Tiense #ABC-10711 698 Laumaka Stroet Nan Inc sag eS ‘eowimile: (8) 841-8281 April 20, 2015 Office of Administrative Hearings (OAH) Department of Commerce and Consumer Affairs (DCCA) 335 Merchant Street, Suite 100, Honolulu, H1 96813 RE: Petition for Administrative Review ‘Honolulu Rail Transit Project - Farrington Highway Station Group Construction Contract (“Project”) Dear M:. Karlan: Pursuant to Hawaii Revised Statutes (“HRS”) § 103D-709 and Hawaii Administrative Rule CHAR’) § 3-126-42, Nan, Inc. (‘Nan’), 636 Laumaka Stret, Honolulu, Hawaii 96819, through the undersigned counsel, hereby files this Petition for an Administrative Review ofthe April 14, 2015, Honolulu Authority for Rapid Transportation's (“HART”), denial of Nan's Protest dated March S, 2015, attached hereto as Exhibits I and 2. Nan further requests a decision by the Office of Administrative Hearings (“OAH”) to find and conclude the following: ‘A. That Hawaiian Dredging Construction Company (‘HDC’) is not a responsive ‘bidder under the solicitation ofthe subject Project. B. That Nanis the lowest responsive and responsible bidder, and isto receve the award of the Project under the Solicitation. CC. That HART inoretly determined that Nan's Protest as untimely in its letter dated April 14, 2015, and incorrectly denied the items of relief requested in Nan’s protest dated March 9, 2015, 1. INTRODUCTION Standing to File For An Administrative Review Pursuant to HRS § 103D-709 and HAR § 3-126-42, Nan has standing to initiate this Appeal due to the following: 1) The subject Request for Sealed Bids (“RFB") was issued pursuant to HRS § 103D.392 Section 103D-303, “Competitive Sealed Bidding.”Nan Ine Page 2of 12 Request for Administrative Hearing Honolulu Ratt Trans Projet - Farrington Highway Station Group Contraction Contract ‘Ape 20, 2015, 2) Nan submitted a fully responsive bid in the amount of $85,074,478 by the bid ‘opening date specified in HART"s IFB; 3) HDCC’s bid of $78,999,000, the only lower-priced bid under HART’ IFB, was ‘nonresponsive, having failed to propery list licensed subcontractors to pecform ‘work in connection with this Project in violation HRS § 103D-302(b) and having submitted a materially unbalanced bi, thus rendering HDCC ineligible for award under the terms of HART's IFB; 4) As the low-priced, responsive, responsible bidder, Nan should be declared the successful bidder and awarded the Contract fo this Project. '5) Nan timely fled a protest with HART pursuant to HRS § 103D-701, which was subsequently denied by HART via letter issued on April 14, 2015. See HRS {$103D-709 (0). 6) Nan’s March 9, 2015, Protest from which this Appeal is taken, concerns a matter that i equal to no less than ten percent (10%) of the estimated value of HDCC’s contract ie, the protest allegations collectively tcl $8,198,187, which greater than ten per cent (10%) ofthe $78,999,000 value ofthe contract. See HRS §103D- 709 (692). 7) A protest bond in the amount of $10,000 is hereby submitted with this Request pursuant to HRS §103D-709(e). ‘4 Timeliness of Request For Administrative Review [Nan's request for administrative review is timely Filed under HRS § 103-712 because iti being filed within seven (7) calendar days of the issuance of HART's denial of Nan's Protest on April 14, 2015 2. SEATEMENT OF FACTS HART’s 2FB was issued on December 23, 2014, pursuant to HRS § 103D-302 witha bid openirg date of March 3, 2015. The purpose of HART’s RFB was to solicit bids for construction of Farringtoa Highway Station Group Construction Contract of the Honolulu Rail Transit Project CHRIP), "a parca, the ses in Nan’s Protest consist of challenges to HDCC"s listing two (2) sept sbcoctrctors to perform the sme stopeof work ($4,125,187), HDCC'sunbelanced bid for compensble delay eons ($3 800,00), FDCs faire to iat al subconracers under 1% of he nal bid ($273,00), ad these poke acs a ‘6,198,187, which restr tan 10% of HDOC's bd of $78 999,00Nan Inc Page $0f 12 Request for Adninisrative Heating “Honolul Ril Trans Project = Farrington Higheay Station Group Construction Contract ‘April 20,2015 [Nan, along with four (4) other bidders submitted bids to HART by the March 3, 2014, due date, Inthe following amounts: Hawaiian Na, ne, Watts | _Hensel-Phelps ] Ralph. Inouye Dredging Constructors, | Construction Co. | Co, Ltd, (Construction Lic Co, Ine, '578,999,000.00 | $85,074,478.00 | $88,803,553.00 | $88,016,525.00 | S117,515,520.00 While HDCC submitted the lowest priced bid, upon closer examination of HDCC’s bid submittal, Nan discovered that HDCC’s bid contained numerous defects that render it noaresponsive, Among other, HDCC’s bid failed to comply with HRS § 103D-302(t)'s joint contractor/subcortractor listing requirements because: > HDC failed to list a properly licensed subcontractor for Tensioned Fabric Structures (Specification Section 13 31 23); and > HDCC listed multiple subcontractors for the same work to be performed under that Specification section.” Furthermore, HDCC’s bid shows that HDCC submitted a materially unbalanced bid by significantly overstating its daily compensable delay costs. The prices proposed by HDCC, in no way reflect @ reasonablelrealistic cost to the State. As such, HDCC's materially unbalanced pricing places a significant risk upon the State that would require HART to compensate HDCC for the inevitable delays that will be experienced under this Project. ‘Based on the foregoing, within five (5) working days ofthe bid opening, Nan submited protest ‘on March 9, 2015, to Mr. Daniel Grabauskas, Executive Director & CEO of HART, which highlighted several material nonconformities in HDC’ bid, By letter dated Aorl 14, 2015, HART dismissed and denied Nan's Protest, because HART hd not issued a notize of award for the subject Protest and that, therefore, the protest was both “premature and, therefore, untimely.” At the same time, while HART claimed that it had not “made a decision regarding the contract award,” HART's April 14, 2015, letter went oa to deny all of Nan's allegations concluding that HDCC’s bid was responsive andior that HART could waive various of the non-compliances with HRS § 103D-302(b), and that HDCC's proposed 2 addon, Nana Protest abo alleged that HDCC filet lt any subcontractor for Mochanial (C2), lsuation or Boiler, Hot Water Heating and Stam Fiting (CO4, improperly listed subcontractor to perform “Abed” ven ‘hough the subcontrator listed doos not have an Asbestos C19 Specialy Liens, an incon sta unlicensed fering entree to perform "Ploering™ eve though o such work i eqied bythe RFS Those ‘nogulities, each of which represents less than 1% of HDCC's bid amount were “waved” by HART. While Nan ‘questions the widomof HART 's decision odo so sine i appears tobe willing to overlook every relay 0 ‘hooses to whenever ¢ can icumveat having to respond to the Pots one tig emt ler. DCE" ‘ubeontacior isting replies under Seeuon 13 3123 amount fa more than 19 fi bd. No ater bow “much HART would undoubtedly ike to evade esponsibility fo following the Hawai Procurement Cole vin soe ‘minisrative fa, tsannot overlook thse deers ia HDCC's bd.Nan Inc Page 40f 12 Regees for Administrative