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FAMILY ARCADE ALLIANCE vs DEPARTMENT OF REVENUE, 91-005338RP (1991)

Court: Division of Administrative Hearings, Florida Number: 91-005338RP Visitors: 32
Petitioner: FAMILY ARCADE ALLIANCE
Respondent: DEPARTMENT OF REVENUE
Judges: WILLIAM R. DORSEY, JR.
Agency: Department of Revenue
Locations: Tallahassee, Florida
Filed: Aug. 23, 1991
Status: Closed
DOAH Final Order on Tuesday, March 17, 1992.

Latest Update: Mar. 17, 1992
Summary: The issues are whether proposed rules 12-18.008, 12A-15.001 and 12A-1.044, Florida Administrative Code, are valid exercises of delegated legislative authority.Rule challenge for failure to prepare economic impact statements, unconstitutionally impairing oral contracts and exceeding authority dismissed.
91-5338.PDF

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS


FAMILY ARCADE ALLIANCE, )

)

Petitioner, )

)

vs. ) CASE NOS. 91-5338RP

) 91-5339RP

DEPARTMENT OF REVENUE, ) 91-5340RP

)

Respondent. )

)


FINAL ORDER


This matter was heard by William R. Dorsey, Jr., the Hearing Officer designated by the Division of Administrative Hearings, on December 18, 1991, in Tallahassee, Florida.


APPEARANCES


For Petitioner: Juana M. Rojas, Esquire

Richard A. Nielsen, Esquire Salem, Saxon & Nielsen

101 East Kennedy Boulevard, Suite 3200 Post Office Box 3399

Tampa, Florida 33601


For Respondent: James McAuley, Esquire

Ralph Jaeger, Esquire

Office of the Attorney General Tax Section, Capitol Building Tallahassee, Florida 32399-1550


STATEMENT OF THE ISSUES


The issues are whether proposed rules 12-18.008, 12A-15.001 and 12A-1.044, Florida Administrative Code, are valid exercises of delegated legislative authority.


PRELIMINARY STATEMENT


These proceedings were filed to challenge three proposed rules of the Department of Revenue and were consolidated. The proposed rules amend current Rules 12A-15.011 and 12A-1.044, and create Rule 12A-18.008. Together they set up procedures which will govern the collection of sales tax on use of a broad range of coin-operated amusement machines. The tax was imposed by the Legislature with the enactment of Chapter 91-112, Laws of Florida. Sections 170 and 171 of that Act created or amended Section 212.02 and 212.05(1)(j)1, Florida Statutes (1991). The term "coin-operated amusement machine" is defined in Section 170 of the Act, and was codified as Section 212.02(25), Florida Statutes (1991).

The issue Petitioners press most strongly is whether the rules are invalid because the Department failed to prepare adequate economic impact statements for them. The next issues are whether subsections 9 and 10 of proposed Rule 12A- 1.044, Florida Administrative Code, are constitutionally invalid because they impair obligations of oral contracts, and whether subsection 10 exceeds the scope of the Department's rulemaking authority by characterizing agreements to place machines on real property as leases or licenses to use real property. The third group of issues are whether changes to the proposed rules, which were published on October 18, 1991, themselves are invalid exercises of delegated legislative authority because they impose unreasonable recordkeeping burdens.

The final issue is whether the failure to define the term "coin-operated amusement machine" the same way in all three proposed rules renders the rules invalid.


The parties filed a prehearing stipulation on December 17, 1992. The mixed issues of law and fact in dispute were framed in part 3(g) of the prehearing stipulation in this way:


  1. Whether the Department of Revenue considered the impact of Rules 12A-15.011, 12-18.008, and 12A-1.044, on small business as defined in the Florida Small and Minority Business Assistance Act of 1985 pursuant to section 120.54(2)(a).

  2. Whether the Department of Revenue, pursuant to section 120.54(2)(a), tiered the rules to reduce disproportionate impact on small business and considered the following methods for reducing the impact of the proposed rules on small businesses:

    1. Establishing less stringent compliance or reporting in the rule for small businesses.

    2. Establishing less stringent schedules or deadlines in the rule for compliance or reporting requirements for small businesses.

    3. Consolidating or simplifying the rules' compliance or reporting requirements for small businesses.

    4. Establishing performance standards to replace design or operational standards in the rules for small businesses.

    5. Exempting small businesses from any or all requirements of the rule.

  3. Whether the Department of Revenue prepared and provided in its proposed action an economic impact statement which complies with section 120.54(2)(b), Fla. Stat.

  4. Whether proposed Rules 12A-1.044, 12-18.008, 12A-15.011 are an invalid exercise of delegated legislative authority pursuant to sections 120.52(8) and 120.54(4)(a) in their failure to include the same definition of "coin-operated

amusement machine." Proposed Rule 12A-1.004(1)(b)1. defines "coin-operated amusement machine" as follows: Any machine operated by coin, slug, token,

coupon or similar device for the purposes of entertainment or amusement. Amusement machines

include but are not limited to, coin-operated radio and televisions, telescopes, pinball machines, music machines, juke boxes, mechanical games, video games, arcade games, billiard tables, moving picture viewers, shooting galleries, mechanical rides and all other similar amusement devices.

Rule 12-18.008, however, in its definition of "coin-operated amusement machine" excludes

radio, television and telescopes. That definition states as follows: (1)(b) for the purposes of these Rules, "coin-operated amusement machine" means any machine operated by coin, slug, token, coupon or similar device for the purpose of entertainment or amusement. The term includes, but is not limited to, coin-operated pinball machines, music machines, juke boxes, mechanical games, video

games, arcade games, billiard tables, moving picture viewers, shooting galleries and all other similar amusement devices.

Rules 12A-15.011 provides no definition at all of "coin-operated amusement machines".

The above failures in the proposed rules to consistently, fully, and adequately define "coin-operated amusement machine" present an issue as to whether the rules are arbitrary and capricious, vague, fail to establish adequate standards for agency decisions, and evidence an invalid exercise of delegated legislative authority pursuant to sections 120.52(8) and 120.54(4)(a), Fla. Stat.


Additional legal issues were identified in part 3(h) of the Prehearing Stipulation and are discussed in the Conclusions of Law.


Twenty-six exhibits including some depositions were received in evidence. Petitioners presented during the hearing the testimony of Brian McGavin, Ph.D., Buzz McKown, Scott Neslund, Tom Poplar and Elton Scott, Ph.D. Dr. Scott testified as an expert in financial economics. Mr. Neslund testified as an expert about the nature and structure of the coin-operated amusement industry. The Department presented testimony from Buzz McKown, Brian McGavin, Ph.D., and James Francis, Ph.D.


The transcript of the hearing was filed on January 23, 1992, and the parties filed their proposed final orders thirty days later. Rulings on proposed findings of fact are made in the appendix to this final order.


