September 27, 2016 – Mira Consoultin, Inc. v. Board of Education, Albuquerque Public Schools, No. 34,486

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IN THE COURT OF APPEALS OF THE STATE OF NEW MEXICO

Opinion Number:

Filing Date: _ September 27, 2016

NO. 34,486

MIRA CONSULTING, INC., a
New Mexico Corporation,

Plaintiff-A ppellant,
Vv.

BOARD OF EDUCATION,
ALBUQUERQUE PUBLIC SCHOOLS,

Defendant- Appellee.

APPEAL FROM THE DISTRICT COURT OF BERNALILLO COUNTY
Nancy J. Franchini, District Judge

Bingham, Hurst & Apodaca, P.C.
Wayne E. Bingham

Albuquerque, NM
for Appellant

Modrall, Sperling, Roehl, Hamis & Sisk, P.A.
Arthur D. Melendres
Zachary L. McComnick

Albuquerque, NM

for Appellee

OPINION
BUSTAMANTE, Judge.
{1} 	Mira Consulting, Inc. appeals the dismissal of its complaint for declaratory
judgment. We agree with the district court that New Mexico’s Procurement Code does
not apply here and that dismissal under Rule 1-012(B)(6) NMRA was appropriate. We
therefore affirm.
BACKGROUND
{2} 	Mira Consulting, Inc. (Mira) is a for-profit New Mexico corporation providing
dental services primarily in Albuquerque. Albuquerque Public Schools (APS) issued
a “Request for Information” (RFI) soliciting information about “dental health
providers who are interested [in] delivering direct services in APS for the 2014-2015
[s]chool [y]ear.” Through the program, successful applicants would be permitted to
provide dental services in APS schools. The RFI stated that “[a]ll services performed
per an award for this RFI must be performed at no cost to APS. Successful applicants
will be directed to bill Medicaid, other third party payers or provide services
pro[]bono.”
{3} 	Mira responded to the RFI. Three other dental service providers also submitted
information. After four reviewers scored each response, Mira and Smiles for New
Mexico Kids were selected as providers. Although Mira was “awarded” sixty-eight

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schools and Smiles for New Mexico Kids was awarded thirty schools, Mira filed a bid
protest with APS’s procurement division pursuant to Section 13-1-172 of New
Mexico’s Procurement Code, NMSA 1978, §§ 13-1-28 to -199 (1984, as amended
through 2015). The bid protest was based in part on the distribution of elementary
schools and high schools between Mira and Smiles for New Mexico Kids, as well as
proximity of the schools to each company’s “dental home.” APS responded to the bid
protest by stating that the protest procedures in the Procurement Code were
inapplicable because the Procurement Code does not apply to transactions in which
APS does not expend any funds.
{4} 	Mira then filed a complaint for declaratory judgment requesting an order
declaring that the RFI was subject to the Procurement Code. After a hearing on a
motion to dismiss, the district court agreed with APS that the Procurement Code did
not apply and dismissed the complaint for failure to state a claim under Rule 1-
012(B)(6). Mira appeals.
DISCUSSION
{5} 	Our review of statutory construction questions is de novo. See Pub. Serv. Co.
of N.M. v. N.M. Pub. Util. Comm’n, 1999-NMSC-040, ¶ 14, 128 N.M. 309, 992 P.2d
860. In construing a statute, we seek to “determine and give effect to the intent of the

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[L]egislature.” Id. ¶ 18 (internal quotation marks and citation omitted). We are guided
by common principles of statutory construction, including the following:
[(1)] The plain language of a statute is the primary indicator of
legislative intent.
[(2)] Courts are to give the words used in the statute their ordinary
meaning unless the [L]egislature indicates a different intent.
[(3)] The court will not read into a statute or ordinance language which
is not there, particularly if it makes sense as written.
Id. (alteration, internal quotation marks, and citations omitted).
{6} 	Although the “plain meaning rule” is a guiding principle, “[i]ts beguiling
simplicity may mask a host of reasons why a statute, apparently clear and
unambiguous on its face, may for one reason or another give rise to legitimate (i.e.,
nonfrivolous) differences of opinion concerning the statute’s meaning.” State v. Smith,
2004-NMSC-032, ¶ 9, 136 N.M. 372, 98 P.3d 1022 (internal quotation marks and
citation omitted). Therefore, “[t]he plain meaning rule must yield on occasion to an
intention otherwise discerned in terms of equity, legislative history, or other sources.”
Id. (internal quotation marks and citation omitted).
{7} 	Section 13-1-30(A) addresses the applicability of the Procurement Code. It
provides that “[e]xcept as otherwise provided in the Procurement Code, that code shall
apply to every expenditure by state agencies and local public bodies for the
procurement of items of tangible personal property, services[,] and construction.” An