Hearing Brot Ball rast Project Farrington Higheay Station Group Consirction Contract ‘Apail20, 2015 ‘unbalanced pricing was simply something that was “im the province of each bidder, who presumably considered the risk that the bidder wanted to add into its daily compensable rate.” Uitimately, the April 14, 2015, letter denied Nan’s Protest, advised Nan that that decision was final ‘and conclusive and advised that Nan had a ight to administrative eviow through the OAH, Based on the foregoing and the direction provided by HART's April 14, 2015, letter, Nan has ‘decided to appeal the subject decision and request a hearing on this matter, 3. DISCUSSION a Nan's is ie 701, HART initially stated in its response to Nan’s March 9, 2015, Protest that it considers Nan’s protest “premature, and therefore, untimely,” since HART has not yet made a decision regarding the contract award forthe Project. As such, HART contends that Nan hasnot suffered any injury and isnot an aggrieved party. How a protest can be both premature and untimely tthe same time, a best, confusing. However, [HRS § 103D-701 clearly states that any offeror who is agerieved in connection withthe solicitation ‘or award of a contract must submit a protest “within five working days after the aggrieved person knows or should have known the facts giving rise thereto.” On the day of the bid opening, which is publicly announced, Nan had learned that HDCC was the apparec low bidder, and had also ‘ound tat it was the second lowest bidder out ofa total of five (5) submitted bid, thereby making Nan both an irterested and aggrieved party. In Bnvironmertal Reeycling of Haw. Ld v. County of Hawall, PCH 95-4 (March 20, 1996) cleasly ‘established that the time of which a protest must be fied is not necessary calculated from the date of an award or the signing of a contract, but rather that “timely protests may be filed well in advance of ~ or well subsequent to ~ either date, depending upon when the protestor knew or should have known the facts that provided him or her a reasonable basis for filing a protest.” Furthermore, in Clinical Laboratories of Hawaii, Inc. v. City & County of Honolulu, Dept. of Budget & Fiscal Services, PCH 2000-8 (October 17, 2000) it was foune that “the filing of «protest 14 days after the bids were submitted defeats the very purpose for which the statute was intended.” ‘Thus, while there is some suggestion in OAH decisions that, until some action is undertaken by the State, a protest is premature and the protester isnot an “aggrieved” party (see GMP Assocs, Ine. ». Board of Water Supply, PCH-2004-11 (Sept. 17, 2004), it would make litte sens to dismiss "Nan’s Appeal as untimely. Here, the determination of an award was not the governing event that defined an “aggrieved person,” but when the bids were submitted since itis when the person “kaown or should have know the facs.” In this case, the facts surounding the numerous defects HDCC’s becane known to Nan atthe time of bid opening. In any event, since HART has gone beyond simply dismissing the protest as being both “premature” and “untimely,” and has actually made a substantive decision on the merits of Nan'sNan Ine Page 5 of 12 Request for Administrative Hearing “Honolulu Ril Transit Proje ~ FarringionHighosy Station Group Contraction Contract ‘Apel 20,2015 “March 9, 2015, Protest, concluding that DCC + bid is ether responsive and/or that the defects contained therein are “raivable,” it would make litle sense to await a formal notice of award to reefile the protest. Having determined that HDCC’s low bid was fair and reasonable and having rejected all of Nan's arguments that HIDCC’s bid was nonresponsive, itis a foregone conclusion that HDCC will be named the apparent successful bidder. 4 DCC Failed To List a Properly Licensed Subcontractor for the Tensioned In Violate 0206) & Must Nonresponsive. Hawaii Procurement Code, at HRS § 103D-302(b), states that, in all REBS issued for construction, the solicitation must specify that all bids include the name of each person/firm to be engaged by the bidder asa joint contractor or subcontractor in the performance of the contact and the nature and scope of work to be performed by each. ‘The purpose of this listing requirement isto prevent ‘bid shopping and bid peddling and to preclude replacing a subcontractor ater bid opening by requiring a contractor to commit, when submitting its bid to utilize a specified subcontractor for 8 particular aspect of the work. See Hawatian Dredging Constr. Co, v. Cty & County of Honolulu, PCH 99-6 (Aug. 9, 1999). Failure to comply with these listing requirements renders a bid rnonresponsive. Thus, falure to name a properly licensed subcontractor that will be engaged for specialty work, is fatal to that bidder's bid. While listing of second-tier subcontractors is not required, HRS § 103D-302(b) mandates thatthe ‘bidder disclose the nature and scope ofthe work to be performed by its listed subcontractors. Such disclosures are necessary to prevent a bidder from listing more than one subcontractor forthe same ‘work, then following award, bid shop among those listed firms. See Frank Coluccio Constr, Co., ». Clty and County of Honolulu, et al, PCH-2002-7 (Aug. 2, 2002). Thus, a bidder's failure to describe the nature and scope of the subcontractor’s work, which in tum, could lead to an ‘opportunity to bid shop would render that bid nonresponsive. Stoneridge Recoveries, LLC v, City ‘and County of Honolulu, PCH-2003-S (June 26, 2003). Strict compliance with this statute is nevessary in order to effectuate the legislative intent to establish a process by which the opportunity to bid shop and/or bid peddle could be reduced/stopped and, at the sume time, avoid delays and expenses in investigating into the existence of those practices in any given case. See Frank Coluceio Constr. Co, v. City and County ‘of Honolul, etal, PCH-2002-7 (Aug. 2, 2002). As such, a construction bids thet fail to comply ‘with this requirement must be rejected unless the chief procurement officer determines that: (1) Acceptance is inthe best interest ofthe State; and (@) The value ofthe work to be performed by the joint contractor or subcontractor is equal to of less than one percent of the total bid amount. Thus, the one percent or less threshold exists forthe purpose of waiving a bidder's failure to comply with the subcontractor listing requirement under HRS § 103D-302(t).Nan Inc Pago 6 of 12 Request for Administrave Hearing Honot Rall Tranet Pec Farrington Highay Station Group Contraction Contract ‘Apel 20, 2015, ‘See HRS § 103D-302(b) and HAR 3-122-21(@)8) (emphasis added). This one percent (1%) ceiling was added to the Statute to, among other things, limit the diseretion of the chief procurement officer to waive a bidders failure to comply with the foregoing subcontractor isting requirements See Ckada Trucking Co, v. Board of Water Supply, etal, 9i7 Haw. 544 (App 2001), In Ground 1 of Nan’s Protest, Nan alleged that HDC listed Structurflex LLC (“Structurflex”) to perform the “Structural Stee! Tensioned Fabric” work and had erroneously listed Structurflex as having a C-48 specialty