FINDINGS OF FACT


  1. The Parties


    1. The Family Arcade Alliance (Alliance) is a group composed primarily of businesses that operate amusement game machines in the State of Florida which are activated either by token or coin. The parties agree that the Alliance is a substantially affected person as that term is defined in Section 120.54(4)(a), Florida Statutes (1991), and has standing to maintain these proceedings.

    2. The Department of Revenue (Department) is the entity of state government charged with the administration of the revenue laws.


  2. The Tax and the Implementing Rules


    1. Except for the period the services tax was in force, no sales tax had been imposed on charges made for the use of coin-operated amusement machines before the enactment of Chapter 91-112, Laws of Florida, which became effective on July 1, 1991. The Act imposed a 6 percent sales tax on each taxable transaction. Coin-operated amusement machines found in Florida are typical of those machines throughout the United States. The charges for consumer use of the machines are multiples of twenty-five-cent coins, i.e., 25 cents, 50 cents,

      75 cents, and one dollar.


    2. The sales tax is most often added to the sale price of goods, but it is not practicable for the sellers of all products or services to separately state and collect sales tax from consumers. For example, there is no convenient way separately to collect and account for the sales tax on items purchased from vending machines such as snacks or beverages, or from newspaper racks.


    3. For these types of items, a seller reduces the price of the object or service sold, so that the tax is included in the receipts in the vending machine, newspaper rack or here, the coin-operated amusement machine.


    4. There are subtleties in the administration of the sales tax which are rarely noticed. The sales tax due on the purchase of goods or services is calculated at the rate of 6 percent only where the purchase price is a round dollar amount. For that portion of the sales price which is less than a dollar, the statute imposes not a 6 percent tax, but rather a tax computed according to a specific statutory schedule:


      Amount above or below Sales tax

      whole dollar amount statutorily imposed


      1-9 0

      10-16 1

      17-33 2

      34-50 3

      51-66 4

      67-83 5

      84-100 6


      Section 212.12(9)(a) through (h), Florida Statutes (1991). In most transactions the effect of the schedule is negligible and the consumer never realizes that the tax rate is greater than 6 percent for the portion of the sales price that is not a round dollar amount.


    5. Where a very large percentage of sales come from transactions of less than a dollar, the statutory schedule for the imposition of the sales tax takes on a greater significance. For those transactions between 9 cents up to a dollar the schedule's effective tax rate is never below the nominal tax rate of

      6 percent, and may be as high as 11.76 percent. For example, the 1 cent sales tax on a 10 cent transaction yields an effective tax rate of 10 percent, not 6 percent.


    6. Where it is impracticable for businesses in an industry to separately state the tax for each sale, the statutes permit sellers (who are called

      "dealers" in the language of the statute) to file their tax returns on a gross receipts basis. Rather than add the amount of the tax to each transaction, taxes are presumed to be included in all the transactions and the dealer calculates the tax based on his gross receipts by using the effective tax rate promulgated by the Department in a rule. See Section 212.07(2), Florida Statutes (1991). Businesses also have the option to prove to the Department that in their specific situation the tax due is actually lower than a rule's effective tax rate for the industry, but those businesses must demonstrate the accuracy of their contentions that a lower tax is due.


    7. Applying the statutory tax schedule to sales prices which are typical in the amusement game machine industry (which are sometimes referred to as "price points") the following effective tax rates are generated at each price point:


      Total Sales Presumed Presumed Effective Price Selling Price Sales Tax Tax Rate

      25 cents

      23 cents

      2 cents

      8.7%

      50 cents

      47 cents

      3 cents

      6.38%

      75 cents

      70 cents

      5 cents

      7.14%

      $1.00

      94 cents

      6 cents

      6.38%


    8. The determination of an effective tax rate for an industry as a whole also requires the identification of industry gross receipts from each of the price points. Once that effective tax rate is adopted as a rule, the Department treats dealers who pay tax using the effective tax rate as if they had remitted tax on each individual transaction.


    9. Proposed Rule 12A-1.044 establishes an industry-wide effective tax rate for monies inserted into coin-operated amusement machines or token dispensing machines of 7.81 percent. For counties with a one half or one percent surtax, the effective tax rates are 8.38 percent and 8.46 percent respectively. These rates include allowances for multiple plays, i.e., where the consumer deposits multiple coins to activate the machine.


    10. Proposed Rule 12A-1.044(1)(b) defines coin-operated amusement machines

      as:


      Any machine operated by coin, slug, token, coupon or similar device for the purpose of entertainment or amusement. Amusement machines include, but are not limited to, coin-operated radio and televisions, telescopes, pinball machines, music machines, juke boxes, mechanical games, video games, arcade games, billiard tables, moving picture viewers, shooting galleries, mechanical rides and all similar amusement devices.


    11. Proposed Rule 12-18.008 contained a definition of "coin-operated

      amusement machines" when the rule was first published which was essentially similar, but that rule's nonexclusive list of amusement machines did not include radios, televisions or telescopes. The Department has prepared a notice to be filed with the Joint Administrative Procedures Committee conforming the definitions so they will be identical. The current differences found in the nonexclusive descriptive lists are so slight as to be inconsequential. The Petitioners have failed to prove any confusion or ambiguity resulting from the differences that would impede evenhanded enforcement of the rule.

    12. Proposed Rule 12A-15.011 did not contain a separate definition of coin-operated amusement machines.


    13. Owners of amusement machines do not always own locations on which to place them. Machine owners may go to landowners and lease the right to place their machines on the landowner's property. The transaction becomes a lease of real property or a license to use real property. Sometimes owners of locations suitable for the placement of amusement machines lease machines from machine owners. Those transactions become leases of tangible personal property. Both transactions are subject to sales tax after July 1, 1991. Proposed rules 12A- 1.044(9)(c), (d) and 10(a), (c) prescribe which party to the leases of real estate or personal property will be responsible to collect, report and remit the tax.


    14. Under subsection 9(d) of proposed rule 12A-1.044, sales tax will not be due on any payment made to an owner of an amusement machine by the owner of the location where that machine is placed if: a) the lease of tangible personalty is written, b) the lease was executed prior to July 1, 1991, and c) the machine involved was purchased by the lessor prior to July 1, 1991. The tax will be effective only upon the expiration or renewal of the written lease. Similarly, proposed 12A-1.044(10)(d) provides that sales tax will not be due on written agreements for the lease of locations to owners of amusement machines if: a) the agreement to rent the space to the machine owner is in writing, and

      b) was entered into before July 1, 1991. At the termination of the lease agreement, the transaction becomes taxable.


  3. Changes to the proposed rules


    1. The Department published changes to the proposed rule 12A-1.044(3)(e) on October 18, 1991, which prescribed additional bookkeeping requirements on any amusement machine operators who wished to avoid the effective tax rate established in the proposed rule, and demonstrate instead a lower effective tax rate for their machines. The significant portions of the amendments read:


      1. In order to substantiate a lower effective tax rate, an operator is required to maintain books and records which contain the following information:

        * * *

        b. For an amusement machine operator, a list identifying each machine by name and serial number, the cost per play on each machine, the total receipts from each machine and the date the receipts are removed from each machine.

