STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

COMMERCIAL CARRIER CORPORATION, )

)

Petitioner, )

)

vs. )

)

DEPARTMENT OF FINANCIAL ) SERVICES, DIVISION OF WORKERS' ) COMPENSATION, )

)

Respondent. )

Case No. 04-2384

)

RECOMMENDED ORDER

A formal hearing was held before Daniel M. Kilbride, Administrative Law Judge of the Division of Administrative Hearings, in Tallahassee, Florida, on March 29 and 30, 2005.

APPEARANCES

For Petitioner: Timothy L. Newhall, Esquire

Rayford Taylor, Esquire Stiles, Taylor & Grace, P.A. Post Office Box 1140

Tallahassee, Florida 32302-1140

For Respondent: Harry O. Thomas, Esquire

Toni A. Funaro, Esquire

Radey, Thomas, Yon & Clark, P.A.

301 South Bronough Street, Suite 200 Post Office Box 10967

Tallahassee, Florida 32302 STATEMENT OF THE ISSUES

Whether Commercial Carrier Corporation (Petitioner), has the financial strength necessary to ensure the timely payment of

all current and future workers' compensation claims in the State of Florida;

Whether Petitioner has maintained a net worth of at least

$1 million during the period 1999 to 2004; and

Whether Petitioner shall post an additional qualifying security deposit to remain qualified to self-insure and the amount of the additional security deposit to be posted.

PRELIMINARY STATEMENT

On October 28, 2002, the Department of Financial Services (Respondent)1/ issued an Order that required Petitioner to provide a certified actuarial report and simultaneously post a security deposit equal to no less than 150 percent of the actuarially determined workers’ compensation loss reserves.

Petitioner disputed this finding and requested a formal administrative hearing on November 13, 2002. At the request of Petitioner, this matter was abated by Respondent, and this matter was not referred to the Division of Administrative Hearings (DOAH) until July 9, 2004. The parties filed a formal Pre-Hearing Stipulation on March 22, 2005, and the matter was heard on March 29 and 30, 2005.

Prior to the hearing, Petitioner filed its Motion to Determine Order and Burden of Proof. Petitioner argued that while it was listed as Petitioner, the ultimate burden of proof rested with Respondent and that Respondent’s burden was to

prevail by clear and convincing evidence. This Administrative Law Judge ruled that Petitioner had the burden of proof at the hearing and that its applicable burden was by a preponderance of the evidence.

In addition, Petitioner asserted that the actions of The Florida Self-Insurance Guaranty Association (FSIGA) and Respondent were taken under an unconstitutional delegation of legislative authority and constituted an unlawful infringement on executive branch authority. Since DOAH is without authority to rule on the constitutionality of a statute, Communications

Workers v. City of Gainesville, 697 So. 2d 167 (Fla. 1st DCA 1997), those issues are not addressed in this Order, but are preserved.

At the hearing, the parties stipulated to 15 joint exhibits, which were admitted into evidence as Joint Exhibits 1 through 15. Petitioner presented live testimony of two expert witnesses, Robert Fox, C.P.A.; and Lawrence Hirsh, C.P.A.; and one fact witness, Thomas Lowe. Fox was tendered as an expert in accounting and financial matters. Hirsh was tendered as an expert in financial matters, including the valuation of companies and the financial strength of companies. Petitioner had 13 exhibits marked for identification; nine of those exhibits, Petitioner’s Exhibits 1 through 8 and 11, were admitted into evidence. Petitioner presented the deposition

testimony of Stacey Keith, which was received into evidence as Petitioner’s Exhibit 11.

Respondent presented the testimony of two expert witnesses, Brian Gee, C.P.A.; and Ashwinpaul C. Sondhi, Ph.D.; and one fact witness, Cynthia Shaw. Gee was tendered as an expert in accounting and financial analysis. Dr. Sondhi was tendered as an expert in the field of financial analysis, with special emphasis in the analysis of financial statements and accounting standards. Respondent had 11 exhibits marked for identification; nine of those exhibits, Respondent’s Exhibits 1 through 9, were admitted into evidence.

A Transcript of the proceeding was prepared and was filed with DOAH on April 15, 2005. Petitioner and Respondent filed their Proposed Recommended Orders on May 2, 2005. Both proposals have been given careful consideration in the preparation of this Recommended Order.

On January 28, 2005, Respondent filed a Motion to Compel the Production of Documents and requested attorney’s fees associated with the motion. On February 2, 2005, there was a hearing on the motion to compel and request for attorney’s fees. The motion to compel was granted; however, ruling was reserved on the request for attorney’s fees. Upon consideration of the motion, supporting documentation, the letter from Timothy Newhall regarding Respondent’s request for attorney’s fees, and

the argument of the parties, it is now determined that the request for attorney’s fees is hereby denied.

