STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA LEAGUE OF CITIES, INC., )

)

Petitioner, )

and )

)

TOWN OF PEMBROKE PARK and ) VILLAGE OF VIRGINIA GARDENS, )

)

Intervenors, )

)

vs. ) CASE NO. 89-6203RX

)

ADMINISTRATION COMMISSION, )

)

Respondent, )

and )

) DEPARTMENT OF COMMUNITY AFFAIRS, )

)

Intervenor. )

)

FINAL ORDER

This matter was heard by William R. Dorsey, Jr., the Hearing Officer designated by the Division of Administrative Hearings, on January 24, 1990, in Tallahassee, Florida.

APPEARANCES

For Petitioner, James R. Wolfe, Esquire Florida League Post Office Box 1757

of Cities: Tallahassee, Florida 32301

For Intervenor, Frank Matthews, Esquire Town of Michael Petrovich, Esquire Pembroke Pines: Hopping, Boyd, Green & Sams

Post Office Box 6526 Tallahassee, Florida 32301

For Intervenor, Vivian F. Garfein, Esquire Virginia Ross A. McVoy, Esquire

Gardens: Barry F. Rose, Esquire

Fine Jacobson Schwartz Nash Block and England

315 South Calhoun Street Tallahassee, Florida 32301

For Respondent, David Maloney, Esquire Administration John J. Rimes, III, Esquire Commission: Office of the Attorney General

Suite 1602, The Capitol Tallahassee, Florida 32031

For Intervenor, David Russ, Esquire Department of Karen Brodeen, Esquire Community 2740 Centerview Drive

Affairs: Tallahassee, Florida 32399 STATEMENT OF THE ISSUES

Whether Rule 28-39.006(3), Florida Administrative Code, and the policies adopted by the Administration Commission on October 24, 1989, which describe a method for calculating sanctions to be imposed under Section 163.3184(11), Florida Statutes, on cities or counties which fail to submit Local Comprehensive Plans, or which submit plans determined not to be in compliance with Part II of Chapter 163, Florida Statutes, are invalid exercises of delegated legislative authority?

PRELIMINARY STATEMENT

This matter was filed on November 14, 1989. The parties submitted an extensive prehearing stipulation; proposed findings of fact were filed before the final hearing. Numerous exhibits were received at the final hearing, but due to the stipulations of fact, only one witness testified. At the request of the League, the record was left open for possible rebuttal evidence. Ultimately the League decided not to offer rebuttal, and the record was closed by Order entered February 8, 1990. No transcript of the final hearing was submitted.

The findings of fact made in this Order are based on the stipulated facts, and the exhibits and testimony submitted at the final hearing. Rulings on proposed findings of fact are made in the Appendix to this Final Order.

FINDINGS OF FACT

The Parties

1. Petitioner, Florida League of Cities, Inc. ("League"), 201 West Park Avenue, Post Office Box 1757, Tallahassee, Florida, 32302, is a wholly-owned instrumentality of its member cities, which include more than 380 incorporated municipalities in the State of Florida. The League's bylaws require it to work for the effective administration and general improvement of municipal government in Florida. It represents its membership on statewide issues affecting municipal government.

   
   

2. The Florida Administration Commission ("Commission"), the Respondent in this proceedings, is created by Section 14.202, Florida Statutes. 1/ It is composed of the Governor and the Cabinet, and is part of the Executive Office of the Governor. The Governor is chairman of the Commission. The Commission is responsible for insuring compliance by city and county governments with the Local Government Comprehensive Planning and Land Development Regulation Act, Chapter 163, Part II, Florida Statutes, ("the Act"). Sections 163.3167(2) and 163.3184(11), Florida Statutes, grant it the authority to impose sanctions on a county or municipality if its local comprehensive plan is not in compliance with the Act or has been submitted more than 90 days after its scheduled due date.

   Imposition of sanctions requires the affirmative vote of the Governor and any three other members of the Commission. Section 163.3164(1), Florida Statutes.

   
   

3. Petitioner/Intervenor, Town of Pembroke Park ("Town"), is a duly incorporated municipality in Broward County, Florida which has approximately 6,500 residents. About 80 percent of its housing units are mobile homes. The Town prepared and submitted its proposed local comprehensive plan to the Department of Community Affairs out of time; according to Rule 9J-12.006(4), Florida Administrative Code, its plan was due on October 1, 1988. The Town therefore was subject to sanctions under the Act, as implemented by the "Non- Submission Policy" adopted by the Commission on October 24, 1989. The sanctions imposed on the Town by the Commission have been stayed by an appeal from the Commission's sanctions order.

   
   

4. Petitioner/Intervenor, Village of Virginia Gardens ("Village"), Florida, is a duly incorporated municipality in Dade County, Florida. The Village prepared and submitted its proposed local comprehensive plan to the Department of Community Affairs out of time; according to Rule 9J-12.006(1), Florida Administrative Code, its plan was due on July 1, 1988. The Village submitted its plan on February 6, 1989. It was therefore subject to sanctions under the Act, as implemented by the "Non- Submission Policy" adopted by the Administration Commission on October 24, 1989. The sanctions imposed on the Village by the Administration Commission have been stayed by an appeal from the Commission's sanctions order.

   
   

5. Respondent/Intervenor, Department of Community Affairs ("Department"), is a Department of the State of Florida headquartered in Tallahassee, Florida. It administers the Act, and has the responsibility under Chapter 28-39, Florida Administrative Code, to make recommendations to the Commission about local comprehensive plans, including whether they have been submitted late or fail to comply with the Act.

   
   

   The Act and its Sanctions

   
   

6. Counties and cities are required under Section 163.3167(1) of the Act:

   
   

   1. To plan for their future development and growth.

   2. To adopt and amend comprehensive plans, or elements or portions thereof, to guide their future development and growth.

   3. To implement adopted or amended comprehensive plans by the adoption of appropriate land development regulations or elements thereof; and

   4. To establish, support and maintain administrative instruments and procedures to carry out the provisions and purposes of the Act.

      
      

      Each local government is required to prepare a local comprehensive plan "of the type and in the manner set out in" the Act. Section 163.3167(2), Florida Statutes. A "complete proposed comprehensive plan" is required to be submitted to the Department by the dates specified in the Department's rules, which are found in Chapter 9J-12, Florida Administrative Code. Section 163.3167(2), Florida Statutes.

7. Any local government that fails to meet the schedule set for submission of its local comprehensive plan by more than ninety days, is subject to imposition of the sanctions described in Section 163.3184(11)(a) by the Commission, as is a local government whose comprehensive plan fails to comply with the Act. Those sanctions include

   
   

   direct[ing] state agencies not to provide funds to increase the capacity of roads, bridges, or water and sewer systems within the boundaries of those local governmental entities. . .specify[ing] that the local government shall not be eligible for grants administered under the following programs:

   1. The Florida Small Cities Community Development Block Grant Program, as authorized by Sections 290.0401 - 290.049.

   2. The Florida Recreation Development Assistance Program, as authorized by Chapter 375.

   3. Revenue sharing pursuant to Sections 206.60, 210.20, and 218.61 and Part I of Chapter 212, to the extent not pledged to pay back bonds. Section 16:3.3184(11)(a), Florida Statutes.

   
   

8. The September 26, 1989, meeting of the Commission was the first time a request for sanctions for failure to submit timely plans came before the Commission for action. Before that time the Commission had adopted no rule or policy specifying which, if any, sanctions would be imposed for non-submission, or for submission of a plan not in compliance with the Act. The Commission took up the three cases of late submissions together. They involved the Town, the Village, and Indian Creek Village (which is not a party to this proceeding). They were agenda items 3, 4, and 5 for that meeting. Staff had recommended that the Commission withhold $191,012, or 44 percent of 1989-90 revenue sharing distributions due to the Town, because its plan was submitted on March 10, 1989

   -- 5.3 months late (see the additional findings made at Finding 54, below). Staff also recommended that the Commission withhold $92,344, or 60 percent of the Village's 1989-90 revenue sharing distributions, because its plan was submitted on February 6, 1989 -- 7.2 months late. Rather than impose sanctions, the Commission requested staff to recommend a policy for sanctions. After a discussion, Commissioner of Education Castor stated, "I'll make a motion, Governor, that we ask staff to come back with a policy." The motion was seconded by Treasurer Gallagher and passed unanimously. Draft policies were developed by staff.

   
   

   The Policies at Issue

   
   

9. The Administration Commission adopted a policy on October 24, 1989, describing the sanctions that would be imposed for late submission of local comprehensive plans (referred to as the "Non-Submission Policy"). It adopted a second policy on the sanctions to be imposed on local governments whose local comprehensive plans have been found not to be in compliance with the Act in an administrative hearing on the compliance issue (referred to as the "Non- Compliance Policy"). These matters were Commission agenda item number 6. Both policies, when referred to jointly, are the "Sanctions Policies". (League of Cities' Exhibit number 3). These policies state:

   1. POLICY FOR NONSUBMISSION CASES. Withhold 1/365 of the annual state/local revenue sharing program distribution for each day a local government fails to submit its

      proposed plan. The sanction would be calculated from the first day after the due date established by DCA Rule 9J-12, Florida Administrative Code, to the date the proposed local plan is actually submitted. Procedure: Under the Administration Commission Rule (Chapter 28-39, Florida Administrative Code), DCA notifies the Administration Commission within 45 days of a local government's failure to submit its plan by the due date. Within 30 days, a meeting is held by Commission staff with Department of Community Affairs and Regional Planning Council staff, and representatives of the local government. Fifteen days later DCA provides a recommendation to the Commission regarding sanctions. The Administration Commission may act to impose sanctions described above no sooner than 90 days after the local plan is due, but the sanctions are calculated from the due date established by DCA Rule 9J-12, Florida Administrative Code.

      EXCEPTION FOR LOCAL GOVERNMENTS THAT DID NOT HAVE ADVANCE NOTICE OF ADMINISTRATION

      COMMISSION POLICY. Upon the DCA's issuance of the Notice of Intent to find the plans IN COMPLIANCE or the Administration Commission's final determination that the plan is IN COMPLIANCE if a challenge to the DCA's Notice is filed with the Division of Administrative Hearings (DOAH) ("final agency action" in either case), DOR would return 90 days' withheld revenue.

      Procedure: The Administration Commission would authorize the automatic return of revenue upon DCA's notification to the Secretary of the Commission and the Department of Revenue (DOR) that a plan is IN COMPLIANCE. If the plans are found NOT IN COMPLIANCE by the Administration Commission, no withheld revenue would be returned and the Administration Commission would impose sanctions as described in 2.

      * * * *

   2. POLICY FOR NONCOMPLIANCE CAFES. A local plan will come under the jurisdiction of the Administration Commission if it is found NOT IN COMPLIANCE after a Division of Administrative Hearings (DOAH) hearing.

   If the DCA issues a Notice of Intent to find the plan NOT IN COMPLIANCE and the Commission ultimately determines that the

   plan is NOT IN COMPLIANCE, the Commission policy would be to withhold 1/365 of the annual state/local revenue sharing distribution for every day that the plan is out of compliance beginning with the date DCA issued its Notice of Intent to find the plan NOT IN COMPLIANCE until the date the local government has amended its plan to incorporate the remedial measures specified by the Administration Commission's Final Order and the DCA issues its Notice of Intent to find the amended plan IN COMPLIANCE.

   If the DCA issues its Notice of Intent to find a plan IN COMPLIANCE but the Commission ultimately determines that the plan is NOT IN COMPLIANCE, the Commission would specify in its final order remedial measures which must be incorporated into the plan by a specific date, and if the remedial measures were not incorporated by the specified date, the Commission would withhold 1/365 of the annual state/local revenue sharing distribution for every day that the plan is out of compliance beginning with the date the Commission entered its final order until the date the plan is amended to incorporate the remedial measures and the DCA issues its Notice of Intent to find the plan IN COMPLIANCE.

   Additional sanctions would also be considered by the Commission based upon the record in each case. The additional sanctions available under Section 163.3184(11), Florida Statutes, include ineligibility for all state expenditures to increase capacity of roads, bridges, and water and sewer systems within the local government's jurisdiction. (emphasis original)

   
   

   The additional factors the Commission may apply to mitigate or enhance the penalty under the final paragraph of the sanctions policy await case-by-case development.

   
   

10. At the October 24, 1989, meeting, Treasurer Gallagher moved as follows: "I think this policy recommendation is a good starting point to get that compliance, and I still think we need to review each case individually, so we can get a feel how this process operates, but I think this message in regards to how serious the Cabinet is in regards to compliance needs to be sent. Therefore I will move the policy." Secretary of State Smith seconded the motion, which carried unanimously. (League Exhibit 3 at 73, 88). The Gallagher motion not only adopted the policies, but re-affirmed the Commission's intention to engage in a case-by-case analysis of what sanctions are appropriate in each case.

11. At the very least, the Sanction Policies will be utilized by the Staff (both the Department of Community Affairs and the Office of Planning and Budgeting, Executive Office of the Governor) as a starting point in determining what sanctions should be applied to a local government which submits an untimely comprehensive plan or a plan found to be not in compliance with the Act.

    
    

12. Prior to the adoption of the Sanction Policies, the Commission did

    not:

    
    

    1. Provide notice in the manner required by Section 120.54, Florida

       Statutes, of its intent to adopt those policies.

       
       

    2. Provide or prepare a short and plain explanation of the purpose and effect of those policies.

       
       

    3. Prepare an economic impact statement concerning those policies.

       
       

    4. Provide prior written notice to any municipality or county of the adoption of those policies.

       
       

    5. Provide notice in the Florida Administrative Weekly of the proposed adoption of those policies.

       
       

    6. Follow any of the procedures outlined in Section 120.54, Florida Statutes.

    
    

13. Section 163.3167(2), Florida Statutes, requires all of the League's members to submit a complete proposed comprehensive plan under the schedule adopted in Rule 9J-12.006, Florida Administrative Code. The Administration Commission could impose sanctions on any League member who submits its plan more than 90 days late or submits a plan which fails to comply with the Act.

    
    

14. On October 24, 1989, when the "Non-Compliance Policy" was adopted, there were no cases seeking the imposition of sanctions against a local government whose timely local comprehensive plan had been found not to be in compliance with the Act, in an administrative hearing on the compliance issue. There were pending cases arising from the failure of cities such as the Town and the Village to submit timely plans.

    
    

15. On October 24, 1989, after the adoption of the "Non-Submission Policy," the Commission applied sanctions based on the policy, without variation, to the Town, the Village, and to Indian Creek Village. These actions were agenda items number 7, 8, and 9.

    
    

16. The policies adopted on October 24, 1989, are identified as general policies in the Commission's agenda for October 24, 1989, and in the minutes of the Commission for that meeting.

    
    

17. No further guidelines have been established by the Commission itself, by the Department of Community Affairs or by the Office of Planning and Budgeting, Executive Office of the Governor, describing the conditions under which the Commission will deviate from the Sanctions Policies when considering an individual case.

    
    

18. The Sanctions Policies were adopted, in part, to send a message to municipalities and counties about what would happen if they failed to submit plans or their plans are found not to be in compliance with the Act.

19. The Department of Community Affairs has communicated the Sanctions Policies to all the municipalities and counties by a technical memorandum, which was distributed to all municipalities and-counties. (League Exhibit number 11).

    
    

20. That memorandum states that these policies will be applied to local governments which submitted untimely plans, or plans determined not to comply with the Act. No notice or guidance is contained in these communications about the criteria the Commission might use to deviate from the policies. In December, 1989, the Department sent a letter to all municipalities and counties that were late in submitting their local comprehensive plans, advising them of the sanctions policies.