icense. Furthermore, Nan explained that nt only does Structurflex not possess a C-48 license it also lacks a “B" general building license, which is required to perform ‘contractor work under City & County or State procurements. HART responded thut, through its responses to Requests for Information (RFI) during the bidding sage, it was made clear that a specialty license was not required to perform the Tension Fabric Structures work under the specification Section 13 31 23, Nan is well aware and is not disputing the fact that a specialty license is not required for this work, and although HDC listed Structurflex as having a C-48 license when Structurflex made it clear to all bidders that it dd not possess such 1 license, the real isme is its lack of a “B” general building license, which it had also openly ‘announced, Despite this, HART asserts that Nan’s argument of Structurflex not possessing a “B" license was somehow untimely since Nan was required to protest this issue prior to the receipt of bids. In doing so, it had relied on Section 6.3, Paragraph 2 inthe Instructions to Bidders (“IT") as shown below. Furthermore, HART has examined the scope of work and determined that the specialty licenses, listed in the Special Provisions, are required for this Contract. Bidders shall provide the names of the entities that hold the specialty licenses and will be providing such services under the resulting Contract. Ifa bidder believes that other or additional specialty licenses are required or any of the listed specialty licenses is not required, it must provide its comments to HART by ‘the Deadline for Clarification Requests stated in the Solicitation Timetable above. The required specialty icenses are a specifications requirement and, 25, ‘such, any dispute as to the required specialty licenses shall be made ina timely ‘manner. (Emphasis in original.) ‘The problem with HART's selective reading ofthe ITB is that, as the foregoing paragraph clea states, “ilf a bidder believes that other or additional specialty Hleenses are required,” itis unmistakably discussing the issue of an offeror solely addressing unstated specialty ieenses, and not the simple fact that every contractor or subcontractor must hold some type of Contractor's License to conduct business, whether itis a general license or a specialty license. In fact, this Section 6.3 that HART points out is entitled “Joint Contractor. Subcontractor Listing: Specialty Licenses,” As such, HART’s argument that Nan should have submited a protest prior tothe bid submission is irelevant.Nan Inc Page 7 of 12 Roquet for Adminitrative Hering “Hpolu Rall Tran Project Farrington Highway Staton Group Contraction Contract ‘Ape20, 2015 As HAR § 16-77-4 ~ Licenses Required, clearly states “{a]o person within the purview of this chapter shall act, or assume to act, or advertise, as a contractor, general engineering contractor, ‘general building contractor, or specialty contractor without a license previously obtained under ‘and in compliance with this chapter and chapter 444.” Itis also well known that, not only does a propery issued and active license demonstrate that an entity is qualified to perform the work and. understands the respective regulations, it also confirms thatthe entity is responsible, financially sound, and is curent in paying its fees and tax liabilities. By HART claiming that Nan should have protested that a “B General Building Contractor's License was required for the Tension Fabric Structures, HART is improperly allowing a ‘completely unlicensed entity to perform this work, and similarly, any other scopes that do not require a specialty license. This clearly is not acceptable and isa clear and unmistakable violation oflaw. ‘What is even more disturbing is that HARTT itself attempts to rationalize HDCC’s fal error by claiming that “HDCC can selfperform this work.” While Nan acknowledges that HRS § 103D- 302(b) would require a general contractor to subcontract any particular work to a particular ‘subcontractor, and ifthe general contractor does not plan to use a subcontractor in performance of ‘some aspect of the work, once HIDCC indicated that it intended to do so under this RFB by listing ‘Structurflex, became bound to use that subcontractor. HDCC obviously had intended to subcontract the canopy fabric work, and HART does not have the authority to modify HDCC’s organizational stricture to serve its own interes, as it des not foster fair competition. Indeed, ‘once a bidder nanes a subcontractor, that subcontractor cannot be substituted, unless permitted ‘pursuant to HRS § 103D-302(g): which also applies tothe opposite circumstance where the hidder does not name a subcontractor for specialty work, and will similarly not be allowed to use a subcontractor to perform such work ift later wishes to do so. See Okada Trucking Cov, Board of Water Supply, et Al 97 Hawaii 544 (App. 2001); CC Engineering & Construction Inc, v. Dept of Budget and Fiscal Services, City and County of Honolulu, PCH-2005-6 (November 1, 2005); Parsons RCI, Inc. v. DOT, et al, PCH-2007-3 (July 13, 2007); Nan, Inc. v. DOT, FCH-2009-9 (October 2, 2008) ‘Thus, despite HART attempts to put itsef into the mind of what HDCC might be able to do thet, is irelevant. The mere opportunity to bid shop or bid peddle itself is enough to constitute a violation of the statute and render a noncompliant bid, like HDCC’s bid, non-responsive. Stoneridge Recoveries, LLC v, City and County of Honolulu, PCH-2003-5 (June 26, 2007); Oceanic Cos. Inc, PCH-2003-15 (July 3, 2004); see also New Shawmut Timber Co.,B-286881, Feb. 26, 2001, 2001 CPD $ 42 (bid was deemed to be non-responsive where blank line item in the bid “rendered the bid equivocal regarding whether [protestor] intended to obligate itsel'o perform ‘that element ofthe requirement”). ‘eving failed to identify properly licensed subsontractor to perform forthe Tensicned Fabric ‘Structures work associated with this Project in its bid in violation of HRS § 103D-302(), HDCC"s bid should have bes sive and eliminated from further consideration for award Similariy, because the value of the Tensioned Fabric Structures work to be performed underNan Inc Page Bf 12 Request for Administaive Hearing Hopolul Ril Transit Project arringlon Hight Station Group Consrction Contrat ‘Apri 20,2015 ‘Strucurflex is $4,125,187 and, thus, far exceeds one percent (1%) of the toll contract value, HART lacked the abity o waive HDCC’s failure to comply with this statutory mandate, « ubcont We ‘Tensloned Fabrie Structures. In addition tothe licensing issues discussed above, Nan also stated in its Protest that HDCC listed two separate subcontractors to perform the same scope of work under ‘he Tensioned Fabric Structures, Firstly, as previously stated, HDCC listed Structurflex to perform the Structural Stel Tensioned Fabric which falls within Section 13 31 23: Teasioned Fabrie Structures ofthe RFBs specifications. Secondly, HDCC listed another subcontractor, Swanson Steel Erectors, Inc. (Swanson) to pero the Tensioned Fabric Structures, which also falls within Section 13 31 23 ‘The fact that HCC listed two different