STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

MANUEL GUALLAR, )

)

Petitioner, )

)

vs. ) CASE NO. 96-0444

) DEPARTMENT OF HEALTH AND ) REHABILITATIVE SERVICES, )

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, a formal hearing was conducted in this case on March 20, 1996, in Miami, Florida, before Stuart M. Lerner, a duly designated Hearing Officer of the Division of Administrative Hearings.

APPEARANCES

For Petitioner: Lester Rosenberg,

qualified representative 1/ AFSCME Florida Council 79 2171 Northwest 22nd Court Miami, Florida 33142

For Respondent: Andre L. Williams

Assistant District Legal Counsel Department of Health and

Rehabilitative Services

401 Northwest Second Avenue Suite N-1014

Miami, Florida 33128 STATEMENT OF THE ISSUES

1. Whether Petitioner was overpaid by Respondent?

   
   

2. If so, what is the amount of the overpayment and what action should Respondent take?

PRELIMINARY STATEMENT

By letter dated November 1, 1995, the Department of Health and Rehabilitative Services (hereinafter referred to as the "Department") notified Petitioner, a Department employee, that "[a]n audit of [his] 1993/94 payroll record indicated that [he] [had been] overpaid from June 28, 1993 through January 27, 1994 . . . an amount of $1,148.35" and that "payroll deductions [would] begin effective January 12, 1996" to recover the overpayment. The letter further informed Petitioner that he had the right to request a Section

1. hearing on the matter. Petitioner, by memorandum dated December 3, 1995,

   requested a formal Section 120.57 hearing. On January 25, 1996, the Department referred the matter to the Division of Administrative Hearings (hereinafter referred to as the "Division") for the assignment of a Division hearing officer to conduct the formal hearing Petitioner had requested.

   
   

   As noted above, the formal hearing was conducted on March 20, 1996. At the outset of the hearing, at the parties' request, the Hearing Officer consolidated (for purposes of hearing) the instant case with Nelida Vega v. Department of Health and Rehabilitative Services, DOAH Case No. 96-0445, and Irma Hawley v.

   Department of Health and Rehabilitative Services, DOAH Case No. 96-0446. (Vega and Hawley, like Petitioner, are Department employees from whom the Department is seeking to recover alleged salary overpayments.)

   
   

   During the evidentiary portion of the hearing in the instant case, a total of five witnesses testified: Gilda Ferradaz, a Senior Management Analyst II with the Department; Mickey Simon, an Accounting Service Administrator with the Department; Hawley; Vega; and Petitioner. In addition to the testimony of these five witnesses, a total of 17 exhibits (Petitioners' Exhibits 1 through 3 and the Department's Exhibits 1 through 14) were offered and received into evidence.

   
   

   At the conclusion of the evidentiary portion of the hearing, the Hearing Officer, on the record, advised the parties of their right to file post-hearing submittals and established a deadline (fourteen days following the Hearing Officer's receipt of the transcript of the hearing) for the filing of such submittals. The Hearing Officer received the hearing transcript on April 3, 1996. On April 15, 1996, and April 17, 1996, respectively, Petitioner and the Department filed proposed recommended orders. The Hearing Officer has carefully considered the parties' proposed recommended orders. The "findings of fact" set forth in these proposed recommended orders are specifically addressed in the Appendix to this Recommended Order.

   
   

   FINDINGS OF FACT

   
   

   Based upon the evidence adduced at hearing, and the record as a whole, the following Findings of Fact are made:

   
   

   1. Petitioner is now, and was at all times material to the instant case, including June 28, 1993, through January 27, 1994, an employee of the Department working in the economic services unit of the Department's District XI (hereinafter referred to as the "District").

      
      

   2. In 1990, Petitioner occupied a PAS (Public Assistance Specialist) I position that, in or around June of that year, was one of 182 such positions in the District to be reclassified to a PAS II position as part of the Department's implementation of the new FLORIDA computer system. 2/

      
      

   3. Those employees occupying these reclassified positions (hereinafter referred to as the "upgraded employees") whose salaries were below the minimum salary for a PAS II received a salary increase to raise their salary to the minimum. Petitioner was among the employees who received such a salary increase. Such action was taken in accordance with the following Department policy set forth at page 11 of HRSP 60-1:

      
      

      When an employee is promoted, a salary in- crease to at least the minimum salary of the higher level position will be made. However,

      an increase of up to ten percent above the current base salary or ten percent above the minimum for the new class may be approved.