    
    

21. Section 163.3184(11)(a)3., Florida Statutes, authorizes the Commission to order that the local government be ineligible to receive revenue sharing funds.

    
    

22. Prior to October 24, 1989, the Administration Commission had adopted no policy or rule announcing its interpretation of when sanctions for late submission or non- compliance would begin to run.

    
    

23. Under the "Non-Submission Policy" sanctions begin to run from the first day after the due date established by Rule 9J-12, Florida Administrative Code. No sanctions are imposed, however, if the plan is fewer than 90 days late.

    
    

24. Under the "Non-Compliance Policy", fines begin to run from the date the Department issues a notice of intent to find the plan not in compliance with the Act.

    
    

    The Effect of the Policies Generally

    
    

25. For cities, the term "state/local revenue sharing" as used in the Sanctions Policies includes:

    
    

    1. 1/2-cent sales tax

       
       

    2. 11-cent cigarette tax

       
       

    3. Gas tax imposed pursuant to Section 206.605, Florida Statutes.

    4. 2-cent cigarette tax

    
    

26. The single occasion the Non-Submission Policy has been applied was on October 24, 1989, and the only counties or cities penalized have been the Town, the Village, and Indian Creek Village. As of the date of final hearing in this case, the "Non-Compliance Policy" had never been applied to any local government.

    
    

27. Estimated statewide state/local municipal revenue sharing distributions to all municipalities within the state for the 1989-1990 fiscal year are $477,107,879. (A breakdown for individual municipalities is found in League Exhibits number 12, Local Government Financial Handbook at 14-29, tables a, b, c, and 105- 111).

28. The actual amount of state/local revenue distributed statewide for the 1988-1989 fiscal year was $471,641,735, as reported by Department of Revenue to the Comptroller for publication in the Florida Comprehensive Annual Financial Report. The breakout for individual cities is found in League Exhibit number 14.

    
    

29. For the state as a whole, municipal revenue sharing constitutes between 13 percent and 15 percent of municipal governmental revenues.

    
    

30. For the state as a whole, 34 percent of municipal governmental expenditures are used to fund police and fire protection.

    
    

31. Section 163.3184(11) authorizes sanctions for failure to submit a local comprehensive clan or for failure to submit a plan which complies with the Act, and permits the revenues in question to be cut off in the middle of a fiscal year, when a municipality is unable to raise ad valorem taxes.

    
    

32. There are a limited number of other sources available to a municipality which may be used as general governmental revenue.

    
    

33. Litigation over whether a local comprehensive plan complies with the Act can take a significant amount of time. For example, a notice of intent to find Charlotte County's local comprehensive plan not in compliance was issued by the Department on February 9, 1989. The case was heard, a Recommended Order issued, and the matter was set to go before the Administration Commission on January 24, 1990. The Hearing Officer found the plan not to be in compliance with the Act. The Department has recommended that no monetary sanctions be imposed can the county, but that the county take a number of specific actions to amend the comprehensive plan.

    
    

34. As another example, administrative litigation over the comprehensive plan submitted by City of Cocoa took approximately 10 months from the time a notice of compliance was issued by the Department, until it was determined that the plan actually was not in compliance, and the Recommended Order came before the Administration Commission for sanctions.

    
    

35. It is reasonable to assume that from the time that the Department issues a notice of intent to find a comprehensive plan not in compliance with the Act until the time the plan comes before the Administration Commission will be at least six months, and perhaps longer.

    
    

36. The potential loss of revenue sharing for a period of six or more months would have a substantial effect on a municipality's budget.

    
    

37. The potential loss of revenue for a period of six or more months is a substantial disincentive to a municipality's willingness to pursue a hearing and challenge the Department's determination when the Department issues a notice finding a local comprehensive plan not in compliance with the Act.

    
    

    Pembroke Park's Compliance Efforts

    
    

38. In 1987, the Town initiated its efforts to prepare a local comprehensive plan pursuant to the Act to guide the future development of the Town. 2/ The Town is approximately 97 percent built out and contains approximately 30 acres of vacant land available for development. The Town initially contracted with the South Florida Regional Planning Council ("the Council") to develop Phase 1 of a plan for the Town. The Council forwarded the

    first part of a revised comprehensive plan in February, 1988, to the Department. The Town's Mayor and some members of the Pembroke Park Town Commission had questions about parts of that plan, and believed, at the time, that it would be more efficient to have an in-house person prepare the rest of the Town's plan.

    In March 1988, the Pembroke Park Town Commission formally decided that the Town should not use the Council to complete preparation of its local comprehensive plan. Milan Knor, a professional engineer who served as the Town's Director of Operations, was awarded a contract to prepare the remainder of the plan.

    
    

39. Under the provisions of Rule 9J-12.006(4), Florida Administration Code, the Town's proposed comprehensive plan was due to be submitted to the Department on or about October 1, 1988.

    
    

40. Mr. Knor did not forward a proposed comprehensive plan to the Department until December 28, 1988. The Department received this document on or about January 9, 1989.

    
    

41. On January 17, 1989, the Department sent a letter to the Mayor of the Town acknowledging receipt of the Town's proposed comprehensive plan, and noting that the plan documentation was missing certain plan elements. This letter also stated that a complete plan was to be submitted by the Town to the Department by January 31, 1989.

    
    

42. That same day, the Department filed a Notice of Non-submission of Proposed Comprehensive Plan with the Commission, because the Town had failed to comply with the submission schedule for its proposed comprehensive plan.

    
    

43. On January 23, 1989, the Commission sent a letter to the Mayor of the Town acknowledging a) receipt of the Department's notice that the Town had failed to meet the schedule set for submission of its local comprehensive plan by more than 90 days, and b) that the Department had requested the Commission to impose sanctions on the Town. That letter from the Commission required the Town to submit an explanation of why it did not submit a timely plan. It also informed the Town that within 15 days of receipt of the explanation, a meeting would be held which would operate as an informal proceeding under Section 120.57(2), Florida Statutes, unless the Town's explanation showed that the plan was not late. A recommendation on sanctions would be made to the Commission within 20 days following the meeting.

    
    

44. On or about January 27, 1989, the Town forwarded a revised plan, including the various elements requested by the Department on January 17, 1989. On or about February 8, 1989, the Department notified the Town that the plan was substantially complete, but that four additional pieces of information were needed, as well as a resolution from the Town Commission formally transmitting the plan to the Department.

    
    

45. On March 9, 1989, the Town submitted the additional information requested to the Department along with a resolution formally transmitting the material. The Department regards March 9, 1989, as the date the Town submitted its complete plan.

    
    

46. In June of 1989, the Department notified the Town that it had completed its review of the proposed comprehensive plan and enclosed the Department's objections, recommendations, and comments ("ORC") concerning the Town's comprehensive plan.

47. On July 14, 1989, Beth Lines, Policy Coordinator for the Office of Planning and Budgeting and member of the Commission staff, sent a letter to the Mayor of the Town confirming July 19, 1989, as the date the meeting would be held to discuss the issues raised in the Notice of Non-Submission filed by the Department. This letter did not repeat the notice given in the letter of January 23, 1989, that this meeting would constitute a Section 120.57(2), Florida Statute, informal hearing or that the Town had to request an evidentiary hearing to consider disputed factual issues at that time, or forever waive its right to do so in the future.

    
    

48. The Town submitted a chronology to the Department on July 27, 1989, containing the Town's explanation of why its plan was late.

    
    

49. On August 3, 1989, Thomas Pelham, Secretary of the Department, recommended that the Commission impose sanctions on the Town for failing to submit its proposed comprehensive plan within 90 days of the scheduled due date. Secretary Pelham's recommendation considered both the written explanation the Town had submitted and comments which had been made during the July 19, 1989, meeting with Town officials, but he found no good reason for the Town's failure to submit a timely plan.

    
    

    Adoption of Rule 28-39.006

    
    

50. On August 7, 1989, Rule 28-39.006, Florida Administrative Code, became effective. The new rule set out the procedure that would be followed whenever a local government fails to meet its scheduled deadline for submission of its comprehensive plan. Before that time, no rule had been promulgated describing the procedure the Commission would follow in dealing with a local government's failure to meet the deadlines for submission of its comprehensive plan.

    
    

    Further Administrative Steps Against the Town

    
    

51. In September, 1989, Patricia Woodworth, Secretary/Clerk to the Commission, submitted a proposed final order to the Commission containing a finding that the Town's proposed comprehensive plan was not timely submitted and requesting the Commission to withhold state/local revenue-sharing funds from the Town.

    
    

52. On September 18, 1989, the Town submitted to the Department its response to the Department's objections, recommendations and comments on the Town's comprehensive plan. (See Finding 46, above). In that response, the Town expressed its desire for continued Department participation since Town's goal was to have its comprehensive plan deemed to be "in compliance" with Chapter 163, Part II, Florida Statutes, and Rule 9J-5, Florida Administrative Code.

    
    

53. On September 19, 1989, in response to the Commission's proposed final order (see Finding 51, above), Frank Matthews, acting as counsel for the Town, submitted to the Commission staff a different proposed final order regarding the Town's failure to timely submit its proposed local government comprehensive plan.

    
    

54. On September 26, 1989, the Commission considered, but did not adopt, Woodworth's proposed final order. Representatives of the Town appeared at that meeting and objected to the proposed order and the sanctions it recommended. The Commission heard argument on the sanctions issue from the Town's attorney, Mr. Matthews, a Town Commissioner, a representative from the Florida Audubon

    Society and from Secretary Pelham. The Town argued that its plan was submitted only 9 days after what it characterized as the "90-day statutory grace period" granted to local governments in Section 163.3167(2), and explained why it believed monetary sanctions were inappropriate; the representative of the Audubon Society argued that the statute gave no grace period to local governments whose plans were more than 90 days late; Secretary Pelham explained why he believed monetary sanctions were warranted. The Commission deferred action and instead directed its staff to prepare a policy for the Commission to apply in cases where local governments fail to timely submit proposed comprehensive plans. (See Finding 8, above).

    
    

55. On September 29, 1989, Frank Matthews, acting as counsel for the Town, sent a letter to Ms. Woodworth, Secretary/Clerk to the Commission, asserting that the Town had not been provided a clear point of entry into the administrative process to contest any proposed final agency action which could adversely affect the Town's substantial interests. The letter recited the Town's understanding that any final agency action occurring in the future would be properly noticed, and that the Town would have 14 days to avail itself of administrative remedies under to Section 120.57, Florida Statutes. On that same date, Mr. Matthews sent a letter to Beth Lines, a member of the Commission staff, asking that the Town be notified of any working groups or meetings held to develop or discuss the sanctions policy, so the Town could participate. Both of these letters were never answered.

    
    

56. On October 10, 1989, the Mayor of the Town sent a letter to Paul Bradshaw of the Department stating that the Department was not using the correct mailing address for all correspondence to the Mayor's office. Consequently, the Mayor expressed concern that certain past correspondence, such as the October 7, 1988, letter from the Department, had never reached his office. The letters were properly addressed; the letters were delivered to the Town. The mayor's implication to the contrary is rejected by the Hearing Officer.

    
    

57. On October 18, 1989, the Town finally adopted its local comprehensive plan, including land development regulations, and hand-delivered these materials to the Department.

    
    

58. On October 24, 1989, when the Commission adopted the sanctions policy for late submissions of comprehensive plans, it heard once again from interested parties before deciding whether to accept the recommendations of the Department and Commission staff on a sanctions policy. A representative of the League of Cities spoke, along with counsel for the Town and a representative of the Department.

    
    

59. On October 24, 1989, approximately one hour after adopting the Non- Submission and Non-Compliance sanctions policies, the Commission considered for the second time the Department's recommendation on imposition of sanctions on the Town. The Commission applied its Non-Submission Policy, and ordered that

    $190,299 in state revenue sharing funds withheld, an amount equal to 160/365 of those funds. The 160 numerator represents the number of days the Commission found the Town was late in submitting its proposed comprehensive plan. The Town was provided the opportunity to recover 90/365 of the amount withheld (approximately $107,043) if and when the Department found the plan adopted by the Town (see Finding 57) to be in compliance with the Act and Rule 9J-5, Florida Administrative Code.

60. On November 6, 1989, the Town of Pembroke Park received a copy of the executed Final Order, No. AC89-3 dated November 1, 1989. This order embodies the sanctions the Commission imposed on October 24, 1989.

    
    

    The Rule Challenge

    
    

61. On November 14, 1989, The Florida League of Cities, Inc., filed a petition pursuant to Section 120.56, Florida Statutes, requesting a determination of the validity of both Rule 28-39.006(3), Florida Administrative Code, and the Sanctions Policies adopted by the Commission on October 24, 1989. This petition was filed with the Division of Administrative Hearings ("DOAH"). On November 17, 1989, the Town filed its Motion to Intervene, and requested party status in that rule challenge proceeding. Additionally, the Town moved to consolidate with the rule challenge a separate petition it filed with the Commission on November 14, 1989, for a Section 120.57(1), Florida Statutes, administrative hearing, challenging the sanctions which the Commission had imposed.

    
    

62. On November 30, 1989, the Hearing Officer granted the Town's motion to intervene, but declined to consolidate the rule challenge with the Town's petition for a Section 120.57(1), Florida Statutes, administrative hearing. The Commission had not yet determined whether the petition for a formal hearing would be granted; as a result it had not referred the matter to DOAH. Consequently, there was then no other proceeding pending at DOAH to be consolidated with the rule challenge.

    
    

63. Similarly, on December 1, 1989, the Village of Virginia Gardens filed its motion to intervene in the rule challenge proceeding. The motion was granted on December 5, 1989.

    
    

64. Finally, on December 4, 1989, the Town received a copy of the Commission's proposed order denying its Petition for Formal Administrative Hearing on the sanctions which had been imposed. On December 5, 1989, the Town filed a response to that proposed order, and argued that the Commission never gave it a clear point of entry into the administrative process. The Commission disagreed, and on December 8, 1989, denied the Town's request for a formal hearing. The Commission found the Town had a clear point of entry based on its January 23, 1989, letter to the Town (see Finding 43, above), and that the Town waived its right to a formal hearing by participating in the proceedings before the Commission on September 26 and October 24, 1989, without requesting a formal hearing.

    
    

65. On December 6, 1989, the Town was notified that its adopted local government comprehensive plan complied with the requirements of Chapter 163, Florida Statutes. As a result of the Department's finding of compliance, the state monies to be withheld from the Town pursuant to the Commission's order were reduced to $83,255 (see Finding 59, above).

    
    

66. On December 8, 1989, the Commission entered its final order denying the Town's request for a formal hearing. Consequently, on January 4, 1990, the Town filed a Notice of Appeal with the District Court of Appeal, First District, appealing the denial of its petition for a Section 120.57(1) hearing.

    
    

    CONCLUSIONS OF LAW

    
    

67. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties in this proceeding. Section 120.56, Florida

    Statutes. The constitutionality of the Act and its sanctions provisions will have to be determined by the appellate court, however. For purposes of this final order, they are presumed to be constitutional.

    
    

68. The League has standing to bring this proceeding. Intervenors, the Town of Pembroke and the Village of Virginia Gardens, have standing to intervene in this proceeding as full parties.

    
    

69. The Department of Community Affairs has standing to intervene in the instant case as a full party.

    
    

70. The "Sanctions Policies" were not adopted in accordance with the procedures enumerated in Section 120.54, Florida Statutes.

