STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

COALITION OF FLORIDA FARMWORKER ) ORGANIZATIONS, INC., )

)

Petitioner, )

)

vs. ) CASE NO. 95-5694

) 95-5695

DEPARTMENT OF COMMUNITY AFFAIRS, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its designated Hearing Officer, Joyous D. Parrish, held a formal hearing in the above-styled case on June 24, 1996, in Tallahassee, Florida.

APPEARANCES

For Petitioner: Arturo Lopez, Executive Director

and

Pedro Narezo

Coalition of Florida Farmworker Organizations, Inc.

Post Office Box 388 Homestead, Florida 33090

For Respondent: Barbara Jo Finer, Esquire

Department of Community Affairs 2555 Shumard Oak Boulevard Tallahassee, Florida 32399-2100

STATEMENT OF THE ISSUE

As stated by the parties in the joint stipulation to limit issues: whether the costs of $70,455.00 associated with the Moore Haven office of Petitioner are eligible costs under the Community Services Block Grant (CSBG) administered by Respondent.

PRELIMINARY STATEMENT

This case began on September 14, 1995, when the Department of Community Affairs (Department) issued a letter notifying Petitioner, Coalition of Florida Farmworker Organizations, Inc. (COFFO), that the Department was withdrawing its offer to consider a modification of the CSBG proposal in the amount of $28,818. Thereafter, COFFO filed a petition to challenge that decision and requested that its proposed modification be approved; that the modification be applied retroactively so that expenditures already made would be reimbursed; and, alternatively, that the length of the contract be extended so that COFFO could expend the full allocation available under the contract modification. Issues

related to the modification were assigned DOAH case no. 95-5694 and were forwarded to the Division of Administrative Hearings for formal proceedings on November 16, 1995.

On September 22, 1995, the Department issued a second letter to COFFO regarding unresolved budget issues. That notice provided that the Department would not release funds claimed by COFFO based upon questioned and disallowed costs. Again, COFFO filed a petition challenging the decision, and alleged it was entitled to the disbursements and that reimbursement would be necessary to avoid a substantial budget deficit. This case, DOAH case no. 95-5695, was forwarded to the Division of Administrative Hearings for formal proceedings on November 20, 1995.

Due to the complexity of the issues, the parties elected to seek resolution through mediation. Accordingly, the cases were placed in abeyance to allow sufficient time for such mediation. Subsequently, the parties filed a joint stipulation to limit issues which acknowledged that all issues between them had been resolved through mediation and settlement except the matter of whether the costs of $70,455.00 associated with the Moore Haven office were eligible costs under the CSBG for which COFFO should be reimbursed.

At the hearing, Petitioner presented the testimony of Arturo Lopez, the executive director for COFFO; and Fernando (Chappy) Pro, Jr., a board member for COFFO. It's exhibits numbered 3 (with qualification) 4, and 6 (with qualification) were admitted into evidence. The Department presented testimony from Rosa Morgan, chief of the bureau of community assistance which is the bureau authorized to monitor CSBGs. It's exhibits numbered 1, 2, 3 were also admitted. Official recognition was requested, and has been taken, of the provisions grouped and identified as "official recognition." Such provisions relate to the administration of the community services block grant program.

A transcript of the proceeding has not been filed. Specific rulings on the proposed findings of fact submitted by the Petitioner are included in the appendix at the conclusion of this order.

FINDINGS OF FACT

1. At all times material to the issues of this matter, the Petitioner was the grantee of a community services block grant.

   
   

2. Generally, the Department enters into CSBGs for a defined period of time for defined work to be performed by the grantee. The work normally entails defined services to low income people.

   
   

3. In this case, the COFFO was to provide personnel, materials, services, and facilities as set forth by their agreements to low income persons in Collier, Dade, Glades, Okeechobee, Polk, Hardee, Indian River, DeSoto, Highlands, Hendry, Lee, and Palm Beach Counties.

   
   

4. At all times material to this matter, COFFO acknowledged that it is governed by applicable laws and rules related to CSBGs, including, but not limited to: The Omnibus Budget Reconciliation Act of 1981 (P.L. 97-35, as amended), 45 C.F.R. Part 96, and Chapter 9B-22, Florida Administrative Code.

   
   

5. Rules governing CSBGs require written documentation both as to the person served and the activity or service provided to such individual.

6. On September 14, 1995, the Department notified COFFO that an audit had determined a lack of justification for funds to continue operation of the COFFO Moore Haven field office Such notice claimed that the field work performed by an independent audit firm found "no documentation to support the expensing of CSBG funds at the Moore Haven field office."

   
   

7. The Department invited COFFO to provide the needed documentation to support its claim for reimbursement.

   
   

8. For the three year period at issue, COFFO was unable to provide documentation for the individuals served at the Moore Haven office. While COFFO claimed twenty-seven persons appeared at that office for service, it also maintained that such persons would have been routed to the COFFO office at Immokalee for services.

   
   

9. Regardless, neither office produced records to verify that eligible individuals received eligible services.

   
   

10. COFFO maintains that since it met the overall terms of its agreements, whether at the Moore Haven office or elsewhere, it should be entitled to all funds claimed.

    
    

11. Additionally, COFFO claims that since the Department did not cite inadequate records at Moore Haven to them at an earlier time, they were unable to correct any deficiencies timely and thus avoid the issue inherent in this case.

    
    

12. Normally, exit interviews conducted by Department staff incidental to a monitoring visit alert grantees of any deficiencies noted during the visit.

