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In the Matter of Protest

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


August 24, 2012

IN THE MATTER OF PROTEST OF B&L TIRE SERVICE, INC. WITH REGARD TO APPROVAL OF PREQUALIFICATION OF TUMINO'S TOWING, INC. FOR THE PERFORMANCE OF EXTRA HEAVY DUTY TOWING SERVICES ON THE NEW JERSEY TURNPIKE.

On appeal from the Executive Director of the New Jersey Turnpike Authority.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued March 20, 2012 -

Before Judges Yannotti and Espinosa.

Tumino's Towing, Inc. (Tumino) appeals from a final decision of the New Jersey Turnpike Authority (the Authority) that rescinded approval of its prequalification to bid for a towing contract. For the reasons that follow, we affirm.

On October 28, 2008, the Authority issued a public notice soliciting responses to a Request for Prequalification (RFP) of contractors for extra heavy duty towing and recovery services*fn1 for six service provider locations, Zones A through F, on the Turnpike. The RFP identifies criteria, including, but not limited to, experience and location of garage facilities, that a contractor must satisfy to become "prequalified" and therefore, permitted to submit a bid for the towing contract. See N.J.A.C. 19:9-2.13.

Subsection A of the RFP sets forth the following experience requirements:

Applicant must have a minimum of five (5) years of extra heavy duty towing and recovery services experience on the following Interstate highways within New Jersey: I-80, I-280, I-287, I-295, I-195, I-78, as an approved extra heavy duty towing and recovery services provider for the New Jersey State Police, and/or five (5) years of such experience on the Authority Roadways*fn2 as an approved extra duty towing and recovery services provider for the Turnpike Authority. Applicant must have completed at least seven (7) verifiable [] extra heavy duty recoveries on the above-mentioned Interstates or Turnpike Authority Roadways within the past five (5) years. Extra heavy duty towing and recovery services experience for county, local or other law enforcement (other than the New Jersey State Police) will not be considered. At least three (3) of the five (5) years of extra heavy duty towing and recovery services experience must have been performed from the present location of Applicant's Principal Garage Facility. At the discretion of the Authority, the requirement of three (3) years of towing experience at present location may be satisfied by time spent at another location. [(Emphasis added).]

An applicant was required to identify in each application the location of the "Principal Garage Facility" for which the application was being submitted. "Garage Facility" is defined as "[t]he facility from which the applicant operates the towing business including the main storage facility and administrative offices[.]"

An applicant was permitted to seek prequalification for more than one zone. But to do so, the applicant had to complete and submit a separate prequalification application for each zone. The RFP explicitly stated that each application had to stand on its own to meet all criteria to warrant prequalification:

If a towing contractor has a Garage Facility located in one Zone and a separate Garage Facility located in another Zone and seeks to be prequalified in each Zone, each Garage Facility shall meet the requirements hereunder independent of the other; that is, there can be no sharing of equipment between Garage Facilities, but each shall meet the required minimums hereunder as to vehicles and equipment and all other criteria. [(Emphasis added).]

Any possible confusion as to the need for each Principal Garage Facility to independently satisfy the experience criteria or the likelihood that the Authority might exercise its discretion to waive this requirement was resolved by the Authority's response to a question regarding the three-year experience requirement at a mandatory prequalification conference:

Absent the occurrence of an uncontrollable circumstance, the Authority will not exercise its discretion and permit an Applicant to rely upon experience at another location as a substitute for three (3) years of experience at the location utilized as the basis for the Application for a particular Zone. The fact that an Applicant had significant experience at another location and has chosen to move its operations or open a second garage in a different Zone will not satisfy the criterion of three (3) years experience in an Applicant's present location.

This response was forwarded to all potential applicants.

On January 7, 2009, Tumino submitted an application for prequalification for extra heavy duty towing services for Zone E on the Turnpike, which includes the region between Interchanges 12 and 15E, and listed 900 Julia Street, Elizabeth (the Elizabeth facility) as the Principal Garage Facility for that application.*fn3 Tumino took title to the property located at that address, which had been owned by Flora Services, Inc. (Flora), on September 20, 2006.

