Balfour Beatty Construction v. Maryland Department of General Services

LEAHY, J. The State of Maryland considers a litany of factors when determining which company’s proposal it will select for the completion of a prominent State construction project. Unlike the selection of a contractor in the private sector, the process for the State is governed by the Maryland Administrative Procedure Act and Maryland procurement law. The question in this case concerns whether the State properly concluded that (1) it could consider a novel specification without triggering the Maryland APA’s rulemaking process and (2) the specification encourages “maximum practicable competition” under Maryland procurement law. In late 2011, the State of Maryland issued a request for proposals (“RFP”) for Construction Management at Risk Services for a new detention facility to replace the rundown and unsafe buildings that house male juvenile offenders at the Cheltenham Youth Facility in Prince George’s County (the “Project”).

Prior to the submission of proposals, Balfour Beatty Construction, Coakley & Williams Construction, Hensel Phelps Construction, and Manhattan Construction (“Protestors”) jointly filed a pre-award protest with the Maryland Department of General Services (“DGS” or “Agency”). Protestors challenged the State’s inclusion of a Project Labor Agreement (“PLA”) as one of the factors used to evaluate ³³⁹ technical proposals. DGS responded by amending the RFP to clarify that inclusion of a PLA was not mandatory and extended the date for submission of proposals. The procurement officer denied the protest, and Protestors appealed to the Maryland State Board of Contract Appeals (“MSBCA” or “Board”), where the Agency’s decision was ultimately affirmed.

Protestors filed a Petition for Review in the Circuit Court for Baltimore City. The matter comes before this Court from the circuit court’s June 19, 2013 order affirming the MSBCA’s determinations. Balfour Beatty Construction, Coakley & Williams Construction, and Manhattan Construction (“Appellants”) 1 present two questions on appeal, which we have rephrased: I. Did the MSBCA err in failing to find that inclusion of a PLA as a factor in ranking proposals establishes a procurement preference for organized labor and constitutes an unprecedented change in state policy mandating formal rulemaking under the Maryland Administrative Procedure Act?

II

Did the MSBCA err in failing to set aside the challenged RFP because it discriminates in favor of offerors who commit to adopt a PLA, thereby restricting competition in violation of Maryland procurement law? For the reasons set forth below, we hold that a novel specification included in a single RFP, without more, does not change existing procurement law or formulate a new policy of widespread application or future effect and, therefore, does not mandate predicate rulemaking under the Maryland Administrative Procedure Act (“Maryland APA”). We also find that the record before the MSBCA contained substantial evidence to support its decision that the PLA specification was reasonably related to the needs of the State while encouraging the maximum practicable competition. ³⁴⁰ I. Cheltenham Youth Detention Center Project The Cheltenham Youth Facility is operated by the Maryland Department of Juvenile Services and is located on approximately 900 acres in southern Prince George’s County, Maryland, near U.S. Highway 301. First opened in 1870 as a school for boys, Cheltenham has served as the primary detention facility for male delinquent youths from many parts of the State.

As stated in the Agency Report filed by DGS, 2 the purpose of the facility today is to house and educate delinquent male youths between the ages of 12 and 18 years who are considered too dangerous to return to their homes and who are awaiting court disposition or trial in Anne Arundel, Prince George’s, Calvert, Charles and St. Mary’s Counties. By all accounts, the residential cottages located on the Cheltenham campus are outdated, inefficient, and unsafe. Other administrative buildings are in various stages of deterioration. The Project centers on replacing deteriorated buildings on the campus with a 72-bed state-of-the-art detention facility and a regional warehouse.