FINDINGS OF FACT

Upon careful consideration, it is found and determined as follows:

1. Petitioner, Commercial Carrier Corporation, is a privately-owned trucking company headquartered in Auburndale, Florida, which has been in business for over 50 years. Petitioner is one of five operating subsidiaries of Comcar Industries, Inc. (Comcar), whose primary business is truckload transportation of general and specialized commodities in the continental United States. Comcar routinely prepares consolidated financial statements reflecting the operations of all five subsidiary companies. Although Petitioner is the nominal Petitioner, Comcar is the de facto Petitioner in this proceeding. All of Comcar’s subsidiaries operate as self- insured in Florida. Petitioner has been self-insured for workers’ compensation in Florida since January 1, 1973.

2. Pursuant to Florida law, Respondent has jurisdiction over Petitioner as a self-insured employer for purposes of workers’ compensation.

3. Under Florida law, the general requirement is that employers must obtain and maintain workers’ compensation insurance coverage. The exception of this general requirement

   is found in Subsection 440.38(1)(b), Florida Statutes (2004), whereby an employer can seek to qualify to self-insure by "furnishing satisfactory proof to the Florida Self-Insurers Guaranty Association, Inc., . . . that it has the financial strength necessary to ensure the timely payment of all current and future claims[.]"

4. FSIGA is a not-for-profit corporation established by Section 440.385, Florida Statutes (2004), to guarantee payment of the covered workers’ compensation claims by employees of self-insurers that become insolvent. Other than governmental entities and public utilities, all self-insurers, including Petitioner, must be members of FSIGA. FSIGA pays the covered claims of current and former insolvent self-insurer members to the extent an insolvent self-insurer’s security deposit is insufficient. An insolvency fund is established and managed by FSIGA for the purpose of meeting the obligations of insolvent members after exhaustion of any security deposit. The insolvency fund is funded by assessments from members of FSIGA. Accordingly, FSIGA and all of its members share an interest in ensuring adherence to the legislative standard that only financially strong employers are granted the privilege to self- insure.

5. To maintain self-insurer status, an employer must submit annual financial statements no later than four months

   following the end of the self-insured’s fiscal year and furnish satisfactory proof to FSIGA that it has the financial strength necessary to ensure timely payment of all current and future claims.

6. The financial statements that must be submitted to FSIGA for financial analysis must be prepared in accordance with the United States Generally Accepted Accounting Principles (GAAP). GAAP-prepared financial statements must show, at all times, a net worth of $1 million. The requirements of furnishing proof of the requisite financial strength and maintaining a net worth of at least $1 million, as shown on the employer’s financial statements, are continuing annual requirements to become and remain qualified to self-insure, and those requirements are applied equally to applicants and current members.

7. FSIGA is required to review the financial strength of its current members. It makes recommendations to Respondent regarding the members’ continuing qualification to self-insure and the amount of security deposit that should be required of each member. If FSIGA determines that a current member does not have the financial strength necessary to ensure the timely payment of all current and estimated future claims, it may recommend that Respondent require an increase in the member’s security deposit.

8. FSIGA operates under a statutorily-approved plan of operations. FSIGA’s plan of operation provides that its executive director has the responsibility to make FSIGA’s recommendations to Respondent. FSIGA’s recommendations are based upon a review of the financial information collected from member employers. It may include recommendations regarding the appropriate security deposit amount necessary for a self-insured employer to demonstrate that it has the financial strength to ensure timely payment of all current and future claims.

9. Respondent is required to accept FSIGA’s recommendations unless it finds, by clear and convincing evidence, that the recommendations are erroneous.

   2002 Financial Review of Petitioner

   
   

10. Petitioner is currently a member of FSIGA and has posted a qualifying security deposit of $2,500,000.00.

11. On October 2, 2002, Brian D. Gee, C.P.A., who is now FSIGA’s executive director, completed a review of Petitioner’s audited financial statements for 1999, 2000, and 2001. Gee was FSIGA's financial analyst, responsible for conducting financial reviews and developing information for FSIGA's executive director, to determine the financial strength of self-insured members and make recommendations to Respondent. Gee’s review of Petitioner’s financial statement consisted of an assessment of Petitioner’s liquidity, profitability, degree of leverage,

    liabilities compared to net worth, and cash flow generated by operations. He also reviewed the financial statements to determine if Petitioner was maintaining a net worth of at least

    $1 million. Gee concluded that Petitioner did not have the financial strength necessary to ensure the timely payment of current and estimated future workers’ compensation claims.

12. On October 8, 2002, FSIGA's executive director forwarded a letter to the Division of Workers’ Compensation, Department of Insurance (now Respondent). He recommended to Respondent that Petitioner be ordered to increase its security deposit to 150 percent of actuarially determined loss reserves.

13. FSIGA’s recommendations were reviewed by Cynthia Shaw, assistant general counsel for the Division of Workers’ Compensation. Shaw drafted a letter for signature by Mark Casteel, General Counsel for Respondent, which adopted FSIGA's recommendations. Casteel signed that letter dated October 28, 2002, without revision or discussion.

14. Shaw, an attorney, has no financial background or expertise. Shaw did not perform any additional financial analysis. Additionally, since Respondent did not have a CPA firm under contract, FSIGA’s recommendation was not reviewed by anyone with financial background before being transmitted to Petitioner.

