district three

7/31/2019 District Three

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FLORIDA DEPARTMENT OF TRANSPORTATION

CONTRACTS ADMINISTRATION OFFICE

MARKET ANALYSIS SECTION

DISTRICT THREE

BID MONITORING AND MARKET ANALYSIS STUDY

Market Analysis Section

Nasser Pourfarzaneh

August , 2010

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CONFIDENTIAL

Per 337.168 F. S.


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TABLE OF CONTENTS

SELECTION CRITERIA..3

SELECT MODEL ......3

Proposals and Bid Ratio ...5

Bids VS Proposals .....6

MARKET SHARE .........8

Market Share by Counties .9

Escambia & Leon Counties .9

Bay & Okaloosa Counties ...10

Walton and Jackson Counties ....11

Market Share with Respect to Asphalt Facilities ........11

APAC-Southeast..12

Anderson Columbia .13

C.W. Roberts 14

Problem Area .........15

Jackson County 17

VENDOR COMPETITION18

Anderson Columbia .18

C.W. Roberts ...18

APAC-Southeast ..19

Anderson Columbia & C.W. Roberts...19

Anderson Columbia & APAC-Southeas. 19

APAC-Southeast & C.W. Roberts19

Peavy & Son...19

Panhandle Grading....20

SUMMARY OF ANALYSIS...20

CONCLUSION.23

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was awarded to Tidewater / Flatiron Construction as joint venture with a total awarded amount of$242,787,000. This contract accounts for 82% of the total awarded amounts that was awarded byDistrict Three.

The table 2 shows, Escambia County with 37 contracts (19.4%), Bay County with 26

contracts (13.6%) and Okaloosa County with 24 contracts (12.6%) are ranked number one to threein number of contracts awarded. The table also shows, Santa Rosa, Leon and Bay Counties with(23.0%, 17.8% and 13.3%) respectively ranked number one to three in receiving awarded contractdollars.

Awarded Awarded Percentage of Percentage of

Contracts Amounts Awarded Contracts Awarded Amounts

DistrictThree

1911,251,967,529

Bay 26 $167,052,635 13.6% 13.3%Calhoun 4 $28,244,791 2.1% 2.3%

Escambia 37 $128,966,511 19.4% 10.3%Franklin 3 $54,662,143 1.6% 4.4%Gadsden 11 $51,833,504 5.8% 4.1%

Gulf 6 $8,464,472 3.1% 0.7%Holmes 10 $18,257,731 5.2% 1.5%Jackson 15 $73,330,197 7.9% 5.9%Jefferson 5 $12,330,252 2.6% 1.0%

Leon 19 $222,843,548 9.9% 17.8%Liberty 2 $9,159,397 1.0% 0.7%

Okaloosa 24 $107,901,285 12.6% 8.6%Santa Rosa 10 $288,248,228 5.2% 23.0%

Wakulla 3 $9,146,103 1.6% 0.7%Walton 8 $51,493,351 4.2% 4.1%

Washington 8 $20,033,382 4.2% 1.6% Table 2

Proposals and Bid Ratio

In this section we will review and analysis the proposals and bid ratios per contracts. Astable 3 shows. in District Three the proposal ratios and bid ratios are below the statewide ratios.

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Proposals Bids Awarded Proposals Bids Bids Over

Contracts Ratio Ratio Proposals

Statewide 10088 5994 1564 6.5 3.8 59.4%

DistrictThree

911 525 191 4.8 2.757.6%

Bay 135 69 26 5.2 2.7 51.1%

Calhoun 18 11 4 4.5 2.8 61.1%

Escambia 180 114 37 4.9 3.1 63.3%

Franklin 21 8 3 7.0 2.7 38.1%

Gadsden 46 31 11 4.2 2.8 67.4%

Gulf 38 17 6 6.3 2.8 44.7%

Holmes 39 27 10 3.9 2.7 69.2%

Jackson 47 34 15 3.1 2.3 72.3%

Jefferson 28 17 5 5.6 3.4 60.7%

Leon 79 45 19 4.2 2.4 57.0%

Liberty 5 4 2 2.5 2.0 80.0%

Okaloosa 101 67 24 4.2 2.8 66.3%

Santa Rosa 52 28 10 5.2 2.8 53.8%

Wakulla 14 7 3 4.7 2.3 50.0%

Walton 45 25 8 5.6 3.1 55.6%

Washington 35 25 8 4.4 3.1 71.4%

Table 3

Liberty County has the lowest proposal and bid ratios per contracts among all the countiesin District Three. It has the lowest number of proposals ordered, bids received and contractsawarded. However; based on the low numbers of the competitors because of Geographicallocation, a low level of competition is anticipated.

Wakulla and Jackson Counties ranked second among all counties with low number of bid ratio.

Jackson County has the lowest Proposals Ratio per contracts among all counties. This indicates,not many contractors actively competing against each other in this county. On the other hand,

Jackson County has the second highest percentage of bids over proposals, which indicates, thatmajority of those contractors who ordered proposals submitted bids. Based on these analysis; thecurrent market competition in Jackson County is not healthy and any improvements will bedifficult because of low level of interest by other contractors to compete.

