vs. ) CASE NO. 94-4488
Respondent. )
Pursuant to notice, a formal hearing was conducted in this case on August 18, 1995, in Fort Lauderdale, Florida, before Stuart M. Lerner, a duly designated Hearing Officer of the Division of Administrative Hearings.
For Petitioner: Margaret G. Gordon, President
G.M. Sales & Service Corporation 1/ 2501 Southeast 4th Street
For Respondent: Joseph L. Shields, Esquire
Whether Petitioner is eligible for certification as a "minority business enterprise" in the area of landscape contracting?
By letter dated July 6, 1994, Petitioner was advised that a preliminary determination had been made to deny its request for certification as a "minority business enterprise" based on its failure to "meet the specifications of Section 288.703(2), Florida Statutes." On or about July 25, 1994, Petitioner filed a written request for a formal administrative hearing on the proposed denial of its application. The matter was referred to the Division of Administrative Hearings (hereinafter referred to as the "Division") on August 18, 1994, for the assignment of a Division hearing officer to conduct the formal hearing Petitioner had requested.
At the formal hearing, which was held on August 18, 1995, 2/ two witnesses testified: Margaret Gordon, Petitioner's president; and Raymond
Bryant, Respondent's certification and office manager. In addition, one exhibit, Respondent's Exhibit 1, was offered and received into evidence at hearing.
At the close of the evidentiary portion of the hearing on August 18, 1995, the Hearing Officer advised the parties of their right to file post-hearing submittals. Furthermore, he established a deadline (15 days from the date of the Hearing Officer's receipt of the hearing transcript) for the filing of these submittals. The Hearing Officer received the hearing transcript on September 8, 1995. On September 20, 1995, Respondent filed a proposed recommended order, which contains, among other things, proposed findings of fact and conclusions of law. The Hearing Officer has carefully considered Respondent's proposed recommended order. The findings of fact set forth in the proposed recommended order are specifically addressed in the Appendix to this Recommended Order. To date, Petitioner has not filed any post-hearing submittal.
Based upon the evidence adduced at hearing, and the record as a whole, the following Findings of Fact are made:
Petitioner is a Florida corporation that was formed and incorporated by Margaret Gordon, who is the corporation's sole shareholder and its lone officer and director.
Gordon is an American woman.
Before forming Petitioner, Gordon held various jobs.
Among her former employers are Florida Maintenance Contractors and Scenico, Inc. She worked for the former from 1984 to 1991, and for the latter from 1984 to 1990.
As an employee of Florida Maintenance Contractors and Scenico, Inc., Gordon supervised landscaping projects.
As a result of this work experience, Gordon has the managerial and technical knowledge and capability to run a landscape contracting business.
Petitioner is such a landscape contracting business, although it has not undertaken any landscaping projects recently. Its last project was completed two years prior to the final hearing in this case. Since that time, the business has been inactive.
Gordon's two sons, working as subcontractors under Gordon's general supervision, have performed the physical labor and the actual landscaping involved in the previous jobs Petitioner has performed.
Gordon herself has never done such work and she has no intention to do so in the future. Instead, she will, on behalf of Petitioner, as she has done in the past, use subcontractors (albeit not her sons inasmuch as they are no longer available to perform such work.)
Petitioner filed its application for "minority business enterprise" certification in the area of landscape contracting in March of 1994.
CONCLUSIONS OF LAW
Respondent is the state agency vested with the authority to "certify minority business enterprises, as defined in s. 288.703," Florida Statutes (Supp. 1994). Section 287.0945(6)(q), Fla. Stat. (Supp. 1994)
A "minority business enterprise" is defined in subsection (2) of Section 288.703, Florida Statutes (Supp. 1994), as follows:
"Minority business enterprise" means any small business concern as defined in subsection (1) which is organized to engage in commercial transactions, which is domiciled in Florida,
and which is at least 51-percent-owned by minority persons who are members of an insular group that is of a particular racial, ethnic, or gender
makeup or national origin, which has been subjected historically to disparate treatment due to identification in and with that group resulting
in under-representation of commercial enterprises under the group's control, and whose management
and daily operations are controlled by such persons. A minority business enterprise may primarily involve the practice of a profession.
A "small business," as that term is used in subsection (2) of Section 288.703, Florida Statutes (Supp. 1994), is defined in subsection (1) of the statute as follows:
"Small business" means an independently owned and operated business concern that employs 100 or fewer permanent full-time employees and that, together with its affiliates, has a net worth of not more than $3 million and an average net income after federal income taxes, excluding any carryover losses, for the preceding two years of not more than $2 million. As applicable to sole
proprietorships, the $3 million net worth requirement shall include both personal and business investments.