    
    

71. It is important to note issues which cannot be raised in this Section

    1. rule challenge proceeding. Although the Commission has imposed sanctions against the Town and the Village, those are separate Final Orders, arising from substantial interest proceedings under Section 120.57, Florida Statutes. Both the Town and the Village have appealed those Final Orders to the First District Court of Appeal. This rule challenge proceeding cannot serve as a collateral attack upon the sanctions imposed by the Commission in those substantial interest cases.

       
       

       The Sanctions Policies as Rules

       
       

72. The Petitioners argue that the sanctions policies have or were intended to have general applicability, affect the rights of all local governments, and constitute rules as defined in Section 120.52(16), Florida Statutes, which are invalid because they were not adopted in a rule-making proceeding. The Commission denies that the sanctions policies are statements of general applicability, because the non-submission policy has only been applied once, on October 24, 1989, and the non-compliance policy has never been applied to any local government. The Commission believes this is significant because the text of Section 120.52(16), Florida Statutes, defines the term "rule" as follows:

    
    

    [E]ach agency statement of general applicability that implements, interprets, or prescribes law or policy . . . (emphasis added).

    
    

73. To determine whether an agency policy constitutes an invalid rule it is necessary to consider the judicial gloss placed on the statute's term "general applicability". Not every statement made by an agency which declares its policy or interprets or implements a statute or a duly adopted rule is itself a rule. The courts invalidate agency policies as general ones which have not been adopted as rules only where they "are intended by their own effect to create rights, or to require compliance, or otherwise to have the direct and consistent effect of law". McDonald V. Department of Banking and Finance, 346 So.2d 569, 581, 585-86 (Fla. 1st DCA 1977) (invalidating a policy prohibiting a new bank from using the term "First" in its name). See also, State, Department of Administration v. Harvey, 356 So.2d 323 (Fla. 1st DCA 1977); State, Department of Administration v. Stevens, 344 So.2d 290, 296 (Fla. 1st DCA 1977).

    
    

74. In Hill v. School Board of Leon County, 351 So.2d 732 (Fla. 1st DCA 1977) cert. den., 359 So.2d 1215 (Fla. 1978), the School Board had discontinued

    its practice of providing free bus transportation for students who lived within two miles of their school. Under Section 234.01, Florida Statutes (1975), and Rule 6A-3.01(3), Florida Administrative Code, transportation at public expense was not required, but the Board nonetheless had provided it for those students who would be required to travel dangerous streets to get to school. The appellate court found that discontinuing this optional bus service would have been an appropriate topic for rule-making, but that the board did not have to enact a rule in order to discontinue or initiate that bus service. The change in the School Board's policy did not constitute a statement which was intended by its "own effect to create rights or to require compliance, or otherwise to have the direct and consistent effect of law." Hill at 733. The court decided to "withhold judicial imperatives and leave affected parties to initiate rulemaking under Section 120.54(5) or to request proceedings under Section 120.57." Id. It refused the parents' request to require the Board to reinstitute the optional transportation until the adoption of a rule specifically terminating the optional school bussing. Courts generally refuse to invalidate policies which do not rise to the level of "general applicability" as defined in McDonald and Stevens because other decisions require the agencies to shoulder the burden to prove "the accuracy of every factual premise and the rationality of every policy choice which is identifiable and reasonably debatable" in Section 120.57 proceedings whenever the agencies attempt to actually apply these less pre-emptive non-rule policies to some citizen.

    Anheuser-Busch, Inc. v. Department of Business Regulation, 393 So.2d 1171, 1182 (Fla. 1st DCA 1981). See also, Florida Cities Water Company v. Florida Public Service Commission, 384 So.2d 1280 (Fla. 1980); McCain Sales of Florida, Inc.,

    400 So.2d 1301 (Fla. 1st DCA 1981); Amos v. Department of Health and Rehabilitative Services, 444 So.2d 43 (Fla. 1st DCA 1983); Florida Public Service Commission v. Indiantown Telephone System, Inc., 435 So.2d 892 (Fla. 1st DCA 1983).

    
    

75. Following its opinion in Hill, the First District began to refer to administrative challenges to agency policies which did not impose requirements or create rights and had not been adopted through formal rule-making as "marginal cases", Department of Corrections v. McCain Sales of Florida, Inc.,

    400 So.2d 1301 (Fla. 1st DCA 1981) (rejecting a challenge to the Department's program of manufacturing metal signs), or as "marginal rule challenges," Department of Highway Safety and Motor Vehicles v. Florida Police Benevolent Association, 400 So.2d 1302, 1303 (Fla. 1st DCA) pet. for rev. den., 408 So.2d 1093 (Fla. 1981) (rejecting a challenge to Highway Patrol guidelines for physical fitness as invalid rules because they were subject to discretion, and not self-executing). In a variation of the judicial principle of non- interference announced in Hill, the Court of Appeals denied a petition to initiate rule-making in Phillips v. Department of Corrections, 472 So.2d 1307 (Fla. 1st DCA 1985). The issue was whether the Department of Corrections was required to adopt rules to define what the appellant characterized as "critical operative phrases" in a statute which would permit certain prisoners serving life sentences to have their sentences converted to a term of years. The Court of Appeals authorized the Department to proceed on a case-by-case basis, and to interpret the statute in Section 120.57 substantial interest proceedings rather than through rule- making. The court apparently regarded the statute as the source of any rights, rather than the Department's actions or interpretations.

    
    

76. In contrast, courts have been vigilant to impose, rather than withhold judicial imperatives, and invalidate agency policies which had not been adopted by the rulemaking procedures described in Section 120.54, Florida Statutes, when policies create rights, require compliance, or otherwise have the direct and consistent effect of law. McDonald v. Department of Banking and Finance, supra;

    State Department of Administration v. Stevens, 344 So.2d 290, 296 (Fla. 1st DCA 1977) (invalidating "bumping" lay-off guidelines which would allow a career service employee to displace another employee, because those guidelines created rights, adversely affected some employees and required implementation by subordinates with little or no room for discretionary modification); Florida State University v. Dann, 400 So.2d 1304 (Fla. 1st DCA 1981) (invalidating a procedure established by the University for awarding merit salary and other pay increases because the procedure had not been adopted as a rule, and was so specific as to be virtually self-executing); Gar-Con Development, Inc. v.

    Department of Environmental Regulation, 468 So.2d 413 (Fla. 1st DCA 1985) pet. for rev. den., 479 So.2d 117 (Fla. 1985) (invalidating a policy which treated pile driving as "dredging" or "filling" which required a permit; the policy was inconsistent with definitions in validly adopted rules, and had the direct effect of prohibiting pile driving in Class II waters); Balsam v. Department of Health and Rehabilitative Services, 452 So.2d 976 (Fla. 1st DCA 1984) (invalidating a moratorium on receipt of certificate of need applications when moratorium met the judicial interpretation of a policy of general applicability announced in Stevens and Harvey, even though it operated for a limited time); McCarthy v. Department of Insurance, 479 So.2d 135 (Fla. 2d DCA 1985) dismissed,

    485 So.2d 832 (Fla. 1986) (invalidating education and experience requirements for eligibility to take a safety inspector's exam which were not adopted by rule; they were categoric requirements which operated as prerequisites for examination); Department of Transportation v. Blackhawk Quarry Co., 528 So.2d

    447 (Fla. 5th DCA) rev. den., 536 So.2d 243 (Fla. 1988) (invalidating a standard operating procedure setting quality control standards for limerock production which could be used in state road contracts; the procedure determined entitlement to participate in projects and had a direct and immediate effect on limerock suppliers).

    
    

77. The First District Court of Appeal has been consistent in applying this analysis in Section 126.57(1) substantial interest cases. See, e.g., Home Health Professional Services, Inc. v. Department of Health and Rehabilitative Services, 463 So.2d 345 (Fla. 1st DCA 1985) where the court declined to invalidate an agency interpretation of a statutory term because that interpretation had not been adopted by rule. Home Health Professional Services, Inc. was a Section 120.57 substantial interest proceeding, arising from the denial of a request by Home Health Professional Services to expand its operations into additional counties; it was not a Section 120.56 challenge to an existing or a "marginal rule", i.e., a non-rule policy. The court upheld the denial of expansion because the record made by the agency in the Section 120.57 proceeding supported the agency's policy, and the applicant offered no evidence to dispute the policy. Similarly, in Gulf Coast Home Health Agency v. Department of Health and Rehabilitative Services, 513 So.2d 704 (Fla. 1st DCA 1987) the court authorized the Department to develop a need methodology for home health agencies in Section 120.57(1) substantial interest cases, and refused to permit an action seeking to enforce a declaration of the invalidity of a prior department rule which had promulgated a need methodology. A similar situation was presented in St. Francis Hospital v. Department of HRS, So.2d , 15 FLW D21 (Fla. 1st DCA 1989). The agency had refused to accept applications for certificates of need which were inconsistent with the applicant's earlier letter of intent to apply for a certificate, because the project costs had changed.

    The policy had been invalidated in a Section 120.56, Florida Statutes, proceeding, and no appeal was taken from that final order. In a substantial interest proceeding under Section 120.57(1), the agency demonstrated that its rejection policy was within the permissible range of statutory interpretation, but then failed to show a rational basis for the policy. The policy was

    invalidated, and the agency was required to consider the application. In its decision the appellate court said:

    
    

    We recognize that an agency interpretation of a statute which simply reiterates the legislature's statutory mandate and does not place upon the statute an interpretation that is not readily apparent from its literal reading, nor in and of itself purport to create rights, or require compliance, or to otherwise have the direct and consistent effect of the law, is not an unpromulgated rule, and actions based upon such an interpretation are permissible without requiring an agency to go through rule-making. However, in this case, HRS' policy does not simply reiterate a legislative mandate and is not readily apparent from a literal reading of the statutes involved and thus, HRS was required to show the reasonableness and factual accuracy of its policy. Having failed to support its policy in the proceedings below, HRS is required to accept for review St.

    Francis' CON application in the applicable batching cycle. 15 F.L.W. at 22-23.

    
    

78. The most recent analysis from the court of appeals on the validity of non-rule policy is found in Florida Public Service Commission v. Central Corp.,

    551 So.2d 568 (Fla. 1st DCA 1989), in which the court invalidated a policy of the Public Service Commission embodied in an order, but which had not been formally adopted as a rule. In March, 1988, that Commission had voted to require that long distance companies which provided alternative operator services hold, subject to refund, revenues they collected which exceeded comparable rates collected by local exchange carriers. This order was entered in April, 1988. The Commission denied Central Corporation's request to hold an evidentiary hearing on the policy before the requirement to hold money subject to refund went into effect. The court found that the Commission's action was not part of a proceeding for a change of rates, but an action taken in anticipation of a future decision on whether alternative operator services were in the public interest. In a Section 120.56 rule challenge to the segregation order filed by Central Corporation, the Hearing Officer had found that the interim rate order was one of general applicability, because it applied to all alternative operator services, and imposed an immediate requirement not otherwise required by statute or existing rule. The providers had to take immediate action to meet their potential liability for a refund of part of their collections. Because the Commission had not followed the rule-making provisions of Section 120.54, or provided a Section 120.57, Florida Statutes, substantial interest proceeding to the affected carriers, there was no record to review in determining whether the Commission's action was appropriate. The policy expressed in the "hold subject to refund" order was therefore invalidated. The decision in Central Corporation is consistent with the court's earlier decision such as the McDonald, Harvey, Stevens, Hill and Dann cases, because it focuses on whether the agency policy requires some immediate action which has the consistent effect of law. Here, the policy of the Administration Commission does not, in itself, require action by a local government; the Act, and Rule 9J-

    12 of the Department of Community Affairs are the substantive law which mandate

    the filing of a complete plan, set the date when the plan must be filed, and authorize specific penalties for local governments which fail to comply with the Act. The matters prescribed in the Commission's policy, viz. the day sanctions will begin to run, the formula to be used in computing sanctions, the specific monies to be withheld, are all matters which the case law indicates may be developed on a case-by-case basis in Section 120.57 substantial interest proceedings.

    
    

79. The opinion in Central Corporation emphasized that neither rule- making, nor an adjudication had occurred in that case. The challengers here maintain that the Commission likewise failed to engage in either rule-making or Section 120.57 hearings, for no formal hearing was held at the request of the Town. The Town was, however, provided the Notice of Non- Submission which the Department filed with the Commission (Finding 42), and was offered a 120.57(2) proceeding in the form of a meeting with staff of the Administration Commission, the Department, and the regional planning council to discuss the issues raised in the Notice of Non-Submission (Findings 43 and 47). The Town has never contended that its plan was timely filed. After that meeting, Secretary Pelham discussed in a recommendation to the Commission the matters raised by representatives of the Town at the conference, as well as the written response to late submission which the Town had filed (see Finding 49 and Town's Exhibit 13). The Town received a copy of the proposed final order before the September 26, 1989, meeting of the Commission (Finding 51) and even submitted its own form of a proposed final order on the sanctions issue (Finding 53). Representatives of the Town appeared before the Commission at both the September 26, 1989, and October 24, 1989, Commission meetings to address the sanctions policy both in general, and as applied to the Town (Findings 54 and 58). The Town has had a full opportunity to present its position on the sanctions issue, and has received what would appear to be a Section 120.57(2) informal hearing on the sanctions policy, which has included the opportunity for face-to-face discussion of the issues. Village Saloon v. Division of Alcoholic Beverages, 463 So.2d 278, 285 (Fla. 1st DCA 1985) (on rehearing); E.M. Watkins and Company v. Board of Regents, 414 So.2d 583 (Fla. 1st DCA), pet. for rev. den 421 So.2d 67 (Fla. 1982). The explication of agency policy may be done in a 120.57(2) informal proceeding. E.M. Watkins & Co., supra at 588. This makes this case different than the Central Corporation case. In any event, whether the Administration Commission erred in failing to provide a Section 120.57(1) hearing or an adequate Section 120.57(2) proceeding to the Town or the Village are matters which are presently pending before the District Court of Appeal. Any error may be corrected on judicial review of the sanctions order, if appropriate.

    
    

80. The Commission has indicated its intention to use the Sanctions Policies as guidelines and consider each case on its merits (Finding 10). An agency has the statutory authority to deviate from "officially stated agency policy or a prior agency practice" if the deviation is explained by the agency. Section 120.68(12)(c), Florida Statutes; General Telephone Co. v. Florida Public Service Commission, 446 So.2d 1063, 1070 (Fla. 1984). Guidelines which impose no duties and which leave room for discretion are not rules. Dept. of Highway Safety v. Florida Police Benevolent Ass'n., 400 So.2d 1302 (Fla. 1st DCA), pet. for rev. den, 408 So.2d 1093 (Fla. 1981). Contrary to the argument of the Town, the Sanctions Policies are not "dogmatic and unbending" (Proposed Conclusions of Law at 31). While the policies of the Commission could be appropriate subjects of rule- making, they are not the type of policies which must be adopted by rule in order to be applied.

    "In Terrorem" Effect of the Policies

    
    

81. The Petitioners emphasize that the Sanctions Policies result in sanctions so onerous as to act as a substantial disincentive to a local government's willingness to pursue a hearing on the issue of non-compliance (Finding 37). This may be true, but the penalties are generally within the range authorized by the Legislature. They do not independently have the type of immediate effect that would make the policies illicit under the standards in the McDonald, Hill, Dann, or Central Corporation cases; the effect arises from Sections 163.3167(2) and 163.3184(11)(a), Florida Statutes. The designation of the policies as "general" ones in the Commission's agenda or minutes lacks legal significance. The independent effect of the policies, not their characterization, controls.