The Wakulla County has a bid ratio of 2.3 which is the same as Jackson County. Theproposal ratio in Wakulla County is 1.6 higher than Jackson County and fifty percent of thosecontractors who ordered proposals submitted bids which it is 22% less than Jackson County.

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The current market competition in Wakulla County is the same as Jackson County and is not wellbut has a better chance of the market improvement than Jackson County because, there are sign ofmore participation by other contractors whom ordered proposals but some reasons didnt submitbids.

Bids VS Proposals

Our analysis on bids and proposals ratios shows a low percentage for number of the bidsover proposals. As Table 4 shows only 59.4% of the proposals ordered turned to bids by allcontractors statewide. As a group, the contractors listed below had ordered 35.0% of the totalproposals ordered and are accountable for 40.2% of the total bids received statewide. They turnedbids on 68.3% of the proposals they ordered.

% of Bids

Proposals Bids % of % Over

Ordered Received Proposals Bids Proposals

Statewide 10088 5994 59.4%

APAC- Southeast 707 520 7.0% 8.7% 73.6%

Community Asphalt 362 329 3.6% 5.5% 90.9%

Hubbard Construction 325 192 3.2% 3.2% 59.1%

Anderson Columbia 320 266 3.2% 4.4% 83.1%

WEEKLEY Asphalt 299 163 3.0% 2.7% 54.5%

Ranger Construction 269 216 2.7% 3.6% 80.3%

Middlesex Corporation 229 148 2.3% 2.5% 64.6%

Ajax Paving 196 142 1.9% 2.4% 72.4%

C.W. Roberts 196 140 1.9% 2.3% 71.4%

Lane Construction 163 134 1.6% 2.2% 82.2%

vendors Total 3066 2250 30.4% 37.5% 73.4%

Kiewit Southern 259 94 2.6% 1.6% 36.3%

Cone & Graham 206 68 2.0% 1.1% 33.0%

Vendors Total 465 162 4.6% 2.7% 34.8%

VENDORS TOTAL 3531 2412 35.0% 40.2% 68.3%

Others 6557 3582 65.0% 59.8% 54.6% Table 4

Other contractors as a group ordered 65.0% of the proposals and are accountable for 59.8%of the total bids received. However, they turned bids on only 54.6% of the proposals ordered. Inother word, other contractors submitted bids only on half of the proposals they had ordered.

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Further Analysis shows, not all of those contractors that ranked high in number of theproposals ordered had high percentages of turning bids. Community Asphalt and AndersonColumbia turned bids on 90.9% and 83.1% of the proposals they ordered respectively while KiewitSouthern and Cone & Graham turned bids on 36.3% and 33.0% proposals they ordered

respectively.

% of Bid

Proposals Bids % of % Over

Ordered Received Proposals Bids Proposal

District Three 911 525 57.6%

Anderson Columbia 130 101 14.3% 19.2% 77.7%

C.W. Roberts 116 96 12.7% 18.3% 82.8%

APAC-Southeast 80 68 8.8% 13.0% 85.0%

Vendors Total 326 265 35.8% 50.5% 81.3%

Others 585 260 64.2% 49.5% 44.4%

Table 5

This problem even more intensifies in District Three where other contractors had shownless interest in submitting bids and the percentage of bids over proposals is 10.2% less than thestatewide percentage. The three contractors listed on Table 5 had submitted 50.5% of the total bidsreceived in this district and turned bids on 81.3% of the proposals. All other contractors submitted

49.5% of the total bids received in this district and turned bids on 44.4% of the proposals.

MARKET SAHRE

Market Share reports show that there are three major vendors in District Three. AndersonColumbia ranked number one as he received 27.75% of the total contracts were awarded and

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23.79% of the contract dollars. C.W. Roberts is second as he received 19.90% of the total contractsawarded and 21.07% 0f the contract dollars. APAC Southeast ranked third as he received 10.99%of the total contracts awarded and 8.10% of the contract dollars. As a group, these threecontractors received 58.64% of the total contracts awarded and 52.96% of the contract dollars inthis district.

Other contractors received 41.36% of the total contracts and 41.36% of the contract dollarsthat includes a contract (E3E19) awarded to Tidewater/Flatiron Construction as a joint venture fora total awarded amount of $242,787,000 in Santa Rosa County. Tidewater and FlatironConstruction received 41.23% of the contract dollars awarded to other contractors and theremaining of $346,064,251 which is about half of the major contractors awarded amount was theshare of all other contractors.

This indicates a major problem in market competition in this district. It is obvious thatother contractors on their own are unable to compete with our selected contractors. Taking awaythe major bridge contract E3E19 from our analysis, the combination of Anderson Columbia andC.W. Roberts received more of the contract dollars than all other contractors and APAC-Southeast

combined. We should be really concern about the growing market share of Anderson Columbiaand C.W. Roberts in this district.