      2. If an operator establishes a lower effective tax rate on a per vending or amusement machine basis, the operator must also establish an effective tax rate for any machine which produces a higher rate than that prescribed in this rule.

      3. Operators using an effective rate other than the applicable tax rate prescribed within this rule must recompute the rate on a monthly basis. (Exhibit 6, pg. 4-5)

        There was also a change noticed to subsection (e) of the proposed rule 12A-1.044, which reads:

        (e) For the purposes of this rule, possession of an amusement or vending machine means either actual or

        constructive possession and control. To determine if a person has constructive possession and control, the following indicia shall be considered: right of access to the machine; duty to repair; title to the machine; risk of loss from damages to the machine; and the party possessing the keys to the money box. If, based on the indicia set out above, the owner of the machine has constructive possession and control, but the location owner has physical possession of the machine, then the operator shall be determined by who has the key to the money box and is responsible for removing the receipts. If both the owner of the machine and the location owner have keys to the money box and are responsible for removing the receipts, then they shall designate in writing who shall be considered the operator. Absent such designation, the owner of the machine shall be deemed to be the operator. (Exhibit 6, pg. 1-2)


  4. The Amusement Game Machine Industry


    1. All operators must be aware of how much money an amusement machine produces in order to determine whether it should be replaced or rotated to another location when that is possible, for if games are not changed over time, patrons become bored and go elsewhere to play games on machines which are new to them. The sophistication with which operators track machine production varies. It is in the economic self interest of all operators to keep track of the revenues produced by each machine in some way.


    2. In general, amusement game machine businesses fall into one of three categories: free standing independent operators, route vendors, and mall operators. Free standing independent operators have game arcades located in detached buildings, and offer patrons the use of amusement machines much in the same way that bowling alleys are usually freestanding amusement businesses. Like bowling alleys, they are designed to be destinations to which patrons travel with the specific purpose of recreation or amusement. They are usually independent businesses, not franchises or chains. Route operators place machines individually or in small numbers at other businesses, such as bars or

      convenience stores. People who use the machines are usually at the location for some other purpose. Those games are maintained on a regular basis by an operator who travels a route from game location to game location. The route operator or the location owner may empty the machine's money box. Mall operators tend to be parts of large chains of amusement game operators who rent store space in regional shopping malls. The mall is the patron's destination, and the game parlor is just one of the stores in the mall.


    3. Amusement machines are operated by either coin or by token. About 75 percent of independent amusement game operators use coin-operated machines. About 75 percent of the large chain operators found in malls use tokens. The cost of converting a coin-activated amusement machine to a token-activated amusement machine is about thirty dollars per machine. The mechanism costs $10 to $12, the rest of the cost comes from labor. Token operators must buy an original supply of tokens and periodically replenish that supply. The use of tokens enhances security because it gives the operator better control over their cash and permits the operator to run "promotions," for example, offering 5 rather than 4 tokens for a dollar for a specific period in an attempt to increase traffic in the store. Depending on the number purchased, tokens cost operators between 5 and 10 cents each.

    4. Token-activated machines accept only tokens. Coin-operated machines only accept a single denomination of coin. Change machines generally accept quarters and one, five and ten dollar bills. A change machine may be used either to provide players with quarters, which can be used to activate coin- operated machines, or they can be filled with tokens rather than quarters, and become a token dispenser. In a token-operated amusement location, the only machines which contain money are the change machines used to dispense tokens. The game machines will contain only tokens.


    5. Token machines record the insertion of each coin and bill by an internal meter as a domination of coin or currency is inserted. Token dispensing machines record their receivables as follows: when one quarter is inserted, the machine records one transaction. When a fifty-cent piece is inserted, the machine records one transaction. When three quarters are inserted, the machine records three transactions. When a dollar bill is inserted, the machine records one transaction. When a five dollar bill is inserted, the machine records one transaction. When a ten dollar bill is inserted, the machine records one transaction. Token machine meters record separately for each domination the total number of times coins or currency of each domination are deposited in the machine.


    6. The internal meters of token dispensing machines do not distinguish between insertion of several coins or bills by one person and the insertion of singular coins or bills by several persons. Token dispensing machines cannot distinguish the insertion of four quarters by one person on a single occasion from the insertion of one quarter by each of four persons at four different times.


    7. Similarly, the internal meters of amusement machines activated by coin rather than by token do not distinguish between insertion of several coins or bills by one person and the insertion of single coins or bills by several persons. Machines which are coin-activated also do not distinguish between the insertion of four quarters by one person at one time or the insertion of one quarter by each of four persons at different times.


    8. Coin-operation has certain cost advantages. The operator avoids the cost of switching the machine from coin to token operation, for machines are manufactured to use coins, and avoids the cost of purchasing and replenishing a supply of tokens. The operator does not risk activation of his machine by tokens purchased at another arcade, which have no value to him, and can better take advantage of impulse spending.


    9. Coin-operated machines do not have a separate device for collecting tax and it is not possible for an operator to fit games with machinery to collect an additional two cents on a transaction initiated by depositing a quarter in a machine.


    10. There are alternative methods available to operators of amusement game machines to recapture the amount of the new sales tax they may otherwise absorb.1 One is to raise the price of games. This can be done either by setting the machines to produce a shorter play time, or to require more quarters or tokens to activate the machines. Raising the prices will not necessarily increase an operator's revenues, because customers of coin-operated amusement businesses usually have a set amount of money budgeted to spend and will stop playing when they have spent that money. In economic terms, consumer demand for amusement play is inelastic. Amusement businesses could also sell tokens over-

      the-counter, and collect sales tax as an additional charge, much as they would if they sold small foods items over the counter such as candy bars. Over-the- counter sales systems significantly increase labor costs. An amusement business open for 90 hours per week might well incur an additional $30,000-a-year in operating costs by switching to an over-the-counter token sales system.


    11. In a small coin-operated business, the operator often removes the receipts by emptying the contents of each machine into a larger cup or container, without counting the receipts from each machine separately because it is too time consuming to do so. But see Finding 17 above.


