin property the
last, proposing a much smaller portion of its total operations in the basin than either of its two
competitors, and the change therefore does not in any way undermine a critical evaluation factor
or the outcome of the competition. Finally, the removal of the basin property does not change
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the essential purpose of the RFP. The change is therefore permissible even if we assume that it
is not within the scope of the RFP.
IV. Concerns about the Miami Beach Sewage Spill Do not Justify Rejecting All Bids
Finally, Commissioner Russell suggests that the City should reject all bids because, in his
view, RCI is responsible for a sewage spill at Miami Beach Marina that occurred more than
sixteen years ago. The facts, however, do not support this conclusion.
Claim: RCI was responsible the largest water -contamination episode in the area.
"We absolutely can discuss whether we want a company, who was part of the largest water
contamination and sewage spill in the area, to be building a marina for us. " (Transcript p. 198)
Reality: RCI did not cause the spill, which caused no environmental damage.
As explained in detail in our June 6 letter, and substantiated by the Consent Order and
Settlement Agreement resolving the spill, RCI absolutely did not cause the 2000 spill. Rather,
Marin and Marin—a subcontractor to a subcontractor to an affiliate of RCI—drove a pile into a
sewage force main, rupturing it. Not only are there thus three degrees of separation between the
firm that caused the spill and RCI, but even Marin and Marin was not logically at fault for
rupturing the pipe, which had never been surveyed, and was located within an utility easement
that had never been recorded. Although the County might have known the location of its own
pipe notwithstanding the lack of any recorded documents to that effect, the County reviewed and
approved Marin and Marin's construction plans. The spill was caused by a series of errors,
dating back multiple decades, and none of which were made by RCI. Holding RCI responsible
for the spill, and rejecting all bids as a result, relies on a logical "butterfly effect"1 that falls
absolutely flat and cannot possibly justify a rejection of all proposals.
CONCLUSION
As explained above, none of Commissioner Russell's numerous reasons for his desire to
throw out all bids and recommence the entire process withstand any amount of scrutiny.
Because his reasons are, without exception, premised upon an incorrect understanding of the
facts, an incorrect understanding of the law, a logical fallacy, or all three, a decision to reject all
bids premised upon those reasons would be arbitrary and capricious and therefore invalid.
Although the City has reserved itself the discretion to reject all bids, before it takes that drastic,
time-consuming, and expensive step—it needs to articulate a valid reason, supported by facts,
logic, and applicable law. Commissioner Russell has not done so.
1 The phrasing often used by meteorologists is "does the flap of a butterfly's wings in Brazil set off a
tornado in Texas?" Holding RCI responsible for the spill is no more logically sound that holding the
butterfly responsible for the tornado.
Submitted into the public
record for item(s) SPA & SP.2
12 on 07/20/2016, City Clerk