Major Contractors Market Share in District Three by Awarded Contracts and Dollars

Contracts Dollars % of Contracts % of Dollars

Anderson Columbia 53 $297,897,982 27.75% 23.79%

C.W. Roberts 38 $263,797,691 19.90% 21.07%

APAC-Southeast 21 $101,,420,605 10.99% 8.10%

TOTAL- Vendors 112 $663,116,278 58.64% 52.96%

Others 79 $588,851,251 41.36% 47.04%

AREA TOTAL 191 $1,251,967,529 100% 100%

Table 6

Table 7 shows the percentages on number of contracts awarded and contract dollars thatour selected contractors received statewide and in District Three. District Three is the main marketarea for C. W. Roberts. He received 78.8% of his total contract dollars and 77.6% of the contractsawarded to him from this district. District Three is also an important market area for AndersonColumbia. He received 42.0% of his total contract dollars and 39.8% of the contracts awarded to

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On the other hand, C.W. Roberts always was the major compotator in Leon County. Heworked on seven contracts (36.8%) and received $54,594,926 (24.5%) of the awarded contractdollar. Other contracts received 48.3% of the awarded contract dollars and 57.9% of the contracts,due to the lack of interest by APAC-Southeast and particularly Anderson Columbia to aggressivelycompete in this county.

Anderson C.W. APAC Contractors Others Total

Columbia % Roberts % Southeast % Total % %

y $51,995,627 31.1% $56,314,376 33.7% $26,358,987 15.8% $134,668,990 80.6% $ 32,383,645 19.4% $167,052,63

lhoun $2,563,049 9.1% $22,712,612 80.4% $0 0.0% $25,275,661 89.5% $ 2,969,130 10.5% $28,244,79

cambia $7,190,259 5.6% $0 0.0% $33,534,638 26.0% $40,724,897 31.6% $ 88,241,614 68.4% $128,966,51

anklin $0 0.0% $19,915,465 36.4% $0 0.0% $19,915,465 36.4% $ 34,746,678 63.6% $54,662,14

adsden $638,257 1.2% $26,676,431 51.5% $0 0.0% $27,314,688 52.7% $ 24,518,816 47.3% $51,833,504

lf $0 0.0% $3,263,472 38.6% $0 0.0% $3,263,472 38.6% $ 5,201,000 61.5% $8,464,472

lmes $7,640,404 41.9% $0 0.0% $5,801,608 31.8% $13,442,012 73.6% $ 4,815,719 26.4% $18,257,73

ckson $62,625,484 85.4% $0 0.0% $5,966,379 8.1% $68,591,863 93.5% $ 4,738,334 6.5% $73,330,19fferson $4,158,335 33.7% $5,598,009 45.4% $0 0.0% $9,756,344 79.1% $ 2,573,908 20.9% $12,330,252

on $60,558,711 27.2% $54,594,926 24.5% $0 0.0% $115,153,637 51.7% $ 107,689,911 48.3% $222,843,54

berty $0 0.0% $9,159,397 100.0% $0 0.0% $9,159,397 100.0% $0 0.0% $9,159,397

kaloosa $46,695,307 43.3% $17,572,898 16.3% $20,648,952 19.1% $84,917,157 78.7% $ 22,984,128 21.3% $107,901,28

nta Rosa $36,325,654 12.6% $0 0.0% $4,918,543 1.7% $41,244,197 14.3% $ 247,004,031 85.7% $288,248,22

akulla $0 0.0% $1,268,477 13.9% $0 0.0% $1,268,477 13.9% $ 7,877,626 86.1% $9,146,103

alton $6,959,864 13.5% $39,466,684 76.6% $4,191,499 8.1% $50,618,047 98.3% $ 875,304 1.7% $51,493,35

ashington $10,547,029 52.7% $7,254,944 36.2% $0 0.0% $17,801,973 88.9% $ 2,231,409 11.1% $20,033,382

Table 8

Bay County

The combination of Anderson Columbia and C.W. Roberts received more of the contractdollars awarded in Bay County than all other contractors and APAC-Southeast combined. Theyreceived 64.8% of the contract dollars awarded. APAC Southeast received 15.8% of the contractdollars awarded. Other contractors were able to receive only 19.4% of the contract dollars inwhich is extremely short of the fifty percent share of the market for ideal market competition.

In term of number of contracts awarded, In Bay County Anderson Columbia and C.W.Roberts were awarded more contracts than all other vendors and APAC-Southeast combined.Anderson Columbia and C. W. Roberts were awarded 61.5% of the contracts. Other contractors

were awarded 34.6% and APAC-Southeast was awarded only one contract for 3.9%. As one of themajor contractor statewide, it is hard to believe that APAC-Southeast was not able to provide anycompetition to Anderson Columbia and C.W. Roberts in Bay County.

