vs.
Respondent.
) Case No. 02-0212
A hearing was held pursuant to notice, on April 10, 2002, in Pensacola, Florida, by Barbara J. Staros, assigned Administrative Law Judge of the Division of Administrative Hearings.
For Petitioners: Julie L. Sheppard, Esquire
Patricia D. Lott, Esquire University of West Florida 11000 University Parkway
For Respondent: Thomas E. Wright, Esquire
Whether Petitioner is entitled to participation in the State University Optional Retirement Program for the period August 1997 through December 1998.
By letter dated December 4, 2001, Respondent advised Petitioner Jeffrey Bradshaw that he was not eligible to participate in the Optional Retirement Program (ORP) for the period August 1997 through December 1998. The denial letter was addressed to Jeffrey Bradshaw but sent to the University of West Florida personnel office. The denial was based on earlier correspondence which had disapproved Mr. Bradshaw's application to participate in the ORP and had given him a 21-day period in which "to submit additional information."
Petitioners University of West Florida (UWF) and Jeffrey Bradshaw disputed the denial and requested an administrative hearing. The request for hearing was forwarded to the Division of Administrative Hearings on or about January 15, 2002. A formal hearing was scheduled for April 3, 2002, which was later rescheduled to April 10, 2002, to accommodate the availability of one of the parties. Respondent filed a Motion to Allow Deposition Testimony in Lieu of Live Testimony which was granted.
At hearing, Petitioner Bradshaw testified on his own behalf. Petitioners presented the testimony of two additional witnesses, Faye Borders and Sherell Hendrickson. Petitioners' Exhibits numbered 1 through 12 were admitted into evidence.
Respondent presented the deposition testimony of one witness, David Ragsdale. Respondent's Exhibit numbered 1 was admitted into evidence. Respondent's Exhibit numbered 2 was offered through the deposition testimony of David Ragsdale and is admitted into evidence.
Official Recognition was requested of Section 121.35, Florida Statutes (1997), and Chapter 60U, Florida Administrative Code, dated 1993 and which were in existence in 1997. The request was granted.
April 23, 2002. A transcript of David Ragsdale's deposition was filed on May 20, 2002. The parties timely filed Proposed Recommended Orders which have been considered in the preparation of this Recommended Order.
Petitioner Jeffrey Bradshaw (Bradshaw) was employed by UWF as a Research Assistant from August 8, 1997, until December 1998. This position was eligible to participate in the ORP for the State University System as described in Section 112.35, Florida Statutes (1997).
On August 18, 1997, Bradshaw signed a Form ORP-16, indicating his election to be a member of the ORP and indicating that he had signed the necessary contract with TIAA-CREF, an approved annuity provider. Bradshaw returned this form to UWF.
Below Bradshaw's signature is a portion of the Form ORP-16 which is entitled, "To be completed by employer." Within that portion of the form, a signature appears in the signature line designated "Signature of University" beneath the following certification: "I certify that since their employment with the university, this employee has signed a contract(s) with the ORP carrier(s) as shown and is filling an eligible position." Following this certification and above the signature of the university representative appears the following in handwriting, "verbal by employee." This portion of the form indicates that it was signed by a representative of UWF on October 6, 1997. The fully executed form ORP-16 was forwarded to Respondent on or about October 6, 1997.
Bradshaw recalls that he sent a copy of the executed contract directly to TIAA-CREF.
UWF paid the employer's statutory portion of Bradshaw's salary to Respondent to participate in the ORP for the entire period from August 8, 1997 to December 31, 1998, for a total of
$11,494.88. Respondent forwarded that money to TIAA-CREF.
On June 2, 1998, Respondent sent a letter to Bradshaw in care of UWF which read in pertinent part as follows:
Effective July 1, 1997, Section 121.35, F.S. was amended and now requires ORP participants that fail to select a provider company and execute an annuity contract within 90 days of eligibility, must be enrolled in the Florida Retirement System (FRS). Even though you selected a provider company within 90 days of becoming eligible for ORP, you have not completed the other required step in the process. According to the company, you do not have a contract with them. The Division will be forced to transfer your contributions from the company account to the FRS Trust Fund unless you act immediately. You will then be credited with the appropriate service credit under the FRS and your employer will be requested to begin reporting you under the FRS.
In order that you may continue in the ORP, you must complete the establishment of your ORP Account. We therefore request that you provide the critical information requested by the company to establish a contract using their application form (enclosed). If you have any questions about this process, please call the special toll free number for the Service Plus Office, 800 842-7715. This should be done as soon as possible, but no later than 15 days from the date of this letter. Please send a copy of this letter along with your form.