    12. With a token-operated business, the operator can determine the percentage of revenue derived from twenty-five cent transactions, as distinct from token sales initiated by the insertion of one, five or ten dollar bills into token dispensing machines. The proposed rule has the effect (although it is unintended) of placing the coin-operated amusement operators at a relative disadvantage in computing sales tax when compared to the token-operated businesses. Token operators can establish that they are responsible for paying a tax rate lower than the 7.81 percent effective rate set in the rule because many of their sales are for one dollar, five dollars or ten dollars. The smaller businesses using coin-operated machines do not have the technological capacity to demonstrate that customers are spending dollars rather than single quarters. Consequently, coin operators will have an incentive to shift to token sales rather than pay the proposed rule's higher effective tax rate if a large percentage of their patrons spend dollars rather than single quarters. For example, Mr. Scott Neslund is an owner of a small business which has 80 amusement machines at a freestanding token-operated location. He is atypical of small amusement game operators because 75 percent of them use coin-operated machines rather than token-operated machines. Mr. Neslund can demonstrate that

      92 percent of his sales are for one dollar or more. By applying the tax rate of six percent to those transactions, he pays substantially less than the proposed rule's effective tax rate of 7.81 percent. This is very significant to Mr. Neslund because over the nine years from 1982 to 1990, his average profit margin was 7.77 percent. Although a flat 6 percent tax would have consumed 73 percent of that profit margin, if his businesses were on a coin-operated basis he would have been required to pay the proposed rule's 7.81 percent effective tax rate, which would have consumed 93 percent of his profit margin, leaving him with a very thin profit margin of 1/2 of 1 percent. The difference between a 1/2 of 1 percent profit margin and 2 percent profit margin, on a percentage basis, is a four hundred percent difference. Mr. Neslund's average profit annually had been

      $24,000. The effective tax rate of 7.81 percent would take $22,7000 of that amount, leaving an average annual profit of only $1,700. It is impossible to extrapolate from this single example and have confidence in the accuracy of the extrapolation, however.


  5. The Department's Effective Tax Rate Study


    1. There is no data for the amusement game industry specific to Florida concerning the number of transactions occurring at specified price points, but there is national data available which the Department considered. There is no reason to believe that the Florida amusement game industry is significantly different from the national industry. Nationally approximately 80 percent of all plays and 60 percent of all revenues come from single quarter (twenty-five- cent) plays.


    2. The Department's study used the typical sale prices charged in the industry and the categories of coin-operated amusement games reported in the

      national survey. Using them the Department derived an estimate of revenues by type of game for Florida.


    3. The effective tax rate the Department derived is the Department's best estimate of the price mix of transactions which occur through amusement machines. It is not itself an issue in this proceeding. Petitioners' counsel specifically agreed that they were not contesting the setting of the effective tax rate at 7.81 percent and presented no evidence that any other effective tax rate should have been set.


  6. The Department's Economic Impact Statement


    1. Dr. Brian McGavin of the Department prepared in July 1991 paragraphs 2, 3 and 5 of the economic impact statement for the proposed rules (Exhibits 14,

      15 and 16), which concluded that proposed rules 12A-15.001, 12-18.008 and 12A-

      1.044 would have no effect on small businesses. The economic impact statements for all three proposed rules contain identical information and involve the same issues concerning economic impact. Before drafting the economic impact statement published with these rules, Dr. McGavin had completed one other economic impact statement, had used a small manual which gave a general description of the process for developing economic impact statements and had discussed the process with another economist, Al Friesen, and his supervisor, Dr. James Francis, the Department's director of tax research. Dr. Francis prepares or reviews more than a dozen economic impact statements annually, and is well aware of the definition of small businesses found in Section 288.703(1), Florida Statutes. Dr. Francis reviewed Dr. McGavin's work and agreed with

      Dr. McGavin's conclusions.


    2. Paragraphs 2, 3 and 5 of the economic impact statements for these rules state:


      1. Estimated cost or economic benefits to persons directly affected by the proposed rule.

        The rule establishes effective tax rates for two categories of machines - 1) amusement machines, 2) vending machines. Amusement machines were not previously taxable (except during the Services tax period).

        * * *

        The costs of this rule are primarily compliance costs. The rules establishe several compliance provisions.

        1. quarterly sale and use tax reports.

        2. submission of supporting information for these reports on electronic media.

        3. affixation of registration certifi-cates to machines.

        4. presentation of certificates by operators to wholesale dealers.

        The filing requirement is obviously an integral and necessary part of the sales tax collection

        process . . . . The costs of complying will be borne by operators. If the operators have previously computerized their records, the marginal compliance costs will be negligible. For a small operator who has not computerized his operations, the costs of minimally configured PC systems - including software and

        training - would be roughly $2,000. This could be a

        major expense for a small operator . . . . We do not have data which will permit us to estimate the proportion of non-computerized operators in this industry.

      2. Effect of the proposed action on competition and on the open market for employment.

      * * *

      Given the low labor-intensity of this industry the overall effect should be very small.

      * * *

      5. Impact of the proposed action on small business firms. Small business firms are not affected by the proposed action. (Exhibits 14, 15 and 16)


    3. The Petitioners demonstrated that before Dr. McGavin prepared the economic impact statement he did not read section 120.54 on rulemaking and he did not conduct any industry research or refer to any sources of information on the amusement game industry in Florida or nationally. He did not use any data to calculate or measure economic impact, consult text books, or refer to any outside sources or statistical information, nor did he talk with any industry experts or representatives. He did not obtain any information about the industry by distributing questionnaires to those in the industry, nor did he know whether there were differences in day-to-day operations between large and small amusement businesses or the different types of accounting and bookkeeping systems used by small businesses. He had not read Section 288.073, Florida Statutes, which defines a small business. He did not know the impact the 7.81 percent effective tax rate established by the rule would have on small business, and he did not analyze the cost difference businesses experienced between the sale of tokens by machine and the sale of tokens over-the-counter by an employee.


    4. To the extent it even entered into Dr. McGavin's thought process, Dr. McGavin made the general assumption that token sales would either be made over the counter, in which case the sales tax could be separately collected, or possibly by selling fewer tokens per unit of currency.


    5. When the Legislature enacted Chapter 91-112, Laws of Florida, and imposed the tax on the use of coin operated amusement machines, it did not provide for any phasing in of the tax, nor for any tiering of the tax based on the size of the taxpayers. Nothing in the language of the statute imposing the tax indicates that the Legislature believed that there was a distinction to be made in the taxation of larger and smaller businesses which provide the same service, viz, use of amusement machines.


    6. The Department does permit certain accommodations to businesses which have a small volume of sales. A business may report quarterly rather than monthly if its tax liability is less than $100 for the preceding quarter, and if the tax liability is less than $200 for the previous six months, a dealer may request semiannual reporting periods. Regardless of size, a business with more than one location in a county may file one return. Both of these provisions may lessen the burden of complying with the tax imposed on the use of coin-operated amusement machines.


  7. The Economic Impact Analysis Performed For The Challengers By Dr. Elton Scott

  1. Dr. Elton Scott is an economist and a professor at the Florida State University. The Petitioners engaged him to evaluate the economic impact statement the Department had prepared when these proposed rules were published. After conducting his own analysis, Dr. Scott wrote a report in which he determined that the Department's economic impact statement was deficient. According to Dr. Scott, one must understand an industry to determine whether an economic impact flows from a regulation and to determine the magnitude of any impact or the differential impact the regulation may have on large and small businesses. To prepare his own economic impact analysis, Dr. Scott first obtained information about the operational characteristics of the industry by speaking directly with a handful of industry members. He developed a questionnaire that tested the experience and background of operators so that he could evaluate the reliability or accuracy of information he received from them. He then asked additional questions about the operators' individual businesses and questions about differences between large and small operators within the industry.