When complete, the new detention center, designed to combine the functions of the existing campus buildings into one facility, will be the first of its kind in Maryland. The proposed 99,000 gross square foot facility — with space for housing, administration, admissions and release, somatic and behavioral health, food service, education, recreation, visitation, staff training, storage and maintenance — will be significantly larger and more complex than facilities ordinarily built by DGS. Plans for the Project began in 2005 following a determination by the Department of Juvenile Services that the current facilities were obsolete. 3 The Project went through several ³⁴¹ design changes and finally appeared in its current form in the Governor’s 2011 capital improvement plan for fiscal years (“FY”) 2012-2016. In 2011, the Project was estimated at approximately $48 million and was expected to take longer than three years to complete.

Phase I of the Project (preconstruction/design phase) was expected to run about 14 months, and Phase II (construction phase) was anticipated to take about 24 months to complete. During 2011, DGS officials explored the use of PLAs for Juvenile Justice facilities generally and on the Cheltenham Project specifically. A PLA is a negotiated pre-hire agreement between a construction manager (here, the CM at Risk), and a designated collective-bargaining representative for all employees on a particular project. 51 C.J.S. Labor Relations § 311 (2014). In order to perform work on a project covered by a PLA, a contractor must sign the PLA and agree that no labor strikes or disputes will disrupt the project.

Id. 4 Typically, PLAs covering public works projects require that bidders are or become bound by the PLA but do not restrict bidding to union contractors or limit work to union members. 5 ³⁴² In a letter dated October 18, 2011, the Maryland Secretary of State wrote to the Vice President of the Laborer’s International Union of North America, stating that the State was “allowing various stakeholders an opportunity to comment on the final draft of the proposed criteria for a [PLA] relating to the Cheltenham [Project].” He explained that, with respect to whether the State would institute a policy encouraging use of PLAs on projects over $25 million, “we are going to evaluate our experience with this upcoming procurement and then decide how we may want to proceed on future procurements.” RFP for Construction Management at Risk Services On November 9, 2011, DGS issued an RFP for Construction Management at Risk Services for the Cheltenham Project, designated No. DC-455-090-001 (“Cheltenham RFP”), pursuant to Maryland Code (1988, 2009 Repl.Vol.), State Finance and Procurement Article (“SFP”), § 13-103 and Code of Maryland Regulations (“COMAR”) 21.05.03 (Competitive Sealed Proposals). 6 DGS determined that the Construction Management at Risk (“CM at Risk”) delivery method was best suited to deal with the magnitude and complexity of the Project. 7 Authorized under COMAR, the CM at Risk is defined as: ³⁴³ [A] project delivery method wherein a construction manager provides a range of preconstruction services and construction management services which may include, but are not limited to, cost estimation and consultation regarding the design of the project, prequalifying and evaluating trade contractors and subcontractors, awarding the trade contracts and subcontracts, scheduling, cost control, and value engineering. COMAR 21.05.10.0113(1). Typically, the CM assumes all risks for cost, scheduling, and performance of trade contracts. The Cheltenham RFP prescribes CM at Risk services during both pre-construction and construction phases of the Project and requires that, “fi]n order to be considered, all firms must agree [ ] to the Guaranteed Maximum Price (‘GMP’) of Forty-Eight Million, Three Hundred Nine Thousand Dollars ($48,309,000.00).” (Cheltenham RFP, Section 00300, Article 2(C)(1)).

The CM serves as a cost estimator and project coordinator during the design phase and as the general contractor during construction. The CM’s responsibilities include developing schedules, preparing construction cost models and estimates, conducting value engineering and labor conditions studies, managing change order review and quality assurance inspections, and advising on the sequencing of the construction work. The “Project Team” comprises the State of Maryland, the CM, the Architects/Engineer(s), and other project consultants. (Cheltenham RFP, Section 00400, Article 1(A)(5)).

Section 00300, Article 2, establishes the scope of the Project and identifies the factors for DGS to consider when evaluating the proposals: B. Evaluation Factors for Award 1. Basis for Award The Procurement Officer shall make a determination recommending award of the contract to the responsible offeror whose proposal is determined to be the most advantageous to the State, considering price and the evaluation factors set forth in the request for proposals. 2. Technical Proposal Evaluation ³⁴⁴ The following technical factors shall be used by the Evaluation Committee to evaluate technical proposals. The factors are listed in descending order of importance.

