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FLORIDA DEPARTMENT OF TRANSPORTATION CONTRACTS ADMINISTRATION OFFICE

MARKET ANALYSIS SECTION AREA SIX BID MONITORING AND MARKET ANALYSIS STUDY

Market Analysis Section Kwan-Li Ling Reviewed by: Nasser Pourfarzaneh November 3, 2010

CONFIDENTIAL
Per 337.168 F.S.

TABLE OF CONTENTS INTRODUCTION. SELECTION CRITERIA...... SELECT MODEL... 1 1 2

Proposal/Bid Analysis......................................................................................................................4 Single-Bidder Contract.....................................................................................................................5 Two-Bidder Contract........................................................................................................................6 Market Share Analysis by Top Vendors..........................................................................................6 Market Share Analysis by County....................................................................................................9 Hillsborough County........................................................................................................................9 Pasco County....................................................................................................................................9 Pinellas County.................................................................................................................................9 Polk County......................................................................................................................................9 Market Share Analysis by Year......................................................................................................11 Finding............................................................................................................................................13 Lane Construction...........................................................................................................................14 Apac-Southeast...............................................................................................................................15 Ajax Paving.....................................................................................................................................16 Findings..........................................................................................................................................21 Findings..........................................................................................................................................23 Lane Construction and Apac-Southeast Bid Pattern in Polk County............................................24 SUMMARY... 23

INTRODUCTION This study monitors proposal and bidding patterns and performs market share analysis, vendor competition analysis, pricing analysis in Area Six. Our goal is to find indicators of bid collusion: suspicious bidding patterns and/or suspicious pricing patterns. The data was collected with specifications listed in Selection Criteria indicated below. SELECTION CRITERIA Area of Study: Contract Letting Date: Area Six, a total of four counties (Hillsborough, Pasco, Pinellas, Polk) January 01, 2005 to December 31, 2009

Contract Types:

All Construction, Traffic Operation contracts, Lump Sum Contracts, Design Build contracts let by Central Office and District Office in Area Six. All awarded contracts selected.

Contract Letting Status:

Contract Awarded Amount: > $250,000. BAMS/DSS Models: Other: Select Model, Market Share Model, Vendor Competition Model, Price Model. Identifying asphalt facility locations by using LIMS Database reports and telephone calls to verify and update the most recent change of facility location together with in-house vendor maps, Microsoft Excel.

SELECT MODEL Vendors in Area Six purchased 1575 proposals and submitted 848 bids in this study period. Low bidders worked on 213 contracts with a total of $1,925,996,310 awarded contract dollar amount over four counties in Area Six. The total awarded contracts, total contract dollar amounts and percentages associated to each individual county in Area Six are summarized in Table 1. Contra ct Numbe r
64

County
HILLSBOROUG

Contrac t Awarded Numbe Amount r (%) ($)


30.05% $1,001,487,2

Awarded Amount (%)


52.00%

H PASCO PINELLAS POLK AREA 6 Total STATEWIDE

26 43 80 213 1603

12.21% 20.19% 37.56% 100.00 %

13 $141,171,815 $461,267,815 $322,069,467 $1,925,996,3 10 $10,883,212, 919

7.33% 23.95% 16.72% 100.00%

Table 1 Hillsborough County received second highest in contract number, 30.0% (64 contracts) of the entire Area Sixs total contracts and 52.0% ($1,001,487,213) of the entire Area Sixs total contract awarded dollars. Hillsborough County received the most awarded contract dollars compared to the other three counties in Area Six. There was one very large joint venture contract T7209 won by PCL Civil and Archer Western with new construction work type awarded for $389,463,750 in this county. PCL Civil won another large road resurface contract over $100 million dollars in this county. Pinellas County received second highest awarded contract dollars, 23.95% and third highest contract numbers, 20.19% in Area Six. Hubbard Construction won one large road resurface contract over $100 million dollars in this county. Polk County received the highest in contract numbers, but no large contract over $100 million. Both Hillsborough and Pinellas Counties got the majority of contracts and contract dollars in Area Six. Together they had 50.2% of contracts and 76.0% of awarded contract dollars in Area Six.