      An increase of up to ten percent of the current base salary is normally used when the employee's salary is the same or nearly the same as the minimum for the new class. An increase of up to ten percent above the minimum for the new class may be granted when an employee possesses training or experience substantially above the minimum training and experience required for the higher class and it is determined that the employee is exceptionally well qualified for the position.

      These increases must be approved by an assistant secretary or district administrator.

      
      

   4. Because of funding constraints that existed at the time, no other salary increases were given to the upgraded employees.

      
      

   5. Funds for such additional salary increases became available toward the end of the 1992-1993 fiscal year.

      
      

   6. The increases were approved at both the Department and District level.

      
      

   7. Petitioner and the other upgraded employees were advised of the increases by a memorandum dated July 7, 1993, from the District XI District Administrator. The District Administrator's memorandum read as follows:

      
      

      Your position has been identified as one which was upgraded as a result of the FLORIDA implementation in 1990/1991. At the time, our records indicate that you received a partial increase, or none at all, because of budgetary constraints.

      Due to the identification of available monies prior to the end of the Fiscal Year, we are pleased to inform you that you will be

      receiving a pay increase in your salary warrant on July 9, 1993. The amount of the increase will be either 10[percent] or the difference between what you received in 1990/1991 and

      10 [percent], and was effective June 28, 1993.

      Should you have any questions about this increase or how it was calculated, please

      call Arelis Valero at 377-5197. Your continued dedication and service to HRS is sincerely appreciated.

      
      

   8. District personnel miscalculated the amount of Petitioner's approved salary increase (which was "the difference between what [he had] received in 1990 . . . and 10[percent]" of his pre-reclassification base salary).

      
      

   9. As a result, following June 28, 1993, the effective date of the increase, for the pay periods ending January 27, 1994, Petitioner was overpaid a total of $1,148.35.

   10. The District discovered the error and revised its payroll records to reflect Petitioner's correct salary.

       
       

   11. In addition, by memorandum, it notified Petitioner of the mistake that had been made and advised him that it was his responsibility to repay the amount he had been overpaid.

       
       

   12. By letter dated November 1, 1995, the District XI District Administrator informed Petitioner that the overpayment would be recovered through payroll deductions beginning January 12, 1996, amounting to "10[percent] of [his] gross salary each pay period, unless [he] prefer[red] a single lump sum, until the balance [was] paid." The letter further provided, in part, as follows:

       
       

       If you do not dispute the overpayment, but feel that the repayment schedule of 10 [percent] of your gross salary per pay period is overly burdensome, please call Thomas Franklin at 377-5055 Number135 and he will review with you what must be documented and submitted to the Comptroller's Office (Capitol Building, Suite 1201, Tallahassee, Florida 32399-0350) to request a modification. While the total amount eventually repaid to the State cannot be adjusted, the Comptroller may be convinced to lengthen the repayment schedule by lessening the percentage withheld each pay period.

       If you do not agree that you were overpaid this amount, you have the right to an administrative hearing under 120.57(1) or (2), Florida Statutes, and Rules 10-2.036 and 28-5, Florida Administrative Code. You may request a formal or an informal hearing. If a request for a formal hearing is made, your petition must be in compliance with Rule 28-5.021, Florida Administrative Code. Please note that Rule 28-5.201(2) specifies that your petition should contain a concise discussion of the specific item in dispute. Informal hearings are governed by Rules

       28-5.501-503, Florida Administrative Code. Your request for either a formal or informal hearing must be received by this office, attention Thomas Franklin, within thirty

       (30) days of your receipt of this letter, in accordance with Rule 10-2.036, Florida Administrative Code. Failure to request a timely hearing shall be deemed a waiver of your right to hearing.

       
       

   13. After receiving this November 1, 1995, letter, from the District XI District Administrator, Petitioner spoke with Thomas Franklin, the Department employee referenced in the letter. Franklin told Petitioner that he could request both a modification in the repayment schedule and an administrative hearing.