Otherwise, to revert your retirement membership to the regular class of the Florida Retirement System, please complete the enclosed Form FRS-M10, Personal History Record and return it to your employer within the next 15 days. Should you have any questions concerning enrollment in the FRS, please call our Enrollment Section at SUNCOM
278-8837 or (850) 488-8837. Please send a copy of this letter along with the form. (emphasis in original)
Faye Borders is a Senior Personnel Representative with UWF. According to her files, UWF contacted Bradshaw by telephone when UWF received the June 2, 1998, letter and Bradshaw indicated that he sent the application directly to TIAA-CREF. It is not clear from the record the scope of the telephone conversation between the UWF representative and Bradshaw. The evidence of record does not establish that Bradshaw was sufficiently informed of the content of the June 2, 1998, letter, or of its consequences. Bradshaw does not recall that the telephone conversation took place. He believed he had done everything he needed to do and did not became aware that there was a question about his earlier membership in the ORP until he signed a new contract in October of 2000. What is clear is that Bradshaw did not receive a copy of the letter and never received any written correspondence from anyone inquiring as to his status in the ORP. As far as Bradshaw was concerned, he completed all forms necessary at the appropriate times.
Bradshaw left employment with UWF in December 1998 and moved out of state. He returned to employment at UWF in 2000 and signed a new ORP-16 and a new contract with TIAA-CREF in October 2000, and is currently actively enrolled in the ORP with TIAA-CREF as his annuity provider. He became aware that there
was an issue about his former membership in the ORP in a telephone call he placed to TIAA-CREF and when he received a letter informing him that the money from the time period of his earlier employment had been returned to UWF. At this point, he sought advice from UWF's office of human relations.
Bradshaw and UWF sent letters to Respondent to clarify this issue. A letter dated November 17, 2000, from Faye Borders to Respondent reads in pertinent part as follows:
Dear Hobe,
Please see (attached) Mr. Jeffrey Bradshaw's letter regarding his status in the Optional Retirement Program during his prior employment with the University of West Florida. I am also attaching information from our files pertaining to Mr. Bradshaw's efforts to enroll in the Optional Retirement Program.
Mr. Bradshaw is certain he sent the application directly to TIAA-CREF and has repeated that on several occasions. He has moved several times since his prior employment, thus the address we provided to TIAA-CREF on our attached copy of the fax sent to them may not have been current.
TIAA-CREF's letter to Mr. Bradshaw states that the University of West Florida requested the institutional premiums be removed from the contract and placed in their Repurchase account at TIAA-CREF.
I am unclear on this and as far as I know the University does not handle such transactions.
Anything you can do to assist Mr. Bradshaw with his request will be greatly appreciated.
Respondent responded directly to Bradshaw, again in care of UWF, with a letter dated March 30, 2001. The letter was written by David Ragsdale, Benefits Administrator, and reads in pertinent part as follows:
Dear Mr. Bradshaw:
This is in reference to your October 20, 2000 letter requesting the Division of Retirement allow you to participate in the State University System Optional Retirement Program (SUSORP) after the ninety day eligibility period.
Effective July 1, 1997, Section 121.35, F.S., was amended and requires SUSORP participants that fail to select a provider company within 90 days of eligibility to be enrolled in the Florida Retirement System (FRS).
Based on the information submitted, it appears you did not complete and submit the ballot, Form ORP-16, within the ninety days window of eligibility in compliance with the law. As such, you will be a compulsory member of the FRS.
Mr. Ragsdale acknowledges that the March 30, 2001, letter to Bradshaw was in error in that the Division had received the ORP-16 signed by Bradshaw in 1997. Mr. Ragsdale also explained that letters to Bradshaw were addressed to UWF because in 1997, and until sometime in 2001, Respondent did not maintain personal addresses for participants, but relied on the employing agencies to maintain addresses for their employees.
On April 26, 2001, Sherell Hendrickson, Director of Human Resources at UWF, sent a letter addressed to Mr. Ragsdale which stated as follows:
Dear Mr. Ragsdale:
This is in reference to your March 30, 2001 letter denying Jeffrey Bradshaw's enrollment in the ORP in 1997. A copy of your letter is attached. This denial is based on
Mr. Bradshaw's failure to complete and submit the ballot, Form ORP-16, within the ninety-day window of eligibility in compliance with the law.