  2. Dr. Scott's testimony outlines the factors which should be used to make an economic impact statement as useful as possible, but his testimony does not, and cannot, establish minimum standards for what an economic impact analysis should contain. Those factors are controlled by the Legislature, and no doubt the requirements imposed on agencies could be more onerous, and if faithfully followed could produce more useful economic impact statements.


  3. The economic impact small businesses will bear is caused by the statute, not by the implementing rule, with the possible exception of the electronic filing requirement, which has not been challenged in any of the three proceedings consolidated here. Large businesses have several advantages over smaller ones. Large businesses have sophisticated accounting systems, whether they use token or coin-operated machines, which allow tracking not only of gross receipts but kinds of plays, which enhance the operator's ability to establish that the tax due is lower than the effective tax rate, while the less sophisticated systems of metering receipts in coin-operated small businesses require reliance on the effective tax rates. (Exhibit 9 pg. 4) Large businesses may extend the useful life of a game machine by rotating the machine from one location to another, may deal directly with manufactures in purchasing a larger number of games or machines and therefore obtain more favorable discounts.

    Small businesses cannot rotate games if they have only one location, and purchase at higher prices from manufactures. In general, smaller businesses have lower profit margins than larger businesses. All of these advantages exist independently of any rule implementing the sales tax statute.


    CONCLUSIONS OF LAW


  4. The Division of Administrative Hearings has jurisdiction over this matter. Section 120.54(4), Florida Statutes (1991).


  5. The Florida Legislature imposed a tax on charges for the use of coin- operated amusement machines when it enacted Chapter 91-112, Laws of Florida, and created Section 212.05(1)(j), Florida Statutes (1991). The tax is levied on each transaction, whenever a customer activates a machine through the use of coins or currency or purchases tokens from a token dispensing machine (which in reality is nothing more than a change machine).


  6. The sales tax statutes permit establishment of effective tax rates as a practical accommodation to the difficulty presented where a seller cannot state and collect separately the tax for each transaction. The promulgation of

    a rule setting an effective tax rate furthers the purpose of the legislation imposing a sales tax upon the use of coin-operated amusement machines, and is authorized by Section 212.05(1)(j)6. and 212.07(2), Florida Statutes (1991).


    Tax on Coin Operation


  7. The Petitioners' argument that Section 212.05(1)(j)1.authorizes the sales tax on charges only "when a machine is activated by a slug, token, coupon or any similar device which has been purchased" but does not authorize the imposition of sales tax if the machine is activated by coin is not well taken. One must read the statutory definition of "coin-operated amusement machine" in Section 170 of Chapter 91-112, Laws of Florida, with the quoted language Petitioners rely upon. The definition of coin-operated amusement machine found in Section 212.02(25), Florida Statutes, includes "any machine operated by

    coin . . ." The use of coin-operated machines is taxed under the statutory language found in the first sentence of Section 212.05(1)(j)1, Florida Statutes (1991), which reads "effective July 1, 1991, a tax is imposed at the rate of six percent on the charges for the use of coin-operated amusement machines."


    Economic Impact Statement


  8. Section 120.54(2)(a), Florida Statutes (1991), requires that when enacting a rule, the agency consider the impact of the proposed action on small businesses as defined in the Small and Minority Business Assistance Act of 1985, Section 288.703(1), Florida Statutes (1991). The businesses defined are those which employ 25 for fewer permanent, full-time employees, and which have a net worth of not more than 1 million dollars. With respect to sole proprietorships, the 1 million dollar net worth requirement includes both personal and business investments.


  9. Dr. McGavin may not have been aware of the requirements of the Florida Small and Minority Business Assistance Act, but his supervisor, Dr. Francis, was. The requirement was considered by the agency through the review by Dr. Francis. The rulemaking statute sets out specific factors which the agency must address in its economic impact statement. See Section 120.54(2)(b)1.-5. Each factor is specifically addressed in the three economic impact statements which the Department included with its filings at the time the proposed rules were published by the Department of State in the Florida Administrative Weekly. See Finding 33.


  10. An agency is not always required to provide accommodations to small businesses. Section 120.54(2)(a) instructs the agency to consider tiering the rule "to reduce disproportionate impacts on small businesses." That tiering has no place in a tax implementation rule where the Legislature itself drew no distinction between large and small businesses but taxed both equally. Neither are there performance standards involved here which the Department could adjust for small businesses. Section 120.54(2)(a)4. It certainly could not exempt small businesses from the tax. See Section 120.54(2)(a)5. The agency did make an attempt to accommodate the needs of small businesses when it adopted the provision which permits businesses which owe a small amount of tax to file reports quarterly or semiannually rather than monthly. See Finding 37. These accommodations apply to all sales tax dealers, and while not developed solely for the benefit of small businesses which provide coin-operated amusement services, they do enjoy the benefit of those accommodations. The Department thus has adequately addressed the factors found in Section 120.54(2)(b) 1, 2 and 3, Florida Statutes (1991).

  11. The standard of review applicable to economic impact statements is a rather limited one. The question is whether it addresses all areas Section 120.54(2)(b) requires the agency to address. Florida League of Cities, Inc. vs. Department of Environmental Regulation, So.2d , 16 FLW D 1933, 1934 (Fla. 1st DCA July 25, 1991) (rehearing pending).


  12. This is not a case where the Department wholly failed to take into consideration in its economic impact statements ongoing reporting costs the Department was imposing upon small businesses. To the extent the rule originally required small businesses to purchase computer equipment to make the filings required on magnetic media, the matter has been fully considered, not ignored, in the agency's economic statement. See proposed rule 12A- 1.044(4)(a)4. and 5. (Exhibit 2, p. 8), as amended by the notice of change (Exhibit 6, p. 7). The decision of the District Court of Appeal in Cataract Surgery Center vs. Health Care Cost Containment Board, 581 So.2d 1359 (Fla. 1st DCA 1991), therefore, is not in point.