Proposal/Bid Analysis We measure vendors participation of purchasing proposals and submitting bids by comparing average proposal and bid ratio per contract from each county to average statewide ratio. Average statewide proposal ratio per contract is 7.29 and bid ratio is 4.12 per contract. Table 2 lists detailed information of proposal, bid, contract numbers and ratio numbers associated with each county in Area Six. It shows average proposal ratio in Area Six is slightly higher than statewide. But bid ratio is below statewide. Location Contract Number Proposals Ordered Bids Received Ratio of Ratio of Proposals/ Bids/

Contracts
STATEWIDE AREA 6 HILLSBOROU GH PASCO PINELLAS POLK
1603 213 64 26 43 80 11684 1575 502 234 362 477 6599 848 245 135 186 282 7.29 7.39 7.84 9.00 8.42 5.96

Contracts
4.12 3.98 3.83 5.19 4.33 3.53

Table 2 Polk County had the lowest vendor participation ratio both in proposal and bid ratio. Hillsborough County also did not do well in submitting bids. Graph 1 demonstrates vendor participation performance of proposal and bid in each county comparing to statewide average. Hillsborough County bid ratio was below statewide 0.29. Polk County proposal ratio was below statewide 1.33 and bid ratio was below statewide 0.59.

Graph 1

LOW COMPETITION Single-Bidder Contract There were a total of 13 single-bid contracts (it included two design build) in this study period. Some of them were awarded with very large amount of contract dollars. Two largest single-bid construction contracts, one is T7070 won by Archer Western and the other is T7168 won by Prince Contracting. Table 5 describes detailed information of these two large single-bid contracts. 5

Contra ct No.
T7070 T7168

Let Date
06/28/20 06 05/23/20 07

Awarded Amt
$89,191,1 91 $42,685,7 42

County
Pinellas Hillsborou gh

Contra ct Type
CC CC

Contract Work Type

Contract Winner

Reconstructi Archer on Western Misc Prince Contracting

Table 5 In addition to Table 5, Lane Construction won a $1 million road resurfacing single-bidder contract in Polk County. Ajax Paving won a $2 million single-bidder contract in Hillsborough County.

Two-Bidder Contract Not only single-bid contracts brought down bid ratio, a large amount of two-bidder contracts will also drive bid ratio down. There were a total of 52 two-bidder contracts, and 14 of these two-bidder contracts were won by Lane Construction in Polk County. It is interesting that 71% of Lane Construction bids were competing with Apac-Southeast among these two-bidder contracts. Apac-Southeast also won 14 two-bidder contracts in Hillsborough, Pinellas and Polk Counties. Among these 14 two-bidder contracts, 64% were competing with Lane Construction and 36% were competing with Ajax Paving. Ajax Paving won a total of 8 two-bidder contracts in Hillsborough and Pinellas. Half of them were competing with Apac-Southeast. These three top major vendors won 69% of total two-bidder contracts, and more than half of the time Lane Construction and Apac-Southeast were competing with each other; Ajax Paving were competing with Apac-Southeast. MARKET SHARE Market Share Analysis by Top Vendors

In this section we analyze market shares among top major vendors and other non-top major vendors in each county and overall Area Six. Top major vendors were chosen by who received the most contracts. Lane Construction, Apac-Southeast and Ajax Paving are the chosen major vendors receiving the highest contract numbers; 42, 36, 23 respectively. Ajax Paving had two different

vendor names and vendor numbers and we merge them in one. Ajax Paving Industries, Inc. won contracts let from 1/12/2005 to 6/18/2008, a total of 19 contracts. Ajax Paving Industries of Florida, LLC won contracts let from 7/15/2008 12/17/2009, a total of 4 contracts. Table 3 demonstrates the number of contracts these three top vendors and other vendors worked on and percentage associated with each county. Together these three top vendors worked on 47.42% of Area Sixs contracts and the other vendors worked on 52.58%.
Counties Lane Const
# contracts and % in County

ApacSoutheast
# contracts and % in County

Ajax Paving
# contracts and % in County

Others # contracts and % in County

Total
# contracts and % in County

HILLSBOROUGH

7 94% 3

10. 1 85%

10 15.63% 3. 6 5% 2 .5%

14 21.88% 1 3.85% 13.9

33 50.00% 21 80.77% 32 74.42% 26 32.50% 111 52.58%

64 30.05% 26 12.21% 43 20.19% 80 37.56% 213 100.00%

11.

PASCO

54%

PINELLAS 32 40.00% 42 19.72%

5 11.63% 20 25.00% 37 16.90%

2 23 10.80%

POLK Total

Table 3 Lane Construction won the most contracts, 42, occupying 20% of awarded contracts in Area Six. Apac-Southeast came in second, 17% and Ajax Paving was the third, 11%. Polk County was awarded the most contracts, 80, occupying 38% of awarded contracts in Area Six. Hillsborough, Pinellas, Pasco was awarded with 64, 43, 26 contracts respectively which occupied 30%, 20%, 12% respectively in Area Six. Table 4 demonstrates the three major vendors and non-major vendors total awarded contract dollars and percentage associated with each county. These three major vendors received 23.3% of total Area Six contract dollars and non-major vendors had a larger portion, 76.7%, due to several very large new construction and road resurface contracts won by PCL Civil, Archer Western, and Hubbard Construction.

