STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
SOUTHERN TERMINAL AND TRANSPORT ) COMPANY, )
)
Petitioner, )
)
vs. ) CASE NO. 75-1173
) FLORIDA DEPARTMENT OF REVENUE, )
)
Respondent. )
)
RECOMMENDED ORDER
The Petitioner herein, Southern Terminal and Transport Company, has filed an Amended Petition dated August 28, 1975. The Amended Petition is grounded, as set forth in paragraph 11 thereof, upon its challenge to the constitutionality of Section 212.08(8), Florida Statutes, and Rule 12A-1.64(5), Florida Administrative Code. In response to the Petition, the Department of Revenue, Respondent, has filed an Answer to Amended Petition and a Motion to Dismiss and Declare Statute Constitutional. After consideration of the pleadings filed herein, Memoranda of Law and argument of counsel, the Hearing Officer concludes that the relief sought by the Amended Petition is grounded upon the determination of the constitutionality of the subject statute and administrative rule and is, therefore, outside the jurisdiction of this forum. It is well established that the declaration of a statute as unconstitutional is a judicial function which may not be exercised by an administrative body. It is the duty of an administrative body to observe the law as it is found until, in a proper proceeding, its constitutionality is judicially passed upon. State ex rel Florida Dry Cleaning and Laundry Board v. Atkinson, 188 So.C34 (Fla. 1938); State v. State Board of Equalizers, 94 So.681 (Fla. 1922); Pickerill v. Schott, 55 So.2d 716 (Fla. 1951); Barr v. Watts, 70 So.2d 347 (Fla. 1953); Canney v.
Board of Public Instruction of Alachua County, 278 So.2d 260 (Fla. 1973).
Therefore, it is, hereby, RECOMMENDED:
1. That the Petition be dismissed on the grounds that it seeks to adjudicate the constitutionality of a statute in an administrative forum, which forum has no authority to make such an adjudication.
Entered this 7th day of November, 1975, in Tallahassee, Florida.
CHRIS H. BENTLEY, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304
(904) 488-9675
COPIES FURNISHED:
Zollie M. Maynard, Jr., Esquire Assistant Attorney General Department of Revenue, State
of Florida The Capitol
Tallahassee, Florida 32304 Attorney for Respondent
Thomas F. Panebianco, Esquire Carswell and McKenzie
O. Box 1200 Tallahassee, Florida 32302 Attorney for Petitioner
STATE OF FLORIDA
DIVISION OF ADMINISTRATIVE HEARINGS
SOUTHERN TERMINAL AND TRANSPORT ) COMPANY, )
)
Petitioner, )
)
vs. ) CASE NO. 75-1173
) FLORIDA DEPARTMENT OF REVENUE, )
)
Respondent. )
)
AMENDED RECOMMENDED ORDER
The parties to this proceeding, by stipulation attached hereto, have agreed that the Respondent, Florida Department of Revenue, shall be allowed to withdraw its Motion to Dismiss and Declare Statute Constitutional upon which notion the Recommended Order dated November 7, 1975, was based. Further, the parties have jointly requested the Hearing Officer to reexamine the merits of the Amended Petition in light of the requested withdrawal of Respondent's notion and the stipulation filed in this cause. Pursuant to the joint request and stipulation of the parties, the Hearing Officer hereby allows the withdrawal of Respondent's Motion to Dismiss and Declare Statute Constitutional and accepts the parties' stipulation and enters this Amended Recommended Order which shall, in every regard, supersede that Recommended Order dated November 7, 1975, previously entered herein.
Pursuant to the above, there has come before the undersigned Hearing Officer, in accord with the provisions of Chapter 120, Florida Statutes (1974 Supp.), the Petition of Southern Terminal and Transport Company, wherein it is charges that the Department of Revenue has sought to illegally assess against
the Petitioner additional sales and use taxes in the amount of $25,254.51 plus interest in the amount of $1,396.85.
By stipulation of the parties there is no disputed issue of fact and the agreed facts are:
Petitioner, a Florida corporation, is in the business of operating barges and tugs in Florida commerce and in interstate commerce pursuant to the exemption of Title 49, U.S.C., Section 903(b), part of what is commonly known as the Interstate Commerce Act. Its ratio of miles traveled in interstate commerce, as opposed to Florida commerce, is approximately 85 percent.
Prior to June 22, 1973, Southern Terminal and Transport Company was allowed the partial exemption provided in Section 212.08(8), Florida Statutes, as it then existed and therefore that period of time is not here in controversy. Pursuant to Laws 1973, Chapter 73-240, effective June 22, 1973, Section 212.08(8) was amended to provide that only vessels licensed by the Interstate Commerce Commission were entitled to the partial exemption.
Since Southern Terminal and Transport Company operates pursuant to Title 49, U.S.C., Section 903(b), its activities in interstate commerce are exempt from Interstate Commerce Commission licensing and regulation, but not from U.S. Coast Guard regulation.
After an audit of the books and records of Southern Terminal and Transport Company, Respondent issued a Notice of Assessment of Tax, Penalties and Interest dated April 14, 1975, which alleged a sales and use tax deficiency of $34,236.83 for the period 12/1/71 to 2/28/75, a penalty of $7,869.40 and interest of $2,288.20. The penalty was subsequently waived pursuant to Section 212.12(5), Florida Statutes, and is not here in issue.
On May 8, 1975, the Florida Department of Revenue adjusted its assessment, and alleged $32,341.91 tax due and $2,164.40 interest due of which Southern Terminal and Transport Company paid $7,087.40 of the tax and $767.55 of the interest, leaving $25,254.51 of tax and $1,396.85 interest here in issue.
QUESTION FOR DECISION
The sole question for decision is whether Section 212.08(8), Florida Statutes, violates Article I, Section 8 of the Constitution of the United States of America by imposing an unreasonable restraint and burden on interstate commerce.
CONCLUSIONS OF LAW
As Petitioner can only prevail if Section 212.08(8), Florida Statutes, is unconstitutional, it cannot prevail before this body.
Under the doctrine of separation of powers it is not within the constitutional prerogatives of the governor and cabinet sitting in their collegial capacity as agency head of the Department of Revenue to declare a taxing statute unconstitutional.
The Supreme Court of Florida, which has the constitutional duty, has not as of this date, declared the pertinent taxing provision unconstitutional.
Therefore, it is, hereby, RECOMMENDED:
That the Respondent, Department of Revenue, has properly assessed Petitioner additional sales and use taxes in the amount of $25,254.51 plus interest in the amount of $1,396.85.
That the Petitioner's prayers for relief be Denied.
Entered this 3rd day of December, 1975, in Tallahassee, Florida.
CHRIS H. BENTLEY, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304
(904) 488-9675
COPIES FURNISHED:
Zollie M. Maynard, Jr., Esquire Assistant Attorney General Department of Legal Affairs State of Florida
The Capitol
Tallahassee, Florida 32304 Attorney for Respondent
Thomas F. Pamebianco, Esquire Carswell and McKenzie
Post Office Box 1200 Tallahassee, Florida 32302 Attorney for Petitioner
| Issue Date | Proceedings |
|---|---|
| Mar. 25, 1977 | Final Order filed. |
| Nov. 07, 1975 | Recommended Order sent out. CASE CLOSED. |
| Issue Date | Document | Summary |
|---|---|---|
| Mar. 25, 1977 | Agency Final Order | |
| Nov. 07, 1975 | Recommended Order | Petitioner wishes to declare tax on interstate barge goods unconstitutional. The tax should be assessed. Only court can decide constitutionality. |