    
    

13. In this case, Department staff attempted a monitoring visit at Moore Haven, but an exit interview was not conducted. COFFO did not have staff or anyone at the location at the time of the visit.

    
    

14. At all times material to this case, the major programs for COFFO were implemented at its main office in Homestead and a field office at Immokalee.

    
    

15. The office at Moore Haven did not have equipment or other resources to provide services. In the past, although not documented as to time, the Moore Haven office had been used to distribute emergency food, for job and budget counseling, and for recreation.

    
    

    CONCLUSIONS OF LAW

    
    

16. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

    
    

17. Rule 9B-22.003(4), Florida Administrative Code, provides:

    
    

    Monitoring and Evaluation. The Department will perform such activities as may be necessary to monitor grantee compliance with state and federal laws, rules, and regula- tions, to evaluate the fiscal and program-

    matic effectiveness of the grantee's activities and to confirm the status of budgets, the accuracy of reports, and the progress of activities.

    
    

18. Rule 9B-22.009(7), Florida Administrative Code, provides:

    
    

    The grantee and any subgrantees shall permit on-site inspections by Department represent- atives and shall require employees, volunteers, and board members to make avail- able all records and information relating to the program that the Department requires for review and monitoring.

    
    

19. Federal law requires that fiscal control and fund accounting procedures be established to assure the proper disbursal of, and accounting for, funds paid through the states to CSBG grantees. Independent audits are conducted to verify compliance and states are held responsible for funds inappropriately disbursed.

    
    

20. In this case, the parties have stipulated that the funds in dispute relate to the operation of the Moore Haven office. The Department has asserted that because records do not support eligible costs for that location, such amount must be disallowed in the entirety. In contrast, COFFO makes a global argument that relies on the grantee having provided all services disclosed and required by the agreements, regardless of where such activity was conducted. Additionally, COFFO maintains that the Department is estopped from disallowing the funds associated with the Moore Haven office since it did nothing to correct the dispute before the contract term expired. COFFO's contentions are not persuasive.

    
    

21. Turning first to the issue of estoppel, it is observed that by executing the contracts which disclosed the Moore Haven office, the Department did not affirmatively approve of the manner of doing business by COFFO at that location. Moreover, by its nature, an audit is an after-the-fact effort to verify activity which occurred. Consequently, even though the results were not completed before the contract expired, COFFO is responsible under such agreement. COFFO's estoppel claim is therefore without merit.

    
    

22. COFFO's contention that although no services were provided at the Moore Haven office it did provide services on a global basis and, therefore, should be reimbursed for costs associated with the Moore Haven office must also fail. Such contention is contrary to the parties' agreement. Consequently, since no documentation or report exists to demonstrate that funds allocated to the Moore Haven office were spent to offer eligible services to eligible recipients, the Department disallowance of those costs was appropriate.

RECOMMENDATION

Based on the foregoing, it is, hereby, RECOMMENDED:

That the Department of Community Affairs enter a final order determining the costs associated with the Moore Haven office of Petitioner to be ineligible under the community services block grant program.

DONE AND ENTERED this 23rd day of September, 1996, in Tallahassee, Leon County, Florida.

JOYOUS D. PARRISH, 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 23rd day of September, 1996.

APPENDIX TO RECOMMENDED ORDER, CASE NO. 95-5694 and 95-5695

Rulings on the proposed findings of fact submitted by the Petitioner:

1. Paragraphs 2, 3, 5, and 9 are accepted.

2. With regard to paragraph 1, with the clarification that it is accepted that COFFO provided services to migrant and seasonal farmworkers but could have provided services to any eligible recipient; the paragraph is otherwise accepted.

3. The first three sentences of paragraph 4 are accepted; the remainder is rejected as contrary to the weight of the evidence or argument of law.

4. With the clarification that forms were not maintained at the Moore Haven office demonstrating eligible services were rendered to eligible recipients, paragraph 6 is accepted.

5. Paragraphs 7 and 8 are rejected as irrelevant or immaterial to the issue of this case, or not supported by reference to the record.

6. The first two sentences of paragraph 10 are accepted; the remainder is rejected as contrary to the weight of credible evidence or irrelevant as stated.

7. With regard to paragraph 11, the first sentence is accepted. The remainder of the paragraph is rejected as irrelevant or contrary to the weight of the credible evidence as stated.

8. Paragraph 12 is rejected as contrary to the weight of the credible evidence.

Rulings on the proposed findings of fact submitted by the Respondent: None submitted.

COPIES FURNISHED:

Arturo Lopez Coalition of Florida

Farmworker Organizations, Inc. Post Office Box 388

Homestead, Florida 33090

Pedro Narezo Coalition of Florida

Farmworker Organizations, Inc. Post Office Box 388

Homestead, Florida 33090

Barbara Jo Finer

Department of Community Affairs 2555 Shumard Oak Boulevard Tallahassee, Florida 32399-2100

Carol Soliz, Board Chairperson Coalition of Florida Farmworker Organizations, Inc.

P.O. Box 1987

Sebring, Florida 33871-1987

James F. Murley Secretary

Department of Community Affairs

2555 Shumard Oak Boulevard, Suite 100

Tallahassee, Florida 32399-2100

Stephanie M. Gehres General Counsel

Department of Community Affairs

2555 Shumard Oak Boulevard, Suite 325-A Tallahassee, Florida 32399-2100

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period within which to submit written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.

Docket for Case No: 95-005694

Orders for Case No: 95-005694