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STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
CENTURYLINK PUBLIC
COMMUNICATIONS, INC.,
d/b/a CENTURY LINK,
Petitioner,
vs.
Case No. 14-2828BID
DEPARTMENT OF CORRECTIONS,
Respondent,
and
GLOBAL TEL*LINK CORPORATION
AND SECURUS TECHNOLOGIES, INC.,
Intervenors.
_______________________________/
SECURUS TECHNOLOGIES, INC.,
Petitioner,
vs.
Case No. 14-2894BID
DEPARTMENT OF CORRECTIONS,
Respondent,
and
GLOBAL TEL*LINK CORPORATION
AND CENTURYLINK PUBLIC
COMMUNICATIONS, INC.,
d/b/a CENTURY LINK,
Intervenors.
_______________________________/
RECOMMENDED ORDER
Administrative Law Judge John D. C. Newton, II, of the
Division of Administrative Hearings (DOAH), heard this case in
Tallahassee, Florida, on July 17 and 18, 2014.
APPEARANCES
For CenturyLink:
Michael J. Glazer, Esquire
Erik Figlio, Esquire
Ausley and McMullen
123 South Calhoun Street
Post Office Box 391
Tallahassee, Florida 32302-0391
For Department of Corrections:
James Fortunas, Esquire
Department of Corrections
501 South Calhoun Street
Tallahassee, Florida 32399-2500
For Global Tel*Link Corporation:
Robert H. Hosay, Esquire
James A. McKee, Esquire
John A. Tucker, Esquire
Foley and Lardner LLP
Suite 900
106 East College Avenue
Tallahassee, Florida 32301-7732
For Securus Technologies, Inc.:
Eduardo S. Lombard, Esquire
W. Robert Vezina, III, Esquire
Vezina, Lawrence and Piscitelli, P.A.
413 East Park Avenue
Tallahassee, Florida 32301-1515
2
STATEMENT OF THE ISSUE
Is Respondent, Department of Corrections' (Department),
Notice of Intent to Award DC RFP-13-031 for Statewide Inmate
Telecommunication Services to Intervenor, Global Tel*Link
Corporation (Global), contrary to the governing statutes, rules,
or policies or to the Department's Request for Proposal
solicitation specifications?
PRELIMINARY STATEMENT
On March 7, 2014, the Department released Request for
Proposal DC RFP-13-031 (RFP).
The RFP sought a vendor to
contract to provide statewide inmate telecommunication services.
The RFP sought proposals to provide an inmate telephone system,
inmate video visitation system, and other required services
detailed in the document.
Petitioner, CenturyLink Public Communications, Inc.,
d/b/a Century Link (CenturyLink); Petitioner, Securus
Technologies, Inc. (Securus); Global; and HomeWav, LLC (HomWav)
submitted proposals.
The Department determined that HomeWav's
proposal was non-responsive.
The Department accepted, reviewed,
and scored the other proposals.
The Department posted its notice
of intent to award the contract to Global.
CenturyLink and Securus protested the intended award as
provided by section 120.57(3), Florida Statutes (2014).1/
protests are consolidated in this proceeding.
3
Both
Securus intervened
in CenturyLink's protest, and CenturyLink intervened in Securus's
protest.
Global intervened in both protests.
On June 18, 2014,
the Department referred the matter to DOAH for conduct of a
formal administrative hearing.
Securus submitted an Amended
Petition and proceeded in this cause upon it.2/
The Department and Global seek a recommended order upholding
the decision to award the contract to Global.
CenturyLink asks
for issuance of an order recommending award of the contract to
CenturyLink or rejection of all proposals.
Securus urges
rejection of all proposals.
Joint Exhibits 1 through 8, 13 through 17, 19,
21 through 24, 29, 31, 37, 39 through 42, 46, and 48 were
received into evidence.
CenturyLink presented the testimony of
Paul Cooper and Shane Phillips.
CenturyLink presented portions
of the deposition testimony of Jon Creamer and Sandra Jolene
Bailey.
CenturyLink offered Exhibits 1 and 2 and 4 through 8,
all of which were received into evidence.
CenturyLink proffered
Exhibit 3 which was not admitted.
Securus presented the testimony of Stephen Viefhaus.
Securus presented portions of the deposition testimony of Sandra
Jolene Bailey, Rosalyn Ingram, Shane Phillips, Steve Wilson,
Randy Agerton, Jon Creamer, Charles Lockwood and Julyn Hussey.
The deposition excerpts were admitted as Securus Exhibits 16
through 23.
4
The Department presented the testimony of Sandra Jolene
Bailey, Jon Creamer, Julyn Hussey and Charles Lockwood.
The
deposition transcripts of Randy Agerton and Steve Wilson were
accepted as Department exhibits.
Global presented the testimony of Steve Montanaro.
Global
also presented portions of the deposition testimony of Paul
Cooper and Stephen Viefhaus, which were received into evidence as
Exhibits 26 and 27.
Global Exhibits 9, 11 through 13 and 23 were
received into evidence.
The parties provided cross designations of depositions that
were admitted into evidence.
The parties timely filed proposed recommended orders.
Those
proposed orders have been considered in the preparation of this
Recommended Order.
At hearing, the parties raised the issue of whether two
deviations noted in CenturyLink's proposal made its proposal
non-responsive.
Those deviations involved the screen size of
video visitation kiosks and the word recognition capability of
the video visit security features.
The parties do not address
those issues in the proposed recommended orders.
They are deemed
abandoned.
During these proceedings, there was a dispute about the
Department permitting Securus to provide complete financial
documents after the proposals were opened.
5
No party advanced
that argument in the proposed recommended order.
It is deemed
abandoned.
Issues related to a five-point error by Mr. Agerton in his
scoring of Global's project staff and issues about "value added"
options, offered by each vendor, have also been abandoned by the
proposed recommended orders.
FINDINGS OF FACT
Background
1.
The Legislature charged the Department with protecting
the public through the incarceration and supervision of offenders
and rehabilitating offenders through work, programs, and
services.
The Department is required to provide telephone access
to inmates in its custody.
2.
Inmate telecommunication services provide inmates the
ability to stay in contact with friends and family.
The services
promote and support efforts to help inmates re-enter society by
fostering communications with the community outside jail and
prison.
3.
The Department does not pay for these services.
The
inmates and their designated family members and friends pay for
the services.
4.
The contract to provide the telecommunications service
generates revenue for the Department.
Department for access to the consumers.
6
The provider pays the
The provider charges the
inmates and their designees for the service.
The provider pays
the Department a commission calculated as a percentage of
revenues received.
The commission is calculated as part of the
charge for the services and is included in it.
The price
competition portion of the RFP is based on the prices charged to
the inmates and designees and the commissions paid to the
Department.
5.
According to the RFP, the State of Florida presently has
a total inmate population of approximately 102,000 people.
In
fiscal year 2010-2011, the inmate calling services generated
total revenue of $14,180,345 from 9,587,040 calls.
In fiscal
year 2011-2012, the inmate calling services generated total
revenue of $13,513,495 from 8,226,577 calls.
And in 2012-2013,
the inmate calling services generated total revenue of
$14,749,021 from 8,853,316 calls.
6.
In 2012–2013, interstate calls generated 11.6 percent of
calls and 12.9 percent of revenues from the contract.
7.
Securus holds the contract with the Department to
provide inmate telephone services and has for over six years.
Before February 11, 2014, Securus paid a 35 percent commission to
the Department on all of its call revenue from the contract.
That changed as of February 11, 2014, when the Department
interpreted a stayed order of the Federal Communications
Commission (FCC), discussed in more detail later, to prohibit
7
collecting the commissions on interstate calls.
The record does
not reveal if Securus stopped collecting the commission portion
of the rates charged to inmates and their designees.
8.