Counties

Lane Const
$ Amt and % in

ApacSoutheast

Ajax Paving
$ Amt and % in Others

Total

$ Amt and % in County

County

$ Amt and % in County

County

$ Amt and % in County

HILLSBOROUGH PASCO

$26,616, 480 2. 66% $36,278, 398 25. 70%

$48,776,560 4.87% $4,574,318 3.24% $7,376,447 1.60% $102,976,90 1 31.97% $163,704,22 6 8.50%

$86,129,09 2 8.60% $4,019,903 2.85% $22,144, 963 4. 80% $3,439,000 1.07% $115,732,9 58 6.01%

$839,965,08 1 83.87% $96,299,196 68.21% $431,746,40 5 93.60% $109,589,00 4 34.03% $1,477,599,6 86 76.72%

$1,001,487,21 3 52.00% $141,171,815 7.33% $461,267,815 23.95% $322,069,467 16.72% $1,925,996,31 0 100.00%

PINELLAS $106,064,56 2 32.93% $168,959,44 0 8.77%

POLK AREA 6 Total

Table 4 Graph 2 shows the market share condition in pie chart among non-major and major vendors.

Market Shares Total Dollars in Area Six


Contract Awarded Amount > $250,000 Year 2005 2009

Graph 2

Market Share Analysis by County Hillsborough County Hillsborough was the county receiving highest contract dollars in Area Six, 52%, a total of $1,001,487,213 contract dollars. Ajax paving, Apac-Southeast and Lane Construction were the top vendors who received $86,129,092, $48,776,560, $26,616,480 contract dollars respectively. These three top vendors together occupied a total of 16% and the other vendors had 84% of the market in Hillsborough County. Pasco County Pasco County had the smallest contract dollars in Area Six, 7%, a total of $141,171,815 contract dollars. Three major contractors were all working in this county. Lane Construction, Apac-Southeast and Ajax Paving received $36,278,398, $4,574,318, $4,019,903 contract dollars respectively. Together they had 32% of the market in Pasco County and the remaining contractors shared the other 68%. Pinellas County Pinellas County had the second highest share of contract dollars in Area Six, 24%, a total of $461,267,815 contract dollars. Ajax Paving and Apac-Southeast received $22,144,963, $7,376,447 contract dollars respectively. These two major contractors had a total of 6% of market in Pinellas County; the other contractors shared a total of 94%. Polk County Pinellas County had the third highest share of contract dollars in Area Six, 17%, a total of $322,069,467. All four top major contractors received contracts in this county. Lane construction, Apac-Southeast, and Ajax Paving got $106,064,562, $102,976,901, $3,439,000 contract dollars respectively. These three top vendors together had 65% and the other vendors had 34% of Polk County market.

Graph 3 Graph 3 shows the three top major vendors relatively having a smaller percentage compared to other vendors in Hillsborough, Pasco and Pinellas Counties. Due to other vendors like PCL Civil, Prince Contracting won a few over $100 million dollar contracts in Hillsborough; Hubbard Construction, Archer Western won a few contracts greater than $50 and under $100 millions in Pinellas. These large contracts may include bridge work, but were not necessarily bridge contracts.

10

Market Share Analysis by Year None of these three major vendors dominated Area Sixs market; Graph 4 demonstrates the dynamic market shares with percentage contract awarded dollar amount by year. It looks like year 2009 was a bad year for Lane Construction and Ajax paving. Non-major vendors won over 92% of awarded contract dollars in year 2009. PCL and Archer Western won a joint venture contract worth $389 million and Hubbard Construction won a very large contract worth $109 million. Just these two contracts alone, occupied 73% of nonmajor vendors sub-total awarded dollars in year 2009.

