STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
CALDER RACE COURSE, INC., and ) TROPICAL PARK, INC., )
)
Petitioners, )
and )
) GULFSTREAM PARK RACING ASSOCIATION ) and HIALEAH, INC., d/b/a HIALEAH ) INC., d/b/a HIALEAH RACE COURSE, )
) CASE NO. 81-118RP
Intervenors, )
)
vs. )
) DIVISION OF PARI-MUTUEL WAGERING, ) DEPARTMENT OF BUSINESS ) REGULATION, and GARY RUTLEDGE, )
Director, )
)
Respondents, )
and )
) WJA REALTY, d/b/a TAMPA JAI ALAI, ) MIAMI JAI ALAI, OCALA JAI ALAI, ) FT. PIERCE JAI ALAI and SUMMER ) JAI ALAI; BISCAYNE KENNEL CLUB; ) WEST FLAGLER ASSOCIATES, LTD.; ) INVESTMENT CORPORATION OF SOUTH ) FLORIDA; and ST. PETERSBURG )
KENNEL CLUB, INC., )
)
Intervenors. )
)
FINAL ORDER
The Petitioners, Calder Race Course, Inc., and Tropical Park, Inc., have filed a "Petition for Administrative Determination of the Invalidity of Proposed Rules" of the Respondent, Division of Pari-Mutuel Wagering, Department of Business Regulation. Petitioners are seeking an order declaring the Division's proposed rules designated 7E-2.03 and 7E-3.03(32) invalid exercises of delegated legislative authority. By Order entered January 26, 1981, the Director of the Division of Administrative Hearings entered an Order assigning this matter to the undersigned Hearing Officer. The final hearing was originally scheduled to be conducted on February 18, 1981, by notice dated January 29. At a prehearing conference conducted through the vehicle of a conference telephone call, the parties agreed to a rescheduling of the final hearing for February 23, 1981, and that was accomplished by amended notice dated February 12.
Gulfstream Park Racing Association and Hialeah, Inc., d/b/a Hialeah Race Course, filed motions to intervene on the side of the Petitioners. WJA Realty,
d/b/a Miami Jai Alai, etc.; Biscayne Kennel Club; West Flagler Associates, Ltd.; Investment Corporation of South Florida; and St. Petersburg Kennel Club, Inc., filed motions to intervene on the side of the Respondents. The motions were granted by Order entered February 19, 1981.
FINDINGS OF FACT
The Division of Pari-Mutuel Wagering of the Florida Department of Business Regulation is an agency charged with responsibility for implementation and enforcement of the statutory framework governing the conduct of pari-mutuel operations in Florida. The Division's agency head is its Director. The Division has initiated proceedings to adopt rules to establish procedures whereby dog racing tracks and jai alai frontons will select dates for matinee performances. Proposed Rule 7E-2.03 relates to the scheduling of matinee programs by dog racing tracks. It provides in pertinent part:
The application [the track's application for an annual license, operating dates, meetings and the number of performances] shall designate the matinee programs to be conducted by the association. Each association shall be permitted during its authorized meeting to conduct a maximum of 54 matinee programs on the days of its choice. Provided, however, that no association located in a county where there is a thoroughbred association or within a radius of 35 miles of another pari-mutuel association shall be permitted to conduct
more than 3 matinee programs during any calendar week of its authorized meeting, except that a matinee program can be scheduled on New Year's Day, Memorial Day, July 4th, Labor Day and Thanksgiving Day. Provided, further, that in those counties where a thoroughbred association is authorized to have dark during its meeting all other pari-mutuel associations in the same county may conduct their matinee programs on any or all such dark days as long as the total for the respective association does not exceed 54 matinee programs.
Proposed Rule 7E-3.03(32) relates to selection of matinee dates by jai alai frontons, and contains language that is functionally identical to Proposed Rule 7E-2.03. The effect of these proposed rules would be to allow dog racing tracks and jai alai frontons to schedule up to fifty-four matinee programs during their authorized operating dates. If the track or fronton is located in a county where there is a horse racetrack, no more than three matinee programs can be scheduled during any calendar week, except for the designated holidays. The Respondent conducted a public hearing with respect to the proposed rules on January 19, 1981.
The Petitioners, Calder Race Course, Inc., and Tropical Park, Inc.; and the Intervenors Gulfstream Park Racing Association and Hialeah, Inc., are horse racetrack operators. These parties are affected by the proposed rules because the proposed rules would allow dog racing tracks and jai alai frontons to operate matinee programs at the same time that horse race programs are being run by these parties. The Intervenors WJA Realty; Biscayne Kennel Club, et al.; and St. Petersburg Kennel Club are operators of dog racing tracks or jai alai frontons. They are affected by the proposed rules because the proposed rules would allow dog racing tracks and jai alai frontons to operate matinee programs at the same time that horse race programs are being run by these parties. The horse racetrack parties are located in Dade County or Broward County, Florida. They conduct only daytime, matinee programs. The dog track and jai alai fronton parties, other than St. Petersburg Kennel Club, Inc., operate in Dade County and Broward County, Florida. They are all located within a radius of thirty-five miles of other pari-mutuel associations, and in the same county with thoroughbred associations.
