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RFP Benefitting Single Bidder Was Valid—C.A.
Opinion Says Prohibition on Criteria Only One Company Can Meet Not Violated Where State Funds Not Involved
By a MetNews Staff Writer
A statute that bars state agencies from drafting a request for proposals in such a way as to identify a particular company as the one that is to be awarded the contract was not violated where recompense was to come not from government coffers but from fees paid by users, Div. Three of the First District Court of Appeal declared Tuesday.
Acting Presiding Justice Thomas M. Goethals authored the opinion. It affirms an order by Orange Superior Court Judge Deborah Servino denying a preliminary injunction sought by Talley Amusements, Inc. which challenged the award of a contract to Ray Cammack Shows to run the Orange County Fairgrounds’ midway as it has for the past two decades.
The contract was awarded by the state’s 32nd District Agricultural Association which serves Orange County. Pointing out that Carmack was the only outfit in the nation that could meet the criteria of Orange County Request for Proposals (“OC RFP”) No. 21, it alleged that the request runs afoul of Public Contract Code §10339 which provides:
“(a)…[N]o state agency shall draft, or cause to be drafted, any invitation to bid or request for proposal, in connection with the awarding of a contract, in a manner that limits the bidding directly or indirectly to any one bidder.
“(b) Any contract awarded in violation of subdivision (a) shall be void.”
The contract awarded to Carmack was void, the plaintiff asserted, calling for injunctive relief and disgorgement of the many millions of dollars garnered by the defendant.
Observing that the appeal “presents an issue of first impression,” Goethals noted that the RFP “did not call for the Association to use public funds to pay the successful bidder for any service.”
He explained:
“OC RFP 21 required the winning bidder to provide a service (i.e., operating the midways) to fair patrons, not to the Association or the state. OC RFP 21 did not require the Association or the state to pay the winning bidder for any services; rather, it required fair patrons to pay the winning bidder for services rendered to them, and it required the winning bidder to pay a percentage of those revenues to the Association. The master carnival operator contract contemplated by OC RFP 21 is therefore not a contract ‘for services to be rendered to the state,’ so it is not subject to the competitive bidding requirements of section 10339.”
The case is Talley Amusements v. The 32nd Dist. Agricultural Association, G062646.
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