Anderson C.W. APAC Contractors Others Counties

Columbia % Roberts % Southeast % Total % % Total

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Bay 11 42.3% 5 19.2% 1 3.9% 17 65.4% 9 34.6% 26

Calhoun 1 25.0% 2 50.0% 0 0.0% 3 75.0% 1 25.0% 4

Escambia 3 8.1% 0 0.0% 11 29.7% 14 37.8% 23 62.2% 37

Franklin 0 0.0% 2 66.7% 0 0.0% 2 66.7% 1 33.3% 3

Gadsden 1 9.1% 5 45.5% 0 0.0% 6 54.5% 5 45.5% 11

Gulf 0 0.0% 3 50.0% 0 0.0% 3 50.0% 3 50.0% 6

Holmes 4 40.0% 0 0.0% 3 30.0% 7 70.0% 3 30.0% 10Jackson 11 73.3% 0 0.0% 1 6.7% 12 80.0% 3 20.0% 15

Jefferson 1 20.0% 1 20.0% 0 0.0% 2 40.0% 3 60.0% 5

Leon 1 5.3% 7 36.8% 0 0.0% 8 42.1% 11 57.9% 19

Liberty 0 0.0% 2 100.0% 0 0.0% 2 100.0% 0 0.0% 2

Okaloosa 9 37.5% 3 12.5% 3 12.5% 15 62.5% 9 37.5% 24

Santa Rosa 6 60.0% 0 0.0% 1 10.0% 7 70.0% 3 30.0% 10

Wakulla 0 0.0% 1 33.3% 0 0.0% 1 33.3% 2 66.7% 3

Walton 2 25.0% 4 50.0% 1 12.5% 7 87.5% 1 12.5% 8

Washington 3 37.5% 3 37.5% 0 0.0% 6 75.0% 2 25.0% 8

Table 9

Walton & Jackson Counties

Unlike the other counties that we reviewed to this point, Walton and Jackson counties aretotally dominated by one of the selected major contractors. Anderson Columbia totally dominatedthe Jackson County. He received 85.4% of the contract dollars awarded in this county. APAC-Southeast received only 8.1% of the contract dollars and C.W. Roberts was not awarded anycontract. The share of the other contractors from contract dollars awarded in this county was6.5%.

The Walton County is dominated by C.W. Roberts as he received 76.6% of the contractdollars awarded in this county. Anderson Columbia worked on two contracts and received 13.5%

of the contract dollars. APAC-Southeast worked on only one contracts and received 8.1% of thecontract dollars. Other contractors share from the market was 1.7% and one contract

Market Share with Respect to Asphalt Facilities

In this section we will review and analyze the level of competition among our selectedmajor vendors in District Three with respect to their asphalt facilities. According to LIMS database, APAC-Southeast owns two asphalt facilities in Walton and one in Escambia County. C.W.Roberts owns four asphalt facilities in Liberty, Leon, Bay and Walton Counties. AndersonColumbia owns three asphalt facilities in Jackson, Santa Rosa and Okaloosa Counties and one

asphalt facility in Bay County under the name AZTEK Double Barrel Anderson Columbia.

APAC-Southeast

APAC-Southeast owns two asphalt facilities in Walton County and one Escambia County.He hardly competed in Jackson and Bay Counties. He was awarded one contract (6.7% and 3.9%)in Jackson and Bay Counties respectively. He was awarded three contracts (30% and 12.5%) in

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Holmes and Okaloosa Counties respectively. In Washington County he submitted only one bid(12.5%) and was not the low bidder. In Walton County where he owns two asphalt facilities, hesubmitted 7 bids (87.5%) and was the low bidder only on one contract.

In Escambia County where he owns one asphalt facility, he submitted a total of 27 bids

(72.9%) and was the low bidder on 11 contracts (29.7%). His chance of winning contracts is .407in Escambia County. APAC Southeast submitted a total of 520 for the period of this study and wasa low bidder on 144 contracts. His chance of winning contracts is 0.277 statewide and 0.309(21/68) in District Three. His chance of winning contracts is 0.428 Holmes, 0.2 in Santa Rosa,0.214 in Okaloosa and .25 in Bay.

His chance of winning contracts in Walton County where he owns two asphalt facilities is0.142 (1/7) which is the lowest among all the counties including counties where he doesnt ownany asphalt facility.

Anderson Columbia

12

4

1

27

1

57

1

7

1

14

3

1

3

1

11

1

1

Contracts Won

Contracts Bid

Facility

FF

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Anderson Columbia owns fasphalt facility in Jackson, Bay, Okaloosa and Santa RosaCounties. With respect to his facilities locations, he was a low bidder on one contract in JeffersonCounty and one contract in Leon County which they were far away from his asphalt facilitylocations.

Historically, Anderson Columbia had shown less interest to compete in Jefferson, Leon,Gadsden, Wakulla, Liberty, Franklin, Gulf and Calhoun Counties. He submitted a total of 12 bidsin these counties and was the low bidder on four contracts. His winning ratio is 0.33 for thesecounties.,

For the remaining counties in District Three except Escambia County, he submitted 70 bidsand was the low bidder on 46 contracts. His winning ratio is 0.66 for these counties. He submitted17 bids in Escambia County and was the low bidder on 3 Contracts. His winning ratio is 0.176 forEscambia County. His Winning ratio is .525 for the entire District Three.

C. W. Roberts

13

Contracts Bid

Contracts Won

2

11

6

7

1

183

13

17

3

3

17

2

74

9

3

2

1

6

11

3

1

F

F

fF

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C.W. Roberts owns asphalt facilities in Leon, Liberty, Bay and Walton Counties.Historically, C.W. Roberts has been among the top contractors in Jefferson, Leon, Gadsden,Wakulla, Liberty, Gulf, Franklin and Calhoun Counties. They submitted a total of 42 bids in thesecounties and were the low bidder on 23 contracts with the winning ratio of 0.55 which is higherthan their District Threes winning ratio of 0.39. Since White Construction suspensions, C.W.