Prior to 1970, dog tracks and jai alai frontons in Southeast Florida conducted nighttime programs almost exclusively. Horse track operators conducted, and continue to conduct, only matinee programs. During the decade of the 1970's, dog tracks and jai alai frontons began conducting an increasing number of matinee programs under various regulatory systems imposed by the Division of Pari-Mutuel Wagering, or its predecessors. In 1978 the Division adopted a policy which is in all material respects identical to the policy that the Division is seeking to implement through the adopting of the rules which are the subject of this proceeding. While it appears to have been the Division's intent to adopt the policy as a rule in 1978, the policy was never formally filed with the Office of the Secretary of State, and was therefore not adopted as a rule. It has, nonetheless, been in operational effect since 1978. The Division's experience with the policy has been favorable. Dog track and jai alai fronton operators have chosen days for operating matinee programs which are most profitable. The State obtains revenue from these operations based upon a percentage of the "handle" or the dollar volume that goes through a facility on a given day. The more money an operation takes in, the more revenue the State obtains. The State's experience with the matinee policy has been favorable from a revenue generating perspective.
Horse track operators are to some degree affected by having dog tracks and jai alai frontons operating conflicting matinee programs. The degree of this effect has not been established with any precision. Horse track operators have experienced operational difficulties during the past decade. Many factors have contributed to these difficulties. It has not been established that having matinee competition from dog tracks and jai alai frontons has been a significant factor. Various statistics were presented by the parties in an effort to show either that matinee competition has resulted in a diminution of the handle of horse racetracks, or the contrary. The statistics were not prepared in such a manner as to isolate the impact of matinee competition upon the revenues of horse racetracks. Even if any such findings could be isolated from the statistics that have been presented, the conclusions would be conflicting. Certainly having competition drains some customers from horse racetracks. The extent of this impact cannot, however, be determined from the evidence presented in this proceeding.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this proceeding. Section 120.54(4), Florida Statutes.
Petitioners contend that the Division of Pari-Mutuel Wagering is without statutory authority to promulgate any rules respecting dates on which dog tracks and jai alai frontons can schedule matinee performances. Petitioners contend that this authority has been delegated by the Legislature exclusively to the Florida Pari-Mutuel Commission which is created in the provisions of Section 20.16(4), Florida Statutes, within the Department of Business Regulation. The Commission is granted in paragraph (a) of the section the following authority:
[To] hear and approve the dates and changes of dates for racing and the dates within which any track or fronton may operate as prescribed by Chapters 550 and 551, and it shall not delegate said function to any subordinate officer or division of said department.
Petitioners contend that the Pari-Mutuel Commission, not the Division of Pari- Mutuel Wagering, is the agency responsible for scheduling the days upon which dog tracks and jai alai frontons can schedule matinees. This contention is without merit. Section 550.011(2), Florida Statutes (1980 Supp.), relates to the scheduling of matinee dates by dog tracks. It provides:
Except as otherwise provided in this chapter, each permitholder shall request days of operation, which request shall include the number of scheduled performances within each day of operation, by January 15 of each year; and the Florida Pari-mutuel Commission shall consider and take action on each request no later than March 15 of each year. The Division of Pari-mutuel Wagering shall establish rules to allow a permitholder to conduct more than one performance in an operation day and may limit such extra performances to specified days of the week, weeks of the year, or times of day, provided the number of extra performances shall not exceed 54. If the Florida Pari-mutuel Commission does not take action on the request for days of operation and number of performances by March 15 in any year, then
the days that are requested that are not in conflict with the operating days of another permitholder within 50 air miles shall be automatically awarded. . . .
Section 551.031(2), Florida Statutes (1980 Supp.), contains identical provisions with respect to jai alai frontons. These statutes specifically empower the Division of Pari-Mutuel Wagering to establish rules to allow dog track and jai alai fronton operators to conduct matinee performances. The statute does not take from the Pari-Mutuel Commission the authority to schedule dates upon which programs can be conducted, but merely limits its authority to that precise role.
The Petitioners have contended that the proposed rules constitute invalid exercises of delegated legislative authority because they are arbitrary and capricious. This contention is without merit. In Agrico Chemical Company
v. Department of Environmental Regulation, 365 So.3d 759 (1 DCA Fla. 1978), the Court stated: (at p. 763)
A capricious action is one which is taken without thought or reason or irrationally.
An arbitrary decision is one not supported by facts or logic, or despotic. Administrative discretion must be reasoned and based upon competent substantial evidence. Competent substantial evidence has been described as such evidence as a reasonable person would accept as adequate to support a conclusion.
The requirement that a challenger has the burden of demonstrating agency action to be arbitrary or capricious or an abuse of administrative discretion is a stringent one indeed. However, the degree of such required proof is by a preponderance of the
evidence. . . .