  13. While it may be technically difficult for the Petitioners to account for the taxes imposed, because of the small sales price of the transactions, and their mechanical inability to separately collect the tax, those difficulties arise from the unusual aspects of the way Petitioners do business, not from the rule. The rule provides an effective tax rate for Petitioners to use, and thus relieve themselves from the burden otherwise placed on them to add the sales tax to the sales price and to remit that tax to the Department. The whole concept of establishing an effective tax rate is an accommodation to businesses such as the Petitioners'. Section 212.07(2), Florida Statutes (1991), gives the Department the authority to establish an effective tax rate for an industry "where it is impracticable, due to the nature of the business practices within an industry, to separately state Florida tax on any charge . . . ." After adoption of the effective tax rate, operators utilizing coin-activated equipment will have to consider whether it is in their economic interest to convert to token-activated machinery rather than pay the effective tax rate the Department has established, but no business is obliged by law to do so. Petitioners have not shown that there is any meaningful alternative to use of an effective tax rate that the Department could have considered. The Petitioners could incur the labor costs for selling tokens over-the-counter to separately collect the tax, but the evidence demonstrated (see Finding 26) that could cost an operator

    $30,000 per year each year into the future. If the Department's rule had imposed such a requirement, the decision in Cataract Surgery Center, supra, 481 So.2d 1359, would have required it to discuss those costs in the economic impact statement, for nothing in the text of the statute imposing the sales tax on

    coin-operated amusement machines required operators to activate their machines by tokens, or to sell those tokens over-the-counter. Here the Department has taken the industry as it exists, and given operators the option to use the effective tax rate established under Section 212.07(2) or to bear the burden of keeping the records necessary to establish the actual tax due. This does not violate the holding in Cataract Surgery Center.


  14. It is not surprising that the bookeeping alterative to the rule's effective tax rate is onerous, because effective tax rates are established for an industry only "where it is impracticable, due to the nature of the business practices within an industry, to separately state Florida tax." Section 212.07(2), Florida Statutes (1991). The reporting requirements imposed are designed to insure that the tax paid by a particular operator is representative of all machines in that business, not just of some machines, and prevents a taxpayer from skewing an average. The rule does not impose any requirement to change from coin-operated to token-operated systems, and thus, there is no

    reason for the Department to have considered the $30 cost per machine of converting a business to tokens or the cost of acquiring and replacing tokens as they may become lost. Had such a requirement been imposed, then the decision in Department of Health and Rehabilitative Services vs. Wright, 439 So.2d 937 (Fla. 1st DCA 1983) would be in point. In Wright the Department had expanded upon a statute which limited adult congregate living facilities (ACLFs) to providing personal services, and the statute defined personal services to exclude nursing services. The Department's rule expanded that general statutory prohibition against providing "nursing services" into a specific, textual prohibition against 1) use of physical restraints such as jacket restraints, body or limb restraints at ACLFs, and 2) use of full bedside rails on the beds of residents. The rule itself had important economic consequences because ACLF residents who needed restraints or bed rails could no longer have them provided by the ACLF. The rule forced them to move into more expensive nursing homes or to contract with third parties for nursing services which the ACLF could not itself provide. The operators of the ACLFs lost a number of residents who required those nursing services, and that number was a calculable percentage of ACLF patients. In that circumstance, the court held the rule invalid because the economic impact statement wholly ignored the economic effect of the rule's new requirements, and held the failure to address the economic impact of the new requirements was not harmless error. The critical distinction is that these rules do not, in express terms, forbid any manner of doing business, or require any operator to switch from coin operation to token operation, or to incur the labor costs involved in selling tokens over-the-counter in order to collect the sales tax separately.


  15. The Petitioners also rely on the decision in Department of Health and Rehabilitative Services vs. Framat Realty, Inc., 407 So.2d 238 (Fla. 1st DCA 1981), in support of its argument that the economic impact statement is insufficient. They emphasize that portion of that decision which affirmed the Hearing Officer's ruling that the economic impact statement in that case was insufficient because the methodology employed by the agency and the data it used were not "sufficiently explicated so as to attach any credibility to the conclusions reached in the [economic impact] statement." 407 So.2d at 242. The Petitioners have misapprehended the holding in Framat. The question is not whether the amanuensis drafting the economic impact statement is well experienced or whether the data relied upon is stated in detail on the face of the economic impact statement. As long as personnel in the agency, whether the initial author, a supervisor, or the agency head personally, have given adequate attention to the economic impact statement, if the statement published contains entries on all required topics, the statement is sufficient even if the entries are brief. The "explication" of entries may take place during a 120.54(4) rule challenge hearing.


  16. Whether Dr. McGavin personally knew about the definition of small business in Section 288.073 or had read Section 120.54 is not determinative. His supervisor, Dr. Francis, is well acquainted with both from past experience, and his review of the adequacy of the economic impact statement before it was

    published carried with it the necessary understanding of the requirements of the statutes. The core question is whether the Department and Dr. Francis incorrectly answered question 5 of the economic impact statement. They did not. There is no special or different impact on small businesses which arises from the rule. This is not to say that there will not be impacts from the imposition of the tax which may cause economically rational small businesses to reconsider whether they should continue to operate as coin-operated businesses, but the same is true for large mall operators who had returned to coin operation after doing business on a token basis, because of a significant influx of bogus tokens (Tr. 144).

    Contract Impairment


  17. The Petitioners have also claimed that subsections 9 and 10 of proposed rule 12A-1.044 are invalid because they violate the constitutional provision forbidding the impairment of contract obligations, Article I, Section

    10 of the Florida Constitution. The State of Florida now will tax agreements giving amusement machine owners the right to place game machines on real property owned by others. These agreements can be cast in one of two ways: as a lease of real property or as a license to use real property. Under Florida's strict view of the constitutional duty to avoid the impairment of contract obligations, the state cannot tax agreements which pre-date the effective date of a new tax. In re Advisory Opinion to the Governor, 509 So.2d 292, 314 (Fla. 1987); Florida Department of Revenue v. Florida Home Builders Ass'n., 564 So.2d

    173 (Fla. 1st DCA 1990). Those agreements may be taxed when they are renewed. The Department will "recognize" licenses or leases, and not tax them, so long as those leases or licenses were in writing, and were entered into before July 1, 1991. Rule 12A-1.044(10)(d). The same is true where the transaction was structured as a landowner's lease of a game machine. Rule 12A-1.044(9)(d).


  18. Petitioners object because the language of the rule only "recognizes," i.e., protects, written agreements from the imposition of the sales tax, and would seemingly tax oral ones. The rule actually is silent on taxation of oral contracts. Like written contracts, oral contracts are entitled to protection. But it does not make sense to invalidate the rule because of what it does not say. The provisions which do appear, exempting unexpired written contracts from tax, are constitutionally sound.


  19. The rule can be validated by giving it a limiting construction. Cf., Florida Education Association/United v. Florida Public Employees Relations Commission, 346 So.2d 551 (Fla. 1st DCA 1977). The constitutional protection accorded to the obligation of contracts only extends to valid contracts. Apparently the Department is concerned that taxpayers will yield to the temptation to engage in fraud and assert nonexistent oral agreements in order to avoid tax. The period of temptation is a brief one. Oral contracts for leases of real property cannot be for periods of more than one year, Section 689.01, Florida Statutes (1991). Similarly, "any agreement that is not to be performed within the space of one year from the making thereof. . . shall be in

    writing . . . ." Section 725.01, Florida Statutes (1991). Valid oral contracts will be expiring throughout the year which begins on the effective date of the tax, July 1, 1991. The Department must also exempt from tax the unexpired term of oral agreements entered into before July 1, 1991, but they all become taxable during the course of the year as they are renewed.