Roberts expended his market area in District Three and became one of the major contractors in thisdistrict. However, for some reasons he didnt show interest in competing in Santa Rosa andEscambia Counties.

He is the top contractors in Walton County where he submitted six bids and was the lowbidder on four contracts. His winning ratio is 0.67 which is much higher than his District Threeswinning ratio. In Washington County, he submitted a total of six bids and was the low bidder onthree contracts. In Jackson and Holmes Counties, he submitted a total 14 bids and didnt win anycontracts. With respect to his facility location in Walton County and his winning ratio of 0.50 inWashington County, his attempt on submitting six bids in Holmes County and not winning anycontracts is questionable.

Problem Area

Based on our analysis and founding, the competition among selected major contractors inOkaloosa, Walton, Holmes, Washington and Jackson Counties is questionable with respect tolocations asphalt facilities. The indicators that make the competition among major contractorsquestionable in these counties are

- Lack of interest to submit bids

14

34

16

2

6

32

312

8

16

3

6

9

6

1

2

3

37

1

4

2

5

5

2

Contracts Won

Contracts Bid

F

FF

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- Sings of possible complementary bids- Low level of participation by other contractors in competition.-

APAC-Southeast Anderson Columbia

C.W. Roberts

Contracts Let

APAC-Southeast unacceptable effort as a number one contractor statewide in WaltonCounty, who owns two asphalt facilities and was awarded only one contract in seven attempt issufficient enough to demonstrate that market competition in Walton is County is not normal andrequires special attention. In addition to the above findings, his lack of interest in WashingtonCounty where he submitted only one bid as compare to Holmes County where he submitted 7 bidsand was the low bidder on 3 contracts shows the possibility of market sharing.

Anderson Columbia owns asphalt facilities in Jackson and Okaloosa Counties. He showedlots of interest in submitting bids in most of selected counties except Walton County. While hiswinning percentage is 100% in Walton County, he just submitted bids on 25% of the contracts letin this county. Compared to Holmes and Washington Counties, where he submitted bids on 70%and 75% of the contracts respectively, his efforts in competing in Walton County is below theexception and clearly shows that he is not interested competing in Walton County.

15

F

F F

6

1314

7

7

1

1

68

18

2

7

6

12

634

31

1

3

3

9

2

4

3

11

1

00

15

88

24

15

15

8

8

8

8

100

100

24

24

F

F

Contract bid

Contracts Won


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County

APAC-Southeast Anderson Columbia C.W. Roberts Contracts

Let (T)

Bids % T Win % B Bids % T Win , % B Bids % T Win % B

Jackson 1 6.6% 1 100% 13 86.7% 11 84.6% 8 53.3% 0 0.0% 15

Holmes 7 70% 3 42.8% 7 70% 4 57.1% 6 60% 0 0.0% 10Washington 1 12.5% 0 0.0 % 6 75% 3 50% 6 75% 3 50% 8

Walton 7 87.5% 1 14.3% 2 25% 2 100% 6 75% 4 66.7% 8

Okaloosa 14 58.3% 3 21.4% 18 75% 9 50% 12 50% 3 25% 24

TOTAL 30 46.1% 8 26.7% 46 70.8% 29 63.0% 38 58.4% 10 26.3% 65

C.W. Roberts owns an asphalt facility in Walton County. He submitted a total of 6 (75%)bids in Washington County and was the low bidder on three contracts (50%). On the other hand,he was not the low bidder on 14 contracts that submitted bids on in Holmes and Jackson Counties.

With respect to his asphalt facility location in Walton County, and his chance of winning (50%) inWashington County, it is surprising that in 14 attempts in Jackson and Holmes Counties, hecouldnt win any bid.

Jackson County

Jackson County ranked on the top of the list among all the counties that controlled anddominated by selected contractors. It is lacking sufficient competition from other contractors.Jackson County has been dominated by Anderson Columbia for many years. From January 1, 2004to December 31, 2008 a total of 15 contracts were let in Jackson County. Anderson Columbia wasthe low bidder on 11 contracts. The table below shows the list of l1 contracts awarded to AndersonColumbia and all the other bidders.

Contid

LettingDate Anderson Estimate

C.W.Roberts

MitchellBrothers

And. /Est.