The Petitioners have not established that the proposed rules were taken without thought or reason or irrationally, or that they are not supported by the facts. On the contrary, it appears that the Department has had two full years of experience with a policy that is identical to the proposed rules, and that the experience has been favorable, especially from the perspective of increasing state revenues. The Petitioners have contended that the Department has given no thought to whether reducing competition would have the effect of increasing revenues at horse racetracks so that state revenues would thereby be increased. It does appear that the Department has considered that potential impact, but determined it adversely to the horse racetracks. It is the Petitioners' burden to establish that the proposed rules are arbitrary and capricious, and the evidence would not support any such conclusion.
Petitioners contend that the Division's proposed rules have the effect of delegating to dog track and jai alai fronton operators the authority to schedule their own matinee dates, and that the proposed rules therefore constitute invalid exercises of delegated legislative authority. This contention is without merit. Sections 550.011(2) and 551.031(2), Florida Statutes (1980 Supp.), authorize the Division to establish rules to allow dog track and jai alai fronton operators to conduct matinee performances. The statutes provide that the Division ". . . may limit such extra performances to specified days of the week. . . ." (e.s.) The Division has not limited the days of the week that dog track and jai alai fronton operators can schedule matinees, but the statutes specifically leave to the Division's discretion whether such limitations should be imposed. The Division has chosen not to impose such limitations because of its conclusion, based on two years of experience with a policy identical to the proposed rules, that state revenues will be maximized by allowing operators to choose their own days for scheduling matinee performances.
Petitioners have contended that the Division did not schedule adequate workshops and meetings in its effort to promulgate the proposed rules. This contention is without merit. The Division did schedule and conduct a public hearing on January 19, 1981, and in connection with implementing the policy in 1978 which is identical to these proposed rules, conducted numerous workshops and public meetings. It has not been shown that the Division has not properly followed all procedural steps for promulgating a rule.
Petitioners contend that Sections 550.011(2) and 551.031(2), Florida Statutes (1980 Supp.), constitute invalid delegations of authority by the Legislature to the Division. This amounts to a constitutional attack upon the validity of the statutes. While a Hearing Officer of the Division of Administrative Hearings may consider the constitutionality of a proposed rule in a Section 120.54(4) proceeding, Department of Environmental Regulation v. Leon County, 344 So.2d 290, 295 (1 DCA Fla. 1977), a Hearing Officer does not have the authority to consider the validity of a statute. Gulf Pines Memorial Park
v. Oaklawn Memorial, 361 So.2d 695 (Fla. 1978). It would, therefore, be beyond the Hearing Officer's authority to rule upon the constitutionality of the statutes, and the Petitioners' contention with respect thereto must therefore be rejected.
FINAL ORDER
Based upon the foregoing findings of fact and conclusions of law, it is, hereby,
The Petitioners have failed to establish that the Division of Pari-Mutuel Wagering's Proposed Rules 7E-2.03 and 7-3.03(32) constitute invalid exercises of delegated legislative authority, and the Petition for Administrative Determination of the Invalidity of Proposed Rules is hereby dismissed.
DONE AND ORDERED this 19th day of March, 1981, in Tallahassee, Florida.
G. STEVEN PFEIFFER Hearing Officer
Division of Administrative Hearings Oakland Building
2009 Apalachee Parkway
Tallahassee, Florida 32301
(904) 488-9675
Filed with the Clerk of the Division of Administrative Hearings this 19th day of March 1981.
COPIES FURNISHED:
Wilbur E. Brewton, Esquire Taylor, Brion, Buker & Greene Post Office Box 1796 Tallahassee, Florida 32301
David M. Maloney, Esquire Staff Attorney
Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301
William P. Cagney, III, Esquire 900 Peninsula Federal Building
200 S.E. First Street Miami, Florida 33131
Aubrey V. Kendall, Esquire Mershon, Sawyer, Johnston,
Dunwody & Cole
1600 S.E. First National Bank Building Miami, Florida 33131
Mallory E. Horne, Esquire
Horne, Rhodes, Jaffry, Horne, & Carrouth Suite 700, Barnett Bank Building Tallahassee, Florida 32301
Leonard Romanik, Esquire Landefeld and romanik Post Office Box 1040 Hollywood, Florida 33022
Ross H. Stanton, Jr., Esquire Greene, Mann, Rowe, Stanton
Mastry & Burton Post Office Box 33542
St. Petersburg, Florida 33731
Carroll Webb, Executive Director Administrative Procedures Committee
120 Holland Building Tallahassee, Florida 32301
Liz Cloud, Chief
Bureau of Administrative Code Department of State
1802 The Captiol
Tallahassee, Florida 32301
| Issue Date | Proceedings |
|---|---|
| Mar. 19, 1981 | CASE CLOSED. Final Order sent out. |
| Issue Date | Document | Summary |
|---|---|---|
| Mar. 19, 1981 | DOAH Final Order | Petitioner's challenge to rules allowing competition between jai alai, dog tracks and horse tracks in daytime fails--reasonably related to statute. |