   14. In a memorandum to Franklin dated December 3, 1995, Petitioner requested an administrative hearing "due to the fact that [he did] not agree that an overpayment [had] ever occurred."

       
       

   15. In another December 3, 1995, memorandum to Franklin, Petitioner requested that only "$10.00 biweekly [be deducted] from [his] paycheck" if it was ultimately determined that an overpayment had indeed been made.

       
       

       CONCLUSIONS OF LAW

       
       

   16. The Comptroller is "the chief fiscal officer of the state" with the authority to "settle and approve accounts against the state." Article IV, Section 4(d), Fla. Const.

       
       

   17. State funds may be disbursed "only upon order of the [C]omptroller." Article IV, Section 4(e), Fla. Const.

       
       

   18. The Comptroller is the head of the Department of Banking and Finance. Section 20.12(1), Fla. Stat.

       
       

   19. Pursuant to Section 17.04, Florida Statutes, it is the responsibility of the Department of Banking and Finance, to "examine, audit, adjust and settle the accounts of all the officers of this state, and any other person in anywise entrusted with, or who may have received any property, funds, or moneys of this state, or who may be in anywise indebted or accountable to this state for any property, funds, or moneys, and require such officer or persons to render full accounts thereof, and to yield up such property or funds according to law, or pay such moneys into the treasury of this state, or to such officer or agent of the state as may be appointed to receive the same, and on failure so to do, to cause to be instituted and prosecuted proceedings, criminal or civil, at law or in equity, against such persons, according to law."

       
       

   20. The Division of Accounting and Auditing is among the divisions of the Department of Banking and Finance. Section 20.12(2)(a), Fla. Stat.

       
       

   21. The Bureau of State Payrolls of the Division of Accounting and Auditing is responsible for "perform[ing] any payroll related tasks assigned by the Comptroller in his capacity as chief fiscal officer for the State of Florida," including those involving the exercise of the Comptroller's authority "to audit and settle all wage claims against the State" and to "issue salary warrants directing disbursement of monies from the State Treasury." Rules 3A- 31.105(1), 3A-31.205(1) and 3A-31.207(1), Fla. Admin. Code.

       
       

   22. The Bureau performs these "payroll related tasks" with the assistance of the Department of Management Services, which is statutorily required, pursuant to Section 110.116, Florida Statutes, to "establish and maintain, in coordination with the payroll system of the Department of Banking and Finance, a complete personnel information system for all authorized and established positions in the state service, with the exception of employees of the Legislature."

       
       

   23. Section 402.35, Florida Statutes, provides that "[a]ll personnel of the Department of Health and Rehabilitative Services shall be governed by rules and regulations adopted and promulgated by the Department of Management Services relative thereto."

   24. Among the rules that the Department of Management Services has adopted are those which "establish or reference procedures to be used when the compensation of an employee is in violation of any provision of the Personnel Rules and Regulations of the Career Service System (60K, F.A.C.), or salary setting provisions by the Department of Management Services in accordance with Section 216.251, and 110.205(2), F.S., or provisions specifically included in legislation, and results in an employee being underpaid or overpaid, and the procedures to be used in correcting such actions." Rule 60L-8.001, Fla. Admin. Code.

       
       

   25. These rules are found in Chapter 60L-8, Florida Administrative Code.

26. Rule 60L-8.005(2), (3) and (4) and Rule 60L-8.006(1) and (3), Florida Administrative Code, require that the employing state agency act in accordance with the following procedures when it believes that one of its employees has received an "overpayment" (which is defined in Rule 60L-8.003(2), Florida Administrative Code, as "[c]ompensation which is greater than the maximum that was authorized for payment in conformity with the provisions of the Personnel Rules and Regulations of the Career Service System[,] 60L-8, F.A.C., Sections

216.251 and 110.205(2), Florida Statutes, or specific legislative or Department of Management Services approval"):

60L-8.005 Procedures.

1. When an overpayment occurs, the agency head shall take the following action:

   1. Notify the employee of the error in writing, including an explanation of how the error occurred and a statement of how the employee's salary is being corrected and that the amount of the overpayment must be reclaimed.