Technical Evaluation Factors a. Experience of Firm b. Management Approach c. Key Personnel d.

Past Performance of Firm e. Labor/Trade Apprenticeship and Training Program f. Project Labor Agreement (include previous experience with PLA projects)[ 8 ] g. Economic Benefits to the State 3.

Price All offers must include reasonable prices. The Procurement Officer may reject offers containing prices determined to be unreasonably high or low. 4. Minority Business Enterprise Participation Goal The PLA cannot be a basis for waiver of MBE participation goals required by this solicitation. (Emphasis added).

Subsection D, entitled “Technical Proposal Requirements,” includes detailed instructions regarding the requirements for each of the technical evaluation factors listed in Article 2, subsection B(2). Although subsequently amended, Subsection D.6 entitled “Project Labor Agreement” originally provided: 9 a. The firm shall provide at least two (2) examples of projects which they have managed where a Project ³⁴⁵ Labor Agreement (PLA) was used and briefly describe their experience in developing and working with the PLA b. The firm shall provide a statement affirming their intent to establish and use a PLA in accordance with Section 00840 of this RFP.

The CM is required to negotiate any PLA in good faith with all relevant labor organizations that have jurisdiction over the trades involved in construction of the Project. Qualifying PLAs must contain a provision that the contractor and all subcontractors are able to compete for contracts without regard to their participation in any other collective bargaining agreements. PLAs must guarantee against strikes, lockouts, and similar job disruptions; and include provisions that set forth effective, prompt, and mutually binding procedures for resolving labor disputes. November 21, 2011 Pre-Proposal Conference 10 On November 21, 2011, procurement officer Myrna L. Harris presided over the pre-proposal conference for the Project.

Representatives from a number of firms attended, including Turner Construction Company, Inc., Skanska USA Building, Inc., Hunt Construction Group, Inc., Gilbane, Inc., and The Whiting-Turner Contracting Company, Inc. At the conference, Ms. Harris explained the RFP process, reiterating that any changes to the RFP would be provided by addenda and that offerors should acknowledge the receipt of such addenda in their technical proposals. She also discussed the submittal process, including that offerors are to submit a two-part proposal consisting of 1) a technical proposal, and 2) a price proposal. She noted that the RFP provides that ³⁴⁶ technical and price proposals are given equal weight, and that the technical evaluation criteria is listed in order of importance. Mr. Stephen Gilliss, DGS Project Manager, briefly described the scope of the Project and clarified that, among other things, Phase I of the Project was not part of the GMP.

The meeting was then opened for questions, and attendees inquired about various issues, including funding for the Project, the addenda process, and the approximate timeline for the award. No one submitted a question related to the evaluation factor regarding PLAs. The Pre-Award Bid Protest One day after the pre-proposal conference, on November 22, 2011, Protestors filed a joint pre-award bid protest pursuant to COMAR 21.10.02, challenging DGS’s use of a PLA as an “unprecedented” evaluation factor. Specifically, Protestors argued that the inclusion of the PLA evaluation factor “compelled] offerors responding to the RFP to agree to enter into a Project Labor Agreement as a condition of receiving full consideration for award of the Project,” thereby unduly restricting competition in violation of SFP § 13-205(a) and creating “a radical new procurement policy” in violation of the rulemaking provisions of the APA, Maryland Code (1984, 2009 Repl.Vol., 2010 Supp.), State Government Article (“SG”) § 10-110.

