An Introduction to Bid Protests Under Florida’s Administrative Procedure Act
Competitive bidding for projects in Florida is governed by a statutory framework that ensures a fair competitive playing field for businesses competing for state funded contracts. For instance, Section 287.057, Fla. Stat. requires that a competitive solicitation process must be used for the procurement of goods and contractual services in excess of $35,000. Further, Section 287.057, Fla. Stat. identifies the three primary competitive solicitations processes: 1) invitation to bid; 2) request for proposals and 3) invitation to negotiate.
Chapter 120, Florida Statutes, otherwise known as the Administrative Procedure Act (“APA”), sets out the procedures and rules agencies use in the execution of the above three solicitation processes. Specifically, Section 120.57 outlines specific procedures for competitive bid protests, or challenges by bidding entities to a solicitation or award. This blog will provide a general overview of the bid protest process, while future posts will analyze how administrative law judges and appellate courts have interpreted the APA.
What Can Be Protested?
In each of the competitive solicitation processes, the subject agency initially publishes a solicitation, which is a description of terms and conditions of the project being put up for bid. After reviewing the specifications outlined in the solicitation, the bidding parties submit their detailed bids to the agency. However, the solicitations themselves can be vague, ambiguous or require certain qualifications that create bias and favor some entities over others. If that occurs, a bidding party can protest the solicitation itself. However, as described in more detail below, a protest targeted at the solicitation must be done immediately, or the protestor’s rights may be waived. See Capeletti Brothers, Inc. v. Dept. of Transportation, 499 So. 2d 855 (Fla. 1st DCA 1986).
More typically, once the agency issues its notice of intent to award a contract, a party may submit a bid protest objecting to the agency’s decision. Bidders protesting the notice of award may challenge how the agency determined the award, what criteria was utilized to identify the most responsive bidder, and whether the agency complied with the criteria outlined in its own solicitation when awarding the contract. A party may even challenge the terms of the contract between an agency and the winning bidder, if it can be shown that those terms were significantly different from the bid specifications. See State, Dept. of Lottery v. Gtech Corp., 816 So. 2d 648 (Fla. 1st DCA 2001).
Who Can Protest a Solicitation or Award?
In order to protest a solicitation or award, the protesting party must be “adversely affected” by the agency’s action. In other words, a protesting party must establish that a substantial interest of that party will be affected by the proposed agency action. See § 120.57(3)(b); Preston Carroll Co. v. Florida Keys Aqueduct Authority, 400 So. 2d 524, 525 (Fla. 3d DCA 1981). If a party cannot show that it would be adversely affected by the agency action, that party does not have standing to protest.
As described above, a bidding party who receives a solicitation and timely files a protest regarding the solicitation specifications will likely have standing to protest the solicitation. For purposes of protesting an agency’s award following the bidding process, a second ranked bidder typically has standing to protest. Preston Carroll, 400 So. 2d at 525. The reasoning here is if the second ranked bidder is successful and the agency withdraws its award to the first ranked bidder, the protesting party will usually be awarded the contract. Alternatively, a third ranked bidder has been held to not have standing to file a bid protest where the second ranked bid was not otherwise disqualified. See Silver Express Co. v. District Board of Low Tribunal, 691 So. 2d 1099, 1100 (Fla. 3d DCA 1997).
Notice of Protest and Formal Written Protest
In the world of bid protests, timing is everything. The APA requires a protesting party give its notice of intent to protest within 72 hours after the issuance of the solicitation or the notice of intent to award. This means that if a bidding party objects to the conditions and requirements contained within an agency’s solicitation, the notice of protest must be filed no more than 72 hours after the solicitation is published. See Capeletti Brothers, 499 So. 2d at 857 (contractor waived its right to protest solicitation criteria by failing to meet the 72-hour deadline). Likewise, any party adversely affected by an agency’s decision to award a contract has 72 hours from the agency’s notice of intent to award to file its notice of protest. Importantly, these notices must be filed with the agency and must be received by the agency within 72 hours (sending the notice by mail does not extend the 72-hour period).
After providing its notice of protest, a protesting party must then file its formal written protest within 10 days. § 120.57(3)(b), Fla. Stat. The contents of the formal written protest are strictly governed by the Florida Administrative Code and Florida Statutes. The contents of a formal written protest include the identity of the petitioner, a statement of how the petitioner’s substantial interests will be affected by the agency decision, a statement of all pertinent material facts, and a statement of relief sought by the protesting party. See § 120.54(5)(b)(4), Fla. Stat.
Bid Protest Hearings
Once an agency receives notice of a formal written protest, the agency must halt the solicitation or contract award process until the protest is resolved. See 120.57(3)(c), Fla. Stat. In other words, the protest triggers an automatic stay of the procurement process to ensure that potential relief is available to the protesting party. The burden of proof in bid protest hearings always rests with the party protesting the proposed agency action.
Statutory guidelines dictate the procedures an agency must follow after receipt of the formal protest. For instance, the agency must provide an opportunity to resolve the protest by mutual agreement between the parties within 7 days, excluding Saturdays, Sundays and state holidays. §120.57(3)(d)(1), Fla. Stat. If resolution cannot be obtained, and there is no disputed issue of material fact, an informal proceeding will be conducted by the agency.
On the other hand, if there is a disputed issue of material fact, the agency will refer the protest to the Division of Administrative Hearings (DOAH) for proceedings in accordance with Section 120.57(1). DOAH will then assign an administrative law judge, who will conduct an evidentiary hearing within 30 days. During these hearings, the parties may present evidence, conduct examination of witnesses and submit findings of fact for the administrative judge to consider.
A party wishing to protest a bid solicitation or award in Florida must adhere to strict statutory deadlines and procedures under the APA. Failure to timely and accurately submit written notices and formal protests may result in a waiver of rights or summary disposition by the agency. Attorneys who represent these protesting parties must be ready to act quickly and be extremely knowledgeable regarding the complexities of the process.