In its application for Zone E, Tumino stated it had fifteen years of extra heavy duty towing experience and three years' experience at the Elizabeth facility. In response to the requirement to list "seven (7) most recent verifiable extra heavy duty recoveries undertaken within the last five (5) years . . . on New Jersey Interstates I-80, I-280, I-287, I-295, I-195, I-78 and authority roads[,]" Tumino submitted thirteen invoices. All the invoices list the address for Tumino as 37 Emerson Street, Ridgefield Park. Of the thirteen invoices, seven identify the destination of the towed vehicle as Elizabeth,*fn4 and four identified the destination of the towed vehicle as Ridgefield Park. The earliest invoice listing the Elizabeth facility as the destination was dated August 20, 2007.

By letter dated May 5, 2009, Tumino was informed by the Authority that it had been prequalified to submit a bid to perform services for Zone E. On July 27, 2010, B&L Tire Service, Inc. (B&L) filed a written protest and a hearing request, alleging that Tumino was not a responsive bidder, principally because the Elizabeth facility failed to meet the experience requirement. Tumino filed a response on August 12, 2010, maintaining that the protest should be dismissed.

Although B&L's protest was initially dismissed as untimely, the Authority effectively reinstated the protest. A protest hearing was conducted on October 14, 2010 by Shawn P. Taylor, Project Supervisor in the Authority's Engineering department, as the designated Hearing Officer.

Patrick Cicchetti, a case manager for the Authority, testified at the October 14 hearing that Tumino had been prequalified to provide extra heavy duty towing and recovery services from the Elizabeth facility. He responded affirmatively to an inquiry into whether Tumino had submitted documentation evidencing its performance of extra heavy duty towing and recovery services at the Elizabeth facility. Cicchetti further testified that, in his opinion, Tumino met the experience requirements in the RFP and that there was no "reason that Tumino would not be prequalified to bid for extra heavy duty towing services or have its prequalification approval revoked[.]"

In his recommended written decision, the Hearing Officer found that "[t]he documentation submitted by Tumino [] supports Mr. Cicchetti's testimony that Tumino possessed five (5) years of experience in providing the Services on interstate highways as described in Section III(A)(I) of the RFP[.]" However, the Hearing Officer found Tumino's application was non-responsive for the following reasons:

The last requirement of Section III(A)(I) is that [Tumino] demonstrate that it has provided extra heavy duty towing on the qualified highways for at least three (3) of the last five (5) years out of its [Elizabeth] Facility. Based on the invoices and documentation submitted, I find that Tumino has not established this requirement . . . Although the documentation supplied by Tumino demonstrates that it has been operating out of the [Elizabeth] Facility as a heavy duty tower since at least November of 2005 . . ., the invoices submitted show that it has only engaged in heavy duty towing from that [Elizabeth] Facility on qualified highways since February 15, 2006.

As a result, Tumino[] has not demonstrated that it has been providing heavy duty towing and recovery services out of the [Elizabeth]

Facility on the qualified highways for the requisite three (3) years.

Based on the foregoing, I find that Tumino did not meet the requirement that it demonstrate that it has provided heavy duty towing and recovery services out of the [Elizabeth] Facility for at least three (3) out of five (5) years as required by Section III(A)(I) of the RFP.

B&L's protest was granted on February 23, 2011, effectively rescinding Tumino's approval for prequalification to bid, when the Executive Director of the Authority adopted without modification the Hearing Officer's findings and recommended decision as the final agency decision. Tumino protested the rescission of its prequalification and asked for reconsideration of the Authority's decision. The Authority declined to reconsider its decision and awarded the contract to B&L.

In this appeal, Tumino argues that the Authority's decision was arbitrary and capricious because the Authority created and relied upon an additional requirement that was not included in the RFP. The thrust of Tumino's argument is that the Authority misinterpreted its own RFP. Tumino concedes that Section III(A) of the RFP requires, in part, that an "[a]pplicant must have a minimum of five (5) years of extra heavy duty towing and recovery services experience" on specified roadways. Tumino claims, however, that the requirement that an applicant must have such experience from the specific Garage Facility that is the subject of the application is not included in the RFP and that it was unreasonable for the Authority to impose such a requirement upon it. Tumino supports this argument with Cicchetti's testimony in which he opined that Tumino's experience satisfied the requirements of the RFP.