    
    

    The Specificity of the Policies

    
    

82. The League argues that the Sanctions Policies cannot be regarded as incipient or emerging under the decision in McDonald v. Department of Banking and Finance, 346 So.2d 569 (Fla. 1st DCA 1977), because they have solidified to the point where they were reduced to writings and formally adopted by the Commission. This argument is not well taken. Were the policies so inchoate that they had not been reduced to writing, they could not be challenged at all under Section 120.56, Florida Statutes. Department of Corrections v. McCain Sales of Florida, Inc., 400 So.2d 1301 (Fla. 1st DCA 1981). Merely reducing the policy to writing does not, in itself, mean that the policy is neither incipient nor emerging. The motion made by Treasurer Gallagher emphasized that the Commission intends to review each Notice of Non-Submission or Non-Compliance carefully, and to evaluate each case individually. The fact-specific discussion of sanctions forwarded to the Commission by Secretary Pelham on the Town is an example of this individualized analysis. It is not fatal that the Sanctions Policies do not contain, in their text, the standards to be used in deviating from the policy. It is the nature of case-by-case adjudication that all situations which would support a deviation cannot be known in advance. The failure to announce standards actually weighs in the favor of the local governments because they are entitled to offer any reason they believe appropriate for mitigating the penalties; the absence of standards does not bar them from making any argument appropriate to their individual circumstance. The absence of these deviation factors does not render the policies invalid under Section 120.52(8)(d), Florida Statutes.

    
    

    Challenges to the Substantive Validity of the Policies

    
    

83. The Petitioners attack the non-compliance policy as an invalid exercise of delegated legislative authority as defined in Section 120.52(8)(c), Florida Statutes, because they believe the policy enlarges, modifies, or contravenes a specific provision of law implemented. They specifically attack the decision that sanctions begin with the date the plan is due or the date the Department issues a notice that a timely plan is not in compliance. Section 163.3167(2), Florida Statutes states in pertinent part:

    
    

    [A]ny county or municipality that fails to meet the schedule set for submission of its proposed comprehensive plan by more than 90 days shall be subject to the sanctions described in section 163.3184(11)(a) imposed by the Administration Commission.

    According to the Petitioners, the text of Section 163.3184 reveals a legislative intention to impose no sanctions unless and until a local government refuses to complete remedial actions specified by the Commission pursuant to Section 163.3184(11), Florida Statutes. In making this argument, the Petitioners rely heavily on Section 163.3184(10)(a), Florida statutes, which states:

    
    

    If the state land planning agency [the Department] issues a notice of intent to find the comprehensive plan or plan amendment not in compliance with this act, the notice of intent shall be forwarded to the Division of Administrative Hearings of the Department of Administration, which shall conduct a proceeding under Section

    1. in the affected local jurisdiction. In the proceeding, the local government's determination that the comprehensive plan or plan amendment is in compliance is presumed to be correct. The local government's determination shall be sustained unless it is shown by a preponderance of the evidence that the comprehensive plan or plan amendment is not in compliance. The local government's determination that elements of the plan are related to and consistent with each other shall be sustained if the determination is fairly debatable. Section 381.484(10)(a), Florida Statutes.

    
    

    The Petitioners infer from this statutory provision a legislative directive to impose no sanctions until the plan, which was adopted by locally-elected government officials, has been finally determined to be out of compliance by the Commission, who are state-wide elected officials. According to the Petitioners, the action of a mere bureaucrat, such as the Secretary of the Department who enjoys only gubernatorial appointment and senatorial confirmation, is insufficient to override or displace the decision of locally-elected officials that their plan meets their duties under the Act. This argument is not well taken. The provisions of Section 163.3184(10)(a) are legislative allocations of the burden of going forward, and burden of proof in Section 120.57(1) administrative hearings on compliance. They simply have no bearing on the question of sanctions. The final order entered by the Commission in the non- compliance proceeding under Section 163.3184(11)(a) determines whether the local comprehensive plan comported with the Act as of the time it was filed with the Department for review. Although a final order of the Commission declares whether the comprehensive plan complies with the Act, that determination relates back to the time the plan was filed. Section 163.3184(10)(a), Florida

    Statutes. Nothing happens after the filing of the plan which has an effect on that determination of ultimate fact. The plan complied with the Act when it was filed or it did not. The legislative purpose of the sanctions provision is to withhold state monies from local governments which fail to do appropriate planning, or which fail to carry out their plans. It is rational for the state to refuse to fund with state monies infrastructure in local communities which have failed to engage in acceptable planning for future development and growth. To interpret the Act in the manner the Petitioners suggest would effectively require the state to make significant contributions in the form of revenue sharing dollars to local governments which fail to submit plans when due or which submit plans which fail to comply with the Act. There is no reason for

    the state to subsidize local governments which have failed to take seriously their growth management responsibilities and develop in a timely manner plans which comport with the Act. (See League Exhibit 1, at 121). With respect to governments which submit plans more than 90 days later, there is no language in Section 163.3167(2) which absolves them from sanctions for the first 90 days they are late, if the lateness persists past 90 days. The Commission's sanctions policy is consistent with the legislative purpose of requiring timely submission of plans, and does not impermissibly add sanctions.

    
    

84. Neither are the Sanctions Policies invalid on the ground that statutory sanctions are permissive, but the policies presume sanctions will be applied. A guideline which presumes that sanctions will be applied unless some reason to the contrary is shown is rational. There are probably very few, if any, valid excuses for failing to file a plan within 90 days of its due date. Because no cases have attempted to impose sanctions in a non-compliance situation, it is not possible to tell whether the general presumption in favor of sanctions is actually over- inclusive, but the policy appears to be rational. There is no reason to doubt that the Commission will require a government to bring its plan into compliance with the Act. That duty is statutory, so there is no need for the Commission to repeat it in its policy.

    
    

85. Moreover, the statute itself prescribes remedial measures for local governments which fail to submit plans. The regional planning council steps in as if it where the local government, prepares a plan, submits it to the Department, and it is adopted by the regional planning council for the defaulting government. Section 163.3167(3), Florida Statutes.

    
    

86. The argument that the sanctions may only be imposed after the local government has the opportunity to bring its plan into compliance by adopting the remedial measures prescribed by the commission is inconsistent with the text of Section 163.3184(11)(a), Florida Statutes. The statutory language appears to contemplate a single order which not only determines whether the plan complies with the Act, but also prescribes remedial steps and imposes sanctions. The relevant portion of the text reads

    
    

    [t)he commission order may also specify that the local government shall not be eligible for grants administered under [specified] programs .... (emphasis supplied)

    
    

    The text contemplates a single order by the Commission, which is inconsistent with the contention that sanctions only become a consideration after the local government has bean given an opportunity to take remedial action. The imposition of sanctions under the Sanctions Policies beginning with the day the Department finds a plan not in compliance with the Act is not an impermissible enlargement upon or extension of Commission authority.

    
    

87. The Sanctions Policies are not invalid because they provide unequal treatment to defaulting or non-complying local governments. It is true that withholding 1/365 of the state/local revenue sharing money for different cities may amount to different dollar figures per day, and thus may have greater effects on some cities than others. This is, to some extent, a function of the choice made by the local governments. To the extent that they raise few taxes locally, the revenue sharing percentage of their budget correspondingly increases. Were the Commission to take a different approach, and set a fixed dollar fine per day, there would still be an aspect of unequal treatment, for

    the fine would have a greater effect on local governments with small budgets than those with large budgets.

    
    

88. The Town also argues that the Non-Submission Policy is invalid because it enlarges the authority cf the Department to determine when a plan is "complete," where the statute does not specifically grant this authority to the Department or to the Commission. The Department implicitly has this authority, given its statutory duty to issue notices finding local comprehensive plans in compliance or not in compliance with the Act, Section 163.3184(10)(a), Florida Statutes, and the requirement that each local government "shall submit its complete proposed comprehensive plan" Section 163.3167(2), Florida Statutes. To deny the Department the right to determine whether a plan is complete, and when it is complete, would eviscerate the Department's review authority, and would be inconsistent with the legislatively mandated time tables for plan review found in Section 163.3167(2) and (3), Florida Statutes. The Department has the implied authority to determine completeness. Fairfield Communities v. Florida Land and Water Adjudicatory Commission, 522 So.2d 1012, 1014 (Fla. 1st DCA 1988) ("[R]ulemaking authority may be implied to the extent necessary to properly implement a statute governing the agency's statutory duties and responsibilities"). That inherent power may be implemented through policy as well as through rulemaking.

    
    

    Withholding of Municipal Gas Tax Monies

    
    

89. The Sanctions Polices are improper to the extent that they purport to withhold from cities gas tax revenues collected under Section 206.605, Florida Statutes. Section 163.3184(11), Florida Statutes, enumerates revenue sharing monies which may be withheld, including those under Sections 206.60, 210.10 and

    218.61. The statute permits the withholding of gas tax revenues to counties under Section 206.60 but does not include the right to withhold similar gas taxes collected and distributed to cities under Section 206.605, Florida Statutes. The Legislature listed the revenues which can be withheld, and it must be presumed that the Legislature intended not to have the Commission withhold gas tax funds from cities under Section 206.605. The Commission does have the additional authority to direct "state agencies not to provide funds to increase the capacity of roads, bridges, or water and sewer systems within the boundaries of those local governmental entities" which fail to comply with the Act. Section 163.3184(11)(a), Florida Statutes. The municipal gas tax monies are not those types of funds because under Section 206.605(3), the municipal gas tax funds are used not only for the purchase of transportation facilities, rights-of-way, and construction, but also for "reconstruction and maintenance of roads and streets." Funds used to maintain roads are not the same as the funds used to expand the capacity of roads and bridges. Under Article 1, Section 18 of the Florida Constitution, administrative agencies such as the Commission may not impose penalties except as provided by law. Consequently, to the extent the Sanctions Policies would attempt to withhold from defaulting cities monies due to them under Section 206.605, Florida Statutes, the policies are not in accordance with law and could not survive a Section 120.57 substantial interest proceeding.

    
    

    The Challenge to Rule 28-39.006(3)

    
    

90. The challenged rule states:

    
    

    Within 30 days of filing the notice [of failure to submit a comprehensive plan] the Office of Planning and Budgeting shall

    schedule and conduct a meeting with the Department and the local government to discuss the issues raised in the notice and response. The meeting shall operate as an informal proceeding under Section 120.57(2), unless the local government files with its response a substantiated allegation that the statutory period for its submission of a plan has not yet elapsed and requests a formal hearing on the issue. The appropriate regional planning agency shall be notified of the meeting.

    
    

91. The issue framed in the prehearing stipulation is whether Rule 28- 39.006(3) constitutes an invalid exercise of delegated legislative authority under Section 120.52(8)(c), Florida Statutes, in that the rule operates to deny a local government notice of its opportunity to request a formal hearing on whether the Commission may waive sanctions, and thus contravenes Section 163.3184(11). The only issue of material fact involved in a non-submission case is whether the plan is late, which is the issue that would be framed under Rule 28-39.006(3), as written. After the determination of that material fact, matters in mitigation may properly be handled in an informal proceeding. Thompson v. Department of Professional Regulation, Board of Medical Examiners,

    488 So.2d 103 (Fla. 1st DCA 1986). Agency explication of non-rule policy may properly take place in an informal proceeding. E.M. Watkins & Co. v. Board of Regents, 414 So.2d 583, 588 (Fla. 1st DCA), pet. for rev. den., 421 So.2d 67 (Fla. 1982). The rule is valid.

    
    

    The Commission's Broad Discretion on Sanctions

    
    

92. The Supreme Court of Florida held that an appellate court lacks the authority to review an agency's penalty as long as the penalty lies within the permissible statutory range, unless the court reverses an agency finding of fact. Florida Real Estate Commission v. Webb, 367 So.2d 201 (Fla. 1979). The discretion which agencies enjoy in assessing penalties is quite broad, and bounded only by the statutory range of penalties, unless the Legislature requires the agency to develop penalty guidelines. The Legislature has done so for boards within the Department of Professional Regulation. See Section 455.2273, Florida Statutes. No similar requirement has been imposed upon the Commission in assessing penalties under the Act. As a result, as long as a penalty falls within the range set out in Section 163.3184(11)(a), Florida Statutes, the Commission is free to impose any penalty within that range. It would be anomalous to find that an agency policy on penalties may be reviewed in a Section 120.56 challenge to a non-rule policy when the exercise of that discretion in a substantial interest case cannot be reviewed by an appellate court. Consequently, the Sanctions Policies are not subject to review in a Section 120.56 proceeding, except to the extent that they may exceed the Commission's statutory authority.

On the basis of the foregoing, it is hereby

ORDERED that the challenge to Rule 28-39.006(3), Florida Administrative Code be dismissed, and that the challenge to the Sanctions Policies adopted by the Administration Commission on October 24, 1989, be dismissed.

DONE AND ORDERED in Tallahassee, Leon County, Florida, this 2nd day of March 1990.

WILLIAM R. DORSEY, JR.

Hearing Officer

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 2nd day of March 1990.

ENDNOTES

1/ All references are to the 1989 edition Cf. Florida Statutes, unless otherwise noted.

2/ The specific compliance efforts of the Village were not the subject of agreed facts in the pre-hearing stipulation, testimony or exhibits at final hearing, or proposed findings of fact.

APPENDIX

DOAH CASE NO. 89-6203RX

The parties not only submitted stipulations of fact in the prehearing stipulation, but also submitted a number of exhibits at final hearing, together with the testimony of Beth Lines. Had the parties intended to submit the case solely on the stipulated facts, they would not have submitted the exhibits or testimony. Therefore, the stipulated facts have generally been accepted, but appropriate amendments have been made based upon the exhibits and testimony.

Rulings on proposals by the Administration Commission: Proposed findings 1-7. Excepted in findings 1-7.

Proposed finding 8. Rejected as unnecessary, see finding 8. Proposed findings 9 and 10. Adopted in finding 9.

Proposed finding 11. Adopted in finding 11. Proposed finding 12. Adopted in finding 10. Proposed finding 13. Adopted in finding 12. Proposed finding 14. Adopted in finding 26. Proposed finding 15. Adopted in finding 26. Proposed finding 16. Adopted in finding 25. Proposed finding 17. Adopted in finding 23. Proposed finding 18. Adopted in finding 24. Proposed finding 19. Adopted in finding 22. Proposed finding 20 and 21. Adopted in finding 9. Proposed finding 22. Adopted in finding 25.

Proposed finding 23. Adopted in finding 8. Proposed finding 24. Adopted in finding 25 Proposed finding 25 and 26. Adopted in finding 26.

Proposed finding 27. Rejected as unnecessary. Rulings on proposals by the Town of Pembroke Park:

Proposed findings 1-6. Adopted in findings 1-5.

Proposed finding 7. Adopted in finding 3 No written direction from the Department was necessary because the due date was established by rule. Proposed finding 8. Adopted in finding 40 and 41.

Proposed finding 9. Adopted in finding 42.

Proposed finding 10. Adopted in finding 44 and 45.

Proposed finding 11. Adopted in finding 47 and implicit in finding 49. Proposed finding 12. Adopted in finding 49. The finding that the plan was not

160 days late is rejected. A complete plan does not appear to have been filed before March 9, 1989.

Proposed finding 13. Adopted in finding 50, except the proposal that the Town did not receive adequate opportunity to contest sanctions is rejected.

Proposed finding 14. Dealt with in the Conclusions of Law. The letter from the joint Administrative Procedures Committee lacks legal significance.

Proposed finding 15. Adopted in finding 51. Proposed finding 16. Adopted in finding 54 and 8.

Proposed finding 17. Generally adopted in finding 8.