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“expenditure” is “[t]he act or process of spending or using money, time, energy, etc.;
esp., the disbursement of funds . . . [or a] sum paid out.” Black’s Law Dictionary 698
(10th ed. 2014). Mira argues that, although the Procurement Code clearly applies to
“every expenditure,” nothing in Section 13-1-30 indicates that it applies only when
there is an expenditure. But this argument ignores the second sentence of Section 13-
1-30(A), which states that the Procurement Code “also applies to concession contracts
at the New Mexico state fair in excess of twenty thousand dollars ($20,000), whether
those concession contracts generate revenue and earnings or expand [sic] funds.”
(Emphasis added.) A “concession” contract is “[a] government grant for specific
privileges.” Black’s Law Dictionary 350; see 19.5.1.7(J) NMAC 	(“ ‘Concession
contract’ means an agreement between the department and a person, or business
entity, 	which 	allows 	the 	concessionaire 	to 	provide 	services, 	merchandise,
accommodations[,] or facilities within a park.”). Although the parties do not describe
it this way, the arrangement at issue here falls within this definition.
{8} 	We conclude that the Procurement Code does not apply here for two reasons.
First, concession contracts typically do not involve expenditures by the public entity.
See John Ziegler, The Dangers of Municipal Concession Contracts: A New Vehicle
to Improve Accountability and Transparency, 40 Pub. Cont. L.J. 571, 575 (2011)
(discussing basic concession contracts); see also Kayak Ctr. at Wickford Cove, LLC

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v. Town of Narragansett, 116 A.3d 250, 255 (R.I. 2015) (describing concession
contracts as “contracts that produce revenue and not purchases”). Second, we interpret
the second sentence of Section 13-1-30(A) as a narrow exception to the expenditure
requirement in the first sentence. Phrased another way, this provision means that the
only time a transaction not involving an expenditure is covered by the Procurement
Code is when it is a concession contract at the New Mexico state fair for over
$20,000. Furthermore, under the principle of inclusio unius est exclusio alterius, the
inclusion of state fair concession contracts over $20,000 in the statute also acts as an
exclusion of omitted alternatives—being concession contracts of other kinds. City of
Santa Rosa v. Jaramillo, 1973-NMSC-119, ¶ 11, 85 N.M. 747, 517 P.2d 69 (stating
that inclusio unius est exclusio alterius “means the inclusion of one thing is the
exclusion of the other”). When the first sentence is read in the context of the second,
there is a clear implication that non-state fair concession contracts are not covered by
the Procurement Code. We conclude that the Procurement Code does not apply to
APS’s RFI or Mira’s response to it.
{9} 	Other courts have held under similar circumstances that concession contracts
are excluded from the ambit of their states’ procurement codes. In Kayak Centre, the
Rhode Island Supreme Court considered a request for declaratory judgment similar
to that here. 116 A.3d at 252-53. The plaintiff argued that the defendant had violated

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a procurement statute when it did not award a concession contract to the plaintiff, who
proposed a higher payment to the defendant than its competitors. Id. In addition to
requiring competitive sealed bidding, the statute at issue provided that “[t]he contract
shall be awarded with reasonable promptness by written notice to the responsive and
responsible bidder whose bid is either the lowest bid price, or lowest evaluated or
responsive bid price.” R.I. Gen. Laws § 45-55-5(e) (1998). Relying on this language
and references to “purchases” and “procurement” in the statute, the Kayak Centre
court held that “[t]he language of the statute is clear and unambiguous. As a result, we
need not delve into the intent of the [g]eneral [a]ssembly, except to say that in our
opinion, in enacting [Section] 45-55-5 the [l]egislature sought to regulate contracts
that require the expenditure of public funds.” Kayak Ctr., 116 A.3d at 254. The court
held that the procurement statute did not apply, stating, “We cannot rewrite the statute
by essentially exchanging the word lowest for the word highest, as [the] plaintiff
would have us do, because we will not insert words into an unambiguous statute.” Id.;
see Indep. Taxicab Ass’n of Columbus v. Columbus Green Cabs, Inc., 616 N.E.2d
1144, 1149 (Ohio Ct. App. 1992) (holding that, where the plaintiff sought to provide
taxi management services at the airport, because “the [defendant-]city is not
purchasing services from [the winning contractor, it] was not required to comply with
the competitive bidding procedures set forth in [the defendant-city’s procurement