The scope of our review in an appeal from a final decision of an administrative agency is limited. Circus Liquors, Inc. v. Governing Body of Middletown Twp., 199 N.J. 1, 9 (2009). Courts afford an agency "great deference" in reviewing its "interpretation of statutes within its scope of authority and its adoption of rules implementing" the laws for which it is responsible. N.J. Soc'y for the Prevention of Cruelty to Animals v. N.J. Dep't of Agric., 196 N.J. 366, 385 (2008) (citing In re Freshwater Wetlands Prot. Act Rules, 180 N.J. 478, 489 (2004)). That approach reflects the specialized expertise agencies possess to enact technical regulations and evaluate issues that rulemaking invites. N.J. League of Municipalities v. D.C.A., 158 N.J. 211, 222 (1999). Similarly, prequalification requirements and bidding specifications are matters that fall within the Authority's area of technical expertise and therefore merit our deference. See N.J.A.C. 19:9-2.13(d) (empowering the Authority to rely upon "factors as the Authority may deem relevant" in determining prequalification).

We apply the same standard of review to appeals from an agency's determination regarding the satisfaction of bidding specifications as we do to administrative agency decisions generally, limiting our review to "whether the decision was arbitrary, unreasonable or capricious." In re Protest of the Award of On-Line Games Prod. and Operation Servs. Contract, Bid No. 95-X-20175, 279 N.J. Super. 566, 590, 593 (App. Div. 1995). Our review is limited to the following inquiries:

(1) whether the agency's action violates express or implied legislative policies, that is, did the agency follow the law; (2) whether the record contains substantial evidence to support the findings on which the agency based its action; and (3) whether in applying the legislative policies to the facts, the agency clearly erred in reaching a conclusion that could not reasonably have been made on a showing of the relevant factors. [In re Carter, 191 N.J. 474, 482-83 (2007) (quoting Mazza v. Bd. of Trs., 143 N.J. 22, 25 (1995)).]

Applying these principles here, we discern no grounds for reversing the Authority's decision. There is substantial support in the record for the Authority's interpretation of its RFP.

Subsection A of the RFP describes the criteria for the "minimum of five (5) years of extra heavy duty towing and recovery services experience" required to be prequalified. To constitute such experience, the contractor must have provided such services on either designated interstate highways or on the Authority Roadways. The RFP explicitly states that extra heavy duty towing and recovery services experience other than that recognized in its specifications "will not be considered."

The Subsection further qualifies the five-year experience required, stating, "At least three (3) of the five (5) years of extra heavy duty towing and recovery services experience must have been performed from the present location of Applicant's Principal Garage Facility." Each application had to identify the Principal Garage Facility that would service the Zone that was the subject of the request for prequalification. In addition, the RFP clearly stated that towing contractors like Tumino, that had garage facilities in more than one Zone and sought prequalification in each, had to meet the requirements for all criteria for each facility independent of the others.

Thus, under the plain meaning of the RFP language, although Tumino had substantial qualifying experience in its operations at other Principal Garage Facilities, its request for prequalification for Zone E entailed its satisfaction of the requirements based upon its experience at its Principal Garage Facility in Elizabeth. The language of the RFP is reasonably interpreted to require that Tumino had to have at least three years of extra heavy duty towing and recovery services experience, as defined in the RFP, at its Elizabeth facility. As noted earlier, that qualifying experience had to be: extra heavy duty towing and recovery services on specified roadways, and no other experience would be considered by the Authority.

At the time Tumino submitted the request for prequalification on January 7, 2009, it had owned the property in Elizabeth for less than three years, having taken title from Flora on September 20, 2006, and had operated some towing operations at that facility while it was in the process of purchasing Flora as early as November 2005. However, after reviewing the invoices submitted to demonstrate the requisite experience, the hearing officer determined that Tumino had "only engaged in heavy duty towing from that Facility on qualified highways since February 15, 2006[.]" For this reason, the hearing officer found Tumino had not satisfied the experience requirement of the RFP, a conclusion adopted by the Authority. This conclusion was reasonably based upon an interpretation of the requirements of the RFP and therefore, will not be disturbed.

Affirmed.


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