Mr. Bradshaw did complete and return his Form ORP-16. He was hired on August 8, 1997; the form ORP-16 was sent to the Division of Retirement on October 6, 1997, less than 60 days after his initial employment with UWF. On this form, he designated TIAA-CREF as his retirement annuity company and certified that he had signed a Florida ORP contract. Mr. Bradshaw sent his enrollment forms directly to TIAA- CREF. HR Benefits Clerk, Valerie Comparetta, notes that he sent the annuity contract to TIAA-CREF on the form ORP-16.
Unfortunately, TIAA-CREF alleges that they did not receive his contract application and that after attempting to get in touch with him, they contacted UWF's Human Resources Department. He gave TIAA-CREF an address that may not have been current to contact Mr. Bradshaw. However, Mr. Bradshaw confirmed with us that he had completed and mailed the contract to TIAA-CREF.
The University's institutional premiums of
$11,496.88 were sent to TIAA-CREF during 1997-98. Mr. Bradshaw moved and did not hear anything else from either us or TIAA- CREF. He returned to employment at UWF on May 6, 2000. When he called TIAA-CREF, he was surprised to find out that his initial
paperwork had never been located by TIAA- CREF and that UWF had requested that the institutional premiums "be removed from the contract and placed in their Repurchase account at TIAA-CREF." To my knowledge, and that of the Benefits Section in HR, no one in this office asked for this to be handled. We do not handle such transactions.
I am requesting that you reconsider this issue. Mr. Bradshaw is in the ORP, has selected TIAA-CREF for his contract, did not receive the notices sent to him by TIAA- CREF, and has stated on more than one occasion that he sent in his enrollment application to TIAA-CREF. The institutional funds were held by TIAA-CREF for two years. We believe that the institutional funds of
$11,496.88 should be sent back to TIAA-CREF and into Mr. Bradshaw's ORP account.
According to Ms. Hendrickson, her office has had problems in the past with TIAA-CREF losing documents or correspondence. Unlike other annuity providers, TIAA-CREF does not have a local representative at UWF. UWF deals directly with the TIAA-CREF office in Atlanta.
Also according to Ms. Hendrickson, UWF's file indicates two instances when Bradshaw informed UWF that he provided a contract directly to TIAA-CREF. These are further explained in a June 13, 2001, memorandum from Hendrickson to Respondent which also references that UWF confirmed with TIAA- CREF in 1999 that the company had a completed application:
Thank you for any additional consideration you might give to my April 26, 2001 letter to Mr. David W. Ragsdale concerning the ORP account of Mr. Jeffrey Bradshaw.
Mr. Bradshaw is in the ORP, has selected TIAA-CREF for his contract, and did not receive the notices sent to him by TIAA- CREF. He has stated to the University of West Florida Office of Human Resources personnel on two (2) separate occasions that he sent in his enrollment application to TIAA-CREF. Our first contact with him about the TIAA-CREF application was in October 6, 1997. When we contacted him about the TIAA- CREF application, he stated that he had signed and sent in his TIAA-CREF application to the company. This is noted on our ORP-16 enrollment form for him. On our second contact with him on June 23, 1998, our notes reveal that he verified to our office that he had sent in his forms directly to TIAA- CREFF[sic]. In January 1999, we have a note in our files that we again confirmed with TIAA-CREF that he completed his TIAA-CREF application and sent it directly to the company. We also have a completed ORP-16 Form from him dated August 18, 1997 after his initial employment on August 8, 1997.
Copies of these documents may be provided, if necessary. They were included in my April 26, 2001 letter.
Based on the above information, we have every reason to believe that Mr. Jeffrey Bradshaw completed his TIAA-CREF application and mailed it to TIAA-CREF.
Respondent responded to Ms. Hendrickson's April 26, 2001, letter on September 4, 2001, in a letter addressed to Bradshaw in care of UWF. This letter gave a different reason for rejecting Bradshaw's membership in the ORP for the period of his earlier employment:
Dean Mr. Bradshaw:
This is reference to your June 13, 2001 letter requesting the Division of Retirement allow you to participate in the State University System Optional Retirement Program (SUSORP) after the ninety-day eligibility period.
Effective July 1, 1997, Section 121.35, F.S., was amended and requires ORP participants that fail to select a provider company within ninety days of eligibility to be enrolled in the Florida Retirement System (FRS).
Based on the information submitted, it appears you did not complete an annuity contract with a provider company within the ninety-day window of eligibility.
Therefore, you are not eligible for the SUSORP and you will be a compulsory member of the FRS.
Should you have any questions, or need additional information, please contact David Ragsdale or Hobart Lawrance at SUNCOM 278- 8837 or (850) 488-8837.