15. Petitioner responded to the October 28, 2002, directive from Respondent by filing a petition requesting a formal administrative hearing.

16. Petitioner failed to file financial statements with FSIGA within four months following the end of its 2000 and 2001 fiscal years. Petitioner’s failure to timely file financial reports for 2000 and 2001 was due to the fact that it was in default on certain loan covenants and was engaged in negotiations with its lenders. In 1999 and 2000, Petitioner incurred additional long-term debt to finance the purchase of a new fleet of trucks. Petitioner’s creditors had exercised their right for accelerated payment of the outstanding loan balances, which by the end of 2001, was approximately $205 million. In 2001 and 2002, Petitioner entered into negotiations with its creditors to amend and restate its loan agreements.

17. In 2002, Petitioner implemented a business plan calling for the sale of non-core assets, reduction of long-term debt, and transition from purchasing to leasing truck tractors.

18. In July 2002, Petitioner entered into amended and restated loan agreements with its creditors. In order to secure the amended and restated loan agreements, Petitioner was required to pay increased interest, pledge substantially all of its property to secure the loans, pay the lenders $3.3 million, provide certain lenders with warrants to acquire an equity

    interest in Petitioner under certain conditions and agree to restrictions on how it could use cash generated by its operations and asset sales.

19. Petitioner timely made all principal and interest payments due pursuant to the restated credit agreement and maintained compliance with all required financial ratios and standards. Furthermore, Petitioner continued to timely pay all claims for current and estimated future claims under its workers’ compensation system.

20. Following execution of the amended and restated loan agreements, Petitioner’s auditors prepared the financial statements of 2001, which Petitioner then filed with FSIGA. Separate audited financial statements for 2000 were never filed with FSIGA, although prior-year financial results were shown (without footnotes) on the audited 2001 financial statements.

21. With respect to liquidity, Petitioner’s financial statements showed a current ratio (current assets divided by current liabilities) of 1.41 at December 28, 2001. It did not disclose that Petitioner had any available funds under its revolving credit line as of December 28, 2001. Although Petitioner’s current ratio was acceptable, further analysis raised serious concern regarding Petitioner’s financial strength.

22. With respect to Petitioner’s capital structure, the financial statement review showed that Petitioner’s total liabilities-to-book-equity ratio deteriorated from 4.91 at December 1999 to 30.46 at December 28, 2001. This deterioration reasonably raised concern because Petitioner became much more heavily leveraged from 1999 to 2001, relying much more heavily on debt to fund its operations. FSIGA concluded, Petitioner’s financial statement showed a "very weak capital structure."

23. The impact of the increasing reliance on debt was marked by the end of 2001, when the financial statements showed that Petitioner was in default of its debt covenants at December 28, 2001. To address its defaults, Petitioner entered into an agreement to restructure its debt by which the creditors waived the defaults in return for imposing additional restrictions on Petitioner as described in paragraph 20 above.

24. Although Petitioner maintained a net worth of $11.1 million at the end of 2001, Petitioner’s net worth at the end of 2001 was significantly lower than its net worth of $74.8 million at the end of 2000. In addition, the financial statement review showed that Petitioner had incurred net losses of $24.2 million,

    $39.5 million, and $5.7 million for the years 2001, 2000, and 1999, respectively. These losses were substantial and raised significant concerns about Petitioner’s financial strength.

25. The 2002 financial review of Petitioner also showed a substantial decline in Petitioner’s cash flow from operations, from positive $32.6 million for 1999 to negative $2.1 million for 2001. This meant that in 2001, Petitioner was spending more cash in its operating activities than it was collecting.

26. At the time FSIGA made its recommendation to Respondent, neither FSIGA nor Respondent had current information from Petitioner regarding the amount of Petitioner’s net outstanding liability for workers’ compensation claims in Florida. This is because Petitioner failed to file the

    Form SI-20 report that had been due on August 31, 2002. From October 2002 until December 14, 2004, FSIGA and Respondent did not have accurate information in regard to the amount of Petitioner’s outstanding liability for workers’ compensation claims in Florida, because Petitioner did not file its required Forms SI-17 and SI-20 reports or provide an actuarial study.

27. At the final hearing, Petitioner did not present evidence disputing the reasonableness of FSIGA’s 2002 assessment of Petitioner’s financial statements or of FSIGA’s conclusions based thereon regarding Petitioner’s lack of financial strength in 2002.

28. Based on FSIGA’s analysis of Petitioner’s 2001 financial statements and the financial statements for the two preceding years, FSIGA reasonably concluded that Petitioner had

    not demonstrated that it had the financial strength to ensure payment of current and future workers’ compensation claims.

    Based on the information then available to it, FSIGA made the correct recommendation to Respondent. There was no clear and convincing evidence available to Respondent that demonstrates FSIGA's recommendation was erroneous, instead, the available evidence supports FSIGA’s recommendation. Accordingly, Respondent’s direction to Petitioner to provide an actuarial report and post additional security was reasonable and appropriate.