    Bookkeeping Alternatives To Avoid The Effective Tax Rate


  20. The changes to subparagraphs 1, 2 and 3 of paragraphs (e) of subsection (3) rule 12A-1.044 (Exhibit 6, p. 4) are not invalid exercises of delegated legislative authority. Those paragraphs describe how an operator must maintain books and records in order to establish a lower sales tax rate than the industry-wide effective tax rate. The operator must identify each machine by name and serial number, the cost per play on each machine, the total receipts for each machine and the dates the receipts are removed from each machine. More importantly, whenever an operator establishes a lower tax rate on an individual amusement machine, the operator must also establish the effective tax rates for all other machines he owns which produces a tax rate higher than the effective tax rate prescribed in the rule. All these computations must done on a monthly

    basis. These provisions are rational and necessary so that a taxpayer cannot skew his tax rate by tracking only machines which produce a lower tax rate while relying on the industry-wide effective tax rate of 7.81 percent for any machines whose actual operations would result in a higher rate.2 It is irrelevant that the cost of keeping these records could outweigh the savings to the taxpayer.

    As noted above, an effective tax rate is established for an industry when it is impractical, due to the nature of the business practices in the industry, to separately state the tax at the time of the transaction. That it would be burdensome to keep records necessary to establish that the tax due is lower than that calculated using the effective tax rate is not a surprise, it is a tautology.


    The Presumption As To Real Property Matters


  21. Proposed rule 12A-1.004(10) characterizes arrangements between a machine owner placing his machine on the property of another as a lease or license to use real property. Petitioners contend this provision impermissibly enlarges or modifies the statute implemented. Section 212.05(1)(j)2.a, Florida Statutes (1991), says a machine owner who is also an operator cannot deduct from the sales tax due any rent or license fee paid to the location owner. The statutory language implicitly treats the arrangement as a lease or license to use real property. The statutory language is sufficient authority for the rule's presumption, when coupled with the language of Section 212.031, Florida Statutes (1991), which imposes sales tax on the business of leasing or granting a license to use real property. Both sections are cited in the portion of the rule disclosing the statutes the rule implements.


    The Presumption About Possession Of Game Machines


  22. Proposed rule 12A-1.044(1)(e) defines who has possession of the amusement machine when the machine is owned by one person, but placed on the real property of another. One person becomes responsible for collecting, reporting and paying over the sales tax. Petitioners argue that the rule is invalid because it "completely ignore[s] in its criteria which party receives the revenue from the machine" (proposed final order at 44). To the contrary, the rule focuses on who "receives" the receipts by collecting them. The "operator" of the machine who must collect and pay over the tax is determined by "who has the key to the money box and is responsible for removing the receipts." If both the owner of the machine and the location owner have keys and are responsible for removing receipts they must designate in writing who will be the operator. If they fail to do so, a presumption is created and the owner of the machine is deemed to be the operator. The rule's provisions are logical. The party with the keys to the money box has his hands on the cash, and must pay the tax. How the parties decide among themselves to divide the cash after the tax is paid is up to them.


ORDER


Based on the foregoing, it is


ORDERED that the proposed rules do not constitute invalid exercises of delegated legislative authority, and the challenges filed by Petitioners to rules 12A-18.008, 12A-1.044 and 12A-15.001 are dismissed.

DONE AND ORDERED in Tallahassee, Leon County, Florida, this 17th day of March 1992.



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 17th day of March 1992.


ENDNOTES


1/ The operator's tax payments do not necessarily come out of profits. An operator will seek to maintain profit levels by reducing the cost of labor, supplies, rent or maintenance first.


2/ These would be machines in which substantially all of the plays were for single quarters, and the sales price is assumed to be 23 cents with 2 cents of tax, producing an effective tax rate of 8.7 percent. See Finding 9.


APPENDIX TO FINAL ORDER, CASE NOS. 91-5338RP, 91-5339RP AND 91-5340RP


Rulings on findings proposed by the Petitioners:


1 &

2.

Adopted in Finding 1.

3.


Rejected as unnecessary.

4.


Adopted in Finding 2.

5.


Adopted in Finding 3.

6.


Adopted in Preliminary Statement.

7.


Implicit in Finding 3.

8.


Adopted in Finding 31.

9.


Adopted in Finding 3.

10.


Irrelevant as the services tax was not a rule and

therefore required no economic impact statement under Section 120.54.

  1. See Finding 26.

  2. Adopted in Finding 9.

  3. Adopted in Findings 8 and 9.

  4. Adopted in Finding 11.

  5. Adopted in Findings 12, 13 and 14.

  6. Adopted in Findings 15 and 16.

  7. Adopted in Finding 13.

  8. Adopted in Finding 16.

  9. Adopted in Finding 16.

  10. Rejected because it is not a finding of fact, see the conclusions of law.

  11. Adopted in Finding 16.

  12. Rejected because the 7.81 percent figure includes an

allowance for multiple plays, see Finding 11, but see


23.

Finding

Adopted

21.

in


Finding 18.

24 &

25. Adopted

in

Finding 21.

26 &

27 Adopted

in

Finding 22.

28 &

29. Adopted

in

Finding 20.

30.

Adopted

in

Finding 19.

31 &

32. Adopted

in

Finding 20.

33 &

34. Adopted

in

Finding 19.

35. Rejected as unnecessary.

36 - 38. Adopted in Finding 19.

39. Adopted in Finding 25.

40 - 42. Adopted in Finding 26.

  1. Adopted in Finding 28.

  2. Adopted in Finding 20.

  3. Adopted in Finding 27.

46 - 48. Adopted in Finding 28.

  1. Rejected, see Exhibit 9, page 4.

  2. Rejected as irrelevant.

51 & 52. Adopted in Finding 28.

  1. Explicit in Findings 19 and 28.

  2. Rejected as unnecessary and implicit in the finding of standing.

  3. Adopted in Finding 40.

  4. Adopted in Finding 32.

57 & 58. Adopted in Finding 11.

  1. Adopted in Finding 33.

  2. Adopted in Finding 34.

  3. Adopted in Finding 35.

  4. Rejected as unnecessary.

  5. Adopted in Finding 35.

64 - 68. Rejected, but discussed in Finding 38. The findings proposed are based on the testimony of Dr. Scott, which was not accepted with respect to what must be contained in an economic impact statement. Certainly the rigor he would require would be helpful, but it is not required by the statute.