Graph 4 Among these large contracts, there was only one bridge contract, the rest of them were construction contracts. Some of these large contracts were single-bidder mentioned earlier in Low Competition section. These large contracts by year were listed below: Let Year
2005 2006 2007 2007 2008 2009 2009

Awarded Amount Won by Work Type (in millions) ________________________________________________________________


$ $ $ $ $ $ $ 76 89 103 42 60 109 389 Flatiron Constructors Bridge construction Archer Western New Construction PCL Civil New Construction Prince Contracting Misc Prince Contracting Misc Hubbard Construction Re-construction PCL/Archer WesternNew Construction

11

VENDOR COMPETITION In this section we analyze how top vendors compete with each other. The top vendors in Area Six were chosen by highest contract numbers that they received. Diagonally in the matrix below, Lane Construction, Apac-Southeast and Ajax-Paving were the chosen top vendors who received 42, 37, 23 contracts respectively. These three top vendors won a total of 102 contracts; the rest of vendors won 111 contracts. Lane Construction submitted 105 bids and won 42 contracts. Their success rate was 40%. Apac-Southeast had 32% and Ajax Paving had 26% success rate. Lane Construction was the best performer and also won the most contracts. The total bids in this study period are 848. Lane Construction had 12% (105/848); ApacSoutheast had 14% (116/848); Ajax Paving had 10% (87/848) of total bids submitted in Area Six. The frequency of submitting bids (bid over contract ratio) were Lane Construction 49%, ApacSoutheast 55%, and Ajax-Paving 41%.

VENDOR COMPETITION MATRIX


SUPPLEMENTED WITH TOP VENDORS RANKED BY CONTRACT NUMBERS SELECTED VENDORS LANE LANE 105 42 80 26 50 9 0.49 0.40 0.69 0.33 0.58 0.18 APAC 80 32 116 37 71 19 0.76 0.40 0.55 0.32 0.82 0.27 AJAX 50 15 71 20 87 23 0.48 0.30 0.61 0.28 0.41 0.26

APAC

AJAX

Off-diagonal elements in the vendor competition matrix are the frequency with which each vendor competes with its rivals. Lane Construction and Apac-Southeast submitted a total of 80 bids together in the same contracts; Lane Construction won 32 contracts (40%) and ApacSoutheast won 26 contracts (33%). If Lane Construction and Apac-Southeast teamed up, their success rate was 73%. Lane Construction and Ajax Paving were competing in 50 contracts together; Lane Construction won 15 contracts (30%) and Ajax Paving won 9 contracts (18%). If they teamed up, their success rate was 48%.

12

Apac-Southeast and Ajax Paving were competing in 71 contracts together. Apac-Southeast won 20 contracts (28%); Ajax Paving won 19 contracts (27%), a difference of 1%. If they teamed up, their success rate was 55%.

Finding None of top major vendors dominates the market. The frequency of Ajax Paving bidding with Apac-Southeast was very high, 82%. When they competed together, their success rates were only 1% off each other. The frequency of Lane Construction bidding with Apac-Southeast was very high, 76%.

13

VENDOR ACTIVITY MAPS The maps in this section provide a vision of where vendor business territories are and how they operate business with or without asphalt facilities. Since asphalt work is related to distance between contract work site and facility, these visual maps provide meaning to our study. They show the major contractors asphalt facility locations; total number of bids won and lost in each county of Area Six; as well as geographic location of contracts.

Lane Construction Lane Construction is ranked number one major contractor for the 42 contracts they won in Area Six. They won 32 and lost 23 contracts in Polk County. They own two asphalt facilities in Polk County. They had 40% of Polk Countys business. They won seven contracts in Hillsborough with one facility and won three contracts in Pasco. They did not win any contract in Pinellas.

Area Six Lane Construction


Year 2005 - 2009

Map 1

14

Apac-Southeast Apac-Southeast is ranked the second major contractor for the number of contracts they won, a total of 37, in Area Six. They have a total of four facilities, and each county in Area Six has one facility. They did not do well in Pasco County, only winning one contract and losing twelve despite owning a facility there. Land Construction won 26%; D.A.B. won 25% and Sema Construction won 21% of contract dollars in Pasco County. Area Six Apac-Southeast
Year 2005 - 2009

Map 2

15

Ajax Paving Ajax paving is ranked 3rd contractor in Area Six. They won most contracts in Hillsborough and Pinellas Counties. They have one asphalt facility in Hillsborough County and one in Pasco County. They submitted the most bids, won the most contracts and lost the most contracts in Hillsborough County. Even though they have facilities in Pasco County, they did not do well there; they only won one contract and lost fourteen.