subcontractors to perform the work covered by Section 13 31.32, without mere, creates an ambiguity and gives rise to an opportunity to bid shop, and therefore, renders its bid nonresponsive. See Kiewitt Pacific Co. v, Dept. of Land and Natural Resources, etal, PCit-2008-20 (February 20, 2009); Ludwig Contr, Inc. v. County of Hawai, ‘PCX-2009-6 (Decemter 21, 2009); Frank Colucclo Const. Co. v. Cty & County of Honolul, et ‘al, PCH 2002-7 (August 2, 2002); Ted's Wiring Serv, Lid. v. DOT, PCH-2007-5 (December 12, 2007) ‘Once again, HART’s response does nothing to address the real flaws in HDCC’s bid. Instead, HART simply claimed that HDCC’s bid was not ambiguous since it listed both subcontractor for the structural steel work, and since Structurflex does not possess a C-48 licease, it eannot perform the steel work, leaving only Swanson. However, as Nan explained earlier, it was not under the structural ste! scope ofthe effort that HDCC listed these two (2) subcontractors, but rather it under forthe tensioned fabrie work. Again, HDCC listed Structurfex to perform the Structural Steel Tensioned Fabric, waich is self-explanatory, and HDC also listed Swanson to perform the ‘Tensioned Fabric Structures. “Tension Fabric St "isthe work specifically described under Section 13 31 23, which outlines “the tensioned fabric canopy roof system” a the section explains, HART even acknowledged thatthe steel work under the Tension Fabric Structures was covered bby a completely different Section of the RFB's specifications ~- Sections 05 12.00 ~ Structural ‘Stee! Framing, and 5 12 13 ~ Architecturally Exposed Structural Stel Framing, Therefore, while DCC may, in fact, have identified Swanson to perform “Structural stee!" uader Section 5-12-00, it should have also listed Swanson to perform the “Architecturally Exposed Structural Stee} Framing” It did not, and could not because Swanson did not provide a proposal for the architectural steel wore related tothe canopy structures. ‘Again, because HCC listed Swanson to perform the “Tension Fabric Structures,” which is the samme fabric canopy roof system for which FIDCC said Structurflex would be responsible, HDCC’s ‘bid was ambiguous at best and would allow HDCC to bid shop this scope of work, especially since this scope does not require a specialty license, Once again, because the value of this subcontracted ‘work is $4,125,187 and, thus, exceeds 1% of the value of HDCC's $78,999,000 bid, no waiver ofNan Ine Page 90f 12 Request for Admisistrtve Hearing Honolul Ral Trost Projet ~ Farrington Highway Staton Group Construction Contract ‘Agr 20,2015, the HDCC's failure to comply with HRS 103D-302(@) would be possibc HDC bid nonresponsive und must be rejected by HART. In a misguided effort to obfuscate the substantive problems with HDCC’s bil, of, HART"s April 14,2015, letter attempts to redirect the infraction back to Nan by claiming that Nan also listed two steel subcontractors, Swanson Steel and Steeltech, who both have C-48 licenses. Yet, as evidenced ‘in Nan’s subcostractr listing (sce Exhibit 3), Nan clearly dferentiated the two (2) scapes of see] ‘work that would be performed by each subcontractor. Nan’s bid clearly shows that both scopes of ‘work are governed by the separate RFB specification sections, by stating that Swanson Stee! will be performing the “Structural steel" work, and Steeltech performing the “Structural steel (Tension, Fabric Canopies)” That isa far ery from the kind of ambiguity created in HDCC’s nonresponsive bid, and it certainly does not justify HART’ refusal to comply with the requirements of HRS 103D.302(4) by rejecting HDCC’s bid without further consideration. 4 HDCC's Bid tem No, 7 Compensable Delay Cost is Materally Unbalanced In Hawaii, as elsewhere, materially unbalanced bids must be rejected as nonresponsive, because such bids demonstrate that the bidder does not understand the solicitation andor its aeceptance ‘poses a significant risk to the procuring agency. See Road Builders Corp. v. City and County of Honolulu, Dept of Budget & Fiscal Servs, PCY-2012-13 (Ape. 27, 2012). An unbalanced bid is ‘one, in which “despite an acceptable total evaluated price, a price of one (or] more contact line items is significantly over or understated as indicated by the application or oost or price analysis techniques.” Id, at 17 (quoting Al Granim Combined Group Co. v. United States, 6 Fed. C502, 513 (C1.Ct. 2003). A mathematically unbalanced bid must be rejected where there is a reasonable doubt that acceptance of such bid will result inthe lowest overall cos to the government. Sanford Cooling, B-242423, Apr. 15, 1991, 91-1 CPD 376, The guiding factor for determining whether ‘mathematically unbalanced bid is also materially unbalanced isthe accuracy of the government's estimate of the anticipated quantity of work to be performed-~ifthe estimate i easonably accurate, then a mathematically unbalanced low bid may be accepted. Edward B, Friel, Inc. etal, 55 Comp, Gen. 488 (1975), 75-2 CPD § 333. {In addition, ifa bid is deemed to be mathematically unbalanced, the Government must perform a risk assessment to determine if any potential risk exists, where acceptance cf the bid would not result in the lowest overall costo the Government. Ifsuch a risk exists, where the overall price is affected and has the potential to increase, the bid must be determined as materially unbalanced, and therefore, nonresponsive. Applying the foregoing principles to this Protest, HDCC proposed an unrcaonsbly high and ‘unrealistic price under Bid item No. 7, “Compenssble Delay Cost,” which rents in its bid being materially unbalanced and provides HDCC with an unfair competitive advantage. As discussed in Nan’s March 9, 2015 Protest, compensable delay costs should be directly proportionate wo the overall jb cost and are generally estimated to be an average ofthe prime contractor's schedule- based cost over the duration of project, as most compensable delays ar app tothe tal end of the projet. Since HDCC’s bid i 7.7% lower than Nan’s, ther compensable delay cost should be proportionately wer. Despite this, the amount of compensable delay est fer each day proposedNan Ine Pago 10 of 12 Rees for Administrative Hearing Honolulu Bail Trans Projet ~Faringion Highway Staton Group Construction Contract ‘Apel 20, 2015, by HDCC at $50,000.00 under Bid Tem 7 is more than double that was proposed by Nan at $12,633.00. Asa result, HDCC’s proposal curiously indicates that, although it casts HDCC more than double what it costs Nan to manage this project, HDCC's overall project cost will be 7.7% less. HDCC’s claimed compensable delay cost of $30,000 per day equates to $26,460,000 aver the duraton of the project. When this amount is deducted from HDCC’s bid amount, it leaves conly $32,339,000 mallion to perform their direct work, a8 compared to Nan's direst cost of $74,727,613. See Exhibit 3, Page 2, Lines 58 and 59, As stated in Nan’s Protest, in the best interest ofthe public, HART must verify HDCC’s claimed ‘compensable delay cost against their submitted escrow documentation, Nan has accurately priced its compensable delay cost to include only