Proposed finding 18. The first two paragraphs were rejected as unnecessary, the third paragraph is adopted in finding 8.

Proposed finding 19. Adopted in finding 55. Proposed finding 20. Adopted in finding 57. Proposed finding 21. Adopted in finding 9. Proposed finding 22. Adopted in finding 9. Proposed finding 23. Adopted in finding 9.

Proposed finding 24. Rejected as unnecessary. Obviously, the statute itself contains no specific language about when fines begin to run.

Proposed finding 25. Rejected as unnecessary.

Proposed finding 26. Rejected as unnecessary, see the Conclusions of Law. Proposed finding 27. Rejected, see the Conclusions of Law.

Proposed finding 28. Rejected as unnecessary, see the Conclusions of Law. Proposed finding 29. Rejected, see the Conclusions of Law.

Proposed finding 30. Rejected as unnecessary.

Proposed finding 31. Rejected as unnecessary, see the Conclusions of Law. Proposed finding 32. Rejected as unnecessary, see the Conclusions of Law. Proposed finding 33. Rejected, see the conclusions of Law.

Proposed finding 34. Adopted in finding 12. Proposed finding 35. Adopted in findings 14 and 26. Proposed finding 36. Adopted in finding 16.

Proposed finding 37. Adopted in finding 11. Proposed finding 38. Adopted in finding 17. Proposed finding 39. Rejected, see finding 10. Proposed finding 40. Adopted in finding 18.

Proposed finding 41. Adopted in finding 19. Proposed finding 42. Adopted in finding 20. Proposed finding 43. Adopted in finding 27. Proposed finding 44. Adopted in finding 28. Proposed finding 45. Adopted in finding 29. Proposed finding 46. Adopted in finding 30. Proposed finding 47. Adopted in finding 31. Proposed finding 48. Adopted in finding 32. Proposed finding 49. Adopted in finding 3:3. Proposed finding 50. Adopted in finding 34. Proposed finding 51. Adopted in finding 35. Proposed finding 52. Adopted in finding 36. Proposed finding 53. Adopted in finding 37.

Proposed finding 54. Adopted in finding 15.

Proposed finding 55 (unnumbered). Adopted in finding 59. Proposed finding 55. Rejected as subordinated to finding 15. Proposed finding 56. Adopted in finding 60.

Proposed finding 57. Adopted in finding 61. Proposed finding 58. Adopted in finding 64. Proposed finding 59. Adopted in finding 65. Proposed finding 60. Adopted in finding 66.

Rulings on proposals by the League of Cities:

Proposed findings 1-5. Adopted in findings 1-5. Proposed finding 6. Adopted in finding 8.

Proposed finding 7. Adopted in finding 9. Proposed finding 8. Adopted in finding 7 and 13. Proposed finding 9. Adopted in finding 12.

Proposed finding 10. Adopted in finding 14. Proposed finding 11. Adopted in finding 15. Proposed finding 12. Adopted in finding 16. Proposed finding 13. Adopted in finding 11. Proposed finding 14. Adopted in finding 17. Proposed finding 15. Implicit in finding 9. Proposed finding 16. Adopted in finding 18. Proposed finding 17. Adopted in finding 19. Proposed finding 18. Adopted in finding 20. Proposed finding 19. Implicit in finding 9.

Proposed findings 20 and 21. Implicit in finding 9. Proposed finding 22. Adopted in finding 22.

Proposed findings 23 and 24. Subordinate to finding 9. Proposed finding 25. Rejected as unnecessary.

Proposed finding 26. Rejected as unnecessary.

Proposed finding 53. Adopted in finding 51. Proposed finding 54. Adopted in finding 52. Proposed finding 55. Adopted in finding 53. Proposed finding 56. Adopted in finding 54. Proposed finding 57. Adopted in finding 55 Proposed finding 58. Addressed in finding 56. Proposed finding 59. Adopted in finding 57.

Proposed finding 60. Adopted in finding 9. Proposed finding 61. Adopted in finding 59. Proposed finding 62. Adopted in finding 60. Proposed finding 63. Adopted in finding 61. Proposed finding 64. Adopted in finding 62. Proposed finding 65. Adopted in finding 63. Proposed finding 66. Adopted in finding 64. Proposed finding 67. Adopted in finding 65. Proposed finding 68. Adopted in finding 56. Proposed finding 69. Adopted in finding 10.

Proposed finding 70. Implicit in the Findings of Fact. Proposed finding 71. Rejected as unnecessary.

Rulings on proposals by the Department of Community Affairs: Proposed finding 1. Adopted in finding 2.

Proposed finding 2. Adopted in finding 5.

Proposed finding 3. Rejected, the cited testimony was not admitted. Proposed finding 4. Adopted in finding 8.

Proposed finding 5. Adopted in finding 8. Proposed finding 6. Adopted in finding 9.

Proposed finding 7. Adopted in finding 12, see also, Conclusions of Law. Proposed finding 8. Implicit in finding 17.

Proposed finding 9. Implicit in finding 9. Proposed finding 10. Implicit in finding 9. Proposed finding 11. Subordinate to finding 15.

Proposed finding 12. Rejected because the supporting testimony was never admitted.

Proposed finding 13. Adopted in finding 10. Proposed finding 14. Adopted in finding 3.

Proposed finding 15. Implicit in findings 45 and 59. Proposed finding 16. Adopted in finding 41.

Proposed finding 17. Adopted in finding 41. Proposed finding 18. Adopted in finding 44 and 45. Proposed finding 19. Adopted in finding 43.

Proposed finding 20. Implicit in finding 64.

COPIES FURNISHED:

James R. Wolfe, Esquire Post Office Box 1757 Tallahassee, Florida 32301

Frank Matthews, Esquire Michael Petrovich, Esquire Hopping, Boyd, Green & Sams Post Office Box 6526 Tallahassee, Florida 32301

Vivian F. Garfein, Esquire Ross A. McVoy, Esquire Barry F. Rose, Esquire

Fine Jacobson Schwartz Nash Block and England

315 South Calhoun Street Tallahassee, Florida 32301

John J. Rimes, III, Esquire

Off ice of the Attorney General Suite 1602, The Capitol Tallahassee, Florida 32301

David Russ, Esquire Karen Brodeen, Esquire 2740 Centerview Drive

Tallahassee, Florida 32399

Patty Woodworth, Director

Land and Water Adjudicatory Commission Planning & Budgeting

Executive Office of the Governor The Capitol, PL-05

Tallahassee, Florida 32399-0001

Carroll Webb, Executive Director Administrative Procedures Committee Holland Building, Room 120 Tallahassee, Florida 32399-1300

NOTICE OF RIGHT TO JUDICIAL REVIEW

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL REVIEW PURSUANT TO SECTION 120.68. FLORIDA STATUTES. REVIEW PROCEEDINGS ARE GOVERNED BY THE FLORIDA RULES OF APPELLATE PROCEDURE. SUCH PROCEEDINGS ARE COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF THE DIVISION OF ADMINISTRATIVE HEARINGS AND A SECOND COPY, ACCOMPANIED BY FILING FEES PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL, FIRST DISTRICT, OR WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE PARTY RESIDES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED.

================================================================= DISTRICT COURT OPINION

=================================================================

IN THE DISTRICT COURT OF APPEAL FIRST DISTRICT, STATE OF FLORIDA

FLORIDA LEAGUE OF CITIES, INC., )

TOWN OF PEMBROKE PARK and ) NOT FINAL UNTIL TIME EXPIRES VILLAGE OF VIRGINIA GARDENS, ) TO FILE MOTION FOR REHEARING

) AND DISPOSITION THEREOF IS

Appellants, ) FILED.

)

v. ) CASE NO. 90-854.

) DOAH CASE NO. 89-6203RX ADMINISTRATIVE COMMISSION and )

DEPARTMENT OF COMMUNITY AFFAIRS,)

)

Appellees. )

)

)

TOWN OF PEMBROKE PARK, )

)

Appellant, )

)

v. ) CASE NOS. 89-3056 AND 90-52

)

STATE OF FLORIDA, ) ADMINISTRATIVE COMMISSION, )

)

Appellee. )

)

) VILLAGE OF VIRGINIA GARDENS, )

)

Appellant, )

)

v. ) CASE NOS. 89-3187 AND 90-43

)

STATE OF FLORIDA, ) ADMINISTRATIVE COMMISSION, )

)

Appellee. )

)

)

TOWN OF PEMBROKE PARK, )

)

Appellant, )

)

v. ) CASE NO. 90-975.

)

STATE OF FLORIDA, ) ADMINISTRATIVE COMMISSION, ) and STATE OF FLORIDA, ) DEPARTMENT OF COMMUNITY AFFAIRS,)

)

Appellees. )

) Opinion filed August 27, 1991.

Appeals from orders of the Division of Administrative Hearings and Administration Commission.

Case No. 90-854: Kraig A. Conn and Jane C. Hayman, Assistant General Counsel, Tallahassee, for appellant Florida League of Cities.

David M. Maloney, Executive Office of the Governor and John J. Rimes, II, Office of the Attorney General, Tallahassee, for appellee Administration Commission; and

David J. Russ and Karen Brodeen, Assistant General Counsel, Tallahassee, for appellee Department of Community Affairs.

Case Nos. 89-3056 & 90-52: Frank R. Matthews and Michael P.

Petrovich of Hopping Boyd Green & Sams, Tallahassee, for appellant Town of Pembroke Park.

Jonathan Davidson and David M. Maloney, Executive Office of the Governor; and John J. Rimes, II, Office of the Attorney General, Tallahassee, for appellee Administration Commission.

Case Nos. 89-3187 & 90-43: Ross A. McVoy, Barry F. Rose, Vivian F. Garfein and Carter N. McDowell, of Fine Jacobson Schwartz Nash Block & England, Tallahassee, for appellant. David M. Maloney, Executive Office of the Governor, and John J. Rimes, II, Office of the Attorney General, Tallahassee, for appellee.

Case No. 90-975: Frank D. Matthews and Michael P. Petrovich of Hopping Boyd Green & Sams, Tallahassee, for appellant.

David M. Maloney, Executive Office of the Governor and John J. Rimes, II, Office of the Attorney General, Tallahassee, for appellee Administration Commission.

David J. Russ and Karen Brodeen, Assistant General Counsel, Tallahassee, for appellee Department of Community Affairs.

BARFIELD, J.

The appeals in these six cases are brought by Florida League of Cities, Inc. (League), Town of Pembroke Park (Pembroke), and Village of Virginia Gardens (Village). All of the cases arise under the Growth Management Act, passed in 1985, and, in particular, the Local Government Comprehensive Planning and Land Development Regulation Act, sections 163.3161-163.3243, Florida Statutes (1985), which requires every municipality in the state to submit comprehensive plans to

the Department of Community Affairs (DCA) by certain specific dates established for each municipality by FAC Rule 9J-11.008. If a plan is submitted late or not in compliance with the statutory requirements, the Administration Commission (Commission), composed of the Governor and Cabinet, imposes sanctions and/or specifies remedial action for the local government. The possible sanctions include a withholding of state funds from revenue sharing, grants, and other programs. With regard to this duty the Commission staff drafted a "Sanctions Policy" for use in cases of late submission and noncompliance, which was adopted by the Commission on October 24, 1989. The sanctions policies were first employed with regard, to appellants Pembroke and Village. The appeals involving these two municipalities arise from the imposition of these sanctions, and the municipalities' unsuccessful attempts to receive a section 120.57, Florida Statutes, hearing on the sanctions issue. The League appeal arises from the League's unsuccessful attempt to challenge the sanctions policy of the Commission as an invalid rule. Pembroke, an intervenor in the League's rule challenge, also filed a notice of appeal.

On November 14, 1989, the League filed a petition for a section 120.56 rule challenge in which it challenged the validity of "certain unadopted, illicit rules of the Administration Commission" concerning the sanctions for noncompliance and nonsubmission of local comprehensive plans. The petition also sought a determination that section 163.3184(11), Florida Statutes (1989), constituted an illegal delegation of legislative power. Pembroke and Village, as petitioners, and the DCA, as respondent, successfully sought to intervene.

The petitioners asserted that the sanctions policies constituted rules under the definition of section 120.52(16), and that the policies and section 163.3184(11) were invalid delegations of legislative authority. The Commission denied that the policies were rules which were required to be adopted by section 120.54, or that the statute was unconstitutional. The DCA asserted that the policies were emerging agency action which did not have to be promulgated as rules at that time. The matter proceeded to final hearing on January 24, 1990. On March 2, 1990, the hearing officer issued a final order finding that the sanctions policies were not invalid rules which should have been adopted, that the sanctions policies were not subject to review in a 120.56 proceeding, and dismissing the petition.

Pembroke is a small municipality located in Broward County. Pursuant to FAC Rule 9J-12.006(4) its proposed comprehensive plan was due to be submitted to DCA for its initial compliance review October 1, 1988. The plan was not mailed by Pembroke to DCA until December 28, 1988, and was stamped as received by DCA January 9, 1989. By letter dated January 17, 1989, DCA advised Pembroke that the plan was not complete, and that the planning documents should not be transmitted until a public hearing was held in accordance with FAC Rule 9J- 11.008(1)(a). The letter advised that the transmittal requirements should be met, and the omitted items provided. By letter dated January 23, 1989, the Commission advised Pembroke that DCA filed a notice that Pembroke was more than

90 days late in submitting its plan.

The letter also advised that the DCA notice requested the Commission to impose sanctions on Pembroke and set forth the procedure and deadlines which would be employed in the determination of the issue. It directed Pembroke to file a response to DCA's notice within 30 days, and provided for, a meeting to be conducted by the Administration Commission within 15 days which "will operate as an informal proceeding under section 120.57(2), F.S., unless the local government files with its response a substantiated allegation that the 90-day period has not yet elapsed." The letter further provided that within 20 days of

the meeting DCA would file a recommendation as to the appropriate sanctions to be imposed, and that the Commission staff would then submit a proposed order to the Commission for final action.

On July 27, 1989, Pembroke submitted its four page response detailing the history, beginning in January 1987, of Pembroke's attempts to formulate its comprehensive plan. According to the response, Pembroke knew the plan was due October 1, 1988, but that its attorney spoke with a representative from DCA and concluded that the imposition of sanctions was "remote" due to "the complexity of the situation" and DCA's awareness of the difficulties Pembroke was experiencing completing the plan on time. According to the response, the completed plan was transmitted to DCA "in early March 1989."

On August 3, 1989, DCA sent a memorandum to the Commission detailing the state funding provided to Pembroke since 1987 to assist in its completion of its comprehensive plan, summarizing Pembroke's efforts to compile a plan, and recommending that Pembroke be sanctioned by withholding of annual state revenue sharing in an amount equal to the fraction of the year (5.3 months) that the plan was late. A copy of DCA's recommendation was provided for Pembroke. The DCA's cover letter explained that the DCA's recommendation was predicated on the March 10, 1989 receipt of the plan, five months late. The letter also directed any questions to the chief of the bureau of local planning.

A hearing was held on the matter before the Commission on September 26, 1989, at a regularly scheduled meeting of the Governor and Cabinet. Also before the Commission for possible sanctions for late submission were Indian Creek Village and the Village of Virginia Gardens. The attorney for Pembroke spoke on its behalf and asserted that the plan was submitted late and in an incomplete form, because of a series of errors by the planner hired to prepare it, and because of political turmoil and, internal problems, Pembroke's elected officials were unaware of what was occurring. He asserted that since the deficiencies were brought to Pembroke's attention, it had worked diligently to remedy the problems and produce a proper plan which was submitted in March 1989. He also argued that the proposed sanction, amounting to $191,000, would be 10 percent of Pembroke's annual budget, and was a disproportionate sanction for the nature of the offense. He asked that $5,940 worth of revenue sharing be withheld instead. Also speaking before the Commission was one of Pembroke's commissioners, who reiterated the attorney's comments. Also speaking before the Commission was a representative of the Florida Audubon Society, and the Secretary of DCA, who urged the Commission to impose sanctions on the small communities whose plans were admittedly late and/or not in compliance.