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code]”); see also 10 McQuillin Mun. Corp., Contracts in General § 29:38 (3d ed.)
(“Where a city is not purchasing services but granting a license or franchise to do
business, it is not required to comply with a competitive bidding ordinance.”).
{10} 	We briefly address Mira’s arguments that the plain language of Section 13-1-30
is not dispositive. To the extent Mira argues that because APS’s RFI resembled and
functioned like a Request for Proposals (RFP), it should be treated like an RFP under
the Procurement Code, we disagree for two reasons. See § 13-1-112 (governing
requests for proposals). First, APS’s decision to use methods for soliciting and
evaluating dental service providers that resembled those for RFPs does not transform
a non-covered transaction into a covered one, or vice versa. If the methods chosen
determined whether the Procurement Code applied, then Section 13-1-30(A) would
be superfluous. Moreover, public entities could avoid the Procurement Code’s
requirements simply by not following its RFP procedures. Second, the RFI made clear
that APS was not offering to buy services from respondents to the RFI. Instead, it
stated several times that the selected vendors must bill third parties for payment. Cf.
Lowe v. City of Hot Springs, 2015 SD 3, ¶ 19, 859 N.W.2d 612 (rejecting an argument
that, because the defendant “utilized the RFP process,” the solicitation was for
procurement of services on the ground that “the RFP itself indicated that the
[defendant] was not seeking to procure services” (internal quotation marks omitted)).

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{11} 	Mira also relies on Memorial Medical Center, Inc. v. Tatsch Construction, Inc.,
to argue that the Procurement Code applies. 2000-NMSC-030, 129 N.M. 677, 12 P.3d
431. In Memorial Medical Center, the issue was whether a private entity (MMCI)
could be considered a “political subdivision” or “local public body” by virtue of its
relationship with the public entities (the City of Las Cruces and County of Doña Ana)
that leased MMCI the hospital facility. Id. ¶¶ 1-2 (internal quotation marks omitted).
The issue in Memorial Medical Center was not whether the Procurement Code would
apply to a new construction project entered into by the City or the County, as public
entities. Id. ¶ 1. It was fully understood that the Procurement Code would apply to the
new hospital construction project if the City or County had continued to own and
operate the hospital. Id. ¶¶ 4, 20-36. More specifically, the question was whether the
Procurement Code and related statutes should also apply to MMCI, a private entity,
“because the private entity has so many public attributes, is so controlled and
conducted, or otherwise is so affiliated with a public entity that as a matter of fairness
it must be considered as the same entity.” Id. ¶ 34.
{12} 	In the present case, we understand Mira’s argument to be that, because it was
so intertwined with a public entity (APS) in offering to provide dental services to APS
schools, the Procurement Code must apply to the RFI selection process for providing
these services. We are not persuaded by Mira’s argument. Mira is not stepping in as

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a private entity to pay for dental services on behalf of APS, as its alter ego or
otherwise. Id. ¶ 35. Mira does not dispute that these dental services will be paid by
Medicaid, other third party payers, or provided pro bono to students. Mira did not
assert that the third party payers and Medicaid are acting as an alter ego for APS.
Unlike the new hospital construction project in Memorial Medical Center, Mira is not
acting to procure and pay a third party for providing dental services. Neither APS nor
Mira pay third parties to provide dental services to APS students. Mira is simply
applying to be one of the third party providers of the dental service. No private entity
acting as the “alter ego” for APS has been established. The alter ego theory offered
under Memorial Medical Center is inapplicable to Mira, and the Procurement Code
will not be altered or expanded to apply to the RFI under these factual circumstances.
{13} 	Finally, although Mira makes several policy arguments for why concession
contracts should be subject to the Procurement Code, such issues call for “legislative
therapy and not judicial surgery.” State v. Gardner, 1991-NMCA-058, ¶ 9, 112 N.M.
280, 814 P.2d 458 (internal quotation marks and citation omitted). “Unless a statute
violates the Constitution, we will not question the wisdom, policy, or justness of
legislation enacted by our Legislature.” Aeda v. Aeda, 2013-NMCA-095, ¶ 11, 310
P.3d 646 (alteration, internal quotation marks, and citation omitted). The Legislature
could have made all concession contracts subject to the Procurement Code. See State

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v. Greenwood, 2012-NMCA-017, ¶ 38, 271 P.3d 753 (“The Legislature knows how
to include language in a statute if it so desires.” (alteration, internal quotation marks,
and citation omitted)); cf. Albuquerque, N.M., Code of Ordinances § 5-5-28(A) (2011)
(distinguishing between “purchases” and “concession contracts” and stating that “[a]ll
purchases of goods, services, and construction in excess of $25,000, and the
establishment of concession contracts expected to exceed $75,000 in revenues to the
contractor shall be made by competitive sealed bid except as otherwise authorized by
this article.”). Our Legislature chose not to do so, and we must honor that choice.
Jones v. Holiday Inn Express, 2014-NMCA-082, ¶ 19, 331 P.3d 992 (“Courts must
construe statutes as they find them and may not amend or change them under the guise
of construction.” (internal quotation marks and citation omitted)).
CONCLUSION
{14} 	We conclude that the Procurement Code does not apply to contracts such as that
contemplated by APS’s RFI. Hence, we affirm the district court’s dismissal of Mira’s
complaint for declaratory judgment.
{15} 	IT IS SO ORDERED.
__________________________________
MICHAEL D. BUSTAMANTE, Judge
WE CONCUR:

JONATHANB. SUTIN, Judge

TIMOTHY L. GARCIA, Judge

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