Area Six Ajax Paving


Year 2005 - 2009

Map 3

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PRICE ANALYSIS From previous sections we learn that Archer Western was a single bidder that won a very large construction contract T7070 ($89 million) in Pinellas County. In this section we analyze contract T7070 asphalt concrete prices compared to other contracts let in the same year and nearby areas. We want to know whether Archer Western raised prices due to no other competitor. Price model reports show the top 30 items being spent in this study period. Table 5 lists the top seven asphaltic concrete materials and total dollars spent. Rank Item Number
2 14 15 17 19 21 28 0334 1 13 0334 1 23 0334 1 14 0337 7 22 0334 1 24 0337 7 6 0337 7 5

Item Description
Superpave Asphaltic Conc, Traffic C Superpave Asphaltic Conc, Traffic C, PG76-22 Superpave Asphaltic Conc, Traffic D Asphaltic Conc FC, Inc Bit, FC-5, PG7622 Superpave Asphaltic Conc, Traffic D, PG76-22 Asphaltic Conc FC, Inc Bit, FC-5, PG76 Asphaltic Conc FC, Inc Bit, FC-5, PG76

Total $ Spent
$54,448,450 $18,605,458 $17,464,837 $15,687,040 $14,024,575 $12,888,673 $11,310,366

Table 5 Table 6 lists all asphalt concrete items in contract T7070 (those items were omitted if the quantities were less than 500 tons). It cost contract T7070 approximately $5 million dollars on asphalt concrete materials. Contract T7070 Item Number
0327 70 6 0327 70 11 0327 70 19 0334 1 12 0334 1 14 0334 1 24 0337 7 0337 7 5 6

Unit Price
$ $ $ 7.5 8.4 8.5

Quantity
8,309 23,800 1,114 10,519 5,971 8,953 1,080 4,982 2,722

Sub-Total
$62,317.50 $199,920.0 0 $9,469.00 $1,420,092 .00 $806,193.0 0 $1,208,668 .50 $162,060.0 0 $772,318.5 0 $408,315.0 0 $5,049,353

$135.0 $135.0 $135.0 $150.0 $155.0 $150.0

0337 7 22 Total

17

.50

Table 6 The unit price fluctuated with quantity. Typically when quantities are less than 1,000 tons, the unit price can grow geometrically three times; when quantities are greater than 10,000 tons, the unit price may drop to half. We use a scatter graph to plot out all contracts let by year 2006 in Hillsborough and Pinellas Counties in asphalt concrete item 0327, 0334 and 0337 in order to get a closer comparison on contract T7070 with other contracts let in the same year and near-by locations, see Graph 5, 6, 7. Milling Exist Asphalt Paving
Let by year 2006 in Hillsborough and Pinellas

Graph 5 Super Pave Asphalt Concrete


Let by year 2006 in Hillsborough and Pinellas

Graph 6 Asphalt Concrete Friction INC BIT/RBR


Let by year 2006 in Hillsborough and Pinellas

18

Graph 7 T7070 unit price $7.50 (quantity 8,309 tons) on item 0327 70 6 was very high compared to E7D72 (let 09/12/2006) unit price $3.51 (quantity 4,743) and all other five contracts except T7130 in Table 7. Contra ct ID
T7130 T7070 E7D72 T7154 E7D81 T7135 T7146

Let Date
01/25/20 06 06/28/20 06 09/13/20 06 12/13/20 06 10/11/20 06 04/26/20 06 07/26/20 06

County
Pinellas Pinellas Hillsborou gh Pinellas Hillsborou gh Hillsborou gh Hillsborou gh

Item No
0327 70 6 0327 70 6 0327 70 6 0327 70 6 0327 70 6 0327 70 6 0327 70 6

Item Unit Price


$10.00 $ 7.50 $ 3.51 $ 1.75 $ 5.65 $ 5.72 $ 4.95

Item Quantity
3,006 8,309 4,743 23,642 38,520 30,615 58,058

Table 7 T7070 unit price $8.4 (quantity 23,800 tons) on item 0327 70 11 was high compared to T7135 (let 04/26/2006) unit price $8.32 (quantity 1,951 tons) and other contracts in Table 8. Contra ct ID
T7070 T7135

Let Date
06/28/20 06 04/26/20 06

County
Pinellas Hillsborou gh

Item No
0327 70 11 0327 70 11

Item Unit Price


$8.40 $8.32

Item Quantity
23,800 1,951

19

E7D81

10/11/20 06

Hillsborou gh

0327 70 11

$6.90

86,609

Table 8 T7070 item 0327 70 19 does not have other contracts to compare in Hillsborough and Pinellas Counties of year 2006. T7070 unit price $135.0 (quantity 10,519 tons) on item 0334 1 12 was very high compared to E8G87 (let 05/23/2006) unit price $105.0 (quantity 10,794 tons) and other contract in Table 9. Contra ct ID
T7070 E8G87 T7102