T3037 25-Feb-04 $1,791,911 $1,374,313 $1,892,000 $1,987,267 1.30

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T3123 28-Jul-04 $1,549,000 $1,361,149 1.14

T3132 28-Jul-04 $740,953 $640,150 $893,786 1.16

T3101 31-Aug-05 $2,971,212 $3,123,327 $3,194,350 0.95

T3106 28-Sep-05 $1,929,525 $1,640,826 $2,836,623 1.18

T3079 7-Dec-05 $2,131,235 $1,745,539 $2,278,803 1.22

T3115 25-Jan-06$16,494,76

5 $15,519,556$17,973,38

9 1.06

T3165 26-Apr-06 $20,277,220 $21,584,141$22,784,74

9 0.94

T3080 30-Aug-06 $6,289,999 $5,319,301 $7,209,735 1.18

T3167 6-Dec-06 $4,165,211 $4,314,882 $4,690,950 0.97

T3171 30-Jan-08 $4,284,453 $5,454,751 $5,194,510 0.79

A total of 22 bids received for these contracts. Mitchell Brothers and C.W. Roberts werethe only bidders who bid with Anderson Columbia. The low number of bidders (3) and a low bid

ratio of 2 per contract are indicators that bids submitted by C.W. Roberts and Mitchell Brothers arepossible complementary bids. These bids not only increased the number of the bids on contractsfrom a single bid to two bids, in majority of the contracts, they supported the high bid forAnderson Columbia over the estimate, and prevented the rejection of the award.

VENDOR COMPETITION

The matrix below is generated from Vendor Competition Model that shows how majorcontractors competed individually, against each other and together. According to the report the

most efficient contractor is Anderson Columbia. In addition to our selected there are two othercontractors that their pattern of bidding with our selected contractors requires close monitoring.Panhandle Grading who submitted several bids with APAC-Southeast and Peavy & Son whosubmitted bids with C.W. Roberts.

Anderson Columbia

Anderson Columbia submitted a total of 101 bids and was the low bidder on 53 contracts.His winning ratio is 0.52. He submitted 58 with C.W. Roberts and was the low bidder on 31contracts. His winning ratio is 0.53 when he bids with C. W. Roberts. He submitted 48 withAPAC-Southeast and was the low bidder on 21 contracts. His winning ratio is 0.43 when he bids

with APAC-Southeast.

Anderson Roberts APAC Panhandle G. PEAVY & Son-------------- ------------ ----------- --------------- -----------------

Anderson 101 .529 58 .574 48 .475 17 .168 3 .03053 .525 31 .534 21 .438 5 .294 1 .333

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Roberts 58 .604 96 .503 28 .292 0 .000 23 .24016 .276 38 .396 8 .286 0 11 .478

APAC 48 .706 28 .412 68 .356 27 .397 2 .02915 .313 6 .214 21 .309 9 .333 0 .000

Panhandle G. 17 .586 0 .000 27 .000 29 .151 0 .0006 .353 0 13 .481 14 .483 0

Peavy & Son 3 .130 23 1.00 2 .087 0 .000 23 .1200 .000 9 .391 1 .500 0 9 .391

C.W. Roberts

C.W. Roberts submitted a total of 96 bids and was the low bidder on 38 Contracts. Hiswinning ratio is 0.39. He submitted 58 bids with Anderson Columbia and was the low bidder on 16

contracts. His winning ratio is 0.27 when he bid with Anderson Columbia. He bid on 28 contractswith APAC-Southeast and was the low bidder on 8 contracts. His winning ratio is 0.28 when hebid with APAC-Southeast.

APAC-Southeast

APAC-Southeast submitted a total of 68 bids and was the low bidder on 21 Contracts. Hiswinning ratio is 0.309. He submitted 48 bids with Anderson Columbia and was the low bidder on

15 contracts. His winning ratio is 0.35 when he bid with Anderson Columbia. He bid on 28contracts with C.W. Roberts and was the low bidder on 6 contracts. His winning ratio is 0.214when he bid with C.W. Roberts.

Anderson Columbia & C.W. Roberts

Anderson Columbia and C. W. Roberts bid on 58 contracts together and were the lowbidders on 47 contracts. Their combined winning ratio is 0.81. When Anderson Columbia andC.W. Roberts bid together, 81% of the time one of them was the low bidder. On contracts that one

the was the low bidder, 66% of the time Anderson Columbia was the low bidder and 34% of thetime C.W. Roberts was the low bidder.

Anderson Columbia & APAC-Southeast

Anderson Columbia and APAC-Southeast bid on 48 contracts together and were the lowbidders on 37 contracts. Their combined winning ratio is 0.77. When Anderson Columbia and

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APAC-Southeast bid together, 77% of the time one of them was the low bidder. On contracts that

one the was the low bidder, 58% of the time Anderson Columbia was the low bidder and 42% of

the time APAC-Southeast was the low bidder

APAC-Southeast & C.W. Roberts

APAC-Southeast and C. W. Roberts bid on 28 contracts together and were the low bidderson 14 contracts. Their combined winning ratio is 0.50. When APAC-Southeast and C.W. Robertsbid together, 50% of the time one of them was the low bidder. On contracts that one the was the

low bidder, 43% of the time APAC-Southeast was the low bidder and 57% of the time C.W.

Roberts was the low bidder.

Peavy & Son

Peavy & Son submitted a total 23 bids and was the low bidder on nine contracts. His

chance of winning contract is 39.1%. C.W. Roberts submitted bids on all contracts withPeavy & Son and was awarded 11(47.8%) contracts. Together, they submitted 23 bids and on 20contracts (86.9%), one of them was the low bidder. When Peavey & Son and C.W. Roberts bidstogether, there is an 86.9% chance that one of them is the low bidder.