According to Protestors, the “restrictive PLA preference” discriminated against them and their non-union subcontractors because they did not have established relationships with Maryland’s labor organizations and their “employees and likely subcontractors do not want to work on a project covered by a PLA.” Moreover, Protestors contended, inter alia, that their nonunion contractors and subcontractors would be unable to use their own employees for the Project and would likely have to pay duplicative costs for various union benefit programs. Protestors charged that the PLA evaluation factor was a “preference” that violated Maryland’s public policy favoring “Maximum Practicable Competition,” and that the RFP did not “contain any explanation or proof of need for a restrictive PLA preference.” ³⁴⁷ Addenda Before issuing her decision on the Protest, the procurement officer issued two addenda to the RFP that affected the PLA evaluation factor. First, Addendum No. 2, issued on December 27, 2011, modified evaluation factor “f” so that firms were no longer required to demonstrate prior experience with PLAs. Thus, the language of Subsection B.2 (1) was changed from “Project Labor Agreement (include previous experience with PLA projects)” to “[t]he presence of a Project Labor Agreement.” Also, item a. of subsection D.6 was deleted, removing the requirement that a firm provide examples of past projects on which it used PLAs.

Second, Addendum No. 4, issued on February 7, 2012, extended the due date for technical and price proposals to February 23, 2012, and revised subsection D.6 to read as follows: If the offeror intends to use a Project Labor Agreement (PLA), it shall provide a statement affirming its intent to establish and use a PLA in accordance with Section 00840 of this RFP. This Addendum also added a provision requiring PLAs to include “provisions prohibiting discrimination on the basis of union membership.” Finally, in subsection 5, the prior language, “[fjailure to furnish such evidence of the required PLA within the above-referenced timeframe ... shall be deemed a material flaw in the Contractor’s proposal,” was modified to read “[fjailure to furnish the PLA ... may constitute a default under the CM contract.” (Emphasis added). Addendum No. 5, issued on February 23, 2012, extended the due date for the receipt of proposals to March 1, 2012. Final Decision on Protest Ms. Harris issued her Final Decision denying the protest on February 21, 2012.

She decided that the PLA evaluation factor contained in the Cheltenham RFP, as amended, was not prohibited because it was not expressly proscribed by CO-MAR or Maryland procurement law, nor was the PLA an express requirement under the RFP. ³⁴⁸ Regarding the reasonableness of including a PLA as an evaluation criterion, Ms. Harris noted that “any PLA must include certain protections for the State against problems that might arise and impede progress,” including guarantees against strikes or similar job disruptions; procedures for prompt resolution of labor disputes; and mechanisms for labor-management cooperation. Therefore, Ms. Harris found that DGS had provided adequate grounds for including a PLA as an evaluation factor for the Project given its size and complexity. She observed that amendments to the RFP clarified that use of a PLA was not a contract requirement, and determined: Any offeror may submit an offer and at its choice may offer, or not offer, a PLA. Should an offeror choose not to offer a PLA it is not excluded from competition for award.

To the contrary, it may submit an offer which it considers to be a superior proposal in terms of experience, approach, price ... and may, in its proposal, choose to demonstrate why its proposal is DGS’s best option without a PLA. This is especially so in this solicitation, since DGS must consider the technical proposal equally with price. (Emphasis added). Ms. Harris discussed how use of a PLA as an evaluation factor did not discriminate against non-union subcontractors: Should an offeror choose to include the use of a PLA in its proposal, by the express requirements of Section 00840, any such PLA must “allow the [Construction Manager] and all Subcontractors to compete for contract and subcontracts without regard to whether they are otherwise parties to any other collective bargaining agreements” and “contain provisions prohibiting discrimination of [sic] the basis of union membership.” Thus, non-union labor firms will have the same opportunity as union firms.

She found that the solicitation was not unduly restrictive because the PLA was only one of seven evaluation factors for the technical proposal (which is only accorded 50 percent value under this RFP), and that it was ranked “of low importance.” ³⁴⁹ Ultimately, Ms. Harris concluded that the inclusion of a PLA was reasonable and nondiscriminatory, and did not constitute a change in procurement policy. Protestors appealed to the MSBCA on February 22, 2012. Award to Turner Construction DGS received seven proposals on March 1, 2012, in response to the Cheltenham RFP, including one from Appellant Manhattan Construction. Each proposal contained a PLA.