According to Mr. Ragsdale, Respondent does not get a copy of the contracts entered into between individuals and annuity providers. Respondent made the payments to TIAA-CREF on behalf of Bradshaw based on the ORP-16 that indicated on its face that a contract existed.
No one involved in this proceeding appears to have a copy of the contract signed by Bradshaw in 1997. At that time, it was not unusual for UWF or Respondent to not have a copy of contracts between individual employees and annuity providers.
On or about June 24, 1999, TIAA-CREF credited the
$11,494.88 to a repurchase fund maintained on behalf of Respondent. Respondent transferred these contributions to the Florida Retirement Trust Fund. As a consequence, Bradshaw has received service credit for the number of months of his earlier employment period with UWF.
CONCLUSIONS OF LAW
The Division of Administrative Hearings has jurisdiction over the parties and subject matter of this proceeding. Sections 120.569 and 120.57(1), Florida Statutes.
Section 121.35(3)3., Florida Statutes (1997), reads as follows:
3. Notwithstanding the provisions of this paragraph, effective July 1, 1997, any employee who is eligible to participate in the Optional Retirement Program and who fails to execute an annuity contract with one of the approved companies and to notify the division in writing as provided in subsection (4) within 90 days of the date of eligibility shall be deemed to have elected membership in the Florida Retirement System, except as provided in s. 121.051(1)(a).
. . .
The burden of proof in an administrative proceeding is on the party asserting the affirmative of the issue unless the burden is established otherwise by statute. Young v. State, Department of Community Affairs, 567 So. 2d 2 (Fla. 3rd DCA 1990); Balino v. Department of Health and Rehabilitative
Services, 348 So. 2d 349 (Fla. 1st DCA 1977). Petitioner has the burden of proof in this proceeding.
There is no genuine dispute that Bradshaw satisfied the statutory requirement of notifying Respondent of his election to participate in the Optional Retirement Program. The dispute involves the statutory requirement that the participant execute an annuity contract with one of the approved companies within 90 days of the date of eligibility.
The preponderance of the evidence shows that Bradshaw did execute a contract with an approved provider. Bradshaw testified that he did so; the Form ORP-16 dated August 18, 1997, shows his signature certifying that he had done so; evidence was presented that the business records of UWF reflect notes indicating that Bradshaw made contemporaneous statements that he had executed the contract and sent it directly to TIAA-CREF.
Further, the construction of Section 121.35(3)3., Florida Statutes (1997), urged by Respondent is unpersuasive. The statute states that the failure of an eligible employee to execute a contract and notify the Respondent within 90 days shall be deemed to be an election to membership in the FRS. The language of the statute does not contemplate that well after the fact, i.e., that thousands of dollars had been withheld from the participant's salary and sent to an annuity provider, that the
money could be removed from the participant's account and converted to creditable service in the FRS.
Respondent did make an attempt in 1998 to notify Bradshaw there was a problem about the contract. This letter offered Bradshaw an opportunity, beyond the 90-day statutory time frame, to submit an executed annuity contract. The letter further instructed Bradshaw that to revert his retirement membership to FRS, he was to complete an enclosed Form FRS-M10 and return it to his employer within 15 days. However, while Bradshaw was called by UWF, he never received the letter and again indicated to UWF by telephone that he had taken care of this already, directly with the annuity provider. Moreover, there is no evidence that he completed Form FRS-M10 indicating his desire to revert his retirement membership to the FRS, as instructed by Respondent's June 2, 1998, letter.
Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is
That Respondent enter a final order rescinding its letter of September 4, 2001, and sending Petitioner Bradshaw's contribution of $11,494.88 to TIAA-CREF, requesting that it be deposited into Bradshaw's ORP account or, in the alternative, refunding the $11,494.88 directly to Bradshaw.
DONE AND ENTERED this 28th day of June, 2002, in Tallahassee, Leon County, Florida.
BARBARA J. STAROS
Filed with the Clerk of the Division of Administrative Hearings this 28th day of June, 2002.
Julie L. Sheppard, Esquire Patricia D. Lott, Esquire University of West Florida 11000 University Parkway
Thomas E. Wright, Esquire Department of Management Services 4050 Esplanade Way, Suite 260
Department of Management Services Cedars Executive Center, Building C 2639 North Monroe Street Tallahassee, Florida 32399-1560
All parties have the right to submit written exceptions within 15 days from the date of this recommended order. Any exceptions to this recommended order should be filed with the agency that will issue the final order in this case.