The Department does not collect commissions because it
interprets the FCC order to say that it cannot receive commission
revenue because it is a state agency.
The Department also
declines to accept commissions because it fears finding itself in
a position where it may have to refund money which has already
been transferred to the general fund, possibly an earlier year's
general fund.
9.
During the RFP process, Securus was aware of the
Department's interpretation of the FCC order, because it had
negotiated the change to its existing contract to end commission
payments.
The changes did not affect Securus charging inmates
the commission.
The Department did not include its
interpretation of the order in the RFP, as modified by the
Addenda.
10.
Commissions on interstate calls are significant revenue
for the Department.
11.
This case involves the Department's second attempt to
award a new contract for inmate telecommunication services.
Earlier, the Department issued an Invitation to Negotiate for
these services.
CenturyLink, Global, and Securus all responded.
The Department negotiated with all three.
8
12.
The Department initially decided to award the contract
to CenturyLink.
Eventually, the Department rejected all bids
after it determined that the scoring language and selection
criteria were poorly worded.
They were subject to different
reasonable interpretations that made how the Department would
select the winning vendor unclear and made the playing field for
vendors unequal.
13.
The vendors protested the decision to reject all bids.
In upholding the decision to reject all bids, Administrative Law
Judge Scott Boyd found at paragraph 70:
The Department concluded that the wording
and structure of the ITN and RBAFO did not
create a level playing field to evaluate
replies because they were confusing and
ambiguous and were not understood by
everyone in the same way. Vendors naturally
had structured their replies to maximize
their chances of being awarded the contract
based upon their understanding of how the
replies would be evaluated. The Department
concluded that vendor pricing might have
been different but for the misleading
language and structure of the ITN and RBAFO.
Global Tel Link Corp. v. Dep't of Corr., Case No. 13-3041BID
(Fla. DOAH Nov. 1, 2013), adopted in whole, except for correcting
two scrivener's errors, FDOC Case No. 13-81 (Fla. DOC Nov. 25,
2013).
The Request for Proposals
14.
The Department released the RFP seeking to establish a
five-year contract with a vendor to provide inmate
9
telecommunications services on March 7, 2014.
The Department
subsequently issued Addenda 1, 2, and 3 to the RFP.
The Addenda
included vendor questions and the Department's answers.
No
vendor protested any term, condition, or specification of the RFP
or the Addenda.
15.
The RFP sought vendor proposals to provide an inmate
telephone system, video visitation system, and other services for
inmates housed in the Department's facilities.
The requested
services included the actual service, system design, equipment,
installation, training, operation, repair, and maintenance at no
cost to the Department.
The RFP included security, reporting,
auditing, and monitoring requirements.
It also established the
procurement process, including scoring criteria.
16.
Of the RFP's 66 pages, only the commissions' role in
pricing, scoring procedure, the score given Securus for its
response to RFP section 3.15, and treatment of refunds are the
focus of the disputes in this proceeding at this point.
Review and Scoring
17.
The RFP established proposal scoring based upon four
categories.
The chart below reflects the categories, the tab of
the RFP in which the scored categories are described, and the
maximum points allowed for category.
10
Mandatory Responsiveness Requirements
Executive Summary and Other Proposal Submissions
Category 1--Business/Corporate Qualifications (Tab 3)
Category 2--Project Staff (Tab 4)
Category 3--Technical Response (Tab 6)
Category 4--Price Proposal
0 points
0 points
50 points
200 points
400 points
350 points
TOTAL POSSIBLE POINTS
1,000 points
18.
The RFP breaks each of the categories into components,
each referencing and correlating to specific RFP sections.
are found at RFP "Attachment 4--Evaluation Criteria."
component, the Evaluation Criteria posed a question.
These
For each
For
example, in Category 3, a question asks "How adequately does the
Respondent describe their overall capability and process for
providing a video visitation system?"
19.
The RFP provides a maximum score for each scoring
component, which range from 15 to 50 points depending on the
relative importance of the particular component.
20.
scale:
Each proposal was graded on the following qualitative
Omitted, Poor, Adequate, Good, and Exceptional.
The RFP
associates a point value with each qualitative description for
each particular scoring component.
For instance, if a component
had a maximum score of 25 points, the scoring framework was as
follows:
Omitted--0; Poor--6.25; Adequate--12.5; Good--18.75;
and Exceptional--25.
A score of zero meant that a vendor
completely omitted any information for the item from which a
qualitative assessment could be made.
11
21.
The RFP directed the vendors how to generally format
and package their proposals.
Specifically, RFP Section 5
(Proposal Submission Requirements) stated:
All Project Proposals must contain the
sections outlined below. Those sections are
called "Tabs." A "Tab," as used here, is a
section separator, offset and labeled,
(Example: "Tab 1, Mandatory Responsiveness
Requirements"), such that the Evaluation
Committee can easily turn [t]o "Tabbed"
sections during the evaluation process.
Failure to have all copies properly "tabbed"
makes it much more difficult for the
Department to evaluate the proposal.
22.
Vendors were to include seven "tabs" within their
proposals:
a.
b.
c.
d.
e.
f.
g.
23.
Tab 1 Mandatory Responsiveness
Requirements
Tab 2 Transmittal Letter with Executive
Summary
Tab 3 Business/Corporate Qualifications
Tab 4 Project Staff
Tab 5 Respondent's Financial
Documentation
Tab 6 Technical Response
Tab 7 Minority/Service Disabled Veteran
Business Enterprise Certification
The RFP gave further instructions about the contents
within each tab.
RFP Section 5.6 provided the requirements for
Tab 6, Technical Responses.
It required vendors to provide a
narrative technical response identifying how vendors will meet
the scope of services required by the RFP and, more specifically,
the scope of services described in RFP Sections 2 (Statement of
Need/Services Sought) and 3 (Scope of Services).
12
The RFP did not
mandate any other formatting requirements for the contents of
Tab 6.
This becomes significant in the analysis of Securus's
response to section 3.15 of the RFP.
24.
The RFP advised that the Department would assign an
evaluation committee to evaluate proposals.
It did not state how
many evaluators would be selected to score proposals or whether
evaluators would be responsible for scoring proposals in their
entirety or just specific portions.
25.
The Department appointed a team of six evaluators:
Jon Creamer, Shane Phillips, Randy Agerton, Steve Wilson, Charles
Lockwood, and Richard Law.
26.
Mr. Law, a certified public accountant, reviewed each
vendor's financial submissions on a pass/fail basis.
The other
five evaluators scored the technical responses, categories one
through three.
27.
Julyn Hussey, the procurement officer, trained the
evaluators, except for Mr. Law.
She provided the evaluators with
a training manual, the RFP, the vendors' proposals, and scoring
sheets.
During training, Ms. Hussey instructed the evaluators to
review proposals in their entirety to properly evaluate and score
their various components.
28.
The Department gave the evaluators approximately eight
days to evaluate and score the proposals.
The evaluators did not
consult with each other during their evaluation.
13
Each evaluator
turned his completed score sheet in to Ms. Hussey.
She then
compiled the technical response scores.
29.
Ms. Hussey also calculated the price scores by taking
the prices from the vendors' price sheet submissions and applying
the RFP price scoring formula.
The Department combined the
technical and price scores to calculate each vendor's total
score.
30.
points.
Global received the highest total score with 2,960.42
Securus was second with 2,911.04 points.
was third with 2,727.94 points.
Global outscored Securus by
49 points on a 3,600-point scale.
by 232.48 points.
CenturyLink
Global outscored CenturyLink
Securus outscored CenturyLink by 183.10
points.
Commissions, Pricing, and an FCC Order
31.
The vendors' price proposal was a critical category of
the RFP review and evaluation.
points available.
points, 400.
It was worth 350 of the 1,000
Only the technical response could score more
Of the 350 points, 300 points were directed toward
the inmate telephone service price proposal and 50 points were
for the video visitation service price proposal.