    Continuing Financial Review of Petitioner After 2002.

    
    

29. In November 2002, Petitioner challenged Respondent’s determination and requested a formal administrative hearing. Petitioner requested that Respondent hold the petition in abeyance. The request was granted, and the petition was not filed with DOAH until July 9, 2004. During this period, Respondent re-examined Petitioner’s financial strength.

30. Following its business plan, on January 16, 2004, Petitioner refinanced its debt. While there was conflicting testimony regarding whether the actual interest on the refinanced debt was lower than on the debt it replaced, it was undisputed that $30 million of the refinanced debt was carrying an interest rate of 19 percent. This is a higher rate than the nine-percent and 11-percent interest applicable to the earlier

    debt. It is undisputed that substantially all of Petitioner’s property is pledged to secure the 2004 refinanced indebtedness, and there continues to be restrictions on Petitioner’s use of cash generated by its operations. However, the 19-percent interest on a portion of the January 2004 refinancing has now caused Petitioner to go into the lending market to attempt to refinance its debt once again. Nevertheless, the refinancing of its long-term debt has reduced its financing costs.

31. Since Respondent’s 2002 request that Petitioner provide an actuarial report and post an additional security deposit, FSIGA has reviewed Petitioner’s audited financial statements for the years ended December 27, 2002, and December 26, 2003, as well as Petitioner’s unaudited financial statements for the year ended December 31, 2004.

32. The financial information received from Petitioner since the 2002 review has not resulted in FSIGA changing its 2002 recommendations. Petitioner’s 2002, 2003, and 2004 financial statements revealed that Petitioner’s net worth had fallen below the required $1 million in each of those three years.

33. The 2002 and 2003 financial statements also show that Petitioner continued to experience net losses. Petitioner sustained a net loss of $12.1 million for the year ended December 27, 2002, and a net loss of $9.9 million for the year

    ended December 26, 2003. Petitioner’s cash flow statement shows a $4.8 million decrease in cash in 2002 and a $2 million decrease in cash in 2003.

34. Petitioner’s 2004 unaudited financial statements indicate net income of $4.1 million for 2004. However, because the 2004 financial statements are unaudited, whether adjustments may be necessary following the audit are unknown at this time. Financial statements prepared without footnotes are not prepared in accordance with GAAP. Even if the unaudited results are confirmed in audited financial statements, 2004 would be the first year that Petitioner has recognized net income since 1998, following a five-year string of annual losses totaling $90 million.

    Petitioner’s Financial Status Evidenced at Final Hearing

    
    

35. At the final hearing, to demonstrate that it had the financial strength necessary to ensure the timely payment of current and future workers’ compensation claims, Petitioner presented testimony of its expert witness, Lawrence Hirsh,

    C.P.A. He posited that Petitioner's financial strength should be measured by determining its ability to generate cash flow through a calculation of its earnings before interest, taxes, depreciation and amortization (EBITDA). EBITDA is a measure commonly used by financial institutions to evaluate the ability

    of a company to generate cash flows and in determining whether to extend credit or to make investments. Petitioner’s lenders evaluated its EBITDA before deciding to refinance its credit facility in 2002 and to refinance its long-term debt in 2004.

36. However, EBITDA is not a calculation provided for under GAAP. GAAP provides a method for determining cash flows and that method is used in preparing the portion of a GAAP- compliant financial statement called the "Statement of Cash Flows."

37. Evidence presented by Respondent demonstrated that EBITDA has many limitations and is not a good proxy for cash flow. Application of EBITDA to Petitioner’s known financial performance in the past consistently overstates Petitioner’s ability to generate cash flow from operations. In every year from 1999 through 2003, Petitioner’s cash flow from operations, as shown on Petitioner’s cash flow statement that was prepared in accordance with GAAP, was significantly lower than the amount calculated for EBITDA by Hirsh:

    Year	Petitioner's Cash Flow From Operations as Shown on GAAP-Compliant Cash Flow Statement	EBITDA
    1999	$32.6 million	$61.1 million
    2000	$344,000	$21.2 million
    2001	($2.1 million)	$40.3 million
    2002	$11.9 million	$54.8 million
    2003	$12.3 million	$42.3 million

38. Petitioner's unaudited 2004 cash flow statement showed

    
    

    $18.1 million in cash flow from operations. This is significantly lower than the $52.9 million in EBITDA calculated for 2004.

39. Similarly, each year from 1999 to 2003, Hirsh's EBITDA's calculation grossly exceeds Petitioner's net loss as shown on its financial statements that were prepared in accordance with GAAP:

    Petitioner's Cash Flow From Operations as

    Year Shown on GAAP-Compliant Cash Flow Statement EBITDA

    
    

    1999 (5.7 million) $61.1 million

    2000 ($39.5 million) $21.2 million

    2001 ($24.2 million) $40.3 million

    2002 ($12.1 million) $54.8 million

    2003 ($9.9 million) $42.3 million

    
    

40. EBITDA is also misleading because it includes gain from the sale of assets. To the extent that Petitioner is selling its operating assets, such as trucks, Petitioner will have to expend cash to replace the assets, either by lease or purchase. To the extent that Petitioner is selling non-core assets, such as its unused real property, Petitioner cannot continue this practice indefinitely. Petitioner will soon run out of assets to sell. Therefore, cash generated from the sale of operating assets and non-core assets should not be considered in determining Petitioner's ability to generate cash from operating activities.