The members of the Commission then undertook a discussion of how the statutory sanctions should be applied. The Governor favored an approach under which the state funding was withheld permanently, but the Treasurer indicated he preferred some method by which some of the funds might be released once the municipality was in compliance. The Commission could not agree how to proceed with regard to the three communities before it at that meeting and, noting that this was the first time it was considering the imposition of sanctions for failure to file a comprehensive plan, moved for staff to formulate a policy for the imposition of sanctions. The three items concerning the municipalities were deferred until the October 24 meeting.

On October 24 the sixth item on the agenda was the presentation of the staff's recommendation of a general policy for imposing sanctions for late submittal, followed by the deferred consideration of the three municipalities' late submission of their plans. As part of the Commission's consideration of

the proposed sanctions policy the League, DCA, Pembroke, and Village through their representatives, spoke briefly. The League and the two municipalities all objected to the Promulgation of the policy without input from the affected local governments, and to the severity of the sanctions, and the Village of Indian Creek specifically argued that the policy constituted an unpromulgated rule.

DCA responded that the policy was incipient and, as emerging policy, was not yet subject to rulemaking requirements. DCA pointed out that the local governments had requested notice of what the sanctions policy would be in the future, and that the policies would be applied to only 2 percent of the local governments required to submit plans. The Commission asked that DCA send notice by certified mail return receipt to the local elected officials, personally, immediately after a plan's deadline for submission passed, and that it further devise a policy by which the government would be advised that the matter was about to be brought before the Commission. It was then moved and passed that the policy be adopted.

The proposed orders imposing sanctions on Indian Creek and Village were adopted unanimously. There was a brief discussion regarding the application of the just-adopted policy to the three local governments who came before the Commission prior to the policy's adoption, but the Commission secretary pointed out the policy contained an express provision for the situation where the local government did not have advance notice of the policy. On behalf of Pembroke, one of its commissioners and its attorney spoke, and advised the Commission that the late submission of the plan resulted from a variety of factors, including the fact that the planner hired by Pembroke misrepresented its degree of completeness, that the mayor denied receiving any notice of the plan's due date, that it was not until January 1989 that Pembroke Commission discovered the plan due date had passed, that extensive political turmoil had ensued, and that once on notice of the requirements, the Pembroke Commission made a diligent effort to promptly submit a proper plan. Pembroke's Commissioner also acknowledged the plan's lateness, but asked that the Commission reconsider the harshness of the penalty. The Attorney General added, on behalf of the Pembroke, that it had undergone tremendous mismanagement in the past decade, and that the current local government should be credited with turning around Pembroke's image. He recommended that instead of calculating sanctions from the March 10, 1989 date when the plan was ultimately submitted in complete form, that they be calculated using the January 31, 1989 date as the date of submission, when an incomplete plan was submitted. By a vote of 3 to 4, the Commission voted to adopt the harsher, staff recommended sanction. Because section 163.3164 requires that the imposition of sanctions requires the affirmative vote of the governor and at least three other members, the 3 to 4 vote, in which the governor was in the minority, was insufficient for any action. After additional discussion two members in the majority agreed to change their vote and the final vote was 5 to 2, with the Governor in the majority, to adopt the proposed final order imposing sanctions.

The final order rendered November 1, 1989, finds that Pembroke submitted its plan 160 days after the due date, and provides that Pembroke will be denied 160/365 of the total state revenue sharing funds for fiscal year 1989-90, in the total amount of $190,299. The order further provides that 90/365 of the funds,

$107,043, would be released to the Pembroke if the plan was ultimately found to be in compliance. The order further provided that Pembroke could seek judicial review of the order pursuant to section 120.68 by filing a notice of appeal within 30 days.

On November 14, 1989, Pembroke filed a Petition for Formal Administrative Hearing with the Commission. The petition asserted Pembroke had not been

afforded any clear point of entry until the rendition of the final order imposing sanctions. The petition also pointed out that the final order purports to withhold municipal gas tax funds despite the absence of any authority for the withholding of such funds in Chapter 163, Part II. Pembroke asserted its substantial interests were affected as the proposed sanction constituted 10 percent of its annual budget for fiscal year 1989, and that disputed issues of material fact existed with regard to the proper submittal date, the imposition of sanctions for the first 90 days a plan is late, the uniform application of the sanctions policy and the adequacy of the notice afforded to Pembroke.

On November 17, 1989, Pembroke filed a notice of appeal to this court of the November 1 final order imposing sanctions.

Pembroke's petition for formal administrative hearing was placed on the agenda for the December 5, 1989 meeting of the Commission as item 4. Village had also filed a petition, and was placed on the agenda as item 3. The attorneys representing the municipalities spoke briefly, and the Commission then voted unanimously to adopt the staff's proposed order denying the petitions. A final Order Denying, Petition was rendered December 8, 1989. On January 4, 1990, Pembroke filed a notice of appeal to this court.

On March 23, 1990, this court remanded the final order imposing sanctions in order to allow the Commission to omit the previous provision for the withholding of municipal gas tax revenues. The total amount of revenue sharing withheld was reduced from $190,299 to $168,006. An amended final order to this effect was rendered April 13, 1990.

Village is a small municipality located in Dade County. Pursuant to FAC Rule 9J-12.006(1) its proposed comprehensive plan was due to be submitted to DCA for its initial compliance review by July 1, 1988. The plan was not sent to DCA until January 27, 1989, and was stamped received by DCA February 6, 1989. On July 11, 1988, DCA wrote Village advising that the required plans had not been submitted by the July 1 due date. In the letter DCA acknowledged that Village's planner had advised that the plan would be ready in approximately one month, and DCA reminded Village of the requirements for submission. On October 7, 1988 DCA provided "formal notice" by letter that the South Florida Regional Planning Agency was being requested by DCA to prepare and submit Village's plan, which was now more than 90 days late. On December 19, 1988, DCA advised the Commission that the Village plan was over 90 days late and requested that the Commission impose sanctions. By latter dated January 3, 1989, the Commission advised Village that the DCA had filed notice that Village was more than 90 days late submitting its plan. The letter also advised that the DCA notice requested the Commission to impose sanctions on Village, and set forth the procedure and deadlines which would be employed in the determination of the issue. It directed Village to file a response to DCA's notice within 30 days, and provided for a meeting to be conducted by the Commission within 15 days, which, "will operate as an informal proceeding under section 120.57(2), F.S., unless the local government files with its response a substantiated allegation that the 90- day period has not yet elapsed." The letter further provided that within 20 days of the meeting DCA would file a recommendation as to the appropriate sanctions to be imposed, and that the Commission staff would then submit a proposed order to the Commission for final action. The Village plan was adopted and transmitted to DCA January 27-February 6, 1989.

On January 30, 1989, Village's chief administrator filed a "Response to the Department of Community Affairs Notice" stating that the plan had not been timely submitted "due to oversight and error on the part of the consulting staff

member." By letter dated February 13, 1989, DCA advised Village that its plan, as submitted, omitted numerous elements required by the statutes. The letter asked that the missing items be supplied no later than Feb. 27, 1989. In a memorandum dated June 20, 1989 the secretary of DCA advised the Commission that two municipalities, Indian Creek Village and the Village of Virginia Gardens, had failed to submit their plans by the July 1, 1988, due date. The Village of Virginia Gardens had not supplied the items missing from its plan as of June 20, and further had failed to supply DCA with the minutes of meetings requested by DCA to substantiate Village's explanation that the late submission was solely the fault of Village's chief administrator. The memo detailed the funding provided to Village since 1987 to assist in the completion of the comprehensive plan, and recommended that Village be sanctioned by a withholding of state revenues equivalent to the fraction of the year that the plan was late. In the case of Village, the recommendation was that .6 of the funding (7.2 months) be withheld. On August 7, 1989 the South Florida Regional Planning Council completed and submitted the plan for Village.

By letter dated August 22, 1989 the Commission advised Village that DCA had submitted its proposed sanctions that it requested the Commission impose on Village. The letter stated that the DCA recommendation would be taken up at a regularly scheduled meeting conducted by the Commission on September 14, 1989 "which will serve as the City's opportunity to be heard in accordance with Section 120.57, Florida Statutes." The letter also advised of the time and location of the September 6 Cabinet Aide's meeting, and advised that Village could appear and make presentations at either, or both, meetings.

Apparently the matter was rescheduled for a September 26 Commission meeting, with the Aide's meeting being held September 20. Village did not appear for the Aide's meeting, but the mayor sent a letter to be read which pointed out the small size and limited resources of Village and stated that the late submission was the result of the planner misrepresenting the completeness of the plan, and that Village had diligently attempted to cooperate with the local and state agencies involved and submit a complete plan in compliance with all the requirements.

At the September 26 Commission meeting Village was on the agenda for possible sanctions for late submission as was Pembroke and Indian Creek Village. Appearing on behalf of Village were its city attorney and mayor. Both asserted that the penalty proposed by DCA was too harsh for such a small municipality, and that the late submission had been unintentional and that Village was already in compliance with the intent of the Growth Management Act. The members of the Commission then undertook a discussion of how the statutory sanctions should be applied. The Governor favored an approach under which the state funding was withheld permanently, but the Treasurer indicated he preferred some method by which some of the funds might be released once the municipality was in compliance. The Commission could not agree how to proceed with regard to the three communities before it at that meeting and, noting that this was the first time it was considering the imposition of sanctions for failure to file a comprehensive plan, moved for staff to formulate a policy for the imposition of sanctions as discussed above with respect to Pembroke.

Following discussions and comments by the representatives of the municipalities and the League as discussed above, the proposed orders imposing sanctions on Indian Creek and Village were adopted unanimously without further discussion. The final order rendered November 1, 1989, finds that Village submitted its plan 220 days late, and provides that Village will be denied 220/365 of the total state revenue sharing funds for fiscal year 1989-90, in the

total amount of $92,767. The order provides that 90/365 of the funds, $37,950, would be released to Village if the plan was ultimately found to be in compliance. The order further provides that Village could seek judicial review of the order pursuant to section 120.68 by filing a notice of appeal within 30 days.

On November 14, 1989, Village filed a Petition for Formal Administrative Hearing with the Commission. The petition followed the course of the petition of Pembroke and resulted in an amended final order reducing the amount of revenue sharing withheld from $92,767 to $83,089.

Pembroke, an intervenor in the League's rule challenge to the Commission sanctions policy, also filed a notice of appeal of the final order of the Division of Administrative Hearings finding that the sanctions policies were not invalid rules which should have been adopted and that the policies were therefore not subject to 120.56 rule challenge and dismissing the petition. The six cases involving the rule challenges, the appeal of sanctions and the denial of petitions for formal hearings, have all been consolidated for review.

The issues for review under the rule challenges are as follows:

1. The "sanctions policies" adopted by the Administration Commission constitute rules which were required to be adopted in

   accordance with Sec. 120.54, Fla. Stat.

   1. The sanctions policies adopted by the Administration Commission on October 24, 1989, are or were intended to be generally applicable and impose requirements not specifically required by statute or by an existing rule

      and, therefore, constitute rules as defined in Sec. 120.52 (16), Fla. Stat. (1989).

   2. The sanctions policies are generally applicable.

   3. The "sanctions policies" are intended by their own effect to create rights, to require compliance or otherwise to

      have a direct and consistent effect of law.

      
      

2. The sanctions policies cannot be considered to be incipient or emerging under the authority of McDonald v. Department of Bank and Finance because said policies are solidified and substantially affected persons are not given a full opportunity to challenge the application of the policies pursuant to Sec. 120.57, Fla. Stat.

   
   

3. The "noncompliance policy" constitutes an invalid exercise of delegated legislative authority pursuant to Sec. 120.52(8)(C), Fla. Stat., by impermissibly imposing sanctions beginning with the date that the Department of Community Affairs issues a notice to find a plan not in compliance in contravention of Sec. 163.3184, Fla. Stat., which provisions contemplate that sanctions will not begin until after a local government has failed to complete remedial actions specified by the Administration Commission pursuant to Sec. 163.3184(11), Fla. Stat.

   
   

4. The "noncompliance policy" constitutes an invalid exercise of delegated legislative authority pursuant to Sec. 120.52(8)(C), Fla. Stat., because the provisions relating to when the sanctions begin to run contravene the clear legislative intent of Sec. 163.3184 by infringing upon a municipality's exercise of its statutory rights to a hearing before a hearing officer and the Administration Commission.

5. The "non-submission policy" constitutes an invalid exercise of delegated legislative authority pursuant to Sec. 120.52(8)(C, Fla. Stat., by impermissibly calculating sanctions from the first day after the due date established by the Department of Community Affairs Rule 9J-12, F.A.C. ..." in contravention of Sec. 163.3167(2), Fla. Stat., which states that a municipality or county that fails to submit its plan and is late "... by more than 90 days shall be subject to sanctions."

   
   

6. The "sanctions policies" constitute an invalid exercise of delegated legislative authority pursuant to Sec. 120.52(8)-(C), Fla. Stat., by mandating that revenue sharing be withheld in contravention of Sec. 163.3184(11), Fla. Stat., which allows the Commission to exercise discretion, in whether to impose sanctions.

   
   

7. Florida Statutes, Sec. 163.3167(2) and 163.3184(11)(a) unlawfully delegate the uniquely legislative power of determining the nature and extent of fines which may be assessed.

The issues in the municipalities appeals from the imposition of sanctions and denial of petition for formal hearing, are as follows:

1. Disputed issues of material fact exist concerning the Commission's action in which the municipalities have, not been afforded the opportunity to present evidence and legal argument.

2. The municipalities were never afforded a clear point of entry into the administrative process.

3. Sections 163.3167(2) and 163.3184(11)(a), Florida Statutes, are unlawful delegations of legislative power.

4. The Commission unlawfully exercised its statutory authority in its policy and its actions toward the municipalities.

In the first point addressed to rule challenge, appellants argue that the "sanctions policy" adopted by the Administration Commission on October 24, 1989 constitutes rules which must be adopted in accordance with section 120.54. We disagree.

Section 120.52(16) provides in pertinent part:

"Rule" means any agency statement of general applicability that implements, interprets, or prescribes law or policy, or describes the organization, procedure, or practice requirements of an agency and includes any form which imposes any requirement or solicits any information not specifically required by statute or by an existing rule

The seminal case interpreting section 120.52(16)4 and addressing at what point an agency policy statement constitutes a rule which must be duly promulgated as such by the agency, is McDonald v. Dept. of Banking and Finance,

346 So.2d 569 (Fla. 1st DCA 1977), appeal after remand, 361 So.2d 199 (Fla. 1st DCA 1978), cert. denied, 368 So.2d 1370 (Fla. 1979). McDonald provides:

The APA does not chill the open development of policy by forbidding all utterance of it except within the strict rulemaking process of section 120.54.

[T]he Section 120.54 rulemaking procedures are imposed only on policy

statements of general applicability, i.e., those statements which are intended by their own effect to create rights, or to require compliance, or otherwise to have the direct and consistent effect of law. . .