32.
The RFP subdivides the inmate telephone service points
into 150 possible points for the provider offering the highest
commission payments to the Department; 125 points for the lowest
intralata, interlata, intrastate, and interstate per-minute
14
rates; and 25 points for the lowest local and local extended area
per-minute rates.
The vendor with the most favorable numbers in
each subcategory received the maximum points.
The rest received
a percentage of the maximum points based on a ratio between their
bid and the most favorable bid
33.
RFP Section 3.8.3, "Rate and Call Charge Requirements"3/
provided:
For the price sheet, the Respondent shall
establish a separate single, blended rate per
minute, inclusive of all surcharges and
department commission rate on the price sheet
(attachment 5) for the inmate telephone
service and the video visitation service.
Local and local extended area service calls
shall be billed as local calls and shall not
exceed $0.50 for a 15 minute phone call.
For the price sheet, the Respondent shall
establish a single, blended rate per minute,
inclusive of all surcharges, for all calls on
the North American Dialing Plan, including
intralata, interlata, intrastate, and
interstate calls which shall not exceed the
maximum rate per minute allowed by the
Federal Communications Commission (FCC) and
appropriate regulatory authority during the
time the call is placed. In addition to the
FCC, vendors can contact the state consumer
protection agency, Better Business Bureau, or
State Attorney General's Office to obtain
maximum rate per minute information.
Note: In accordance with Federal
Communications Commission 47 CFR Part 64
[WC Docket No. 12-375; FCC 13-113]--Rates for
Interstate Calling Services--effective
February 11, 2014, no commission shall be
paid on revenues earned through the
completion of interstate calls of any type
received from the Contract
15
Call charges for international calls shall
not exceed the maximum rate allowed by the
appropriate regulatory authority during the
time the call is placed.
Local call charges for coin-operated
telephone calls at the Work Release Centers
shall not exceed thirty-five cents (.35) per
local call plus the Local Exchange Carrier
(LEC) charges, which vary between LEC's.
Long distance call charges for coin-operated
phones at the Work Release Centers shall be
at the same rates for inmate telephone calls.
The Contractor shall agree that charges for
calls shall include only the time from the
point at which the called party accepts the
call and shall end when either party returns
to an on-hook condition or until either party
attempts a hook flash. There shall be no
charges to the called party for any setup
time.
The Contractor shall not charge, pass on, or
pass through to the customer paying for
collect or prepaid calls any charges referred
to as Local Exchange Carrier's (LEC's) or
Competitive Local Exchange Carrier's (CLEC's)
billing costs, or any bill rendering fee or
billing recovery fee. The Contractor shall
also ensure that LEC's and CLEC's do not
charge or pass on to the customer any
additional fee or surcharges for billing.
The Contractor shall be responsible for any
such LEC or CLEC surcharges incurred if
billing through the LEC or CLEC.
In addition, the Contractor shall not charge,
pass on, or pass through to the customer
paying for the collect, prepaid calls or
video visitation visits any of the following
charges and/or fees:
Bill Statement Fee, Funding Fee, Mail-In
Payment Fee, Western Union Payment Fee,
Refund Fee, Regulatory Recovery Fee, Wireless
Admin Fee, Single Bill Fee, Paper Statement
16
Fee, Account Setup Fee, Account Maintenance
Fee, Inactive Account Fee, Account Close-Out
Fee, Non-Subscriber Line Charge, Inmate
Station Service Charge, Third-Party Payment
Processing Fee, State Regulatory Recovery
Fee, Check/Money Order Processing Fee,
Biometric Service Charges, JPay Payment Fee,
Federal Regulatory Cost Recovery Fee,
Regulatory and Carrier Cost Recovery Fee,
Validation Surcharge or Wireless Termination
Surcharge.
The Contractor shall ensure, inmates' family
and friends utilizing the Florida Relay
Service to receive calls from inmates are
charged the same rates as those family and
friends receiving calls from inmates not
utilizing this service. [emphasis added].
34.
The Department intended for the boldface note to advise
responding vendors that the vendor would not pay commissions on
interstate call revenues.
The language raised questions which
the Department replied to in the Addenda issued after the RFP
issued.
35.
None of the Addenda modified the plain statement in
section 3.8.3 that "the Respondent shall establish a separate
single, blended rate per minute, inclusive of all surcharges and
department commission rate on the price sheet (attachment 5) for
the inmate telephone service."
36.
Section 7.3.1 of the RFP established the requirements
for commission and monthly payments.
It states:
The Contractor shall pay to the Department a
monthly commission based on the percentage of
gross revenues as determined through this RFP
process. The Department will begin to
17
receive payment for a facility on the date
the Contractor assumes responsibility for the
operation of that facility's inmate
telecommunication service in accordance with
the Final Transition and Implementation Plan.
37.
Sections 7.3.2 through 7.3.4 contain additional
requirements for commission payments, supporting documentation
for the commission calculation, and penalty, if the vendor does
not timely make the final commission payment at the end of the
contract.
They make the importance of commission payments to the
Department clear.
38.
Attachment 5 is a mandatory form for vendors to provide
their proposed call and commission rates.
It contains the same
boldface note about the FCC order as section 3.8.3.
39.
The form solicited a blended rate and a single
commission rate for telephone services.
40.
FCC, 47 C.F.R. Part 64 (WC Docket No. 12-375;
FCC 13-113) (FCC order), referred to in RFP Section 3.8.3 and
Attachment 5, is a commission decision and regulation, effective
May 31, 2013, addressing a need for reform in what the FCC
determined were "egregious interstate long distance rates and
services" in the inmate telecommunications business.
The FCC
identified paying commissions to correctional institutions and
including them in the rates charged inmates and their families
and other designees as a significant factor contributing to
unreasonably high rates for inmate telecommunications services.
18
The decision also addressed surcharges and fees.
The FCC
determined that inmate telecommunications charges must be costbased and that commission payments, among other things, could not
be included in the costs.
The FCC adopted subpart FF to
47 C.F.R. part 64 of its regulations to regulate inmate calling
services.
41.
The FCC included in subpart FF, section 64.010, titled,
cost-based rates for inmate calling services.
It states:
"All
rates charged for Inmate Calling Services and all Ancillary
Charges must be based only on costs that are reasonably and
directly related to the provision of ICS [inmate calling
services]."
This is the rule implementing the FCC's decision
that commission payments are not included in the reasonably and
directly related costs.
42.
The FCC made clear that it was not prohibiting payment
of or collection of commissions, only prohibiting including them
in the costs determining the fee paid by inmates and their
designees.
43.
The FCC addressed this in paragraph 56 of the order,
which states:
We also disagree with ICS providers'
assertion that the Commission must defer to
states on any decisions about site commission
payments, their amount, and how such revenues
are spent. We do not conclude that ICS
providers and correctional facilities cannot
have arrangements that include site
19
commissions. We conclude only that, under
the Act, such commission payments are not
costs that can be recovered through
interstate ICS rates. Our statutory
obligations relate to the rates charged to
end users—the inmates and the parties whom
they call. We say nothing in this Order
about how correctional facilities spend their
funds or from where they derive. We state
only that site commission payments as a
category are not a compensable component of
interstate ICS rates. We note that we would
similarly treat "in-kind" payment
requirements that replace site commission
payments in ICS contracts.
44.
Providers of inmate calling services, including all
three vendors in this proceeding, sought review of the decision
and regulation by the United States Court of Appeals for the
District of Columbia Circuit.
The court stayed section 64.010,
along with sections 64.6020, and 64.6060.
45.
Following release of the RFP, the Department received
and answered inquiries from vendors.
The inquiries, the
Department's responses, and changes to the RFP are contained in
Addenda 1, 2, and 3 to the RFP.
Rates and commissions received a
fair amount of attention in the process.