  1. Rejected as irrelevant.

  2. Adopted in Finding 10.


Rulings on findings proposed by the Department of Revenue:


  1. Adopted in Finding 3.

  2. Adopted in Findings 6, 7 and 8.

  3. Adopted in Finding 7.

  4. Adopted in Finding 8.

  5. Adopted in Findings 8 and 9.

6 & 7. Adopted in Finding 10.

  1. Adopted in Finding 29.

  2. Adopted in Findings 11 and 28.

  3. Adopted in Finding 29.

  4. Rejected as unnecessary.

  5. Adopted in Finding 30.

  6. Adopted in Finding 31.

  7. Rejected as subordinate to Finding 17.

15 & 16. Adopted in Finding 11.

17. Adopted in Finding 19.

18 & 19. Rejected as subordinate to Finding 19.

  1. Adopted in Finding 19.

  2. Adopted in Finding 16.

22 - 27. Adopted in Finding 32.

  1. Adopted in Finding 3.

  2. Adopted in Finding 36.

30 & 31. Adopted in Finding 37.

  1. Adopted in Finding 38.

  2. Adopted in Finding 35.

  3. Rejected as unnecessary.

  4. Adopted in Finding 40.

  5. Rejected as subordinate to Finding 40.

  6. Adopted in Finding 40.

  7. Adopted in Finding 13.

  8. Adopted in Finding 40.

  9. Adopted in Finding 19.

  10. Adopted in Finding 24.

  11. Rejected as unnecessary because Dr. Francis' work did not relate to the rule, but to the statute imposing the tax -- obviously Dr. Francis "knew" that same information when reviewing the economic impact statements prepared by Dr. McGavin.


COPIES FURNISHED:


Juana M. Rojas, Esquire Richard A. Nielsen, Esquire Salem, Saxon & Nielsen Suite 3200

101 East Kennedy Boulevard Post Office Box 3399 Tampa, Florida 33601


James McAuley, Esquire Ralph Jaeger, Esquire

Office of the Attorney General Tax Section, Capitol Building Tallahassee, Florida 32399-1550


J. Thomas Herndon Executive Director Department of Revenue

104 Carlton Building Tallahassee, Florida 32399-0100


Vicki Weber General Counsel

Department of Revenue

204 Carlton Building Tallahassee, Florida 32399-0100


Carroll Webb, Executive Director Administrative Procedures Committee

120 Holland Building Tallahassee, Florida 32399-1300

Liz Cloud, Chief

Bureau of Administrative Code Room 1802, The Capitol Tallahassee, Florida 32399-0250


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.


Docket for Case No: 91-005338RP
Issue Date Proceedings
Mar. 17, 1992 CASE CLOSED. Final Order sent out. Hearing held 12-18-91
Feb. 24, 1992 (Respondent) Notice of Filing Department of Revenue's Proposed Final Order w/Respondent's Proposed Final Order filed.
Feb. 24, 1992 (Petitioner) Proposed Final Order filed.
Jan. 23, 1992 Transcript (Vols 1&2) filed.
Dec. 20, 1991 Telephone Deposition of Tom Fricke; Telephone Deposition of Ed Tolisano; Telephone Deposition of Larry Naddeo filed.
Dec. 18, 1991 CASE STATUS: Hearing Held.
Dec. 17, 1991 (Respondent) Notice of Filing Joint Prehearing Stipulation w/Prehearing Stipulation filed.
Dec. 17, 1991 (Respondent) Notice of Taking Telephonic Deposition filed.
Dec. 17, 1991 Subpoena Ad Testificandum filed. (From Juana M. Rojas)
Dec. 16, 1991 Notice of Taking Deposition via Telephone filed.
Dec. 11, 1991 (Respondent) Notice of Taking Deposition VIA Telephone filed.
Dec. 09, 1991 Order on Second Prehearing Conference sent out.
Dec. 09, 1991 Notice of Hearing sent out. (hearing set for Dec. 18-19, 1992; 9:30am; Tallahassee).
Dec. 09, 1991 Order of Prehearing Instructions sent out.
Dec. 09, 1991 (Respondent) Amended Notice of Taking Deposition filed.
Dec. 09, 1991 (Petitioner) Amended Statement of Issues filed. (from Juana M. Rojas)
Dec. 09, 1991 (Petitioner) Notice of Taking Deposition filed.
Dec. 05, 1991 Respondent's Motion in Limine w/Statement of Issues filed.
Dec. 03, 1991 (Respondent) Notice of Taking Deposition filed.
Dec. 02, 1991 (Petitioner) Statement of Issues filed.
Nov. 27, 1991 Order on Prehearing Conference sent out.
Nov. 25, 1991 (Respondent) Supplemental Response to Request for Production filed.
Nov. 22, 1991 (Petitioner) Notice of Service of Answers to Interrogatories; Notice of Appearance; Petitioner`s Response to Respondent`s First Request for Production of Documents filed.
Nov. 21, 1991 Order Closing File sent out. (Re: 91-5342R, closed).
Nov. 19, 1991 Department of Revenue`s Response to Petitioner`s Request to Produce; Notice of Serving Answers to Petitioner`s First Set of Interrogatories to Respondent filed.
Nov. 15, 1991 (Respondent) Notice of Serving Answers to Petitioner`s First Set of Interrogatories to Respondent; Department of Revenue`s Response to Petitioner`s Request to Produce filed.
Nov. 12, 1991 Joint Agreement For Dismissal of Petition filed.
Nov. 12, 1991 (Respondent) Response in Opposition to Motion For Leave to File Amended Petition filed.
Nov. 05, 1991 (Petitioner) Amended Petition For Administrative Determination of The Invalidity of Proposed Rule w/Exhibits A&B (3); (Petitioner) Motion for Leave to File Amended Petitions w/Exhibits A&B filed.
Nov. 01, 1991 Respondent`s First Request for Production of Documents; Notice of Serving Interrogatories filed.
Oct. 30, 1991 (Petitioner) Status Report filed.
Oct. 28, 1991 (Petitioner) Notice of Service of Interrogatories filed.
Oct. 22, 1991 (Petitioner) Request for Production of Documents filed.
Oct. 02, 1991 Order of Consolidation and Placing Case in Abeyance sent out. 91-5338R, 91-5339R & 91-5340R consolidated.
Sep. 13, 1991 Department of Revenues Response to Petition filed.
Sep. 12, 1991 Stipulated Motion to Hold Proceedings in Abeyance filed. (From Rex Ware)
Aug. 28, 1991 Order of Assignment sent out.
Aug. 26, 1991 Letter to Liz Cloud & Carroll Webb from Marguerite Lockard
Aug. 23, 1991 Petition for Administrative Determination of the Invalidity of a Proposed Rule (Exhibit A) filed.

Orders for Case No: 91-005338RP
Issue Date Document Summary
Mar. 17, 1992 DOAH Final Order Rule challenge for failure to prepare economic impact statements, unconstitutionally impairing oral contracts and exceeding authority dismissed.
Source:  Florida - Division of Administrative Hearings

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