While the Florida APA thus requires rulemaking for policy statements of general applicability, it also recognizes the inevitability and desirability of refining incipient agency policy through adjudication of individual cases. There are quantitative limits to the detail of policy that can effectively be promulgated as rules, or assimilated; and even the agency that knows its policy may wisely sharpen its purposes through adjudication before casting rules.

(emphasis in original, footnote omitted) 346 So.2d at 580-581. The continuing viability of McDonald is acknowledged by several recent decisions. See e.g.: Rabren v. Dept. of Professional Regulation, 568 So.2d 1283 (Fla. 1st DCA 1990); Florida Optometric Ass'n v. Dept. of Professional Regulation, Board of Opticianry, 567 So. 2d 928 (Fla. 1st DCA 1990); Florida Public Service Commission v. Central Corp., 551 So.2d 568 (Fla. 1st DCA 1989).

Agency policy is incipient or evolving (and therefore exempt from rulemaking) when the agency has not yet "solidified" its position on policy in a particular area, and instead seeks to exercise its authority on a case-by-case basis until it has focused on a common scheme of inquiry derived through experience gained from adversary proceedings. City of Tallahassee v. Florida Public Service Commission, 433 So.2d 505 (Fla. 1983). Rulemaking cannot be forced upon an agency and its policy may be developed, at the agency's choice, through the adjudication of individual cases. Rabren v. Dept. of Professional Regulation; Florida Public Service Commission v. Central Cob

The sanctions policy fits the definition of incipient or evolving policy, and not the section 120.52(16) definition of a rule. With regard to the provisions, of section 120.52(16), the policy isn't one of "general applicability" as it applies only to municipalities who are late or not in compliance in submitting their comprehensive plans. Every municipality in the state subject to the requirements of the Growth Management Act is potentially subject to the policy, but only those which fail to comply with the statutory and rule requirements will actually be considered for application of the policy. The policy has been applied, for the first time, to the first municipalities to ever come before the Administration Commission for "nonsubmission." On the record before this court, the "noncompliance" portion of the policy has never been applied to any one at all. The sanctions policy is also not one of "general applicability" because it is not intended by its own effect to create rights or to require compliance. The rights afforded and compliance required are the product of the statutes.

The sanctions policy arguably "implements" or "interprets" law or policy as it sets forth the starting point for the Commission's consideration of the statutory penalties detailed in section 163.3184(11)(a). But as McDonald points out, such a literal reading of the statutory definition of "rule" would encompass virtually any utterance by an agency." 346 So.2d at 581, quoting

Pacific Gas & Elec. Co. v. Federal Power Commission, 506 F.2d 33, 37 (D.C. Cir. 1974). The discussions of the Commission, as well as the manner in which the policy was employed as to each of the municipalities, clearly indicates that the sanctions policy is merely a guideline, or a starting point, for the Commission's consideration of the imposition of sanctions in each particular case. Here, the particular circumstances of the late submission of each municipality were considered individually. The case of the Town of Pembroke Park, in particular, was discussed at length, and the possible imposition of less stringent sanctions was expressly considered and even voted upon.

Ultimately, the basic sanctions set forth under the policy were imposed. The quantum of the sanctions varied depending upon how late the belated submission was found to have been. The fact that policy sanctions were applied to all three municipalities is not surprising given the fact that they all submitted virtually identical reasons for the late submission: mistakes and/or misrepresentations by the hired planner, as well as virtually identical mitigating factors upon which the pleas for mercy were based: the small size of the municipality and the resultant harsh effect of the proposed sanction, and the diligent effort of the municipal officials to comply with the law once the nonsubmission was discovered. 1/ Given the similarity of excuses, a similarity of the basic sanctions was within the Commission's discretion.

For the same reasons, the policy is clearly an evolving one, which is intended to be utilized to differing extents on a case- by-case basis as described in City of Tallahassee v. Florida Public Service Commission. The hearing officer's conclusion and dismissal was correct.

In their second point addressed to the rule challenge, appellants argue that the sanctions policy cannot be regarded as incipient or emerging under McDonald because the policies are solidified and the parties are not afforded a full opportunity to challenge the application of the policy. We disagree. The sanctions policy is not "solidified" to the point that it cannot be regarded as evolving as discussed above.

Appellants also argue that the policy does not afford substantially affected parties a clear point of entry to pursue section 120.57 proceedings. This argument has merit with regard to the Administration Commission's actions concerning the particular municipalities before this court in these appeals.

However, the sanctions policy itself makes no attempt to speak to the hearing procedures. The fact that the parties stipulated, "The potential loss of revenue for a period of six or more months may act as a substantial disincentive to a municipality's willingness to pursue a hearing and challenge the Department of Community Affairs when the Department has issued a Notice of Noncompliance" does not alter the fact that the policy itself does not address adjudication.

Whatever "disincentive" the statutorily created sanctions may pose to pursuit of section, 120.57 proceedings, they arguably pose a greater disincentive to the filing of plans late or not in compliance. Any disincentive is of statutory origin, and not from the policy. As noted, whether or not the particular municipalities involved in these appeals were properly afforded a clear point of entry is a separate issue addressed in those particular cases.

In their third point addressed to the rule challenge, appellants argue the noncompliance portion of the sanctions policy constitutes an invalid exercise of delegated legislative authority as it imposes sanctions as of the date the DCA issues its notice of noncompliance, rather than waiting until after the local government has failed to complete remedial actions as specified in section 163.3184(11). We disagree. Section 163.3184(8) provides for the DCA to make a determination within 45 days of submission whether a plan is or is not in

compliance. If the DCA finds the plan is not in compliance, section 163.3184(10) provides that the DCA issues a notice of intent to find the plan not in compliance which is forwarded to the Division of Administrative Hearings for a 120.57 hearing. The hearing officer's recommended order is then submitted to the Administration Commission for final agency action. At this point, if the Commission finds the plan not in compliance, under section 163.3184(11), it must specify remedial actions, and may impose sanctions.

Section 163.3184(11)(a) provides:

1. ADMINISTRATION COMMISSION-

   1. If the Administration Commission,

upon a hearing pursuant to subsection (9) or subsection (10), finds that the comprehensive plan or plan amendment is not in compliance with this act, the commission shall specify remedial actions which would bring the comprehensive plan or plan amendment into compliance. The commission may direct state agencies not to provide funds to increase the capacity of roads, bridges, or water and sewer systems within the boundaries of those local governmental entities which have comprehensive plans or plan elements that are determined not to be in compliance. The commission order may also specify that the local government shall not be eligible for grants administered under the following programs:

[Subsections 1. through 3. set forth the specific programs and revenue sharing sources.]

(Emphasis added.) The statute plainly directs that remedial actions are mandatory, and that the, Commission's imposition of the authorized sanctions is optional and within the Commission's discretion.

The October 24, 1989 sanctions policy provides that once a plan is determined to be not in compliance, "the Commission policy would be to withhold 1/365 of the annual state/local revenue sharing distribution for every day that the plan is out of compliance beginning with the date DCA issued its Notice of Intent ..." until the amended plan is found to be in compliance by the DCA.

If the DCA initially finds a plan in compliance and issues its notice accordingly but, following 120.57 hearing, the Commission instead determines the plan is not in compliance, the sanctions policy provides that the Commission's final order will specify remedial measures to be incorporated by a specific date. If they are not incorporated by that date, 1/365 of the annual state/local revenue sharing distribution will be withheld for every day the plan is out of compliance, beginning with the date the Commission entered its final order until the plan is found to be in compliance by the DCA.

Appellants apparently challenge only the first part of the policy, concerning the imposition of sanctions when both the DCA and then the Administration Commission find the plan not in compliance. Appellants argue sanctions should not be calculated and imposed as of the date of the DCA notice of intent to find the plan not in compliance. Instead, appellants argue the

statute represents a clear legislative intent to not impose any sanctions until the local government has failed to comply with the mandated remedial action set forth in the Administration Commission's final order. We do not find any support for this argument in the statute.

Section 163.3184(10)(a) provides that during the administrative hearing held after the DCA has issued its notice of intent to find the plan not in compliance "the local government's determination that the [plan] is in compliance is presumed to be correct." Section 163.3167(2) provides that the local government submit a "complete proposed comprehensive plan" by the due date. Nothing in the statutes addresses from which point in time the sanctions imposed should be calculated. The manner of the imposition of sanctions is clearly a matter left to the discretion of the Administration Commission by section 163.3184(11)(a). Assuming appellants have any standing to challenge the Commission's policy which has yet to be applied to any local government, we do not think appellants have shown that the policy constitutes an invalid exercise of delegated legislative authority.

As the hearing officer found, section 163.3184(11)(a) clearly seems to contemplate that once the Commission determines a plan is not in compliance, it will issue one final order addressing remedial actions and sanctions. There is no basis in the statute for concluding that sanctions should not be calculated and applied until a local government has failed to comply with the remedial measures ordered. On the contrary, the statute clearly provides that the plans are to be submitted, in compliance, on their due dates. Any plan which is submitted not in compliance, is not in compliance from that day forward. The Administration Commission would be within its discretion in imposing sanctions for noncompliance as of the submittal date. The fact that the statute refers to the plan being presumed correct is a procedural, not a substantive directive.

Section 163.3184(l0)(a) merely sets forth the relative burdens of proof in the

120.57 hearing to be conducted upon the DCA's determination of noncompliance. The local government does not have to prove its plan is in compliance; the state must prove it is not. The sanctions policy provision for the imposition of sanctions as of the date of the DCA Notice of Intent is not contrary to any provision in the statute, and is not an invalid exercise of delegated legislative authority.

In their fourth point addressed to the rule challenge, appellants argue the noncompliance policy is an invalid exercise of delegated legislative authority as the Commission acknowledges it poses a disincentive to the local governments to pursue their statutorily afforded right to a 120.57 hearing. We disagree.

Prior to the administrative hearing the parties stipulated, "The potential loss of revenue for a period of six or more months may act as a substantial disincentive to a municipality's willingness to pursue a hearing and challenge the Department of Community Affairs when the Department has issued a Notice of Noncompliance."

Any actual imposition of sanctions will not occur until after a 120.57 hearing has been held, and a final determination of noncompliance has been made by the Administration Commission. Only at this point are sanctions imposed. The policy only poses a "substantial disincentive" to those local governments whose plans are not in compliance for a substantial period of time. Any government whose plan is in compliance, or whose plan is out of compliance for only a brief period of time, would not be subject to extensive sanctions. Therefore, it would be more accurate to regard the policy as a substantial disincentive to noncompliance, particularly extended noncompliance. As such, it is consistent

with the intent of the Growth Management Act. The disincentive aspect of the sanctions is analogous to a situation involving a criminal defendant. The possibility that an accused may face incarceration if he exercises his right to a jury trial and is found guilty cannot be viewed as a "substantial disincentive" to the exercise of that constitutional right, unless, of course, he is guilty. The possibility of incarceration is intended as a substantial disincentive to the criminal behavior itself. Similarly, the imposition of sanctions is a disincentive to noncompliance, and not to the pursuit of a 120.57 hearing on the issue of noncompliance.

In their fifth point addressed to the rule challenge, appellants assert that the fact that section 163.3167(2)(b) provides for the imposition of sanctions for late submission only if the plan is more than 90 days late precludes the Commission from calculating sanctions for days 1-90. We disagree. The pertinent portion of section 163.3167(2)(b) provides:

Any county or municipality that fails to meet the schedule set for submission of its proposed comprehensive plan by more than 90 days shall be subject to the sanctions described in s. 163.3184(11)(a) imposed by the Administration Commission.

In the proceedings below the appellants and others consistently and erroneously referred to the statutory provision of a "90-day grace period." The statute does not provide a grace period. It merely sets forth the threshold degree of tardiness which will warrant the imposition of sanctions. Plans submitted beyond their due date, but less than 90 days late are nevertheless late; but the local government escapes sanctions. Plans submitted more than 90 days late were late as of midnight on their due date, not as of day 91. The imposition of sanctions calculated as of the first day is in no way contrary to the statute or its intent.

In their sixth point addressed to the rule challenge, appellants argue that contrary to the statute's use of the permissive "may" in discussing the Administration Commission imposition of sanctions, the sanctions policy mandates the withholding of revenue sharing in every case and improperly precludes the exercise of any discretion. We disagree.

Nothing in the policy itself states that it is mandatory or utilizes commonly accepted mandatory words such as "shall." In fact, in keeping with its nature as a non-mandatory "starting point" type of policy, the provisions are written in a grammatically concise, somewhat abbreviated form. The dialog at the Commission meetings on September 26 and October 24, 1989, clearly establishes that the Commission intends for the policy to serve as a general guideline and starting point to be employed in a case-by-case basis as the local governments appear before it on the grounds of having submitted their plans late and/or not in compliance. There is nothing explicit, either in the policy itself, or in the transcripts of the Commission meetings discussing its adoption, which indicates the policy is to be inflexibly applied. The only indications are to the contrary. To the extent that the policy presupposes that sanctions will be imposed for late submittal or noncompliance, the hearing officer correctly found this posture to be reasonable, particularly given the mandatory nature of the Growth Management Act requirements.

In their final point addressed to the rule challenge, appellants argue that sections 163.3167(2) and 163.3184(11)(a) are unconstitutional delegations of

legislative authority as only the legislature can properly determine the nature and extent of the fines to be assessed. We disagree.

The legislature cannot delegate the power or authority to enact or declare law, and cannot delegate unrestricted discretion in the application of law.

State v. Cain, 381 So.2d 1361 (Fla. 1980). The doctrine of nondelegation does not preclude the exercise of all agency discretion. Solimena v. State, Dept. of Business Regulation, Division of Pari-Mutuel Wagering, 402 So.2d 1240 (Fla. 3d DCA 1981), rev. den., 412 So.2d 470 (Fla. 1982). To determine whether a delegation is invalid the court examines whether the transfer of authority was possible, and if so, whether it was sufficiently restrictive. State, Dept. of Citrus v. Griffin, 239 So.2d 577 (Fla. 1970), appeal after remand, 257 So.2d 116

(Fla. 2d DCA 1972), cert. dismissed, 266 So.2d 36 (Fla. 1972). These factors must be tempered by due consideration for the practical context of the problems sought to be remedied or the policy sought to be effected. Id. So long as the agency is following the legislative purpose, there is no invalid delegation.

Solimena. See also McRae v. Robbins, 151 Fla. 109, 9 So.2d 284, 290-291 (Fla. 1942) (Justice Whitfield concurring).

In these cases the delegation of discretionary authority on the issues of sanctions was proper. Section 163.3184(11) specifies the general nature of the sanctions in subsection (a): "The commission may direct state agencies not to provide funds to increase the capacity of roads, bridges or water and sewer systems within the boundaries of those local governmental entities..." Subsection (a)1. through 3. specifies additional particular grant programs for which eligibility may be terminated as a sanction. If the local government's plan was one of the ones required to contain a coastal management element, subsection (b) provides an additional funding sanction under a particular statute. Section 163.3184(11) therefore sets forth the range of sanctions available with specificity. Section 163.3167(2)(b) further limits the imposition of any sanctions for late filing only to those local governments which fail to file their plans within 90 days of its due date. Section 163.3184(11)(a) mandates the Commission to specify remedial actions for any plan determined by the Commission to be not in compliance; the provision of remedial measures is not a matter of discretion.

Article I, section 18 of the Florida Constitution provides: "No administrative agency shall impose a sentence of imprisonment, nor shall it impose any other penalty except as provided by law." The Commission's discretionary authority to impose sanctions has been duly conferred by law, and the statute provides appropriate guidelines for the exercise of that authority.

In determining whether the legislature

has improperly delegated discretion to the agency, we must consider whether the statute establishes standards and guidelines which direct the agency in implementing the law. . .