46.
In response to inquiries about section 3.8.3 and
Attachment 5, the Department changed both with Addendum 2.
questions and Department responses follow.
47.
Question No. 4 states:
Page 30: 3.8.3 - Rate and Call Charge
Requirements and Attachment 5 – Blended Call
Rates. Regarding the blended rate (inclusive
20
The
of all surcharges) to be bid – the current
wording could be opportunistically
misinterpreted in a few different ways:
First in the treatment of per-call versus
per-minute fees, based on our understanding,
one bidder could possibly offer a flat $1.80
per call fee for non-local inmate telephone
calls and claim to have the same blended rate
($1.80/15 minutes = $0.12) as someone bidding
$0.12 per minute with no per-call fee.
This
could occur even though calls average less
than 15 minutes (and many calls are less than
10 minutes), meaning these two offers are not
comparable in terms of overall cost to family
members.
Second, the RFP wording could also possibly
be interpreted as allowing a Contractor to
set different rates for different call types
(collect/prepaid, intraLATA/interstate) and
then averaging them using assumptions they
define.
Question 1: To minimize cost to family
members and make offers comparable, would the
Department please explicitly disallow
per-call fees for the inmate telephone system
(for example, per-call setup charges,
per-call surcharges), allowing only a true
per-minute rate?
Question 2: If no to Question 1, would the
Department require separate disclosure of
per-call fees and per-minute rates?
Question 3: Would the Department please
verify that ALL non-local domestic calls-intraLATA, interLATA, and interstate, for
both collect and prepaid-–must be charged at
an identical rate?
48.
Answer No. 4 states:
Question 1: Per this Addendum #2, the
following revisions will be made to Section
3.8.3:
21
In 3rd paragraph after first sentence add:
The Respondent shall establish a separate
single, blended rate per minute inclusive of
all surcharges for all local and local
extended area calls. These per minute rates
delete: which
Delete 4th paragraph beginning with Note.
In 6th paragraph first sentence revised to
read: Local call charges for coin-operated
telephone calls at the Work Release Centers
shall not exceed forty-five cents (.45) per
local call plus the Local Exchange Carrier
(LEC) charges, which vary between LEC's.
In 9th paragraph following In addition, the
Contractor shall not charge, pass on, or pass
through to the customer paying for the
collect, prepaid calls or video visitation
visits any of the following charges and/or
fees: Add Pre-call setup charges, Pre-call
surcharges,
Delete last paragraph;
Question 2:
Not applicable,
Question 3: Confirmed, per Section 3.8.3 all
non-local and local extended area calls must
be charged at an identical rate.
49.
Question No. 5 states:
Attachment 5 - Price Sheet.
Page 30--Section 3.8.3 states that on the
price sheet, the Respondent will provide a
"single, blended rate per minute, inclusive
of all surcharges . . . ." Attachment 5
states "Blended Telephone Rate for All
Calls . . ." To eliminate ambiguity, would
the Department consider changing the language
in Attachment 5 to read "Blended Telephone
Rate Per Minute for All Calls . . . ?" [sic]
22
50.
Answer No. 5 states:
Attachment 5 will be revised to include
"Blended Telephone Rate Per Minute for All
Calls".
51.
Question No. 6 states:
Page 30: 3.8.3 - Rate and Call Charge
Requirements. The fourth paragraph states
that "In accordance with Federal
Communications Commission 47 CFR Part 64
[WC Docket No. 12-375; FCC 13-113]--Rates for
Interstate Calling Services--effective
February 11, 2014, no commission shall be
paid on revenues earned through the
completion of interstate calls of any type
received from the Contract."
Respectfully, this interpretation of the
FCC's Order is incorrect. The Order, without
question, does not prohibit the payment of
commissions on interstate calls. Also, rules
regarding future cost-based regulation
(including consideration of commissions in
rate-setting) have been stayed by the D.C.
Circuit Court of Appeals, and FL DOC
interstate rates are well below the FCC rate
caps that have been left in place by the
Court. This is why most providers have
continued to pay commissions on interstate
calling, in compliance with their contracts.
Q. Will the State consider removing this
paragraph from the RFP in order to ensure
revenue for the State and a level playing
field across providers?
52.
Answer No. 6:
Section 3.8.3 and Attachment 5--Price Sheet
is amended, per this Addendum to remove the
paragraph. In addition, Section 7.3.1 has
also been amended, per this Addendum, to
state that commissions will be paid in
accordance with all Federal, State and Local
regulations and guidelines.
23
53.
Further questions and clarifications followed.
are found in Addendum 3 to the RFP.
54.
Question No. 2 states:
In Addendum No. 2; Answer #4 Revises Section
3.8.3 by revising the 3rd paragraph
Instructions are to add the following
language:
The Respondent shall establish a separate
single, blended rate per minute inclusive of
all surcharges for all local and local
extended area calls. These per minute rates
(delete: which)
For the price sheet, the Respondent shall
establish a single, blended rate per minute,
inclusive of all surcharges, for all calls on
the North American Dialing Plan, including
intralata, interlata, intrastate, and
interstate calls which shall not exceed the
maximum rate per minute allowed by the
Federal Communications Commission (FCC) and
appropriate regulatory authority during the
time the call is placed. The Respondent
shall establish a separate single, blended
rate per minute inclusive of all surcharges
for all local and local extended area calls.
These per minute rates (deIete [sic]: which).
In addition to the FCC, vendors can contact
the state consumer protection agency, Better
Business Bureau, or State Attorney General's
Office to obtain maximum rate per minute
information.
The instructions to add "These per minute
rates (delete: which)" does not fit with the
instructions. The word "which" is not
included in this area of paragraph 3.
Question #2: Can the Department please
clarify?
24
They
55.
Answer No. 2 states:
To further clarify 3.8.3, paragraph 3 is
revised to read as follows:
For the price sheet, the Respondent shall
establish a single, blended rate per minute,
inclusive of all surcharges, for all calls on
the North American Dialing Plan, including
intralata, interlata, intrastate, and
interstate calls. The Respondent shall also
establish a separate single, blended rate per
minute inclusive of all surcharges for all
local and local extended area calls. Both of
these per minute rates shall not exceed the
maximum rate per minute allowed by the
Federal Communications Commission (FCC) and
appropriate regulatory authority during the
time the call is placed. In addition to the
FCC, vendors can contact the state consumer
protection agency, Better Business Bureau, or
State Attorney General's Office to obtain
maximum rate per minute information.
56.
Question No. 3 states:
Question: Is the Department requiring the
successful Respondent to pay commissions on
revenues generated through the completion of
interstate calls?
57.
Answer No. 3 states:
The Department's position is that the
collection of commission rates will be
determined by the FCC ruling 47 CFR Part 64
[WC docket no. 12-375; FCC13-113].
For purposes of this solicitation the
Department requests respondents submit a
commission rate for interstate calls. The
Department will comply with any future FCC
ruling.
25
58.
Question No. 10 states:
Section 7.3.1 was revised to include:
"Commissions will be paid in accordance with
all Federal, State and Local regulations and
guidelines." There are no Federal, State, or
Local regulations and guidelines which
require phone vendors to pay commissions on
interstate calling. Thus, in not paying
commissions on interstate calling, there
would be no violation of any Federal, State,
or Local regulation or guideline. The
requirement as to whether or not commissions
will be paid on interstate calling must come
from FL DOC and must be clearly indicated in
the RFP. If not clearly indicated one way or
another, we fear some vendors may have an
unfair advantage as commissions are not
currently being paid and there does not seem
to be a compliance issue with the current
contract which requires such commissions.
a. Please, clearly specify whether or not
commissions are required to be paid on
interstate calls.
59.
Answer No. 10 states:
Please see answer to question 3.
60.
The Department never definitively stated whether it
would ultimately collect commissions on interstate revenues.