Let Date
06/28/20 06 05/23/20 06 08/30/20 06

County
Pinellas Hillsborou gh Hillsborou gh

Item No
0334 1 12 0334 1 12 0334 1 12

Item Unit Price


$135.00 $105.00 $131.31

Item Quantity
10,519 10,794 3,148

Table 9 T7070 unit price $135.0 (quantity 5,971 tons) on item 0334 1 14 was high compared to T7102 (let 08/30/2006) unit price $131.31 (quantity 3,670 tons) and other contracts in Table 10. Contra Let Date County Item No Item Item ct ID Unit Quantity Price
T7070 T7102 T7103 06/28/20 06 08/30/20 06 01/25/20 06 Pinellas Hillsborou gh Hillsborou gh 0334 1 14 0334 1 14 0334 1 14 $135.00 $131.31 $117.80 10,519 3,670 1,088

Table 10 T7070 unit price $135.0 (quantity 8,953 tons) on item 0334 1 24 was high compared to T7103 (let 01/23/2006) unit price $123.5 (quantity 578 tons) in Table 11. T7102 unit price $139.39 was higher than T7070, normal as prices drop slightly when quantity is greater than ten thousand tons. Contra ct ID
T7070

Let Date
06/28/20

County
Pinellas

Item No
0334 1

Item Unit Price


$135.00

Item Quantity
10,519

20

T7102 T7103

06 08/30/20 06 01/25/20 06

Hillsborou gh Hillsborou gh

24 0334 1 24 0334 1 24

$139.39 $123.50

4,130 578

Table 11 T7070 unit price $150.0 (quantity 1,080 tons) on item 0337 7 5 was high compared to T7135 (let 04/26/2006) unit price $113.0 (quantity 6,935 tons) in Table 12. Contra ct ID
T7070 T7135

Let Date
06/28/20 06 04/26/20 06

County
Pinellas Hillsborou gh

Item No
0337 7 5 0337 7 5

Item Unit Price


$150.00 $113.00

Item Quantity
1,080 6,935

Table 12 T7070 unit price $155.0 (quantity 4,982 tons) on item 0337 7 6 was not high compared to E7D81 (let 10/11/2006) unit price $170.0 (quantity 3,081 tons) and other contracts in Table 13. Contra ct ID
E7D81 T7070 T7154

Let Date
10/11/20 06 06/28/20 06 12/13/20 06

County
Hillsborou gh Pinellas Pinellas

Item No
0337 7 6 0337 7 6 0334 7 6

Item Unit Price


$170.00 $155.00 $165.50

Item Quantity
3,081 4,982 1,891

Table 13 T7070 item 0337 7 22 does not have close to the quantity of contracts let by year 2006 in Hillsborough and Pinellas Counties to compare. Findings From the above nine asphalt concrete items of comparison between T7070 unit price and all contracts involving those items in Hillsborough and Pinellas Counties, we conclude for T7070: 6 of them (item unit prices) were high or very high; 1 of them (item unit prices) was not high; 21

2 of them (item unit prices) did not have other data to compare.

We extend the scope of data from Hillsborough and Pinellas Counties to entire Area Six for comparison. Table 14 is a summary of statistics data we gathered from Price model reports and combined with T7070 unit price for comparison. Last column (Where does T7070 price stand?) of Table 14 shows the result of comparison. Item # us e Average Price Stan dard S. D. compa re to 75th %ile Price Max Price T707 0 Price Max Price Qty Where does T7070

22

Devi ation
0327 70 6 0327 70 11 0327 70 19 0334 1 12 0334 1 14 0334 1 24 0337 7 5 0337 7 6 0337 7 22 10 4 2 8 4 3 5.3 4 6.2 8 7.5 7 132.0 1 123.5 1 132.6 3 155.4 1 145.4 5 145.9 6

other years
7.50 8.36 8.50 157.50 133.15 135.00 10.00 8.40 8.50 215.00 135.00 139.39 7.50 8.40 8.50

Count y

price stand?
75%ile Highes t Highes t < 75%ile Highes t 75%ile Highes t (not count small qty) < 75%ile Highes t (not count small qty)

3.0 high 8 above 3.2 averag 6 e below 1.3 averag 2 e above 44.5 averag 8 e below 11.6 averag 8 e 8.2 low 1 above 44.1 averag 1 e below 34.4 averag 6 e above 25.8 averag 9 e

Not in 135.0 10, 0 15** 135.0 0 135.0 0 150.0 448 0 tons Not in 155.0 10,15* 0 * 150.0 510 0 tons