Nan’s schedule-based cost (see Exhibit 3, Page 1, Lines 1 through 49), which may be used as a check against HDCC's cost represented in thet escrow documens and against ther falsely claimed $30,000 per day bid unit price. Without conducting the required risk assessment to determine material unbelancing, HART conveniently dismisses HDCC’s unbalanced bidding practices by claiming thatthe rate proposed is simply a measure of a bidder's incentive to receive the award, as it direelly affects the ‘contractor's total bid. That, however, is the very kind of gamesmanship that the concept of ‘unbalanced bidding is designed to preclude. It is aot simply a measure ofa bidder's incentive to ‘be awarded a contract based on the overal bid amount. HARTT still has an obligation to the public ‘and the taxpayers to ensure that the claimed compensable delay cost reasonably reflects the ‘operational costs, and instead docs not include an artificial punitive amount that would benefit HDC disproportionately tothe rest ofits bid items. Furthermore, because Bid Item No. 7 was arbitrarily set at 30 days its negligible when compared to the actual delays that have been experienced by the previous related projects, which will also hhave a direct influence on the delays anticipated for this project. It is well known that the West (Oahu Farington Highway Guideway and the Kamehameha Guideway contractor may not meet the platform deliverables set forth in the RFB, as it was questioned in an RFT during the bidding ‘process. 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AHR NO SAD AT « “Sp onas jo FAT .OGHTT USUYENY] 1gs6r-DHb nt nen» voonasu05 dhaxp vones aun! wuz -.14¥0 HON ag[Notice of Protest Fusigion Highway Suton Group Construction Contac, RFB HRT T9316 Pt |Attachment 2-Strctufles LLC Bid oe QO structurflex To: Al Bing Contractors Project: Westside Stations Group Construction Contract, RFB-HRT-708002 Location: Honoll, Ht Proposal Date: March 3, 2015 PROPOSAL AND GENERAL SCOPE OF WORK STRUCTURFEK LCi lensed to prove our frm fer to esl, enn, abate ond sway he [adds engerng of the fic canopies fr the stato, Souci Ste, PFE ‘rhtectural membrane, wire rope cables clamping and complet ncSTSBon al matel supplied by Stractrfes: @ sre proposal terms, pring and sched Indeed hein sbased upon the design irate inthe pretninary design dcaments proved to STRUCTURFLEX by the nme Tis proposal shal be referenced as a part of any contract/purchase order drafted for this project. (Our price forthe Base Bid work described within this proposals “See Bid form” ‘The proposal terms, pricing and schedule indcated herein is based upon the design ilustrated inthe bid ‘documents provided to STRUCTURFLEX. This price I vald for thet (6) days from the above date. This Broposa shall be referenced as apart of any contract/purchase order drafted fortis project. wt lge Richard Appleby North Americs Business Development Manager BASIS OF DESIGN: @ ring sued by The tate of Hawa, vison of Purchasing"Notice ot Protest Farangton Highway Sation Group Coosiscion Contract, RFB-FIRT- 798316 P.2 Attachment 2-simenflee LC Rid structurflex March 3, 2015 ‘To: All Bidding Contractors HART Farrington Station Group RO HAT ~ 798316 Regarding: StructurflexSub-contractor use for installation ofthe Structural Steel assocated withthe tensle membrane fabric canopies Dear sie: 1 ‘Please be advised tat itis the intent of Siructurlex LLC to contrad forthe | Installation ofthe structural steel support systems associated withthe tensile ‘membrane fabric structures with; Swanson Steel Erectors Nimitz Center 11130 North Nimitz Highway Honolulu, Hawall 96817 Dalis CorBrmad oe be BDIPol Dy Deskin Searsorn ty Qrwerr Cle. ‘Aso, please be advised that although there sno lcense requirement forthe tensile fabric membrane instalation, Structurflex, LLC has successfully Bar Dreling, President Structurfiex, LLCpaacitmot | pemmanavennsnen | samy “yon mapas yey pens ns su upesogs poe suopsnie 7 PT eve ne gpm bai epee sees a Ba NN oe ABE PP “wero ren'ner9 09 1 we ¥9's9 seen apes Spats. me OREN EN BU FIO sro Fe Us 9 9169°959 89879 '8C9"RLE LED SED “wo mia reo ur wo 49169 eaaN MoENNE Gnd 3, oy One ODS) LV, ON PND re roe gg6s-ENET-uny oenDOD uosonnsH0. spo ued se Tar DoBeAMORTS UNG THSUNPIENY| 1430 20 nose worms Suns woe 10TD 3} 6 tH greene Renesas w Sees OF ‘woe PIED seorwortn| som Soopers] WIPRIBIAS 09077 sence ra 40 ON “momar 2M Ju} A >) nner AN 27719 5m7) ena 2M 7lypal Im 7) eats i ALK 3 ae et aN) PAA S77 aay P10 00. eee ‘renee eps mm en opal id ete mim i eas opaag ees sey ty Tape ao ONG RURPENY] 91¢864-DIH-4LTY “eRUOS YoRonNsuO, dno voNRS Kemuarp] UOIBUELE-r8910%4 JO SHON]amar] so; RAONRNS UNE TUTUYTENY S1eR6rLAYy oemv0D vosonns¥0| dnosp ones Keays vorFuaRJasIeNg J 29N0N,|) apceate eee ya 1 298044. < | Zoo sey Jo 080 spond | Py aopesyeooqnyss0 e289 en of o aaron ips oq PINOT < “om og ajdt oy san ssopesyeos Ayepads 2m) 9484 ‘ue pEANaDgas pu s10}>"L NOD Jap PaIEH 20 sepa 2 Ye Pe oferta 0} poxzbassanIesINeOqES Zo s0}2I809 IE Jo BaRSH P=a}dmD Bq) HOARE IPP sara pee ayo ze 29 59 sag opens Gypsies) 2am GENOME HODENEED ., HPENA Pees 170 pws 0815-9°980'6r9 tro 80-9 ALE ‘e2'e9 smn anu mde, sm mehr StooeanD w heseooaee SE Teor avn sss pao a saan: Kons, smdane ay any sot EY vet oceans eg amt eons eed 10,¥,)sopom om eren na pan wo etd -vSiiane nade spn esed e cds putes Bone syn pe coc aca § gut fa pass eqns oe ‘efi ame PAG ePRaegN 8 tReet DoW eh Seem egy EON PUN 20) Stones TOCACOTS SHH Sk pee ssopong 7 Tar sooenwogS UNG TUG] sa S1eS6LEMH-UnH tenveD vompansHe9 dois Yon enn Hoi EEL o =m00cau nsaonmucg mor —7%8! 100 se Andsnes sopng oh ba sa os vos Cen vO ar viooDaH) 201-20 wonaneD Bexsperd TENTH Ue eee oeyeyavens Pom ieee wy ee 4 Pa re o> z a pee ted si taeda ie eeecen toto) Saal oie ro (pas pumonais =| cae = tr ‘Sayoou | ro ‘im AO) PS rae apa = Sy mis | prmmimarrernon pam, | PRIMO Hay Ne Ane Wa see - ‘metso sae ae vin id 916860 LNH ne Tanir onEMIOORTS NG UTUTYSENY| 1oeniwo9 voronssue5 dees vous Sums wo\Buar. eno2d 70 29NON|pot onan an sums Cami seo soc of — cves TOE ser And soo euiyoo Rp 2AET = meds ou 1 sorenoognsaoeeuo of pase aM JENS wesntog ae (odia 3014 91 259) gL fuanpcens ents) eS e eee pLeD WOR EELIONY) FUTON AA 3a] Kyepads 209844 [81d a | earn mD ee “3 Bapang 221099, = mal =e =H seo =e 2 | peemrumsrs| Saree Rema. i ‘sueping 7 Bong neusey ‘uopesodiey sping proy, sete | mmeriscemensemd | 75 > pasate cera ‘motyo2mee apes WOO apg‘Notice of Protest Faringion Highway Sation Group Gonstracion Coote, RFE ART T55316 Attachment 4-Nan Compensable Delay Cot emia Descipaoe Tile SCHEDULE BASED COR rg Ma 5 “Gere Sunetede reer SET $1 0 Wap Speed SE To Sern 0 Tiss Sar on ‘Office ‘277.1160 Si amr 200 cs $08.50) Warlack TCs Sears SEF on Suen 1/2 1 poco Te 17 To Sate Soaps Pap 7 Teel re Cal Pre xe Tad Lae Fz SRE Tishose 5 se Pessald rE Tans Sot Soar oT x Tee nas PORARY CONSTRUCTION] de Mache zal 3] TOTAL COMPENSAR F290 am ale DELAY COS! a[Novice of Prot angion Fighway Sesion Group CaosTacaon Centra, RED FIRT TO \Attachment 4.Nan Compensable Delay Cost Htesization Besengoon Takeo tay Fic] ‘NANS TOTAL HID} ‘BETH Naw Be Ti] NANS COMPENSABLE! Darin Ome DELAY COST AS % O SB] HBeCS TOTAL BID} 99 om ADC 7] COMPENSABLE DELI Bane aga Le cost AS %OF TOTAL BID| ‘HDCCS THEORETICAL] 182 DY] —SiLTSUR] — wn SRS |ne xe COMPENSABLE DELAY cost| ¥ DCC AS-a1D] HEE DY | 0) — BEA Ra DCT COMPENSABLE DELA ‘COST (EXTENDED) T]_HBDES DIRECT Cost] Sn ine Tee NAN'S DIRECT COST] ase ‘DIRECT[Notice of Protect Farngton Sigheay Suton Group Conntnicion Contact, RFE-TIRE T58516 ‘Attachment 5-HDCC's OverSiated Bid Itc Anais Pot Delayio] HCC Ba] DCC Aid) Unt (10% of ‘Theoretical Dare Unit] Adusted Pec ost] Adustod Pr ql Te 3a] —_sanp00 | ¥00000 | ——sizyan | —sabisa0 | ssaa70 “so —ss0000 | $2800.00] 11.731 | —s703960 | 9.096140 ‘of ss0000 | —s2.70q000| ——sui.7ax | $155,790 | —s1e14210 2a] $30000 | $3600000 | siz7ar] —si<07.720| —$2302-200 150] $30,000 | —s4s00000| —six7si | $1759.50 [ 32.740350, a0] $51,000 | $5400000 | —sin7sx | s2.111500 | —$3.200420 z1o[ $5000 | Sesto] suas] —sanessi0 | —sa050 $721,050‘ovazser80n25) ‘alsa sore espa pe nar aundeg en 99 vp a aL hy Puig pe, wine ois og Ueno ours ogee nds NSS pm pe ALON CUM 20-0 (patna pol opts 9 toe 76 wow Z | FO | Fr aExhibit “2”HART cote HONOLULU AUTHORITY RAPID TRANSPORTATION Drath Gutcaes ‘evil 24, 2015 oss or omer Mr. Fooney Freestone, Fresident Semtsse ‘Nan inc. sacle rom 1636 Laumaka Street serene Honoluly, Hawai! 96819 Saati se ag ear Mr. Freestone: Subject: Honolulu Rall Transit Project - Farrington Highway Station Group Construction Contract Moreh 9, 2018 Protest of Nan ne. ‘The Honolulu Rapid Transit Authory ("HART") acknowledges receipt of, and responds to, Nan Inc's letter dated and received on Merch 9, 2015 “RE: Notice of Protest ("Protest relating to HART's Request for Bids, RFE-HT-798346, Farrington Highway Station Group Consuction Contract, (Project). Nan ine ‘Nan") argues that “[plursuantto Section 2030-701 [sc] ofthe Hawa Revised Statutes, HOCCS fallures renders ts bid non responsive and requires HART to dlequalty OCC trom futher consideration for award”? Pease be advised that HART has not issued notice of award for this the Project. Accordingly, HART considers the Protest premature and therefore, untimely. As such, Nan lacks standing to protest because itis not an “aggrieved parson” under HRS § 1030-703, which provides that. a protest shal be submited in wrtng within ve working days afte the aggreved person knows or should hhave known ofthe facts ging rise thereto...” An aggrieved person s one who suffered an injuyin ‘fact 35a result ofthe agancy’s decision. HART has not made a decision regarding the contract ‘award forthe Project, thas Nan has not suffered an inuryivfact and isnot a1 agsfieved party. Consequenty, Nan lacks standing to protest at tis ime. This notwthstanding, and without waiving ‘the above, HART provides its response to each of the allegations ralsed Inthe Protest, as follows: Protest em Nan alleges that Hawallen Dredging Construction Company (*HDCC") at not prope lst two ‘subcontractors, Structure LLC ("Structurlex’) ang Swanson Stee Eretor, ne. ("Swanson") 2s having the “proper licenses” to perform the work related tothe Tensioned Fare Structures. "nan esses Na raring to Honal Revised Sautes HS") § 1050-701. HRS does nt cortana eo 2050" ‘one RO TEDELED Fa (8H/TEBSLIO men onaurnst ow teWe Freestone ar seat ia 2015 ‘The nature of work fr the Tensioned Fabre Svuctues under Section 13:31 23 ofthe Technical Specifications ofthe Project renuices a bidder to erecta tensioned fabric eanony ‘oof system which includes two distinct types of work: (1 erecting the ste! support structures which are referenced in sectens 05 12 00 and 05 12 23 and (2) installing the fabric membrane tothe steel support strictures. AC-AB structural ste! specialty license is Fequied to perform the work identfied in Sections 05 12 00 and 05 12 33, including the ‘erection ofthe steel support structures fr te installation of the entire tensioned fabric structures. However, no specialty licenses required for installation of the fabric membrane tothe steel suppor structures Ints bid, HOC sted Swanson who possesses a C-48 structural steel speciaty lense, to perform tne 48 work nacossary in Sectons 05 12 00 and 05 12 13, including the tension fabric structure's ste! support systems, structural steel, and metal aligs Therefore, 'HDCC met the bid requirements for sting a C-48 structural ste! spectatylicensed ‘subcontractor and forthe subcontractor isting requirement for work relating to erecting the stool suppor structures. ‘Wah regard tothe Installation of the fabre membrane, a specatylcense Is not required ‘and HART informed al potential bidders ofthis. On February 12, 2015, HART issued Addendum No.3 for this solitation, andQuestion and Response #52 state: ‘Questions #52 ‘Spee 133123 Special Provisions SP8.2). Special Provision Section $P-8.2 does not Include a speciaty icense clasit-ation for the Tensioned Fabrie Contractor. Does the required classification fall under one ofthe specialty coracter classfcstion| listed ori there a ctferentspecityIoense or leenses needed to perform thie, scope of work which includes perspec section 133123 both PTFE membrane & cable instalation and structural ste! febication erection (ve. C-48)2 ‘Response #52 ‘There ls no spevatyllense(s)requlred forthe Tensloned Fabrlo Contractor. (Goi in origina) Aliso, on February 18, 2035, HART Issued Addendum No. 4 which proved further clarflstion on ‘isissue. Question and Response #1B states ‘Questions #38 In Addendum #2 addressed speciaty contractor licensing, This has created Confusion regarding the appropriate licensing forthe installation ofthe tensile I aon lng a8, HDC ei Sanson as °C ata in lation woking on ‘he "Tenslone Fabs Sere” bt tata ovis pgp er ar Seo ony hls 4 C8 "Metal Raigs” work be perfrod, nd MART has Sarid tht» a8 tcl eel peal ee readin we ioe res Se HAR Son, Roser, ing ofthe apecaty ceme croton rerio shy Ising eines dr RS [S10SD020) See Noe ia.Me Freestone: Page Sof 7 ‘Api 14, 2015 membrane systems. Please clarify what license o licenses are acceptable forthe instalation of the tensliemembcane systems. Wil the Awnings C-446, stil be ‘ceptable forte instalation of the systems? If thsi Boing replaced with Sheet Meta C-4, it would note practical to consider that a sheet metal contractor would have the experience in installing a highly speciaized tensile membrene system. wing lcense or sma most appropriate. ‘Response #18 ‘Ther ls no specialty llcense() required fr the Tensloned Fabre Contractor. Please refer to Addendum 3, Response 52. (Gold in orginal) ‘As a specialty license s not roquied for installation ofthe fabric membrane tothe steel support structures, HOCC wes not requited to identify a specialty licensed subcontractor fr ths work. ‘Therefore, HDCC satisfied its responsive requirements forthe work related tothe Tensioned Fable structures. [Atorrativly, Nan asserts ints Protest that a“B" leense fs required to perform the Tensioned Fabric Structures werk Section 13 31.23 ofthe Teohnial Specifications). As the addenda were part ofthe solcaton, Nan was requited to protest this issue prior to the ‘receipt of offers, March 3, 2025, pursuant to Hawall Revised Statutes HRS") §1030-704 {and Hawai