Nor
did it provide a means for vendors to propose rates or
commissions based upon whatever the Department concluded were the
most likely scenarios resulting from the FCC order and appeal.
But the Department's RFP persisted in the RFP requirement that
the bidders must include the commission in the calculation of
their blended rate for the price proposal.
26
This stands in
contrast to the RFP's lengthy list of items, such as bill
statement fees, paper statement fees, and account setup fees,
which could not be included in the rate.
These are items, like
the commissions, that the FCC order said could not be part of the
fee base.
61.
A vendor, who did not calculate the commission in the
blended rate, would have a significant price advantage over a
vendor who included the commission in its blended rate.
It could
propose lower rates and/or higher commissions while maintaining
its profit margin.
That is because although the price sheet
identifies a commission, the commission is not accounted for in
the blended rate.
62.
CenturyLink included payment of a commission rate of
65.3 percent on interstate calls in the blended rate it provided
on Attachment 5.
This action is a reasonable application of the
statements of the RFP and the Addenda about blended rates,
commissions, and the cryptic statement about plans to follow the
FCC order.
63.
CenturyLink proposed a blended rate that did "establish
a separate single, blended rate per minute, inclusive of all
surcharges and department commission rate."
64.
If CenturyLink had not included the commission payment
on interstate calls in its blended rates, it could have bid
higher commissions, lower rates, or a combination of both.
27
65.
Securus identified a commission percentage for all
calls of 73 percent on its Attachment 5 price sheet.
Securus did
not include the cost of paying a commission on interstate calls
in calculating the blended rate that it submitted.
This allowed
Securus to submit a lower blended rate than it would otherwise
have had to submit to achieve the same revenue from the contract.
66.
The blended rate that Securus proposed did not
"establish a separate single, blended rate per minute, inclusive
of all surcharges and department commission rate."
67.
Global identified a commission percentage of 46 percent
for all calls in its Attachment 5 price sheet.
In determining
the proposed rates for interstate calls, Global did not include
or assume payment of the commission percentage rate.
This
allowed it to submit lower blended rates and/or a higher
commission rate.
68.
Global did not intend to or think it would be required
to pay commission rates on interstate calls.
This was based on
its evaluation of the FCC order, the appeal, and the Department's
decision not to accept commission payments on interstate calls
under its current contract with Securus.
This is why it did not
include the commission as a cost when calculating the blended
rate.
69.
Global chose to take the business risk that its
evaluation of the FCC order would be correct.
28
If it was
incorrect and a commission payment was required, Global was
prepared to make the payment, even though it would not have been
collected from inmates and their designees through the blended
rate.
70.
The blended rate proposed by Global did not "establish
a separate single, blended rate per minute, inclusive of all
surcharges and department commission rate."
71.
Ms. Hussey applied the formula in the RFP to determine
points awarded each vendor for its price proposal.
This
calculation was a ministerial function that did not call for any
exercise of judgment or discretion.
72.
The overall cost ranking scores were:
Global 280.42,
Securus 276.04, and CenturyLink 232.94.
73.
The scores for the commissions were:
Global 94.52,
Securus 150, and CenturyLink 134.18.
74.
The scores for the blended rates for inmate telephone
services that included interstate services were:
Securus 56.25, and CenturyLink 50.90.
Global 125,
This difference reflects
the vendors' differing treatment of commissions when proposing
their blended rates.
75.
The Department did not know during the evaluation
process that Global and Securus had not included or assumed
payment of the commission in its proposed rates for interstate
29
calls.
The Department learned this during discovery in this
proceeding.
76.
Not including commission payments on interstate calls
in the proposed blended rate was contrary to the instructions of
the RFP.
Securus Response to RFP Section 3.15
77.
The Department awarded Securus zero points for the
question of "[h]ow adequate is the Respondent's plan to meet the
performance measures outlined in section 3.15 of the RFP?"
This
criterion related to the performance measures of RFP Section 3.15,
for which proposals could earn 125 total points.
The difference
between zero and the possible maximum points would have made a
difference in winning and losing the contract award for Securus.
78.
The score of zero is a factual finding by the Department
that Securus's 600-plus-page proposal had no information from
which evaluators could qualitatively assess the proposal by that
criterion.
79.
A score of zero is not a qualitative assessment, like a
score of "poor" or "exceptional."
A score of zero reflects a
finding that information is completely absent.
80.
The evaluation criteria score sheet, RFP Attachment 4,
provided factors to be considered in evaluating and scoring
proposals.
It presented the factors to evaluators in the form of
questions to evaluators.
For section 3.15, the question and
30
accompanying scores allowed were:
How adequate is the
Respondent's plan to meet the performance measures outlined in
section 3.15 of this RFP?
(Omitted-0; Poor-6.25; Adequate-12.5;
Good-18.75; and Exceptional-25.)
81.
Because the Department allowed each evaluator to score
this factor, a total of 125 points was ultimately available to the
vendors.
82.
RFP Section 3.15 provides:
3.15 Performance Measures
Upon execution of this contract, Contractor
agrees to be held accountable for the
achievement of certain performance measures
in successfully delivering services under
this Contract. The following Performance
Measure categories shall be used to measure
Contractor's performance and delivery of
services.
Note: the Contractor shall comply with all
contract terms and conditions upon execution
of contract and the Department may monitor
each site upon implementation of services at
that site to ensure that contract
requirements are being met. The Department
reserves the right to add/delete performance
measures as needed to ensure the adequate
delivery of services.
1)
2)
Performance Outcomes and Standards; and
Other Contract Requirements.
A description of each of the Performance
Measure categories is provided below:
83.
RFP Section 3.15 was divided into two components.
Section 3.15.1 listed key "Performance Outcomes and Standards"
31
deemed most critical to the success of the contract and required
that "the contractor shall ensure that the stated performance
outcomes and standards are met."
The key elements were:
(1) Completion of Routine Service, (2) Completion of Major
Emergency Repair Service, and (3) Commission and Call/Video
Visitation Detail Report (Invoice Documentation).
84.
The first is RFP Section 3.15.1.
It provides:
3.15.1 Performance Outcomes and Standards
Listed below are the key Performance Outcomes
and Standards deemed most crucial to the
success of the overall desired inmate
telecommunication service. The contractor
shall ensure that the stated performance
outcomes and standards (level of achievement)
are met. Performance shall be measured as
indicated, beginning the second month after
which service has been fully implemented.
1.
Completion of Routine Services
Outcome: All requests for routine service
(as defined in Section 1.22) shall be
completed within twenty-four (24) hours of
request for service from the Department,
unless otherwise instructed by the
Department.
Measure: Compare the date/time that service
is completed to the date/time that the
request for service was received from the
Department by the Contractor. (Measure
Monthly).
Standard: Ninety percent (90%) of routine
service requests shall be completed within
twenty-four (24) hours of notice from the
Department.
32
2. Completion of Major Emergency Repair
Service
Outcome: All major emergency repair service
(as outlined in Section 3.10.8) shall be
completed within twelve (12) hours of request
for repair from the Department, unless
otherwise instructed by the Department.
Measure: Compare the date/time that major
emergency repair service is completed to the
date/time that the request for major
emergency repair service was received from
the Department by the Contractor. (Measure
Monthly).
Standard: Ninety percent (90%) of routine
service requests shall be completed within
twelve (12) hours of notice from the
Department.
3. Commission and Call/Video Visitation
Detail Report (Invoice Documentation):
Outcome: The Contractor shall provide the
Commission and Call/Video Visitation Detail
Report to the Contract Manager or designee as
specified in Section 7.3.3 within thirty (30)
days of the last day of the Contractor's
regular billing cycle.
Measure: Compare the date the Commission and
Call/Video Visitation Detail Report was
received with the last day of the
Contractor's regular billing cycle. (Measure
Monthly).