183.57

217.17

11

170.00

210.00

150.00

181.82

** Hillsborough county code is 10; Pinellas county code is 15

Table 14 Findings Among the nine asphalt concrete items listed in Table 14 last column, we conclude for T7070: 5 of them (item unit price) were highest in Area Six; Note: 2 of them do not count contracts with small quantity. 2 of them (item unit price) were in 75th percentile of Area Six; 2 of them (item unit price) were under 75th percentile of Area Six. ADDENDUM

23

Lane Construction and Apac-Southeast Bid Pattern in Polk County We did a research on Lane Construction and Apac-Southeast bid pattern in Polk County, due to both of them having very close contract awarded dollars in this study period. Lane Construction won 32 contracts and Apac-Southeast won 20 contracts, but awarded dollar amount was only approximately $3 million difference. Table 15 shows all contracts won by both Lane Construction and Apac-Southeast with data sorting by let date. Ratio of accumulated contract dollars for both vendors was calculated to observe the bid pattern.
Ratio of Lane Accu m $/Apa c Accu m$ 0.119 9 0.042 0 0.247 2 0.400 1 0.620 7 0.482 8 0.445 4 0.346 7 1.114 2 1.290 5 2.307 1 2.776 8 3.002 9

CONT ID T111 1 T110 3 T112 4 T112 2 T110 7 T112 9 T112 0 E1F1 0 T114 6 T113 7 T112 8 T113 6 T115 3 T115 2

Let Date 2/23/200 5 3/30/200 5 3/30/200 5 7/27/200 5 7/27/200 5 8/31/200 5 9/28/200 5 9/28/200 5 10/20/20 05 11/2/200 5 11/2/200 5 12/7/200 5 12/7/200 5 1/25/200 6

Contract $ won by Lane Construction 291,000.0

Accumulated Contract $ won by Lane Construction 291,000.0 291,000.0 291,000.0

Contract $ won by ApacSoutheast

Accumulate d Contract $ won by Lane Construction

2,427,000.0 4,499,900.0

2,427,000.0 6,926,900.0 6,926,900.0 6,926,900.0 6,926,900.0

1,421,400.0 1,059,070.0 1,527,944.5

1,712,400.0 2,771,470.0 4,299,414.5 4,299,414.5 4,299,414.5 4,299,414.5 1,977,650.0 748,239.3 2,749,900.0

8,904,550.0 9,652,789.3 12,402,689. 3 12,402,689. 3 12,402,689. 3 12,402,689. 3 12,402,689. 3 12,402,689. 3

9,519,327.3 2,187,500.0 12,608,188. 2 5,825,739.5 2,804,000.0

13,818,741.8 16,006,241.8 28,614,430.1 34,440,169.5 37,244,169.5

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T116 9 T116 7 T118 4 T117 4 T118 9 T117 9 E8H2 1 T120 5 T120 1 T120 0 T121 6 T120 6 T121 4 T122 3 T121 1 T122 2 T121 3 T122 0 T124 3 T119 0 T122 5 T123 2 T128 0 T128 2 T129

3/29/200 6 3/29/200 6 5/24/200 6 5/24/200 6 7/26/200 6 7/26/200 6 8/24/200 6 8/30/200 6 9/27/200 6 9/27/200 6 10/25/20 06 10/25/20 06 12/13/20 06 1/31/200 7 3/7/2007 3/28/200 7 4/25/200 7 6/20/200 7 7/25/200 7 7/25/200 7 10/31/20 07 3/5/2008 6/18/200 8 7/30/200 8 8/27/200

2,606,766.1 1,175,041.4 626,352.0 1,464,535.9 1,133,008.8

39,850,935.6 41,025,977.0 41,652,329.0 43,116,864.8 44,249,873.6 44,249,873.6 44,249,873.6 315,053.1 22,251,280. 6

2,018,905.6

46,268,779.2 46,268,779.2 46,268,779.2 1,776,000.0 2,113,000.0

4,730,549.2 1,315,000.0 31,557,145. 6 916,428.0 4,242,775.4

50,999,328.4 52,314,328.4 83,871,473.9 84,787,902.0 89,030,677.3 89,030,677.3 5,990,000.0

2,229,000.0 2,045,867.0

91,259,677.3 93,305,544.3 93,305,544.3 93,305,544.3 959,900.0 2,084,000.0

1,077,513.0 932,415.0 937,640.6 3,144,681.0

94,383,057.3 95,315,472.3 96,253,112.9 99,397,793.9 99,397,793.9 3,692,431.0

12,402,689. 3 12,402,689. 3 12,402,689. 3 12,402,689. 3 12,402,689. 3 12,717,742. 4 34,969,023. 0 34,969,023. 0 36,745,023. 0 38,858,023. 0 38,858,023. 0 38,858,023. 0 38,858,023. 0 38,858,023. 0 38,858,023. 0 44,848,023. 0 44,848,023. 0 44,848,023. 0 45,807,923. 0 47,891,923. 0 47,891,923. 0 47,891,923. 0 47,891,923. 0 47,891,923. 0 51,584,354.