Panhandle Grading

Panhandle Grading submitted a total 29 bids and was the low bidder on 14contracts. Hischance of winning contract is 48.3%. APAC-Southeast submitted bids on 27 contracts withPanhandle Grading and was awarded 9 (33.3%) contracts. Together, they submitted 27 bids and on22 contracts (81.5%), one of them was the low bidder. When Panhandle Grading and APAC-Southeast bids together, there is an 81.5% chance that one of them is the low bidder.

SUMMARY OF ANALYSIS

District Three is the largest district in State of Florida, but it lacks in number of contractorswhom could work regular road and highway construction contracts. The proposals ratio of 4.8 percontract is 1.7 below the statewide ratio and the bid ratio of 2.7 per contract is 1.1 below thestatewide ratio.

No. of Contracts No. of Proposals No. of Bids Proposals Ratio Bid Ratio

Statewide 1564 10088 5994 6.5 3.8

District Three 191 911 525 4.8 2.7

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Normally, construction contracts let by districts, because of their size, attract not only themajor contractors, but also a different group of contractors that have limited capacities and capital.The contracts let by districts provide an opportunity for this group of contractors to growth in sizeand capital, so they can compete with the major contractors. This creates a healthy environment forcompetition and guaranties a competitive market for the future.

Based on our analysis, 33.19% of the statewide construction contracts let by districtsoffices. The contract dollars associated with these contracts is 36.28% ($4,234,501,920) of the totalcontract dollars ($11,672,027,945) awarded statewide. However, only 13.61% of the constructioncontracts in District Three let by district office and 23.67% ($296,408,115) of the total contractdollars ($1,251,967,529) was associated with these contracts. This decreases the chance of growthfor smaller contractors which ultimately will result in low number of contractors to compete withthe major contractors.

The dispersal of contract dollars between major contractors and other contractors in DistrictThree also points out to lack of healthy competition. The construction market consider healthy

when contract dollars split evenly among major contractors and other contractors.

Other contractors received a total of $588,851,251 (41.36%) of the contract dollarsawarded in District Three. However this amount includes a total amount of $242,787,000 (19.39%)that was awarded to Tidewater/Flatiron Construction for the major bridge work on contract E3E19in Santa Rosa County. The remaining of $346,064,251 (27.64%) was the share of other contractsin District Three on regular construction contract.

As table below indicates, Anderson Columbia and C.W. Roberts together received more ofthe contract dollars awarded in District Three then APAC-Southeast and other contractors together.APAC-Southeast is the leading major contractor in State of Florida; therefore it is very surprisingto see him doing so poorly in District Three where he owns three asphalt facilities. While he shownstrength in Escambia County where he owns an asphalt facility by submitting 21 bids and winning11 (52.4%) contracts for a total awarded amount of $33,534,638, in Walton County where he ownstwo asphalt facilities, he was the low bidder on only one contract, and lost bids on seven contracts.

Contract Dollars % of Dollars

Anderson Columbia $297,897,982 23.79%

C.W. Roberts $263,797,691 21.07%

TOTAL $561,695,673 44.86%

Contract E3E19 $242,787,000 19.39%

APAC-Southeast $101,420,605 8.1%Others $346,064,251 27.64%

Total (APAC-Southeast & Others $447,484,856 35.74%

AREA TOTAL $1,251,967,529 100%

One of the main reasons behind the poor performance by APAC-Southeast in is theexceptional and at the same time questionable performance by C.W. Roberts. Since the suspensionof White Construction Company, C.W. Robertss gradually emerged as a major contractor in this

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district. C.W. Roberts is the most efficient contractors among all contractors in District Three.C.W. Roberts never participated in competition in Escambia and Santa Rosa counties, yet theymanaged to surface as a major contractor in this district.

C.W. Roberts share of contract dollars were more than the Anderson Columbias in area

where both we actively submitted bids. As table below indicates, Anderson Columbia wasawarded nine contracts for a total awarded amount of $45,515,923 in Escambia and Santa RosaCounties. For the remaining counties in this district, C.W. Roberts worked on 38 contracts andreceived more of the contract dollar than Anderson Columbia who worked on 44 contracts for lesscontract dollars.

Area Total Escambia, Santa Rosa Remaining counties

Dollars Contract Dollars Contract Dollars Contract

Anderson Columbia $297,897,982 53 $43,515,923 9 $254,382,069 44

C.W. Roberts 263,797,691 38 $0.0 0 263,797,691 38

Based on our analysis, C.W. Roberts bidding practices in Jackson, Holmes andWashington counties is questionable with respect to his asphalt facility in Walton County. Lasttime C.W. Roberts was the low bidder in Jackson or Holmes Counties was in 1995 in JacksonCounty. Since then, he has been submitting bids in Jackson and Holmes Counties with no positiveresult. For Duration of this study, C.W. Roberts submitted bids on 8 contracts (seven contractswere two bidders and one three bidders) in Jackson county with Anderson Columbia that theycould be considered possible complementary bids.