Standard: One hundred percent (100%) of
Commission and Call Detail Reports shall be
received within thirty (30) days of the last
day of the Contractor's regular billing
cycle.
Upon execution of this Contract, the
Contractor hereby acknowledges and agrees
that its performance under the Contract shall
meet the standards set forth above. Any
33
failure by the Contractor to achieve any
outcome and standard identified above may
result in assessment of Liquidated Damages as
provided in Section 3.17. Any such
assessment and/or subsequent payment thereof
shall not affect the Contractor's obligation
to provide services as required by this
Contract.
85.
Section 3.15.2 advised that the Department will monitor
the contractor's performance to determine compliance with the
contract.
It states:
3.15.2 Other Contract Requirements
Standard: The Department will monitor the
Contractor's performance to determine
compliance with other contract requirements,
including, but not limited to, the following:
•
•
•
•
•
Video Visitation System (as outlined in
Section 3.7)
Inmate Telecommunication System
Functionality (as outlined in Section
3.7)
Transition/Implementation/Installation of
System
Bi-Annual Audit
Timely Submittal of Corrective Action
Plans (when applicable)
Measure: Failure to meet the agreed-upon
Final Transition/Implementation/Installation
schedule or failure to meet (compliance with
other terms and conditions of the contract or
contract requirements listed above) may
result in the imposition of liquidated
damages
86.
Each of the three items in section 3.15.1 and the five
items in section 3.15.2 relate directly to a particular provision
within RFP Section 3 titled, "Scope of Services."
34
87.
Section 3.15.1 related to RFP Sections 1.22 and 3.10.7
(Routine Maintenance), 3.10.8 (Major Emergency Repair Service),
and 7.3.3 (Detail Report).
Section 3.15.1 specifically identifies
the last two.
88.
Similarly, section 3.15.2 cross referenced section 3.7
(Telecommunications Services System Functionality) for the first
two performance measure items.
89.
Two others items relate directly to sections 3.5
(Facility Implementation Plan and Transition of Service), 3.6
(Installation Requirements), and 3.11 (Bi-Annual Audit).
This is
significant because Sections 3.5, 3.6, and 3.11 were independently
scored.
90.
In other words, the RFP required that the proposals
contain a narrative explaining how vendors planned to provide the
services required by each of those sections.
91.
The RFP did not require the proposals to contain a
separately delineated section titled, "3.15."
It only required
that each proposal include, under "Tab 6," a narrative description
of the vendor's solution and plan to meet the performance
measures.
Evaluation of Responses to Section 3.15
92.
Global included a specifically labeled section 3.15 in
its response.
It essentially copied and pasted the RFP language
for Sections 3.15, 3.15.1, and 3.15.2, and after each subsection,
35
inserted the words "GTL [Global] Response:
complies."
GTL understands and
Global did not provide a substantive narrative under
the heading, section 3.15.
CenturyLink's labeled response to
section 3.15 was very similar.
93.
The evaluators reviewed the section of Global's proposal
labeled as responsive to section 3.15.
The maximum score the
evaluators could award per evaluator was 25 points.
Global earned
scores of 25, 18.75, 12.5, 12.5, and 12.5 from Messrs. Lockwood,
Agerton, Phillips, Creamer, and Wilson, respectively.
94.
The evaluators reviewed CenturyLink's proposal labeled
as responsive to section 3.15.
It also earned scores of 25,
18.75, 12.5, 12.5, and 12.5 from Messrs. Lockwood, Agerton,
Phillips, Creamer, and Wilson, respectively.
95.
All five evaluators reviewed copies of the vendors'
proposals.
Some evaluators performed a section-by-section and
some performed side-by-side evaluations of the proposals.
96.
Since Securus did not have a labeled section 3.15 and
the other proposers did, the evaluators scored Securus's proposal
as "Omitted-0" for section 3.15.
97.
After their initial review of Securus's proposal, three
evaluators raised concerns with the Department's procurement
officer, Ms. Hussey, over their inability to find a section in the
Securus proposal specifically identified as a response to
Section 3.15.
36
98.
Ms. Hussey reiterated the instruction given during
evaluator training to review proposals in their entirety when
scoring any component of the RFP.
99.
None of those evaluators changed their scores of
"omitted" for section 3.15 of Securus's proposal after receiving
Ms. Hussey's additional instruction and presumably performing a
second review of Securus's proposal.
100.
RFP Section 3.15 included cross references to
sections 3.7 and 3.10.8.
Following these referenced sections to
the matching section numbers in the Securus proposal reveals
narratives addressing the section 3.15 requirements.
In addition,
these cross-referenced sections were separately scored by each
evaluator during his review of each vendor's Telecommunications
Service System Functionality and Telecommunication Service
Equipment Requirements.
101.
Securus's proposal complied with the RFP specifications
by affirming Securus's commitment to comply with section 3.15
throughout the proposal.
Although Securus's proposal did not
include a separate tabbed section addressing Securus's plan to
meet the section 3.15 performance measures, Securus provided a
narrative explaining how Securus would meet each performance
measure required in section 3.15.
Securus also provided
narratives explaining how it would meet and provide the scope of
service of each one of the performance measures of Section 3.15.
37
102.
The first performance measure in RFP Section 3.15.1
required that 90 percent of all routine service be completed
within 24 hours of the Department giving notice to the vendor.
The routine service requirement was located at section 3.10.7.
103.
In its proposal, behind Tab 6 and labeled "3.10.7
Routine Service," on page 388, Securus's response stated:
All routine service shall be completed within
twenty-four (24) hours of the initial system
failure notice, service request for service
or equipment failure or liquidated damages
may be imposed as stated in Section 3.17.
Securus has read, understands, and complies.
Securus Field Repair staff is strategically
located throughout the state to be able to
respond to all repair service needs in order
to meet all repair service needs. Securus
will continue to complete all routine
service, as we do under the existing
contract, within twenty-four (24) hours if
the initial system failure notice, service
request for service or equipment failure or
liquidated damages may be imposed as stated
in Section 3.17.
104.
This response complied with the RFP requirement.
It
could not rationally be deemed omitted.
105.
The second performance measure in RFP Section 3.15.1
required that 90 percent of all major emergency repair services
(as outlined in section 3.10.8) be completed within 12 hours of
the Department giving notice to the vendor.
measure cross-referenced section 3.10.8.
38
This performance
106.
Securus's proposal behind Tab 6 and labeled "3.10.8
Major Emergency Repair Service," addressed the emergency repairs
stating:
All major emergency service shall be
completed within twelve (12) hours of the
initial system failure notice request or
liquidated damages may be imposed as stated
in Section 3.17.
Securus has read, understands, and complies.
Securus Field Repair staff is strategically
located throughout the state to be able to
respond to all repair service needs in order
to meet all repair service needs. Securus
will continue to complete all major emergency
service, as we do under the existing
contract, within twelve (12) hours if the
initial system failure notice, service
request for service or equipment failure or
liquidated damages may be imposed as stated
in Section 3.17.
Securus's response complied with the RFP requirement.
It could
not rationally be deemed omitted.
107.
The third performance measure in RFP Section 3.15.1
required that the Commission and Call/Video Visitation Detail
Report (Invoice Documentation) be provided to the contract manager
or designee, as specified in section 7.3.3 at the end of every
month with the contractor's regular billing cycle.
Securus
addressed this requirement behind Tab 6 in a section labeled "2.4
Revenue to be Paid the Department," on page 107.
39
108.
Securus's response stated:
This RFP will result in a Revenue Generating
Contract. The Contractor shall pay the
Department a commission based on a percentage
of gross revenue. The Contractor shall be
responsible for collections and fraud, and
shall not make any deductions from gross
revenue for uncollectible accounts, billing
fees or other administrative costs prior to
applying the commission percentage.