41. Petitioner sought to bolster its evidence of its financial strength through testimony that it had received a credit rating in November 2003 from Standard & Poor's of B-plus. However, a B-rating is not an investment grade rating. It means that while a company currently has the capacity to meet its debt obligations, adverse business, financial, or economic conditions likely will impair the obligor's capacity or willingness to meet its financial commitment on the obligations in the future. In addition, Petitioner received a lower credit rating of B-3 from Moody's Investment Services. A B-3 rating from Moody's Investment Services is equivalent to a B minus rating from Standard & Poor's. The Standard & Poor's and Moody's credit ratings do not effectively demonstrate that Petitioner has the financial strength necessary to ensure the payment of current and future workers' compensation claims.

42. Respondent's expert witness, Dr. Sondhi, disputed Petitioner's calculation of its EBITDA interest coverage ratio because Petitioner's calculation was based on interest paid as opposed to interest expense, and it failed to adjust for

    non-recurring items. Petitioner's interest expense is greater than the interest paid partly because Petitioner's loan agreement provides that a portion of the interest payments will accrue monthly with payments deferred until the final prepayment date or other principal payment milestone dates. Petitioner's

    calculation of the EBITDA interest coverage ratio was not performed in accordance with Standard & Poor's formula for determining the EBITDA interest coverage ratio. Even if the calculation of EBITDA interest coverage ratio was an appropriate measure of Petitioner's financial strength, the formula used by Petitioner to calculate the ratio overstates the results and shows greater financial strength than would be shown if the Standard & Poor's formula had been used.

43. For the reasons noted above, Petitioner's EBITDA calculations are rejected as an inappropriate, overstated method to assess whether a company has the financial strength necessary to ensure the payment of current and future workers' compensation claims.

44. Petitioner also argued that it had the required financial strength because it has paid all workers' compensation claims to-date and because, at the end of 2004, it had a cash balance of $26.6 million in the bank.

45. The ability to currently pay workers' compensation claims does not demonstrate the financial strength to ensure the payment of workers' compensation claims in the future. Current capacity to pay is only part of the statutory standard, which is a risk-based standard requiring a company to ensure payment into the future because of the long period of time that workers' compensation claim payments continue.

46. Likewise, having cash in the bank in the amount of

    
    

    $26.6 million at the end of 2004, does not demonstrate the required financial strength. Current cash balance is not an indicator, by itself, of financial strength to ensure payment in the future. Given Petitioner's extensive operating expenses,

    $26.6 million represents a very small amount of operating expenses.

47. Petitioner’s consolidated balance sheets list its assets at historical or book cost, the cost at which those assets were purchased, and not at their current fair market value. Petitioner argues that adjusting the book values of assets to current market value would provide the most accurate assessment of Petitioner's net worth.

48. To demonstrate that it has maintained a net worth of

    
    

    $1 million, Petitioner presented testimony that when determining net worth, the fair market value of its assets should be considered in place of the book value of its assets that is reflected on its balance sheet. However, GAAP does not permit the value of assets to be shown at fair market value and instead, requires that assets be shown at book value.

49. Even if GAAP permitted the use of fair market value of assets to be used on a balance sheet, Petitioner did not offer any admissible evidence to prove the current fair market value of its assets for 2002, 2003, and 2004. Consequently, it cannot

    be determined whether the use of the current fair market value of assets would result in Petitioner's financial statements showing a net worth at all times of at least $1 million.

50. Respondent has interpreted the term "net worth," as it is used in Florida Administrative Code Rule 69L-5.106, to mean the total assets of a company as reflected on the balance sheet, minus the total liabilities of the company as reflected on the balance sheet. Respondent's interpretation of the term "net worth" is a reasonable interpretation, consistent with the interpretation given to the term by accountants and financial analysts. The more credible expert testimony is that net worth appears on the balance sheet as stockholders' or shareholders' equity.

51. Based on the above interpretation of Florida Administrative Code Rule 69L-5.106, for each year from 2002 through 2004, Petitioner has failed to maintain a net worth of at least $1 million. The preponderance of evidence demonstrates Petitioner's net worth was negative $976,000, and negative $10.8 million for the years ended December 27, 2002, and December 26, 2003, respectively. In addition, Petitioner's unaudited financial statements for 2004 show that Petitioner maintained a negative net worth of $6.7 million as of December 31, 2004.

52. Although Petitioner's financial condition has strengthened significantly from year end 2001 to year end 2004,

    based on the evidence, Petitioner does not now have the financial strength necessary to ensure payment of current and future workers' compensation claims, nor has Petitioner maintained a net worth of at least $1 million. Therefore, an additional security deposit is required for Petitioner to remain qualified as a self-insurer.