On May 23, 2012, the Maryland Board of Public Works unanimously approved the award of the contract to Turner Construction pursuant to COMAR 21.10.02.11A, which provides: A. If the authority to award a contract has not been delegated to a department pursuant to COMAR 21.02.01.04, and a timely protest or appeal has been filed, the contract may be executed only if either: (1) The Board of Public Works finds that execution of the contract without delay is necessary to protect substantial State interests; or (2) The Appeals Board issues a final decision concerning the appeal. If a contract is to be executed pursuant to § A(l) of this regulation, the procurement agency shall so notify the Appeals Board. Turner began providing preconstruction services shortly thereafter, and construction began in November of 2013. 11 ³⁵⁰ MSBCA Appeal Protestors timely appealed to the MSBCA, and in their memorandum in support thereof, Protestors introduced the affidavit of economist Anirban Basu, Chairman and CEO of Sage Policy Group, Inc. Mr. Basu’s affidavit asserts that his research regarding the impact of PLAs on the DC-Maryland construction industry led him to conclude that PLAs are likely to (1) burden non-union contractors and business owners (adding that disadvantaged business owners are overwhelmingly nonunion); (2) have adverse impact on local economies; (3) diminish opportunities for pre-existing skilled non-union workers; (4) result in unsafe work practices and poor construction outcomes; (5) generate large inefficiencies; and (6) result in increased price without realizing any benefits. Mr. Basu also states that a survey conducted by the Associated Builders and Contractors of Maryland (“ABC”) revealed that “more than 98% of ABC member contractors and subcontractors were less likely to bid on a public construction project that is covered by a PLA.” Moreover, Mr. Basu states that according to his research, comparable government projects in Maryland encountered none of the problems — labor-related disruptions, delays, and inefficiencies — identified by DGS in the RFP as grounds for inclusion of the PLA evaluation factor.

DGS submitted an Agency Report, 12 which included, among other documents, a March 2012 assessment of the Cheltenham facility issued by Grimm & Parker Architects, and a study ³⁵¹ prepared by Fred Kotler, J.D. supporting the use of PLAs on public projects and upon which DGS relied, in part, in preparation of the RFP specifications. See Fred B. Kotler, J.D., Project Labor Agreements in New York State: In the Public Interest, Cornell Univ. (2009). Mr. Kotler addresses general allegations that PLAs are anticompetitive and explains: Because union and non-union contractors are free to bid on projects covered by PLAs, they avoid the favoritism that competitive bidding laws are designed to prevent.

Awards are frequently made to both union and non-union companies. Those same contractors are not required to become union contractors, that is, signatories to the respective area craft agreement, but only to become signatories to the PLA. Id. at p. 12. In response to the Agency Report, the Protestors moved for summary decision, claiming that the State failed to conduct market research or a study of labor conditions in Maryland such as that performed by Mr. Basu and, therefore, contending the State produced no prima facie evidence to justify the PLA evaluation factor.

The State’s reply included the Affidavit of Assistant Secretary for DGS, Mr. Bart Thomas. In his affidavit, Mr. Thomas asserts that the use of a PLA “gives owners and contractors a unique opportunity to anticipate and avoid problems that might arise and possibly impede progress.” Mr. Thomas maintains that he concluded, based upon research and communications with various union and nonunion contractors and the Maryland Department of Labor, Licensing and Regulation (“DLLR”), among others, that PLAs in large-scale projects (1) help provide a dedicated, trained workforce; (2) boost local economies; (3) facilitate apprenticeship and job training programs; (4) promote project stability and safety; (5) promote project efficiency, (6) provide a planned approach to labor relations and more accurate prediction of labor costs; and (7) assure timely completion. 13 ³⁵² Following submission of the record and competing affidavits, the MSBCA heard oral argument on September 20, 2012. After final briefing, the Board issued its decision denying the appeal on November 16, 2012. At the outset, the Board acknowledged that under SFP § 13 — 205(a)(1) and attendant regulations, 14 the law is clear that a procurement specification may not unduly restrict competition.