Notwithstanding the above, gross revenue
shall not include taxes charged by an
appropriate governmental entity. The monthly
commission amount is obtained by multiplying
the commission percentage times each month's
total charges.
The successful contractor shall submit a
Commission and Call/Video Visitation Detail
Documentation for Monthly Payment report as
indicated in Section 7.3.3 with the monthly
commission payment.
Securus has read, understands and complies.
Securus will provide the monthly payment
report as required and will provide all
appropriate auditing detail required upon
request from the Department.
109.
This response complies with the RFP requirement and
cannot rationally be deemed omitted.
110.
Some evaluators acknowledged that they did not factor
Section 3.15.2 into their scoring of Securus's proposal.
111.
The terms of the RFP require considering section 3.15.2
during the scoring of section 3.15.
It is part of that section.
Failing to consider Securus's narrative related to section 3.15.2
is not rational.
40
112.
As with section 3.15.1, Securus's proposal complied
with the RFP Section 3.15.2.
Securus committed to complying with
the requirements of section 3.15.2 throughout its proposal.
113.
The record does not prove whether each evaluator
re-reviewed the cross-referenced sections identified in
Section 3.15.
But Mr. Phillips did.
Despite seeing the exact
language in those sections as required in the "Outcome" portion of
Section 3.15, Mr. Phillips awarded Securus a score of zero
because, in his mind, "key parts of 3.15" were not addressed.
114.
The conclusion that Securus entirely omitted a plan to
address Section 3.15's requirements is irrational and clearly
erroneous.
Something was there.
A score of omitted is not
supported.
115.
Mr. Phillips also did not score section 3.15
consistently with the way he scored another section of Securus's
proposal.
He originally gave Securus a score of zero for
section 3.14 entitled, Training, because he did not find a
specifically delineated section titled section 3.14 in Securus's
response.
116.
But Mr. Phillips changed his score before submitting it
to Ms. Hussey because upon further review of Securus's proposal,
he found some aspects that addressed the training requirements of
section 3.14.
He scored that section accordingly.
41
This
highlights the error in evaluators not doing the same with
section 3.15.
117.
The evaluators irrationally concluded that Securus
failed to include in its technical proposal any information
explaining how it would meet the performance standards and
outcomes of section 3.15.
Some evaluators relied on the theory
that Securus did not "acknowledge" the outcomes and standards.
As
established above, Securus acknowledged that "the Performance
Outcomes and Standards are crucial to the success of the overall
inmate telephone service," and throughout its technical response,
Securus addressed all the required outcomes and standards.
118.
Securus mentioned and acknowledged the performance
outcomes and standards a total of six times in its proposal:
twice on page 42 and once on each of pages 100, 138, 160, and 392.
Three of those pages were narrative responses to sections 3.7
and 3.11, which are specifically included as part of section 3.15.
119.
Some evaluators also claimed that Securus never
expressly agreed to be bound by the performance measures of
section 3.15.
That may theoretically affect the qualitative
evaluation of the response, but it does not support a finding that
the information was omitted.
120.
Also, the RFP did not require a vendor to specifically
delineate each of the 18 subsections of section 3 in its response.
To comply with the Technical Response section of the RFP, a vendor
42
needed to address, in narrative form, its plan to provide the
scope of services outlined in section 3.
121.
This was not disputed.
Several Department employees
testified and agreed that a response to the RFP did not require
specifically delineated sections of the response that mirrored the
delineation of the RFP.
Inclusion of Prohibited Fees
122.
In Addendum 2, the Department asked the vendors to
provide a sample refund policy.
The policies were not described
as or intended to be final refund policies that would be used in
administration of the contract.
The terms of a refund policy, if
any, would be negotiated with the winning vendor, subject to the
requirements of the RFP, including the prohibition against
including fees in the blended rate.
123.
The sample policies of Securus and Global included
some costs or forfeitures for obtaining a refund depending on how
and when the inmate sought the refund.
These are not prohibited
fees or even items agreed to in the RFP.
They are only samples.
The evidence does not prove that the sample refund policies
violate the requirement of section 3.8.3.
Scoring
124.
The review and evaluation process described in
section 6 of the RFP identified the maximum number of points that
could be awarded for each part of the inmate calling services
43
project.
The total number of possible points was 1,000.
sections and points allotted to them were as follows:
The
Mandatory
Responsiveness Requirements--0, Executive Summary and Other
Proposal Submissions--0, Business/Corporate Qualification--50,
Project Staff--200, Technical Response--400, and Price
Proposal--350.
This allowed 350 points for the pricing section
and 650 for the remaining technical sections.
125.
Because each evaluator scored the technical sections,
the cumulative totals of their scores exceed 1,000.
Securus
maintains that this scoring is inconsistent with the process
described in the RFP.
126.
But each evaluator scored the technical portion of the
proposals within the maximum 650 total points available to each
vendor.
And the procurement staff scored the price proposals
within the maximum 350 points available for price to each vendor.
127.
Applying the RFP's mathematical scoring methodology to
the price proposals, the procurement staff scored the pricing as
follows:
Global 280.42, Securus 276.04, and CenturyLink 232.94.
The scoring for each was within the RFP's 350-point maximum.
128.
The scores given by each evaluator for the technical
portion of the vendors' proposals are as follows:
EVALUATORS:
CenturyLink
Securus
Global
Shane
Phillips
722.94
749.79
782.92
Steve
Wilson
857.94
808.54
880.42
44
Jon
Creamer
707.94
702.29
751.67
Charles
Lockwood
776.69
834.79
859.17
Randy
Agerton
734.19
779.79
802.92
129.
Each evaluator's technical score when combined with
the pricing score was within the RFP's 1,000-point maximum.
130.
Ms. Hussey totaled all the evaluator's technical
scores for each vendor with the pricing score for that vendor.
The resulting number exceeded 1,000.
The award memorandum
presented the totals, as follows:
Ranking = Cost + Total Evaluator Scores (As Posted)
Global
CenturyLink
Securus
131.
Commission +
Rates
280.42
232.94
276.04
Evaluation
Scores
2,680.00
2,495.00
2,635.00
Total
Ranking
2,960.42
2,727.94
2,911.04
1
3
2
This method of compilation did not affect the relative
ranking of the vendors.
132.
If the technical scores awarded by the five evaluators
are averaged and added to the pricing scores, the points total
for each vendor is under 1,000.
And the ranking of the vendors
does not change.
Ranking = Cost + Evaluator Scores (Evaluator Scores Averaged)
Global
CenturyLink
Securus
Commission + Rates
Evaluation Scores
Total
Ranking
280.42
232.94
276.04
535.00
499.00
527.00
815.42
731.94
803.04
1
3
2
133.
Averaging in this fashion is consistent with the RFP.
134.
The evidence does not prove the Department erred in
scoring the proposals.
45
CONCLUSIONS OF LAW
135.
The Division of Administrative Hearings has
jurisdiction over the parties and of the subject matter of this
proceeding.
136.
§§ 120.569 and 120.57, Fla. Stat.
CenturyLink and Securus bear the burden of proving the
proposed award of the contract to Global does not comply with
legal standards.
137.
Stat.
§ 120.57(3)(f), Fla. Stat.
This is a de novo proceeding.
§ 120.57(3)(f), Fla.
But it is not a typical de novo proceeding in which a
factual basis for the Department's decision or error must be
proven by the evidence.
The Florida Legislature has established
a specific standard of review and standard of proof for
administrative hearings on protests to the Department's proposals
to contract through the competitive procurement process.
138.
These statutory standards do not require a
determination that the Department has made the best decision or
the only decision or the decision that the trier-of-fact would
have made.