3.213 1 3.307 8 3.358 3 3.476 4 3.567 8 3.479 4 1.265 4 1.323 1 1.259 2 1.190 7 1.312 5 1.346 3 2.158 4 2.182 0 2.291 2 1.985 2 2.034 9 2.080 5 2.036 9 1.948 3 1.970 8 1.990 2 2.009 8 2.075 5 1.926

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2 T126 6 T123 4 T129 7 E1G5 6 T129 8 T126 8 T131 5 T124 9 T128 7 T132 3 T136 6 E1H6 9 E1H5 9

8 8/27/200 8 9/24/200 8 10/29/20 08 11/20/20 08 12/3/200 8 1/28/200 9 3/4/2009 3/4/2009 3/4/2009 4/29/200 9 12/2/200 9 12/10/20 09 12/17/20 09

1,431,108.0

348,647.0

875,850.0 2,110,000.0 1,080,738.0

820,425.0

99,397,793.9 100,828,901. 9 100,828,901. 9 101,177,548. 9 101,177,548. 9 102,053,398. 9 104,163,398. 9 105,244,136. 9 105,244,136. 9 106,064,561. 9 106,064,561. 9 106,064,561. 9 106,064,561. 9

1,888,943.0

3,460,000.0

4,208,997.0

4,960,807.0

1,198,000.0 34,778,500. 0 897,300.0

0 53,473,297. 0 53,473,297. 0 56,933,297. 0 56,933,297. 0 61,142,294. 0 61,142,294. 0 61,142,294. 0 61,142,294. 0 66,103,101. 0 66,103,101. 0 67,301,101. 0 102,079,601 .0 102,976,901 .0

9 1.858 8 1.885 6 1.771 0 1.777 1 1.654 8 1.669 1 1.703 6 1.721 3 1.592 1 1.604 5 1.576 0 1.039 0 1.030 0

Table 15 There is no suspicious indicator being found in the pattern shown in Table 15.

SUMMARY 26

In this study we analyzed 1575 proposals, 848 bids, and 213 contracts involving $1,925 million contract dollars. We found bid ratio was slightly below statewide level in Hillsborough County which received highest contract dollars. Polk County received the most contract numbers having proposal and bid ratios both below statewide level. Low competition among vendors led to low proposal and bid ratio. There was 8% of single bid contracts if we do not count design build contracts in this study. We found a couple of fairly large size single bid contracts on construction contracts won by Archer Western and Prince Contracting. There were 24% of two-bidder contracts in this study. Most two-bidder contracts were won by three chosen top vendors, Lane Construction, Apac-Southeast and Ajax Paving. Market was shared approximately half and half among major and non-major vendors by contract numbers. But it split to a quarter and three quarter among major and non-major vendors by contract dollars. Non-major vendors like PCL Civil, Archer Western and Hubbard Construction won several contracts over $100 million. These large contracts were spread in Hillsborough, Pasco and Pinellas Counties. Competition matrix shows that 82% of the time Ajax Paving was bidding together with Apac-Southeast. They had very close success rates, only 1% difference. Lane Construction bid together with Apac-Southeast76% of the time. Their success rates were also very close, only 7% difference. Since the non-major vendors dominate the market, our price analysis focuses on one large single bid contract won by Archer Western. We want to see if they raised price on asphalt concrete items due to no other competitors. Among nine most commonly used asphalt concrete items, six of them had high or highest prices compared to the same year contracts and near-by counties (Hillsborough and Pinellas). Only one item unit price was not high. The other of two items cannot be compared because there is no data. If we enlarge the comparison scope from Hillsborough and Pinellas counties to Area Six, then five out of nine had highest unit price (we did not count two highest prices with small quantities). The remaining two items prices were in 75th percentile and the other two were under 75th percentile. We found that standard deviation of asphalt concrete unit prices stretched out further in year 2006 and 2007, possible impacted by world oil price gouging. Lastly we did a bid pattern study on Lane Construction and Apac-Southeast in Polk County. We did not find any suspicious indicators on rotating bids.

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