Balfour Beatty, MSBCA 2803 at 4, — MSBCA ¶ — (2012) (citing Xerox Corp., MSBCA 1111, 1 MSBCA ¶ 48 (1983)). 15 The Board also instructed that, “it is for the government as procuring entity, and not the function of private vendors, to determine what restrictions may reasonably be imposed to achieve the State’s procurement goals.” Id. at 5. Although the State enjoys “great latitude” in its determination, the State is prohibited from steering contracts to a particular vendor. Id. In order to defend its specifications, the government must simply assert reasonable cause for a restrictive bid or proposal requirement.

The Board noted that “the more restrictive a specification may be, the greater ³⁵³ the justification that the State may be fairly required to assert.” Id. at 5-6. Once the State satisfies this showing, the protestor has a “considerable burden” to prove by a preponderance of the evidence that the restriction is unreasonable. Id. at 5 (citing Xerox Corp., supra; The Trane Co., MSBCA 1264, 2 MSBCA ¶ 118 (1985)). The Board found that the challenged specification — the PLA evaluation factor — is not highly restrictive: The RFP at issue does not even impose the requirement of a PLA.

Any qualified offeror was free to submit a proposal in response to this RFP with or without a PLA ... The contested specification in this RFP simply allows the State to consider the potential benefit to the State of selecting a proposal with a PLA in place. In addition, the option of including a PLA in a proposal was assured by the State to be afforded the weight of only the sixth most important of a total of seven evaluations factors. Id. at 6.

The MSBCA concluded “the alleged restriction is slight, even giving appellant the benefit of classifying the allowance of consideration of a PLA as a restriction at all.” Id. That the degree of restrictiveness was small, the Board added, is evidenced by the fact that not one, but seven separate proposals were submitted to the State, each proposing use of a PLA. Id. Turning to the State’s justification for including the PLA evaluation factor, the Board first acknowledged that the parties advanced affidavits containing diametrically opposing perspectives.

The Board stated: It is not for the Board to determine which view is correct. The Board does not substitute its judgment for that of the state agency that identifies its procurement methods and desires and must later live with the consequences of its settled procurements. Id. at 9 (citing Lottery Enterprises, Inc., MSBCA No. 1680; 4 MSBCA ¶ 314, at 8 (1992)). The Board explained that its seminal function is “merely to decide whether the State’s determinations to give consideration to an offeror’s proposal to ³⁵⁴ use a PLA is rationally or reasonably related to the State’s identification of its construction needs.” The Board found that the evidence adduced by Protestors did not prove an abuse of discretion by DGS and so declined to disturb the agency’s decision.

Inclusion of a PLA as an evaluation criterion in the Cheltenham RFP, the Board found, had no general application or future effect and, therefore, it did not constitute a new regulation subject to the formal rulemaking procedures required by the Maryland APA. Id. at 11. 16 In its final analysis, the Board posed the rhetorical question, “[c]an the same contractor claim through its experts that juvenile detention center should be built using a different construction approach in other respects, or perhaps not build at all? The answer is of course not.” Id. at 12. Pursuant to SG § 10-222 and SFP § 15-223, the Protestors sought review of the MSBCA decision in the Circuit Court for Baltimore City.

From that court’s order denying Protestors’ Petition for Review, Appellants filed their Notice of Appeal with this Court on July 17, 2013.