53. In May 2002, Thomas Lowe was employed by Petitioner as its vice-president in charge of Risk Management. Lowe instituted a number of risk management practices which have significantly reduced the number and costs of Petitioner's workers' compensation claims.

54. In 2001, Petitioner's workers' compensation claims were adjusted by three separate third-party administrators (TPAs), resulting in three overlapping data bases of claims information. Petitioner was unable to reconcile this overlapping claims information and, consequently, was unable to accurately determine the amount of its workers' compensation reserves for 2001.

55. As a result of its inability to determine its workers' compensation reserves in 2001, Petitioner did not submit the required SI-17 and SI-20 forms to FSIGA in 2002 and 2003. Petitioner informed FSIGA of the difficulty it was having in reconciling its claims data for 2001 and paid the required penalties for its inability to timely submit Forms SI-17 and

    SI-20 in 2002 and 2003. Failure to submit these forms did not affect Petitioner's ability to make timely payments of all current and estimated future workers' compensation claims.

56. In 2004, Petitioner submitted Forms SI-17 to FSIGA reflecting incurred workers' compensation losses for calendar years 2002 and 2003. On December 14, 2004, Petitioner submitted Form SI-20 to FSIGA, reflecting that the present value of its estimated loss reserves was $6,894,776.00.

57. Anthony Gripps, Sr., an independent actuary who is a member of the American Academy of Actuaries, reviewed Petitioner's workers' compensation claims data pursuant to Respondent's October 28, 2002, directive. Grippa issued two reports, one dated December 1, 2004, and the other dated December 15, 2004. Grippa concluded that the present value of Petitioner's workers' compensation loss reserves as of September 30, 2004, was $6,831,175.00.

58. The parties stipulated to Grippa's finding that the amount of Petitioner's workers' compensation loss reserves as of September 20, 2004, was $6,831,175.00.

59. Petitioner's financial statements for 2004 had not been audited as of the final hearing, but were received into evidence in unaudited form. There was no evidence presented that Petitioner's 2004 financial statements do not accurately represent its financial performance in 2004 and its financial

    condition as of December 31, 2004. Florida Administrative Code Rule 69L-5.101(4) does not require Petitioner to submit audited financial statements as it has been self-insured since prior to January 1, 1997. Petitioner timely supplied Respondent with unaudited financial statements at least annually as required by Florida Administrative Code Rule 69L-5.101(4).

60. Petitioner currently has a qualified security deposit of $2,500,000.00 deposited with FSIGA.

61. In 2002, FSIGA recommended that in light of Petitioner's "significant net losses and very weak capital structure," Petitioner's security deposit should be increased to

    150 percent of the actuarially determined loss reserves. Upon consideration of all of Petitioner's financial statements from 1999 through 2004, FSIGA's recommendation should be followed.

62. Petitioner's actuarially determined loss reserves for all current and estimated future workers' compensation claims are $6,831,175.00.

63. One hundred and fifty percent of the actuarially determined loss reserves of $6,831,175 equals $10,246,762.50.

64. Petitioner presented no evidence of a different amount of security deposit increase that would be sufficient assuming one were to find that Petitioner lacks the financial strength to ensure payment of future workers' compensation claims or that

    Petitioner has failed to maintain a net worth of at least $1 million.

    CONCLUSIONS OF LAW

    
    

65. The Division of Administrative Hearings has jurisdiction over the parties and subject matter of this cause pursuant to Section 120.569 and Subsection 120.57(1), Florida Statutes (2004).

66. Respondent has jurisdiction over Petitioner as a self- insured employer for purposes of workers' compensation pursuant to Sections 440.38 and 440.385, Florida Statutes (2004).

67. The statutory framework for this proceeding is established in Sections 440.38 and 440.285, Florida Statutes (2004). The statutory provisions are elaborated on in implementing rules set forth in Florida Administrative Code Chapter 69L-5.

68. Section 440.02, Florida Statutes (2004), reads in pertinent part:

    Definitions.--

    
    

    * * *

    
    

    (12) "Department" means the Department of Financial Services; the term does not include the Financial Services Commission or any office of the commission.

    * * *

    
    

    (14) "Division" means the Division of Workers' Compensation of the Department of Financial Services.

    
    

    * * *

    
    

    (24) "Self-insurer" means:

    
    

    1. Any employer who has secured payment of compensation pursuant to s. 440.38(1)(b) or (6) as an individual self-insurer; . . . .

       
       

69. Subsection 440.38(1)(b), Florida Statutes (2004), reads as follows:

    1. Every employer shall secure the payment of compensation under this chapter:

       
       

       * * *

       
       

       1. By furnishing satisfactory proof to the Florida Self-Insurers Guaranty Association, Incorporated, created in s. 440.385, that it has the financial strength necessary to ensure timely payment of all current and future claims individually and on behalf of its subsidiary and affiliated companies with employees in this state and receiving an authorization from the department to pay such compensation directly. The association shall review the financial strength of applicants for membership, current members, and former members and make recommendations to the department regarding their qualifications to self-insure in accordance with this section and ss. 440.385 and 440.386. The department shall act in accordance with the recommendations unless it finds by clear and convincing evidence that the recommendations are erroneous.