Administrative Rules HAR") §3-126-3; however, Nan did not protest tissue Dror tothe date set forthe receipt of offers. See Ludwig Construction, Inc. v. County of Hows, Department of Public Works, POX-2008-6 (December 21, 2008), In addition, HAT welcomed potontial bicrs who belleved that specialty licenses were ‘equiod for certain work ut no: identified as such in the eolicsation to inform HART. The Instructions to Bidders ("TB") of the RFB, Section 6.3, Paragraph 2 provides: Furthermore, HART has examined the scope of work and determined thatthe ‘peciat lcenses,Isted inthe Special Provisions, are required fortis Contract. Bidders shal provide thenames ofthe entities that hold the specaty licenses and wil be providing such services uncer the resulting Contract. ia bidder belleves that ‘ther or addtional speci lenses are required or any of the listed spectaty ‘icenses isnot required, t must provide hs comments to HART by the Deadline for CGiartcatlon Requests stated in the Soltaton Timetable above. The requted Speciatyloenses are a specications requlrement anc, as such, any dispute as to the requlred specialty eenses shall be made ina timely manne. (Emphasis added) ‘The deadline fr clarification recuests was February 12, 2015. See Addenda Nos. 2 and 6. Nan didnot inform HART that actions license or specialty icensos were required forthe Tensioned Fabric Structures work by this deadline. Therefore, Nan's protest thatthe Tensioned Fabric Structures work required a "8" loenee is untimely $5 3 ONDA, i at 88,558 Hs i E88 ‘Roe omeeta fac oareRSITe. wmateninnt oeec. Freestone Page 4of 7 ‘pi 24, 2015 Notwtnstanding this, HART notes that HOCC holds both an A" and a“B licenses. AS the Installation of the tension fabric membrane work does not require specaty license, HOC Can seit perform this work. Nar's assertion that Swanson, in conjunction wth HDCC, does ‘ot have the expertise to instal he tension fabrie membrane is nota respensiveness issue, DCC listed al require specialty licenses and subcontractors forthe workin Section 13 34 23. Ils the responsibity ofeach bidder to comply with the requtements tthe Contacts ‘compliance with the Contract fs nota matter of responsiveness but contest administration. (Nan included Nan‘s subcontractor bas with its Protest. Subcontractor bids were nota part ofthe required submits for HART's Request for Bids, AFE-HRT-7983416 (RFB"). To the extent that subcontractor bids were not required asa part ofthe RFE submittals andthe Issue ls responsiveness, Nan’s subcontractor bids are not relevant and wil nat be ‘considered « part ofthe Protest. Furthermore, the subcontractor bas referenced In Nan's Protest are Nan's subcontractor bids and nat nevessariy HDCC's) Finally, ART notes thet HOGC lsted Suoturfle's nature of work as “Strucurel Steel Tensioned Fabric” and ientiied a C48 structural ste! specialty loense, Structuriex isnot current registered withthe Professional Vocational License (‘PVL") Dion ofthe Department of Commerce and Consume Afars as a C-48 structural steel Yeense holder ® {As such ts Istng wl rot be accepted as a C48 structural stool specialty ieensed subcontractor. However, dlsqualfieation of Stucturlx does not render HOCC's Did ‘onresponsive. As HOCC's bid propose) included a valid C4 structural steel specialty lloensed subcontractor, ICC's bid proposals responsive. Therefore, HDC prooerly sted its subcontractor forthe Tensioned Fabric Stuctures work. AS such, HART ntends to waive ‘the listing of Strctutiec as a minor informality® ‘rotestitem 2: Nan asserts that because HOCC listed mutipte subcontractors for Tensioned Fabric Stuctures, that HOCC's bid is “inacequate and ambiguows,” and that HOCCs bis shopping. {As stated above, Swanson’s scope of work includes the structural steel! work ofthe Tensioned Fabric Structures, which includes the work dented in Sections 5 12 00 and § 1213. As discussed previously, because Structuriex’s isting as 8 C-48 speciaty contactor was a minor informality and it cannet perform the structural see! work wll not be considered @ C-48 subcontracor. Thus, bla shopping isnot an issue. (uiugh tructurox cennot perform the structural steel wor, it could supply the fabric membrave tobe affixed to te structural ste! installed by Swanson; however since suppliers are nat required to be listed under the subconractor listing requirement under HRS §1030 302(t), Suucturfiex was not required to be Isto.) In Klewit Pacific Co. v. Dap. of Land and Nairal Resources, FFCH-2008:-20 (February 20, 2008), the hearings officer held, Intervenor' isting of two ‘subcontractors to perfoim ‘masonry’ work, wRtNOWA more, is ambiguous an as such, Ives tise to an opportunty to bia shop. (Emphasis added.) Here, however, the potential forbid * HART ates hn cof Mach 16,2015, Sour holds a C4 (Aang & Pas Cove speiaty * Raina mits th dos ot af pre gua, gui, dle of ea conden wc uy be wate ercomed. See HAR B:1221@AIN).Me Freestone Page Sof 7 ‘Apri 14, 2015 ‘shopping between Swanson and Stucturfexs not 8 concer, because HOCC tists diferent ‘scopes of work for each subcontrac‘or and only Swanson nolds a C-48 structural steel ‘peciaylicense.® Consequent, te opportunity to bid shop between the two ‘Subcontractors isnot possible. HART rejects Nan’s assertion that HDCC’s bid i Inadequate ‘and ambiguous and that HOOG engaged in bid shopping between Swarson ang Structure. HART would tke to note that review of Nan's bid proposal shows that Nan also named two C- ‘4s: Swanson Stel ana Steeltech.n Nam's ease, both Swanson Stee! and Steetech are C- 448 conse holders. ‘Protest tem 3 Nan assorts that HECC's bid tem for compensable delay cst is “materially unbalanced.” HART cisagrees with Nan's assertion. Inthe Protest, Nan provides a lengthy argument as to how HOCC should have calcuated is cay compensable ate; however, the calculations are the provenance ofeach bidder, who presumably considered the risk tat the bidder wanted 10.44 into ts daly compensable rae. This i a determination each bidder must make on Is own. As such, the dally compensable rates povided by each ofthe fve (5) bidders were \widaly varied and dla not folow the methodology posited by Nan. ‘Te daly compensable rates provided by each are as folows: = Hansel] Ralph ert li Watts | preiostic | inowe Day Compersatie] $20,000 | 12,633 | $85,000 | $19,122.90] $40,000 Rate ‘Ailowance Yor Compensabie Ferte* | $900,000 | $378,990 | $2,850,000 | $573,670 | $1,200,000 $78,999,000 | $85,074,478 | $88,803,553 | 88,016,525 | $117,515.520 Percentage of ‘compensable Detay Dey ecto | 213% | 045% 29% 05% 1.02% Totat contract ‘Amount "HART sts that te ol rumen forbes eo iene ame exch ern of oe tea scape of wort b peformedby enh See HRS FUBD'S020). The Specialy Lice [senato sot santo rgsrement ad not many ‘40 00 OF NOL Pace, Sat 70, 00 Ain St Hs, a 9S ‘OES ec eneH85I0 mm sonaahemst ogMi Freestone Page 6of 7 ‘pil 14, 2015 ‘Aso, the quoted compensable delay ratels applicable only if thece fa dela caused solely bby HARTs actions or omissions. HART isnot able to predict the numberof days for which the contractor might be entitled to its qucted dally compensable delay rate. The quoted dally