747 A.2d 625 (Md. 2000), 86, Chesapeake Charter, Inc. v. Anne Arundel County Bd. of Educ.

Docket Nº:86, Sept. Term, 1999.
Citation:747 A.2d 625, 358 Md. 129
Opinion Judge:[8] The opinion of the court was delivered by: Wilner, J.
Party Name:CHESAPEAKE CHARTER, INC., et al. v. ANNE ARUNDEL COUNTY BOARD OF EDUCATION.
Case Date:March 07, 2000
Court:Court of Appeals of Maryland
 
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Page 625

747 A.2d 625 (Md. 2000)

358 Md. 129

CHESAPEAKE CHARTER, INC., et al.

v.

ANNE ARUNDEL COUNTY BOARD OF EDUCATION.

No. 86, Sept. Term, 1999.

Court of Appeals of Maryland

March 7, 2000

Page 626

Joseph G. Billings (Law Offices of Joseph G. Billings P.C., on brief), Landover, for appellants.

William A. Kahn, Asst. Atty. Gen. (J. Joseph Curran, Jr., Atty. Gen. of Maryland and Valarie Cloutier, Asst. Atty. Gen., on brief), Baltimore, for appellee.

B. Darren Burns, Staff Atty. (Anne Arundel County Bd. of Educ., on brief), Annapolis, for appellees.

Argued before BELL, C.J., and ELDRIDGE, RODOWSKY, RAKER, WILNER, CATHELL and HARRELL, JJ.

WILNER, Judge.

Before us is a procurement dispute between three school bus contractors, appellants here, and the Anne Arundel County Board of Education, appellee. The precise issue is whether the Maryland State Board of Contract Appeals (MSBCA), created to resolve disputes arising under the State General Procurement Law, has jurisdiction over that dispute. The larger question, which the parties agree governs that issue, is whether the procurement of services by a county board of education is subject to the General Procurement Law. We shall answer that question in the negative and thus affirm the judgment of the Circuit Court for Anne Arundel County which, in turn, affirmed MSBCA's dismissal of the procurement protest by the bus contractors.

PROCEDURAL BACKGROUND

For many years, appellee obtained much of its student transportation services through contracts negotiated and entered into with individual bus contractors, each contract covering one or more routes. In 1997, the board decided to use a different approach, involving sealed competitive bids for longer-term, multi-route contracts. On November 3, 1997, it formally solicited bids for four groups of bus routes, each group containing five routes. Two pre-bid conferences were held, and, as a result of questions and concerns raised by prospective bidders, five amendments and clarifications were issued and an initially scheduled bid opening was postponed.

On February 2, 1998--one day before the rescheduled bid opening--18 prospective

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bidders, still dissatisfied, sent a protest letter to the board's purchasing officer complaining (1) about certain substantive specifications, including a minimum wage requirement for bus operators and aides, and (2) that the board's bidding procedures did not comply with the requirements of the General Procurement Law. Joined by some other bus contractors, they also filed suit in the Circuit Court for Anne Arundel County to restrain the board from opening the bids. That suit was voluntarily dismissed, without prejudice, after the court denied their request for a preliminary injunction. The board opened the bids as scheduled, and, on February 18, it formally awarded contracts for three of the four route groups. The bids for one route group were rejected because they were too high.

Treating the opening of the bids as an implicit denial of their protest, and without waiting for either an award of the contracts or a formal denial of their protest, appellants, on February 12, filed a Notice of Appeal with MSBCA. On February 27, the purchasing officer formally rejected each aspect of the protest, including the contention that the board was subject to the General Procurement Law. She advised that county school boards were authorized to enter into procurement contracts pursuant to their own procedures, subject to administrative review by the State Board of Education, and that they were not under the General Procurement Law or subject to the jurisdiction of MSBCA. Unpersuaded, appellants pressed their appeal to MSBCA.

Appellee, joined by the State Board of Education, which intervened as an interested party, moved to dismiss the appeal on the ground that, as appellee was not subject to the General Procurement Law, MSBCA had no jurisdiction to consider the protest and that any administrative review of appellee's decision must come from the State Board of Education. On April 10, 1998, MSBCA filed a memorandum opinion in which it adopted that view and dismissed the appeal. MSBCA concluded that, although county boards of education may be State agencies for some purposes, they are not units in the Executive Branch of the State Government for purposes of the General Procurement Law and are therefore not subject to that law. Although acknowledging some gaps in the law, MSBCA determined that procurement by the county boards was provided for in the Education Article of the Code and that some of the provisions in that Article were inconsistent with the General Procurement Law. Noting the extensive supervisory control possessed by the State Board of Education over matters relating to educational policy and the administration of the public school system, MSBCA held that the authority to review procurement practices and decisions of the county school boards was vested in the State Board of Education and not in MSBCA.

The Circuit Court for Anne Arundel County, on appellants' petition for judicial review, affirmed MSBCA's decision, for the reasons cited by MSBCA. It concluded that "the Education Article, and not the General Procurement Law, governs the procurement of school bus transportation contracts, and that MSBCA is, therefore, not the appropriate forum to which disputes of this nature should be brought." Instead, citing the extensive authority vested in the State Board of Education, the court held that that board was "the appropriate forum" for resolving controversies involving a county board, "including a protest to a solicitation for bids." We granted certiorari in appellants' appeal on our own initiative, prior to any proceedings in the Court of Special Appeals, to review that judgment.

DISCUSSION

The General Procurement Law is codified in the Maryland Code as Division II (titles 11 through 17) of the State Finance and Procurement Article (SFP). Section 11-202 provides, in relevant part, that, unless otherwise expressly provided by law,

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the General Procurement Law applies to "each expenditure by a unit under a procurement contract." (Emphasis added). MSBCA is created by SFP § 15-205 and is vested with jurisdiction to hear and decide, subject to judicial review, all appeals from the final action of "a unit" on a protest relating to the formation of a procurement contract or, except for a contract claim relating to a lease of real property, on a contract claim concerning breach, performance, modification, or termination. See § 15-211.

There is no dispute that the award of a contract by a county school board for bus transportation service constitutes an "expenditure" under a "procurement contract." Thus, whether appellee is subject to the General Procurement Law and, as a result, MSBCA has any jurisdiction in this matter, hinges on whether a county school board is "a unit" within the meaning of that law.

The term "unit" is defined in SFP § 11-101(x):

"(1) 'Unit' means an officer or other entity that is in the Executive Branch of the State government and is authorized by law to enter into a procurement contract.

(2) 'Unit' does not include:

(i) a bistate, multistate, bicounty, or multicounty governmental agency; or

(ii) a special tax district, sanitary district, drainage district, soil conservation district, water supply district, or other political subdivision of the State."

Relying on a number of decisions of this Court holding that county school boards are State, rather than county, agencies, appellants assume that those boards are therefore part of the Executive Branch of the State government. They thus maintain that, as the boards are authorized by law to enter into procurement contracts but are...

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