The legislatively established standards state:
Unless otherwise provided by statute, the
burden of proof shall rest with the party
protesting the proposed agency action. In a
competitive-procurement protest, other than a
rejection of all bids, proposals, or replies,
the administrative law judge shall conduct a
de novo proceeding to determine whether the
agency's proposed action is contrary to the
agency's governing statutes, the agency's
rules or policies, or the solicitation
specifications. The standard of proof for
46
such proceedings shall be whether the
proposed agency action was clearly erroneous,
contrary to competition, arbitrary, or
capricious. § 120.57(3)(f), Fla. Stat.
139.
The Recommended Order in Health Management Systems v.
Agency for Health Care Administration, Case No. 08-2566BID at 21
(Fla. DOAH Aug. 15, 2008; Fla. AHCA Aug. 28, 2008), defines
"clearly erroneous, contrary to competition, arbitrary, or
capricious," as:
Agency action will be found to be "clearly
erroneous" if it is without rational support
and, consequently, the trier-of-fact has a
"definite and firm conviction that a mistake
has been committed." U.S. v. U.S. Gypsum
Co., 333 U.S. 364, 395 (1948).
49. An act is "contrary to competition" if
it unreasonably interferes with the
objectives of competitive bidding, which are:
To protect the public against collusive
contracts; to secure fair competition upon
equal terms to all bidders; to remove not
only collusion but temptation for collusion
and opportunity for gain at public expense;
to close all avenues to favoritism and fraud
in various forms; to secure the best values
for the [public] at the lowest possible
expense; and to afford an equal advantage to
all desiring to do business with the
[government], by affording an opportunity for
an exact comparison of bids.
Wester v. Belote, 138 So. 721, 723-24 (Fla.
1931).
50. "An action is 'arbitrary if it is not
supported by logic or the necessary facts,'
and 'capricious if it is adopted without
thought or reason or is irrational.'" Hadi
47
v. Liberty Behavioral Health Corp., 927 So.
2d 34, 38 (Fla. 1st DCA 2006).
Pricing
140.
The facts proven by the preponderance of the
persuasive evidence in this cause prove that Global and Securus
submitted prices that did not include, as section 3.8.3 of the
RFP required, "a separate single, blended rate per minute,
inclusive of all surcharges and department commission rate on the
price sheet (attachment 5) for the inmate telephone service and
the video visitation service."
The facts also prove that they
did not disclose this information to the Department.
141.
Awarding the inmate telecommunications service
contract to either of them would be contrary to the RFP's
solicitation standards.
142.
The Global and Securus proposals also undermine the
Department's ability to secure the best value for the public at
the lowest possible expense.
Since they do not include all of
the price elements required by the RFP, the Department cannot and
did not conduct a meaningful price comparison of them and the
CenturyLink proposal.
143.
This is not a minor irregularity as defined in
section 1.19 of the RFP.
It affects approximately 12 percent of
the revenue under the proposed contract and provided Global a
substantial advantage.
Tropabest Foods, Inc. v. Dep't of Gen.
48
Serv., 493 So. 2d 50, 52 (Fla. 1st DCA 1986).
Commissions are
also critical factors both to the price paid by inmates and their
designees and the Department, should it collect the revenue.
They are also an important variable considered by vendors when
they construct their proposals.
Basing a decision on prices that
do not include commissions when the RFP required including them,
is contrary to competition, clearly erroneous, arbitrary, and
capricious.
See Pro Tech Monitoring, Inc. v. Dep't of Corr.,
Case No. 11-5794 BID (DOAH April 4, 2012; Fla. Dep't of Corr.
May 1, 2012) (Vendor's decision not to list all state, federal,
and government contracts for electronic monitoring as required by
the RFP provided direct competitive advantage; Department's
failure to enforce the requirement was clearly erroneous,
contrary to completion, arbitrary, and capricious.)
144.
Not including the commissions in the blended rate also
made the competition between the three vendors unfair and
unequal.
145.
This is not a matter of raising a specifications
protest in an award protest.
not being followed.
This is a matter of specifications
At the least, the parties had differing
interpretations of the meaning and effect of the FCC order.
RFP provided no guidance on the issue.
The
Awarding the contract in
these circumstances denies CenturyLink the equal advantage the
49
competitive procurement laws were enacted to provide.
Wester v.
Belote, 138 So. 721, 723-24 (Fla. 1931).
RFP Section 3.15
146.
The documents proved, and several Department
representatives acknowledge, that the Securus proposal contained
the required narrative responsive to, at a minimum, some of the
elements of section 3.15.
The failure to consider and award some
points for the Securus response is not rational, not supported by
logic, and clearly erroneous.
The effect is contrary to
competition because it severely undermined the ability of the
Department to award the contract to a competent possible
provider.
Scoring
147.
Section 287.057(1)(b), Florida Statutes, governing
requests for proposals, requires that the RFP state the "relative
importance of price and other evaluation criteria."
148.
The Department stated the relative importance of price
and the other evaluation criteria in its RFP.
CenturyLink and
Securus argue, however, that the Department failed to follow its
RFP or to comply with section 287.057(1)(b)2.b.
The findings of
facts do not support a conclusion that the Department's
application of the RFP scoring system was arbitrary or
capricious.
They also do not support a conclusion that
50
assembling the scores in the fashion urged by CenturyLink and
Securus would have caused a different result.
Conclusion
149.
CenturyLink and Securus have met the burden imposed by
section 120.57(3)(f).
The Department's intended award to Global,
where price proposals of two vendors do not comply with the RFP
specifications and the scoring of Securus's proposal incorrectly
awarded zero points out of the possible 25 for its response to
section 3.15, together, require concluding that the preponderance
of the credible persuasive evidence establish a "definite and
firm conviction that a mistake has been committed."
RECOMMENDATION
Based on the foregoing Findings of Fact and Conclusions of
Law, it is RECOMMENDED that the Department of Corrections enter a
final order rejecting all proposals for Request for Proposal
DC RFP-13-031.
DONE AND ENTERED this 4th day of September, 2014, in
Tallahassee, Leon County, Florida.
S
JOHN D. C. NEWTON, II
Administrative Law Judge
Division of Administrative Hearings
The DeSoto Building
1230 Apalachee Parkway
Tallahassee, Florida 32399-3060
(850) 488-9675
Fax Filing (850) 921-6847
www.doah.state.fl.us
51
Filed with the Clerk of the
Division of Administrative Hearings
this 4th day of September, 2014.
ENDNOTES
1/
All references to the Florida Statutes are to the 2014
codification, unless otherwise noted.
2/
The Pre-Hearing Order granted the unopposed motion to amend.
3/
Boldface type shown in quotations of the RFP appeared in the
original.
COPIES FURNISHED:
Michael D. Crews, Secretary
Department of Corrections
501 South Calhoun Street
Tallahassee, Florida 32399-2500
(eServed)
Jennifer Parker, General Counsel
Department of Corrections
501 South Calhoun Street
Tallahassee, Florida 32399-2500
(eServed)
Eduardo S. Lombard, Esquire
W. Robert Vezina, III, Esquire
Vezina, Lawrence and Piscitelli, P.A.
413 East Park Avenue
Tallahassee, Florida 32301-1515
(eServed)
James Fortunas, Esquire
Department of Corrections
501 South Calhoun Street
Tallahassee, Florida 32399-2500
(eServed)
52
Michael J. Glazer, Esquire
Erik Figlio, Esquire
Ausley and McMullen
123 South Calhoun Street
Post Office Box 391
Tallahassee, Florida 32302-0391
(eServed)
Robert H. Hosay, Esquire
James A. McKee, Esquire
John A. Tucker, Esquire
Foley and Lardner LLP
Suite 900
106 East College Avenue
Tallahassee, Florida 32301-7732
(eServed)
NOTICE OF RIGHT TO SUBMIT EXCEPTIONS
All parties have the right to submit written exceptions within
10 days from the date of this Recommended Order. Any exceptions
to this Recommended Order should be filed with the agency that
will issue the Final Order in this case.
53