On the other hand, he was the low bidder on 50% of his bids in Washington County and25% in Okaloosa County. Therefore, based on his asphalt facility location in Walton County andhis chance of success in Washington and Okaloosa Counties, we did not see any practical orlogical evidence of preventing C.W. Roberts from wining contracts in Holmes or Jackson Countiesfor the past 15 year.

Based on our analysis, our selected major contractors didnt compete against each other inall counties in District Three in regular bases. Anderson Columbia didnt submit a bid in Liberty,Franklin and Wakulla Counties. C.W. Roberts didnt submit a bid in Santa Rosa and EscambiaCounties. APAC-Southeast didnt submit a bid in Gulf, Calhoun, Gadsden, Liberty, Wakulla andFranklin Counties.

The chance of winning contracts among our selected contractors when they bid together onregular bases is unusually high. The chance of Anderson Columbia or C.W. Roberts is the lowbidder on a contract when they bid together is 81%. The chance of Anderson Columbia or APAC-Southeast is the low bidder on a contract when they bid together is 75%. The chance of APAC-Southeast or C.W. Roberts is the low bidder on a contract when they bid together is 50%.

Further review on all contracts bid by all three major contractors indicates that, they bid on21 contracts and only two contracts (9.5%) were awarded to other contractors. Contract T3179 for

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awarded amount of $538,133 was awarded to Tindle Enterprises in Okaloosa County and contractE3E84 for a total awarded amount of $14,331,863 was awarded to Archer Western in OkaloosaCounty.

The fact that our selected contractors have a 90.5% chance of winning contracts when they

bid on the same contract should be a major concern. The market area that all three selectedcontractors bid consists of Bay, Okaloosa, Walton, Washington, Jackson and Holmes Counties.Ninety one contracts were let and awarded in these counties and other contractors were awarded 27contracts (29%). The problem with this market area even more deepen and apparent when we goover how contract dollars disperse among contractors in these counties.

The very low percentage of contract dollars (15.5%) awarded to the other contractorsshows the total domination by selected contractors in these counties. Perhaps, the cause of poorperformance by other contractors could be the possible market division among selected contractors(Possible complementary bids by C.W. Roberts in Holmes and Jackson Counties) and the poorperformance by APAC-Southeast (awarded only one contract in Walton County where he ownstwo asphalt facilities) that could not be easily disregard.

%Vendors

Anderson C.W. RobertsAPAC-

SoutheastTotal Others

%Others

Bay $51,995,627 $56,314,376 $26,358,987 80.6% $32,383,645 19.4%

Holmes $7,640,404 $0 $5,801,608 73.6% $4,815,719 26.4%

Jackson $62,625,484 $0 $5,966,379 93.5% $4,783,334 6.5%

Okaloosa $46,695,307 $17,572,898 $20,648,952 78.7% $22,984,128 21.3%

Walton $6,959,864 $39,466,684 $4,191,499 98.3% $875,304 1.7%Washington

$10,547,029 $7,254,944$0

88.9% $2,231,409 11.1%

Total $186,463,715 $120,608,902 $62,967,425 84.5% $68,073,539 15.5%

While Anderson Columbia has been the leading major contractors in District Three, C.W.Roberts emerging as the most efficient contractors. C.W. Roberts awarded contract dollars inselected counties is just a little less than what APAC-Southeast and other contractor receivedtogether.

CONCLUSION

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Our analysis shows that market competition in District Three is at very low level based onpoor performance by other contractors. Although other contractors shown strength in Leon andEscambia Counties, and particularly on specialty contract that contained major bridge work, ourselected contractors Anderson Columbia, C. W. Roberts and APAC-Southeast managed to

dominate the market in District Three.

Our analysis shows a poor performance by APAC-Southeast especially in Walton County,an increase on C.W. Roberts performance to the point that he could be consider the most efficientcontractors in this district with respect to the market that he competed with Anderson Columbiaand won at least one contract.

The market competition in District Three requires more frequent close monitoring as wediscover possibility of complementary bidding by C. w. Roberts in Jackson and Holmes Counties,a possibility of market sharing between C.W. Roberts and Peavy & Son in Panhandle Area andpossibility of market division between all major contractors in Bay, Okaloosa, Walton,Washington, Jackson and Holmes Counties.

Unfortunately, during our analysis, we didnt identify any indicator to show that marketcompetition in this district is heading toward any improvement. The number of contracts let by theDistrict Three is the lowest among all districts and this will reduce the chance of small constructionfirms participating in competition. Not only, didnt we identify any attempt of entry with newconstruction firms with ability to compete with our selected contractors, we discovered lower thanexpected performance by APAC-Southeast and higher than expected performance with AndersonColumbia and C. W. Roberts in Bay County where they received 64.8 % of the contract dollarsawarded in this county in expenses of GAC contractor who was the major contractor in BayCounty before Anderson Columbia and C.W. Roberts take over the market.

The construction market in District Three needs to be managed differently than otherdistrict for any chance of improvements. We do recommend if possible split the large contracts tosmaller contracts and increase the number of contracts and lettings by district office. This willincrease the number of bids, provides more opportunity for smaller construction to participate incompetition and guaranties much better disperse of contract dollars among all contractors.

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district three

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