Ponte Vedra Beach business loses on appeal

Historic City News in St. Augustine received word that Ponte Vedra Beach executive, Ken Underwood, who won a first round challenge in Leon County circuit court last winter between his company, National Safety Commission and a state agency, has lost, in a 2-1 decision, before the 1st District Court of Appeals in Tallahassee.

Yesterday’s ruling reverses the lower court decision — holding that now, the Department of Highway Safety and Motor Vehicles can cancel its contract with the St. Johns County vendor that provides the Florida Driver’s Handbook.

Underwood’s company has printed the state driver’s manual since 2005 when it was the only company to bid on the contract. Making the contract somewhat unconventional, in state procurement terms, is that the state paid nothing for the manuals; which, in turn, it has distributed freely to applicants for a driver’s license.

In lieu of the Department incurring a printing cost for the manuals, Underwood gained the right to control the advertising they contained. He previously stated it is somewhat difficult to fix the value of the advertising — he advertises other businesses that he owns including an Internet driving school.

After years of controversy surrounding the contract, the state agency said it wanted a “clean slate” and pushed to end the contract last year.

Attorneys for National Safety Commission, which includes the firm of Holland & Knight and the Jacksonville firm of Tanner Bishop, contend that the department cannot end the contract simply because it wants a “clean slate.”

“The option to renew is not unilateral for either party,” concluded the majority opinion by Judge Simone Marstiller; which held that the renewal of the contract would require “mutual agreement” between the agency and the vendor.

The opinion cites an earlier case that found that Florida’s procurement laws do not “guarantee any vendor the right to continue to do business with the state beyond the original term of the contract.”

Judge Marstiller’s opinion notes that the arrangement came under a “cloud of suspicion” when it was revealed that one of Underwood’s lobbyist was married to the Department of Highway Safety and Motor Vehicles executive director at the time the contract was awarded.

That, coupled with mounting concerns about the way National Safety Commission used its role as the supplier of traffic handbooks to promote LowestPriceTrafficSchool.com, led a later executive director to decide, “Although NSC was performing the contract satisfactorily, for policy and business reasons it would be in the State’s best interests not to renew the contract after the term ended.”

Now that the State has prevailed in the long-simmering contract dispute, there has been no word on whether Underwood’s attorneys will try to seek to be heard in the Florida Supreme Court — or if the high court would accept the case for review.

Photo credits: © 2011 Historic City News archive photograph