   2. Make arrangements with the employee to reclaim the amount of overpayment.

   3. Furnish the Office of Comptroller with the information explaining the error and the arrangements for reclaiming the amount of the overpayment.

   4. Immediately effectuate a payroll change to correct the employee's salary to the correct amount for future pay periods.

2. If an . . . overpayment is discovered after the employee has terminated state employ- ment, or retired from state government, the agency head shall notify the former employee, by certified mail, return receipt requested,

   of the error, and the appropriate action to be taken by . . . the former employee with

   copies to the Department of Management Services and the Office of the Comptroller. If no response is received, or if the employee refuses to submit the repayment, every reason- able effort must be made to collect the over- payment and notification of refusal must be furnished to the Office of Comptroller for appropriate action . . . .

3. For all overpayments . . ., the Office of the Comptroller must be furnished full information for all pay periods in which the

overpayment . . . occurred. The reimbursement

. . . must be made to the Office of Compt- roller in accordance with the rules prescribed by that office.

Rule 60L-8.006 Reporting Requirements.

(1) The agency head shall notify the Depart- ment of Management Services of all overpay- ments . . . as they are discovered by the agency and shall report the resolution of

such error. . . .

(3) All reports of resolution shall be made to the Department of Management Services with- in 10 calendar days after the matter has been resolved. . . .

1. A state employee who disputes that he or she has been overpaid in the amount claimed by the employing agency must be afforded the opportunity to have a Section 120.57 hearing on the matter before any final action is taken to recover the alleged overpayment. See Department of Corrections v. Career Service Commission, 429 So.2d 1244, 1246 (Fla. 1st DCA 193).

   
   

2. At the Section 120.57 hearing, the burden is on the state to prove by a preponderance of the evidence that the alleged overpayment was made. See Department of Banking and Finance v. Osborne Stern and Company, 21 FLW S142, 143 (Fla. March 28, 1996)("'[t]he general rule is that a party asserting the affirmative of an issue has the burden of presenting evidence as to that issue'"); Florida Department of Transportation v. J.W.C. Company, 396 So.2d 778, 788 (Fla. 1st DCA 1981)("'the burden of proof, apart from statute, is on the party asserting the affirmative of an issue before an administrative tribunal'"); Florida Department of Health and Rehabilitative Services v. Career Service Commission, 289 So.2d 412, 414-15 (Fla. 4th DCA 1974)("the burden of proof is 'on the party asserting the affirmative of an issue before an administrative tribunal;'" "'[a]s a general rule, the comparative degree of proof by which a case must be established is the same before an administrative tribunal as in a judicial proceeding- that is, a preponderance of the evidence'").

   
   

3. In the instant case, after notifying Petitioner of its belief that he had been overpaid and unsuccessfully attempting to enter into a repayment agreement with him, the Department, at the request of Petitioner, who disputed that the "overpayment [had] ever occurred," made the necessary arrangements to have a formal Section 120.57 hearing conducted on the matter.

   
   

4. The preponderance of the evidence adduced at that hearing establishes that, following June 28, 1993, the effective date of the salary increase for upgraded employees, for the pay periods ending January 27, 1994, Petitioner received salary "overpayments," as that term is defined in Rule 60L-8.003(2), Florida Administrative Code, totalling $1,148.35 as a result of miscalculations made by District personnel in determining the amount of Petitioner's approved salary increase (which was "the difference between what [he had] received in 1990 . . . and 10[percent]" of his pre-reclassification base salary).

5. Accordingly, in accordance with the provisions of Chapter 60L-8, Florida Administrative Code, the Department should notify the Department of Management Services of these "overpayments" and refer the matter to the Comptroller so that the Comptroller may take appropriate action to recover the moneys Petitioner owes the state.

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby

RECOMMENDED that the Department: find that, from June 28, 1993, until January 27, 1994, Petitioner was overpaid a total of $1,148.35; notify the Department of Management Services of this finding; and refer the matter to the Comptroller so that the Comptroller may take appropriate action to recover these moneys owed to the state.

DONE AND ENTERED in Tallahassee, Leon County, Florida, this 29th day of April, 1996.

STUART M. LERNER, 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 29th day of April, 1996.