When "neither the agency nor the

courts can determine whether the agency is carrying out the intent of the legislature," unlawful delegation of legislative power may result.

Solimena v. State, Dept. of Business Regulation, Division of Pari-Mutuel Waging,

402 So.2d at 1245 (citations omitted).

The imposition of sanctions for a local government's failure to submit a plan on time, or in compliance is a matter which could be addressed only on a case-by-case basis. The human factor in such failures would make it impossible for the legislature to provide a more precise or detailed manner of imposing sanctions which would be equitable in each of the myriad possible circumstances. The practical difficulty of the legislature attempting to address "fluid conditions" has been recognized by the courts. In State, Dept. of Citrus v.

Griffin, the supreme court pointed out:

Obviously, the very conditions which may operate to make direct legislative control impractical or ineffective may also, for the same reasons, make the drafting of detailed or specific legislation impractical or undesirable. .

[I]t should be remembered that our Constitution does not deny to the Legislature necessary resources of flexibility and practicality, and when a general approach is required, judicial scrutiny ought to be accompanied by recognition and appreciation of the need for flexibility.

239 So.2d at 581. See also Brewer v. Insurance Commissioner and Treasurer, 392 So.2d 593 (Fla. 1st DCA 1981) (the legislature may not delegate the power to say what the law is, but it may enact laws which leave some discretion in the operation and enforcement of the law with an administrative official); and Connor v. Joe Hatton Inc., 216 So.2d 209 (Fla. 1968), appeal after remand, Joe Hatton, Inc. v. Connor, 240 So.2d 145 (Fla. 1970) (the distinction is between the delegation of power to make law and the conferring of authority or discretion in executing the law pursuant to and within the confines of the law itself).

The Commission is executing and enforcing law within the specific parameters placed by the legislature on the exercise of its discretion. The only possible basis for a finding of unconstitutionality is the fact that the statutes do not expressly limit the duration of the sanctions imposed. Absent any such limitation, theoretically a local government which submits a plan late or not in compliance could be subject to state revenue loss indefinitely.

However, the wording of the statutes sufficiently limit the duration of any sanctions imposed. With regard to late submissions, section 163.3167(2)(b) provides that sanctions may be imposed as described in section 163.3184(11)(a) if a plan is more than 90 days late. It is inherent in the statute that the, sanctions will terminate once a plan is submitted. This is also what the sanctions policy adopted by the Commission provides. However, the statutes do not place any express limitation on the duration of sanctions for nonsubmission. With regard to sanctions for noncompliance, section 163.3184(11)(a) clearly contemplates that such sanctions will be imposed only for the duration of the noncompliance. There is no statutory authority for the imposition of sanctions on a local government whose plan is in compliance. But theoretically the Commission, during the period of noncompliance, could order a permanent forfeiture of all designated state funding by the local government.

Any penalty imposed by an administrative agency cannot be the subject of judicial review so long as its imposition is supported by competent substantial evidence and the penalty itself is within the statutory range as prescribed by law. Florida Real Estate Commission v. Webb, 367 So.2d 201 (Fla. 1978); Decola

v. Castor, 519 So.2d 709 (Fla. 2d DCA 1988); Lee v. Division of Florida Land Sales and Condominiums, 474 So.2d 282 (Fla. 5th DCA 1985). Statutes prescribing penalties typically place a maximum limit on the dollar amount of a fine or the temporal duration of the sanction. See e.g., Florida Real Estate Commission v. Webb, (maximum 2-year real estate license suspension under s. 475.25(1), Fla. Stat. (1975)); Decola v. Castor, (maximum 10-year teaching certificate revocation under s. 231.28(1), Fla. Stat.); Lee v. Division of Florida Land Sales (maximum $10,000 fine for violations under s. 498.049(4), Fla. Stat. (1983)).

The statutes in the instant case do not give the Administration Commission unfettered discretion in the type of sanction to be imposed, but the statutes do fail to place any express limits on the duration or maximum amount of such sanctions. However, the statute does set forth implied limits on the duration of any sanction based on its requirement that, sooner or later, all plans due will be submitted and/or brought into compliance, thereby eliminating the basis for any imposition of sanctions. It is well-established that all statutes are presumed constitutional, and that if there is any reasonable way that a statute can be construed not to conflict with the constitution, it must be so construed. Firestone v. News-Press Pub. Co., Inc., 538 So.2d 457 (Fla. 1989); Sandlin v.

Criminal Justice Standards & Training Commission, 531 So.2d 1344 (Fla. 1988); Vildibill v. Johnson, 492 So.2d 1047 (Fla. 1986); Felts v. State, 537 So.2d 995

(Fla. 1st DCA 1988), approved, 549 So.2d 1373 (Fla. 1989); Southeast Volusia Hose. v. State, Dept. of Ins., 478 So.2d 820 (Fla. 1st DCA), rev. denied, Tallahassee Memorial Regional Medical Center v. Florida Patients Compensation Fund, 476 So.2d 676 (Fla. 1985). All reasonable doubt must be resolved in favor of constitutionality. Bunnell v. State, 453 So.2d 808 (Fla. 1984); Industrial Fire & Cas. Ins. Co. v. Kwechin, 447 So.2d 1337 (Fla. 1983); Felts v State.

Applying this standard to sections 163.3167 and 163.3184, they are not an unlawful delegation of legislative authority.

Of the four issues addressing the imposition of sanctions and denial of section 120.57 hearing raised by the municipalities the third issue alleging unlawful delegation of legislative authority has been discussed and rejected above.

The municipalities' first issue concerning disputed issues of fact is without merit. While the facts concerning the two municipalities differ somewhat, neither showed the existence of material facts in dispute.

In their fourth point, the municipalities argue that the Administration Commission unlawfully exercised its statutory authority in applying its sanctions policy in several respects. First, they argue the Commission failed to comply with the mandatory provisions of section 163.3184(11)(a) and "specify remedial actions." We disagree. They were before the Commission for submitting their plans late: "nonsubmission." The Commission never made any determination whether the plans were or were not in compliance. The statute clearly requires the Commission to specify remedial actions for plans determined to be not in compliance with this act," upon the conclusion of a 120.57 hearing as provided in section 163.3184(9) or (10). The municipalities' proceedings before the Commission never progressed to this point. No noncompliance determination was made, and no remedial actions were to be specified. In any event, there is only one remedial action available for nonsubmission, and that is submission.

Second, they argue the Commission applied automatic sanctions in contravention of statutory directive that it "may" direct the withholding of state funds. This argument is clearly refuted by the record. Pembroke's case

in particular was the subject of extensive discussion by the Commission, and the amount of sanction was voted upon twice. The transcript of the meetings demonstrate indisputably that the sanctions were imposed pursuant to an exercise of discretion, and not automatically.

Third, they argue the Commission cannot impose sanctions for the first 90 days the Plan a late. Nothing in section 163.3167(2)(b) indicates any statutory intent to afford a 90 day grace period.

Last, they argue that Florida Real Estate Commission v. Webb, 367 So.2d 201 (Fla. 1978), which precludes judicial review of any administrative penalty which is within the statutory range, does not preclude this court from reviewing the penalties in the instant cases. They argue the penalties are improperly based upon an erroneous finding of fact, and that the absence of legislative guidelines and imposition of sanctions within the 90 day grace period are beyond the Commission's discretion.

If there are no erroneous findings of fact and no 90 day grace period, then Webb precludes review of the, extent of the sanctions imposed as they are within the specified statutory range. However, we need not reach this issue in view of our disposition of the parties' second issue discussed below.

In their second point, the municipalities argue they were never afforded a clear point of entry into the administrative process because they were not provided adequate notice of their right to seek an administrative hearing because the notices contained in the January 3 and January 23, 1989 letters were inadequate, and because they never waived their right to a 120.57 hearing. The Commission agrees that substantial interests warranting the application of section 120.57 are involved, and the parties agree that the determination of the issues turns on the provisions of the January 3 and January 23, 1989 letters from Patricia Woodworth, Secretary of the Administration Commission to the mayors of the municipalities.

Any substantially affected person must be provided with a clear point of entry, within a specified time period after some recognizable event in the investigatory or other free form proceedings, to formal or informal proceedings under section 120.57. Capeletti Brothers, Inc. v. State, Department of Transportation, 362 So.2d 346, 348 (Fla. 1st DCA 1978), cert. den., State, Department of Transportation v. Capeletti Bros., Inc., 368 So.2d 1374 (Fla.

1979). Simply providing a point of entry, however, is not enough if the point of entry is so remote from the agency action as to be ineffectual as a vehicle for affording a party whose substantial interests are or will be affected by agency action a prompt opportunity to challenge disputed issues of material fact in a 120.57 hearing. General Development Utilities, Inc. v. Florida Department of Environmental Regulation, 417 So.2d 1068, 1070 (Fla. 1st DCA 1982). Notice of agency action which does not inform the affected, party of its right to request a hearing and the time limits for doing so is inadequate to trigger the commencement of the administrative process. Henry v. State Department of Administration, Div. of Retirement, 431 So.2d 677, 680 (Fla. 1st DCA 1983).

Until proceeding's are had satisfying section 120.57, or an opportunity for them is clearly offered and waived, there can be no agency action affecting the substantial interests of a person.

We agree with appellants that the letters are insufficient to provide the requisite clear points of entry. At the time no rules had been promulgated governing the procedure for the determination of nonsubmission matters, which appellee concedes involved the determination of substantial interests of a

party. When an agency has not adopted its own specific rules of procedure, FAC Rule 28-5.101 provides that the procedure set forth in that chapter applies. In particular, Rule 28-5.111, entitled "Point of Entry into Proceedings" provides that a substantially affected party has 21 days to file a petition upon receipt of written notice of the decision, or receipt of written notice of intent to render such decision. The rule specifies that "whenever possible" the agency shall issue a notice of intent prior to the actual decision, to allow the affected person 21 days to request a hearing. The letters call for a "response" to be submitted within 30 days, and provides that an informal 120.57 proceeding will be held within 15 days "unless the local government files with its response a substantiated allegation that the 90-day period has not, yet elapsed." Although this procedure was subsequently promulgated as a rule (see FAC Rules

28-39.001 - 28-39.006), those rules were not effective until August 7, 1989, approximately 7 months after the letter at issue was written. 2/

The letters not only failed to provide 21 days to seek a hearing as required by Rule 28-5.111, they also do not provide any basis for the affected parties to seek formal or informal proceedings. Fortune Life Ins. Co. v. State, Dept. of Ins., 569 So.2d 1325, 1327 (Fla. 1st DCA 1990) (absent any emergency, the agency should follow nonemergency procedure by announcing its intended action and "giving the adversely affected party a clear point of entry and the opportunity to elect formal or informal proceedings."); Florida Optometric Ass'n

v. Department of Professional Regulation, Board of Opticianry, 567 So.2d 928, 935 (Fla.- 1st DCA 1990) (a clear point of entry is "a clear opportunity to file a petition for formal proceedings"). As appellants point out, the letters effectively eliminate any option for the municipalities to elect the type of proceedings they wish to pursue, and instead mandate that a meeting serving as informal proceedings will be held unless the municipalities can file a "substantiated allegation" that 90 days have not elapsed since the due dates established by rule. Since the letters were not composed until more than 90 days after the due date this option is meaningless and a nullity. The letters therefore provide informal proceedings as the only option.

The letters do not set forth the procedure to be followed, as is required by Rule 28-5.111. In order to provide an adequate clear point of entry the notice does not have to track any particular language or recite statutory provisions verbatim, so long as it clearly informs the affected party of its rights and the time limits. Capital Cody Inc. v. University of Florida, 526 So.2d 988 (Fla. 1st DCA 1988); Lamar Advertising Co. v. Department of Transportation, 523 So.2d 712 (Fla. 1st DCA 1988). A properly noticed clear point of entry does not have to set forth the Commission's sanctions policy which will be employed. An agency is entitled to apply its evolving, non-rule policy without prior notice so long as the affected party has a clear point of entry to challenge the use of the policy, and any ultimate use by the agency is supported by competent substantial evidence. Health Care and Retirement Cord. of America, Inc. v. Department of Health and Rehabilitative Services, 559 So.2d 665 (Fla. 1st DCA 1990); St. Francis Hosp., Inc. v. Department of Health and Rehabilitative Services, 553 So.2d 1351 (Fla. 1st DCA 1989).

The policy behind the requirement of a clear point of entry is to assure that affected parties are not prejudiced by administrative action without being afforded an opportunity to pursue an available and adequate remedy. Lamar Advertising Co. v. Dept. of Transportation; Lewis Oil Co., Inc. v. Alachua County, 496 So.2d 184 (Fla. 1st DCA 1986). Notice of final agency action is intended to create a clear point of entry, not a trap for the unwary. SWS Partnership v. Florida Dept. of Corrections, 567 So.2d 1048 (Fla. 5th DCA 1990). Under Capeletti, "Until proceedings are had satisfying section 120.57, or an

opportunity for them is clearly offered and waived," the agency is without power to act. Without a clear point of entry the Commission was without authority to proceed to impose sanctions. See City of St. Cloud v. Department of Environmental Regulation, 490 So.2d 1356, 1358 (Fla. 5th DCA 1986), wherein the court stated (cites omitted):

Notice of agency action which does not inform the affected party of his right to request a hearing, and the time limits for doing so, is inadequate to provide a clear

point of entry to the administrative process. An agency seeking to establish waiver based upon the passage of time following actions claimed as final must show that the party affected by such action has received notice sufficient to commence the running of the time period within which review must be sought. The notice must contain a statement concerning a right to a hearing, set forth a time limit for requesting a hearing, and refer to the applicable procedural rules of the agency.

We reverse the denial of Pembroke's and Village's request for section

120.57 hearings. In all other respects we affirm the decisions below.

WIGGINTON and MINER, JJ., CONCUR

ENDNOTES

1/ With regard to the Village of Virginia Gardens, this assertion of diligent effort is thoroughly belied by the record. Its plan was over 6 months late; its' response to the DCA notice of sanctions, due within 30 days, was never filed in complete form; and the items omitted from the plan and requested by the DCA were never provided. The plan was ultmately filed by the regional planning authority.

2/to the extent that the Sept. 5, 1989 cover letter accompanying Pembroke's copy of the DCA's recommended sanctions could be regarded as notice of proposed agency action, it is entirely inadequate. The letter does not provide any of the requisite information and only gives a name and phone number to contact "If you have any questions..."

MANDATE

From

DISTRICT COURT OF APPEAL OF FLORIDA FIRST DISTRICT

To the Honorable William R. Dorsey, Jr., Hearing Officer Division of Administrative Hearings

WHEREAS, in that certain cause filed in this Court styled:

FLORIDA LEAGUE OF CITIES, INC.,

and

TOWN OF PEMBROKE PARK and

VILLAGE OF VIRGINIA GARDENS Case NO. 90-854

vs. Your Case NO. 89-6203RX

ADMINISTRATION COMMISSION,

and

DEPARTMENT OF COMMUNITY AFFAIRS

The attached opinion was rendered on August 27, 1991

YOU ARE HEREBY COMMANDED that further proceedings be had in accordance with said opinion, the rules of this Court and the laws of the State of Florida.

WITNESS the Honorable James D. Joanos

Chief Judge of the District Court of Appeal of Florida, First District and the Seal of said court at Tallahassee, the Capitol, on this 27th day of September, 1991.

Jon S. Wheeler

Clerk, District Court of Appeal of Florida, First District

Docket for Case No: 89-006203RX

Orders for Case No: 89-006203RX