70. Subsection 440.385(1)(a), Florida Statutes (2004), reads as follows:

    1. CREATION OF ASSOCIATION.--

       
       

       (a) There is created a nonprofit corporation to be known as the "Florida Self-Insurers Guaranty Association, Incorporated," hereinafter referred to as "the association." Upon incorporation of the association, all individual self- insurers as defined in ss. 440.02(24)(a) and 440.38(1)(b), other than individual self- insurers which are public utilities or governmental entities, shall be members of the association as a condition of their authority to individually self-insure in this state. The association shall perform its functions under a plan of operation as established and approved under subsection

       (5) and shall exercise its powers and duties through a board of directors as established under subsection (2). The association shall have those powers granted or permitted corporations not for profit, as provided in chapter 617. The activities of the association shall be subject to review by the department. The department shall have oversight responsibility as set forth in this section. The association is specifically authorized to enter into agreements with this state to perform specified services. . . .

       
       

71. Subsection 440.385(3), Florida Statutes (2004), reads in pertinent part:

    (3) POWERS AND DUTIES.--

    
    

    1. Upon creation of the Insolvency Fund pursuant to the provisions of subsection (4), the association is obligated for payment of compensation under this chapter to insolvent members' employees resulting from incidents and injuries existing prior

       to the member becoming an insolvent member and from incidents and injuries occurring within 30 days after the member has become an insolvent member, provided the incidents giving rise to claims for compensation under this chapter occur during the year in which such insolvent member is a member of the guaranty fund and was assessable pursuant to the plan of operation, and provided the employee makes timely claim for such payments according to procedures set forth by a court of competent jurisdiction over the delinquency or bankruptcy proceedings of the insolvent member. Such obligation includes only that amount due the injured worker or workers of the insolvent member under this chapter. In no event is the association obligated to a claimant in an amount in excess of the obligation of the insolvent member. The association shall be deemed the insolvent employer for purposes of this chapter to the extent of its obligation on the covered claims and, to such extent, shall have all rights, duties, and obligations of the insolvent employer as if the employer had not become insolvent.

       However, in no event shall the association be liable for any penalties or interest.

       
       

    2. The association may:

    
    

    * * *

    
    

    1. Collect and review financial information from employers and make recommendations to the department regarding the appropriate security deposit and reinsurance amounts necessary for an employer to demonstrate that it has the financial strength necessary to ensure the timely payment of all current and future claims. The association may audit and examine an employer to verify the financial strength of its current and former members. If the association determines that a current or former self-insured employer does not have the financial strength necessary to

       ensure the timely payment of all current and estimated future claims, the association may recommend to the department that the department:

       
       

       1. Revoke the employer's self-insurance privilege.

          
          

       2. Require the employer to provide a certified opinion of an independent actuary who is a member of the American Academy of Actuaries as to the actuarial present value of the employer's estimated current and future compensation payments, using a

          4-percent discount rate.

          
          

       3. Require an increase in the employer's security deposit in an amount determined by the association to be necessary to ensure payment of compensation claims. The department shall act on such recommendations as provided in paragraph (6)(a). . . .

    
    

72. Subsection 440.385(6)(a), Florida Statutes (2004), reads as follows:

    1. POWERS AND DUTIES OF DEPARTMENT.--The department shall:

       
       

       1. Review recommendations of the association concerning whether current or former self-insured employers or members of the association have the financial strength necessary to ensure the timely payment of all current and estimated future claims. If the association determines an employer does not have the financial strength necessary to ensure the timely payment of all current and future claims and recommends action pursuant to paragraph (3)(b), the department shall take such action as necessary to order the employer to comply with the recommendation, unless the department finds by clear and convincing evidence that the recommendation is erroneous.

73. Florida Administrative Code Rule 69L-5.101 reads as follows:

    69L-5.101 Definitions.

    
    

    * * *

    
    

    (4) "Financial Statement" – A report including the balance sheet, statement of operations, statement of cash flows, statement of changes in capital, and appropriate footnotes for the most recent fiscal year. The financial statements shall be prepared in accordance with United States Generally Accepted Accounting Principles as set forth in GAAP Interpretation and Application of Generally Accepted Accounting Principles 1996 which is hereby incorporated by reference into Rule Chapter 69L-5, F.A.C. Applicants approved subsequent to January 1, 1997 shall submit financial statements which are audited in accordance with Generally Accepted Auditing Standards. . . .

    
    

74. Florida Administrative Code Rule 69L-5.102(2) reads in pertinent part:

    1. All other individual employers not eligible under section (1) shall qualify for self-insurance under Section 440.38(1)(b), Florida Statutes, and must meet the following minimum requirements:

       
       

       1. Have and maintain a minimum net worth of $1,000,000 U.S.

    
    

    * * *

    
    

    (d) Have the financial strength to ensure the payment of current and estimated future compensation claims when due, as determined through review of their financial statement or summary by the division. . . .