II

A Single Specification Does Not a Regulation Make On the question of whether the PLA evaluation factor constituted an unprecedented change in State policy mandating predicate rulemaking under the Maryland APA, we review the Board’s decision de novo. Salisbury University v. Joseph M. Zimmer, Inc., 199 Md.App. 163, 166 , 20 A.3d 838 (2011) (citing White v. Workers’ Comp. Comm’n, 161 Md.App. 483 , ³⁵⁵ 487, 870 A.2d 1241 (2005)). “We bypass the judgment of the circuit court and look directly at the administrative decision.” Id. The Court of Appeals in Schwartz v. Maryland Department of Natural Resources, stated: With respect to an agency’s conclusions of law, we have often stated that a court reviews de novo for correctness.

We frequently give weight to an agency’s experience in interpretation of a statute that it administers, but it is always within our prerogative to determine whether an agency’s conclusions of law are correct, and to remedy them if wrong. 385 Md. 534, 554 , 870 A.2d 168 (2005) (citations omitted). Appellants contend that the inclusion of a PLA as an evaluation factor in the Cheltenham RFP establishes an unprecedented preference having general application and future effect; therefore, its adoption without undertaking the formal rulemaking process violated the Maryland APA. Appellants cite an October 18, 2011, letter from the Secretary of State to the Laborer’s International Union of North America (“LiUNA”) addressing the use of PLAs on juvenile justice facility projects as constituting an agency statement creating new state procurement preferences. Appellants maintain that this is a change in regulation that could not lawfully take place without compliance with the Maryland APA, and as a result, the Cheltenham Project RFP must be set aside.

Appellees, DGS and Turner Construction Company, respond that this first (and, thus far, only) use of a PLA as an evaluation factor did not violate the Maryland APA. As evidenced by the Secretary of State’s letter contained in the record, the State and DGS intended to “evaluate [their] experience with this upcoming procurement [the Cheltenham Project] and then decide how [they] may want to proceed on future procurements.” Appellees argue that the use of such an evaluation factor in a single solicitation does not constitute a change in procurement policy because it does not have general application or widespread effect. As such, this one ³⁵⁶ time use of an evaluation factor is not a “regulation” under the Maryland APA. The Maryland APA, Title 10, subtitle 1, sets forth certain requirements for the adoption of regulations by executive agencies governed by the APA, 17 thereby establishing a process known as “notice and comment” rulemaking.

See Dep’t of Health & Mental Hygiene v. Chimes, 343 Md. 336, 340 , 681 A.2d 484 (1996). A unit “may not adopt a proposed regulation” until it has sent a proposed draft to the Attorney General or unit counsel for approval as to legality, SG § 10-107(b), and also to the General Assembly’s Joint Administrative, Executive, and Legislative Review Committee (“AELR Committee”), SG § 10-110(c). Next, the proposed regulation must be published in the Maryland Register and be accompanied by a notice that: (1) states the economic impact of the proposed regulation on State and local government revenues and expenditures and on groups that may be affected by it, and (2) sets a date, time, and place for public hearing^ For the next 30 out of the 45 days during which the regulation is published in the Maryland Register, the unit must accept public comment on the proposed regulation. 18 It is undisputed that DGS, in the instant case, failed to follow these procedures. The crucial determination, then, is whether the first-time inclusion of a new bid specification, in light of the present facts, constitutes a “regulation” under the Maryland APA.

Section 10-101(g) of the Maryland APA defines “regulation” as: (g)(1) “Regulation” means a statement or an amendment or repeal of a statement that: ³⁵⁷ (i) has general application; (ii) has future effect; (iii) is adopted by a unit to: 1. detail or carry out a law that the unit administers; 2. govern organization of the unit; 3. govern the procedure of the unit; or 4. govern practice before the unit; and (iv) is in any form, including: 1. a guideline; 2. a rule; 3. a standard; 4. a statement of interpretation; or 5. a statement of policy. (2) “Regulation” does not include: (i) a statement that: 1. concerns only internal management of the unit; and 2. does not affect directly the rights of the public or the procedures available to the public; (ii) a response of the unit to a petition for adoption of a regulation, under § 10-123 of this subtitle; or (iii) a declaratory ruling of the unit as to a regulation, order, or statute, under Subtitle 3 of