A "minority person, as that term is used in subsection (2) of Section 288.703, Florida Statutes (Supp. 1994), is defined in subsection (3) of the statute, in pertinent part, as follows:
"Minority person" means a lawful, permanent resident of Florida who is:
(e) An American woman.
In determining whether an applicant is eligible for certification as a "minority business enterprise," within the meaning of subsection (2) of Section 288.703, Florida Statutes (Supp. 1994), Respondent must examine the certification application, not only in light of the foregoing statutory provisions, but also in light of the provisions of Chapter 60A-2, Florida Administrative Code, which were transferred to Respondent from the Department of Management Services by operation of Section 16 of Chapter 94-322, Laws of Florida. cf. City of Palm Bay v. Department of Transportation, 588 So.2d 624, 628 (Fla. 1st DCA 1991)("duly promulgated agency rules . . . will be treated as
presumptively valid until invalidated in a section 120.56 rule challenge"); 3/ Decarion v. Martinez, 537 So.2d 1083, 1084 (Fla. 1st DCA 1989)("[u]ntil amended or abrogated, an agency must honor its rules").
Among these rule provisions are those found in subsection (7) of Rule 60A-2.005, Florida Administrative Code, which provides, in pertinent part, as follows:
The applicant business shall establish that it is currently performing a useful business function in each specialty area requested by the applicant. For purposes of this rule,
"currently" means as of the date of the Office's receipt of the application for certification.
The applicant business is considered to be performing a useful business function when it is responsible for the execution of a distinct element of the work of a contract and carrying
out its responsibilities in actually performing, managing and supervising the work involved. The useful business function of an applicant shall be determined in reference to the products or services for which the applicant business requested certification on Form PUR 7500. . . .
An applicant for certification as a "minority business enterprise" whose application is preliminarily denied is entitled to notice of the grounds for the proposed denial of its application and an opportunity to have a Section
120.57 hearing on the proposed action. Section 120.60(3), Fla. Stat.
At the Section 120.57 hearing, the applicant has the burden of proving by a preponderance of the evidence that it is entitled to the certification it has requested. See Pershing Industries, Inc., v. Department of Banking and Finance, 591 So.2d 991, 994 (Fla. 1st DCA 1991); Cordes v. Department of Environmental Regulation, 582 So.2d 652, 654 (Fla. 1st DCA 1991); Department of Transportation v. J.W.C., Co., 396 So.2d 778, 787 (Fla. 1st DCA 1981); Department of Health and Rehabilitative Services v. Career Service Commission, 289 So.2d 412, 414-15 (Fla. 4th DCA 1974).
The Section 120.57 hearing is a de novo proceeding "intended to formulate final agency action, not to review action taken earlier and preliminarily." Hamilton County Board of County Commissioners v. Department of Environmental Regulation, 587 So.2d 1378, 1387 (Fla. 1st DCA 1991); Beverly Enterprises-Florida v. Department of Health and Rehabilitative Services, 573 So.2d 19, 23 (Fla. 1st DCA 1990); McDonald v. Department of Banking and Finance, 346 So.2d 569, 584 (Fla. 1st DCA 1977). Accordingly, in determining whether the applicant has met its burden of proof, the hearing officer "is not limited to consideration of the record made by [Respondent] during its preliminary investigation of the [applicant's] application and may freely consider any and all additional evidence presented by the parties, including evidence of changed conditions since the preliminary review, so long as [the evidence] is relevant" to the issues raised in the notice of intended denial. Gulf Court Nursing Center v. Department of Health and Rehabilitative Services, 483 So.2d 700, 710 (Fla. 1st DCA 1985).
The evidence adduced at the Section 120.57 hearing held in the instant case on the proposed denial of Petitioner's application for certification as a
"minority business enterprise" (specifically, Gordon's testimony that the "last time [she] did a landscaping job [was t]wo years ago," that is, in August of 1993) affirmatively establishes that Petitioner is not now, nor was it at the time it submitted its certification application in March of 1994, "performing a useful business function," as required by Rule 60A-2.005(7), Florida Administrative Code.
Inasmuch as Petitioner does not meet this requirement, its application for certification as a "minority business enterprise" in the area of landscape contracting should be denied.