compensable rate, However, san agreed upon rate for future compensable delays ‘The contractor's bid item tor "Allowance for Compensable Project Delay” direct atfects the contractor's total bid. Logically, tis creates an incentive for bidders to quote the lowest Possite rate order to lower Is bi price and inorease the likelihood of being the lowest [idde. Man's eryumtent at HOCC's niger ually compensable rave acuallyYowered HUUCS bid price isnot corect. I HOC used a higher compensable delay rate wouls have Increased HOCC's bid price. Based on itsanalysis, HART determined that HDOC's bi Is fair ‘and reasonable and thatthe bid complied in al material respects tothe instructions an ‘train the Request for Sealed Bis. Protest tem 4: Nan assers that HOCC ot nat ita jontcontrator/subcontractor for 02 Mechanica Insulation, nor for -04 Bolt, Hot Water Heating, and Steam Fting as required bythe RFB. HRS § 1030-302() provides thet “Construction bids that do not comply with this [subcontractor listing] requirement may be accepted f acceptance isin the best Interest of the State andthe vlue ofthe work to be performed by the joint contractor or subcontactor 's equal to or les than one percent of te total bid amount.” The C02 Mechanical Insulation work is estimated at $30,000 and the C04 Boller, Hot Water Heating, and Steam Fiting wrk is estimated ot $36,000. One percent ofthe total bid amount is $789,000. Accordingly, Both C-02 and €-04 work arectealy below one percent. HART determined that itis nits best interest to accept HOCC's tid without te isting ofthe C02 and C04 subcontractors and intends to wave the fale to list those subcontractors. ‘Protest item 5: Nan argues that HDOC Incrrecty ited Pacific Commercial Services, LLC as 36-9 Asbestos spocaty licensed subcontractor, rather than a C-17 Exoavating. Grading and Trenching specialty licensed subcontvactor. Inthe RFB Technical Speciicatons, thereis no asbestos work and therefore @ C-19 ‘seca licensea subcontractor isnot nesded, However, there fs work for an Excavating, Grading, and Trenching contractor to excevate, transport and dispose of contaminated oi material. Pace Commereal Services, LIC holds a C-17 specatyleense. Under HAR § 3- 122.31/6)(2)), “i the mistake is minor informality which shall na affect price, quantity, ‘quality, delvery o contractual conditions the procurement officer may waive the informalities... Examples of mistakes inc ude: () Typographical errors; (i) Transpostion lrrors. Hoen, tha ators claaiya miner nfrmaly. The Professional and Vaestona Llcensing Division shows that Pactic Commercial Services holds @(C-17 specialty leenee, not 8-19 special license. Furthermora, there is no asbestes work under this Contract. AS ‘30h, HART finds the mistake tobe @ miner informaly which does not affect price, quantity, ‘ualiy, celery or contractual cantons which may be correctable, See Okada Trucking (Co, Lt. v. Board of Water Supply, 104 Hawaii 68, 780,62 P. 34 631, 642-43 (awall Apo. 2082). ‘one TOES Tac SD8WBSLED emeryMr. Freestone: Page 7 of 7 ‘pil 14, 2015, ‘Protestitem 6: Nan asserts that HOCC incorrectly listed specialty license for Tile Craft, Inc. HDCC incorrectly lsted Tile Craft, Inc. as having @ C21 Flooring specialty license. However, if ther is flooring work, itis a minimal amount (less than 46) required for this Project. ‘Three ofthe five bidders either didnot list a -21 Flooring subcontractor o, in Nan’s case, Stated “no work" and did not lista 0-24 Flooring subcontractor. As slated above, HRS § 4103D-302(b) provides that “Construction bids that do not comply with this (subcontractor listing] requirement may be accepted if acceptance is in the best interest ofthe State and the value ofthe work to be performed by the joint contractor or subcontractor fs equal to or less than one per cent of the total bid amount.” Here if there is any floring work, it is less ‘than 1% and HART has determined that it may accept HDCC’s bid without the isting of the €-21 Flooring subcontractor and that doing sos in HART's best interest. See HRS §103D- 302(0). Protest tem 7: Nan asserts that HDCC did not use the correct Form 1 forthe Apprenticeship rogram Preference. 'Nan’s argument is unclear. Both Nan’s and HDCC's Form 1 were signed by the same State ‘Administrator and dated March 3, 2015 and March 2, 2015, respectively. HART'S Investigation into the forms reveaied that Operating Engineers Local Union No. 3 updates ‘columns C and D each time the number of apprentices changes. Accordingly, HART rejects the assertion that HDCC did not use the correct Form 1. Even if Nan’s assertion were true {and the Apprenticeship Program Preference did not apply to HDC, but dd apply to Nan's bid price, HDCC’s bid price would stil be lower. HDCC's evaluated price would be ‘$78,999,000 and Nan’s evaluated price (with the Apprentloeship Program Preference) would be $80,820,754.10. For the reasons stated above, Nan's Protest dated March 9, 2025 Is denied. The decision is final and conclusive. Nan has the right to administrative review ofthis decision pursuant to HRS §§ 1030-701, 1030-709, and 1030-712, and Hawall Administrative Rules Chapter 3- £126, Subchapter 5. A request for administrative hearings must be made directly to the ‘State of Hawaii Department of Commerce and Consumer Affars, Executive Director arf CEO 2 He BUY 08 HELL, an Put 170, 1099 Aan Se, HMO, He ‘one (80a7eeeiss Fax @O8/GBS110 mew hotaExhibit “3”Noize of Protest argon Hihny Sion Groyp Contton Contact RFBAIRT. 798916 Exhibit 3 Nes compemable Det Cott Itemization Desetpioa Taso Tail Pas] Rema] SCHEDULE BASED COST] 'STAFP - SUPERVISIO? 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MO[ a Es Teer Ch 09 Mol 200 —— gras sf Fissses Chagel 2900 MO] Ha ai as ‘ah Talon & Sappe| 2900 NOL 3 fs rH CRAFT EXPENSES! c Desig Ved ONO om] —— Senta Fasten] 2800 MOL 0. was eY CONSTRUCTION] ‘SILDING SETUP/DI 1b Otte PTET TSE IEE {IGETTY SETUP DISMANTL ail Copier Pasi soe} aol —— gaa “$] TOTAL COMPENSABI B82 DY] —Siz63833) — Bi M295 0 [Sam of ne DELAY cost| ie 8[Novice of Protest Feng Highy Son Group Consion Cott, RFBHRT T9836 Exhibit 3 ans conpentale Delay Cos tenizaon DIFFERENCE| Bescon Tae t Ta] "NAN'S TOTAL BID} ‘BT aTAAO rom Nea bd ‘AMOUNT Si] NAN COMPENSADI Birdie Ora DELAY COST AS % OF| ‘TOTAL BID AMOUN| HDCCS TOTAL BID] 9 0 eas DOC Be ‘COMPENSABLE DEL Brig aes cost aS % OF TOTAL BID] HDCCS THEORETICAL) 2 DY| —siL7aiIa] — a eA ae 3 Le ST (COMPENSABLE DELAY ‘cost S TDC. TREY | — STOO HE AION From ADO COMPENSABLE DELAY| (COST (EXTENDED) “al —nippes DinecT cos BS ie “Le “Sof —NAN'S DIRECT Cost $7477 2-5] 50Line 5 DIRECT COS} 22185625] ie S85Exhibit “4”No of ron Fay igh Suc Gop Casta Conn, RFBHRT- P0316 Exhibit 4 s0cc1 uname Anis TST eta Hoce id] Unie 10% of] Theoretical] Unbalances Daye Adjusted Pre Cost|_Aajusted Pre a axal 3 $ooo000 | ——sinraa | —sisasa0 | sean oy 3300000 | 811,734] $703.60 | 3.096140 30 2700000 | ——sti7sx | $1.055.790 | —$1.644210 2 $3,600000 | $11,731] ~sia07.720 | —s2av2200 350 S1500000| sii7ai| —si.7s9.6s0 | 2.740350 i80] 880000 | 5400000 | sin7si | —saaiaseo | — $3,200,420 ‘0] s30.000 [$6300.00 | sti7si| —$2.463:10 | —$3936490 $8221050