ENDNOTES

1/ At the outset of the final hearing, Petitioner indicated that he desired to have Rosenberg, who is not a member of The Florida Bar, represent him in this proceeding. The Hearing Officer, in accordance with Rule 60Q-2.008, Florida Administrative Code, authorized Rosenberg to provide such representation after questioning Rosenberg and determining that Rosenberg had the necessary qualifications to render such representation in a competent and responsible manner that would not impair either the fairness of the proceeding or the correctness of the action to be taken.

2/ Vega's and Hawley's PAS I positions were similarly reclassified.

APPENDIX TO RECOMMENDED ORDER IN CASE NO. 96-0444

The following are the Hearing Officer's specific rulings on the "findings of facts" proposed by the parties in their proposed recommended orders:

Petitioner's Proposed Findings

1. Rejected as a finding of fact because it is more in the nature of a statement of law than a finding of fact.

2. First paragraph: Rejected as a finding of fact because it is more in the nature of a statement of law than a finding of fact. (Moreover, the rule recited in this paragraph, Rule 3A-31.309, Florida Administrative Code, was repealed effective January 25, 1996.) Second paragraph: Rejected because it is contrary to the greater weight of the evidence. Third paragraph: Rejected as finding of fact because it is more in the nature of a statement of law than a finding of fact.

3. Rejected as a finding of fact because it is more in the nature of a statement of law than a finding of fact.

4. First, fourth and fifth paragraphs: Rejected as findings of fact because they are more in the nature of summaries of testimony adduced at hearing than findings of fact. See T.S. v. Department of Health and Rehabilitative Services, 654 So.2d 1028, 1030 (Fla. 1st DCA 1995)(hearing officer's factual findings which "merely summarize[d] the testimony of witnesses" were "insufficient"). Second and third paragraphs: Accepted as true and incorporated in substance, although not necessarily repeated verbatim, in this Recommended Order.

The Department's Proposed Findings

1. Rejected as a finding of fact because it is more in the nature of a statement of law than a finding of fact.

2. Accepted as true and incorporated in substance.

3. Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer.

4-6. Accepted as true and incorporated in substance.

1. To the extent that this proposed finding states that the memorandum in question was dated July 27, 1993, and not July 7, 1993, it has been rejected because it lacks sufficient evidentiary/record support. Otherwise, it has been accepted as true and incorporated in substance.

2. Accepted as true and incorporated in substance.

3. To the extent that this proposed finding discusses the notification given Vega and Hawley, it has not been incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer. Otherwise, it has been accepted as true and incorporated in substance.

4. Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer.

5. To the extent that this proposed finding discusses the notification given Vega and Hawley, it has not been incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer. Otherwise, it has been accepted as true and incorporated in substance.

6. Not incorporated in this Recommended Order because it would add only unnecessary detail to the factual findings made by the Hearing Officer.

7. To the extent that this proposed states that Petitioner was overpaid in the amount $1,148.35, it has been accepted as true and incorporated in substance. The remaining portions of this proposed finding have not been incorporated in this Recommended Order because they would add only unnecessary detail to the factual findings made by the Hearing Officer.

8. Not incorporated in this Recommended Order because, even if true, it would not alter the recommendation of the Hearing Officer.

9. Rejected as a finding of fact because it is more in the nature of a summary of testimony adduced at hearing than a finding of fact.

10. Accepted as true and incorporated in substance.

11. Rejected as a finding of fact because it is more in the nature of legal argument than a finding of fact.

COPIES FURNISHED:

Andre L. Williams

Assistant District Legal Counsel Department of Health and

Rehabilitative Services

401 Northwest Second Avenue Suite N-1014

Miami, Florida 33128

Lester Rosenberg

AFSCME Florida Council 79 2171 Northwest 22nd Court Miami, Florida 33142

Manuel Guallar

2723 Southwest 13th Street Miami Beach, Florida 33145

Richard Doran, General Counsel Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Tallahassee, Florida 32399-0700

Gregory D. Venz, Agency Clerk Department of Health and

Rehabilitative Services 1323 Winewood Boulevard

Building 7, Suite 728

Tallahassee, Florida 32399-0700

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 of time 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: 96-000444

Orders for Case No: 96-000444