Xerox State & Local Solution, Inc. v. Department of Revenue and Systems & Methods, Inc. , 187 So. 3d 386 ( 2016 )

IN THE DISTRICT COURT OF APPEAL
FIRST DISTRICT, STATE OF FLORIDA
XEROX STATE & LOCAL NOT FINAL UNTIL TIME EXPIRES TO
SOLUTION, INC., FILE MOTION FOR REHEARING AND
DISPOSITION THEREOF IF FILED
Appellant,
CASE NO. 1D15-1712
v.
DEPARTMENT OF REVENUE and
SYSTEMS & METHODS, INC.,
Appellees.
_____________________________/
Opinion filed March 18, 2016.
An appeal from a Final Order of the Department of Revenue.
W. Robert Vezina, III, Eduardo S. Lombard, and Megan S. Reynolds of Vezina,
Lawrence & Piscitelli, P.A., Tallahassee, for Appellant.
Jeffrey J. Kelly, Assistant General Counsel and Joy A. Stubbs, Assistant General
Counsel, Tallahassee, for Appellee Department of Revenue; Karen D. Walker and
Mia L. McKown of Holland & Knight, LLP, Tallahassee, for Appellee Systems &
Methods, Inc.
PER CURIAM.
This is an appeal from a final order entered by the Department of Revenue
awarding a state contract to Systems & Methods, Inc. (SMI) and dismissing a bid
protest by Xerox State & Local Solution, Inc. (Xerox). Xerox raises a number of
arguments, only one of which merits discussion. Xerox contends that the
Department improperly awarded the contract to SMI because SMI’s reply did not
contain a “renewal price” as required by section 287.057(13), Florida Statutes.
Because we conclude that Florida law imposes no such requirement in this
circumstance, we affirm the final order.
The Department issued an invitation to negotiate (ITN) seeking a contractor
to operate its State Disbursement Unit, a processing center that collects and
disburses child support payments. Only Xerox and SMI responded to the ITN.
After evaluation and negotiation, the Department posted its Notice of Intended
Award to SMI. Xerox timely filed a bid protest and received a formal hearing. The
administrative law judge recommended dismissal of the protest, the Department
dismissed it, and this appeal follows.
Xerox contends that the Department should have rejected SMI’s reply as
unresponsive because it did not include a “renewal price” as required by section
287.057(13), Florida Statutes. We conclude that the plain language of the statutory
provision in question imposes no requirement on vendors to include a renewal
price in a response. Instead the language in question simply makes the inclusion of
a renewal price a condition of contract renewal.
Section 287.057(13) provides as follows:
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Contracts for commodities or contractual services may be
renewed for a period that may not exceed 3 years or the term of the
original contract, whichever is longer. Renewal of a contract for
commodities or contractual services must be in writing and is subject
to the same terms and conditions set forth in the initial contract and
any written amendments signed by the parties. If the commodity or
contractual service is purchased as a result of the solicitation of bids,
proposals, or replies, the price of the commodity or contractual
service to be renewed must be specified in the bid, proposal, or reply,
except that an agency may negotiate lower pricing. A renewal
contract may not include any compensation for costs associated with
the renewal. Renewals are contingent upon satisfactory performance
evaluations by the agency and subject to the availability of funds.
Exceptional purchase contracts pursuant to paragraphs (3)(a) and (c)
may not be renewed. With the exception of subsection (10), if a
contract amendment results in a longer contract term or increased
payments, a state agency may not renew or amend a contract for the
outsourcing of a service or activity that has an original term value
exceeding $10 million before submitting a written report concerning
contract performance to the Governor, the President of the Senate, and
the Speaker of the House of Representatives at least 90 days before
execution of the renewal or amendment.
(Emphasis added.) Appellant interprets the italicized portion of this subsection to
require vendors to include “the price of the commodity or contractual service to be
renewed” in their responses to a procurement solicitation. To the contrary, section
287.057(13) merely describes the conditions necessary for the state to renew a
contract. If a vendor does not include a renewal price in its response to a
solicitation, then any resulting contract cannot be renewed. In other words, this
provision creates a precondition to contract renewal, not a precondition to the
contract itself.
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This interpretation is consistent with other parts of section 287.057. Before
2010, section 287.057 clearly provided that in all three types of procurement,
whether by invitation to bid, request for proposal, or invitation to negotiate,
vendors were required to include a renewal price in their responses if renewal was
contemplated by the procuring agency. But in 2010, the legislature removed
renewal requirements from the invitation to negotiate process. * In doing so, the
Legislature evinced its intent to dispense with the requirement that replies to an
invitation to negotiate include a contract renewal price.
To summarize, section 287.057(13) does not require vendors to include
renewal pricing in their responses to procurement solicitations. Rather, it describes
the requirements that must be met before an agency may renew a contract.
Accordingly, any failure on the part of SMI to provide a renewal price did not
render its reply unresponsive under section 287.057(13).
We conclude that the Department did not violate the applicable law. We
have carefully considered all of the other arguments in the briefs, and find no basis
*
Sections 287.057(1)(a), (2)(a), and (3)(a), Florida Statutes (2009),
described the three processes of procurement. Each section contained
requirements regarding renewal pricing. Section 287.057(3)(a), which governed
invitations to negotiate, provided in pertinent part: “If the agency contemplates
renewal of the contract, that fact must be stated in the invitation to negotiate. The
reply shall include the price for each year for which the contract may be renewed.”
In 2010, however, the legislature removed this language. Ch. 2010-151, § 19, at
1342-44, Laws of Fla.
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for reversal. Consequently, we affirm the final order by the Department awarding
the contract to SMI.
AFFIRMED.
LEWIS, SWANSON, and WINOKUR, JJ., CONCUR.
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