75. Florida Administrative Code Rule 69L-5.105 reads in pertinent part:

    General Requirements.

    
    

    1. Employers approved for self-insurance privilege in accordance with Section 440.38, Florida Statutes, and these rules will be continuous unless and until voluntarily withdrawn or revoked.

       
       

    2. A review of all self-insurance programs will be made periodically. Deterioration in the financial strength as indicated in the financial statements or summaries which may affect their strength to pay current and estimated future claims when due or significant increases in losses detected as a result of such reviews, shall result in changes to the prior requirements to continue to be self-insured. . . .

       
       

76. Florida Administrative Code Rule 69L-5.106 reads in pertinent part:

    Financial Statement or Financial Summary.

    
    

    Failure to provide the following information in the name of the self-insurer when due shall be cause for revocation of privilege:

    
    

    1. Financial statement shall show, at all times, a net worth of at least

       $1,000,000 . . . The financial statement or financial summary must demonstrate the self-insurer has the financial strength to ensure the payment of all current and estimated future compensation claims when due, as determined by the division. The statements and summaries must be submitted not later than four (4) months following the end of the self-insured employer’s fiscal year.

       * * *

       
       

       (3) All separate legal entities which are included in the self-insurer’s privilege shall submit financial statements in accordance with this rule. Separate financial statements shall be submitted for each entity unless consolidated or combined financial statements are submitted.

       
       

       * * *

       
       

       1. The division shall require additional financial information if it determines, based upon the self-insurer’s financial statement or financial summary, that there has been or may be a significant change in the self-insurer's financial condition compared to the most recent financial statement.

          
          

       2. The division shall conduct an overall evaluation of the self-insurer’s financial condition to determine if the self-insurer has the financial strength necessary to ensure the payment of all current and estimated future compensation benefits when due. Failure to maintain such financial strength shall constitute good cause for:

          
          

          1. Revocation of the self-insurance privilege,

             
             

          2. Increasing The security deposit,

             
             

          3. Requirement for quarterly financial filing, or

             
             

          4. A combination thereof. . . .

       
       

77. As referenced throughout Sections 440.38 and 440.385, Florida Statutes (2004), the Legislature has determined that self-insuring workers' compensation benefits is a privilege. See, e.g., §§ 440.38(1)(b)3 and 440.385(1)(b), Fla. Stat.

    (2004). To demonstrate entitlement to retain that privilege, a self-insurer has a continuing obligation to annually demonstrate that it has the required financial strength to self-insure.

    § 440.38(1)(b), Fla. Stat. (2004); Fla. Admin. Code R. 69L-5.105.

78. The statutory scheme establishes that Petitioner in this case is asserting the affirmative of the issue, i.e., that it has the financial strength necessary to ensure the payment of current and future workers' compensation claims. As such, the burden of proof is on Petitioner to establish, by a preponderance of the evidence, that it has the financial strength to ensure the timely payment of all current and future workers' compensation claims and that its financial statements show that it has maintained the requisite net worth. See

    § 120.57(1)(j), Fla. Stat. (2004) ("Findings of fact shall be based upon a preponderance of the evidence, except in penal or licensure disciplinary proceedings or except as otherwise provided by statute, and shall be based exclusively on the evidence of record and on matters officially recognized."); Department of Transportation v. J.W.C. Co., Inc., 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."); See also this Administrative Law Judge's Order dated

    March 24, 2005. However, even if the burden of proof was on Respondent in this case, the result would not change.

    Petitioner Does Not Have the Financial Strength to Ensure the Future Payment of Its Workers' Compensation Claims

    
    

79. FSIGA is established by Section 440.385, Florida Statutes (2004), and is an organization that provides a guarantee for workers' compensation benefits for companies that are self-insured. § 440.385, Fla. Stat. (2004). A self-insurer must annually provide financial statements to FSIGA which demonstrate: (1) that the self-insurer has the financial strength necessary to ensure timely payment of all current and future workers' compensation claims, individually and on behalf of its subsidiary and affiliated companies, with employees in Florida; and (2) that the self-insurer has maintained, at all times, a net worth of at least $1 million. § 440.38(1)(b), Fla. Stat. (2004); Fla. Admin. Code R. 69L-5.106(1).

80. Financial statement must be submitted no later than four months following the end of the self-insured's fiscal year. See Fla. Admin. Code R. 69L-5.106(1). Petitioner failed to timely file its 2000 and 2001 financial statements with FSIGA. Petitioner's difficulties with obtaining accurate workers' compensation benefits payouts did not relieve Petitioner from its obligation to timely file its financial statements.

81. A financial statement is a report including the balance sheet, statement of operations, statement of cash flows, statement of changes in capital, and appropriate footnotes for the most recent fiscal year. See Fla. Admin. Code R.

    69L-5.101(4). The financial statements must be prepared in accordance with GAAP. See Fla. Admin. Code R. 69L-5.101(4).

82. FSIGA, acting through its executive director, reviews the financial strength of applicants for membership, current members, and former members alike and makes recommendations to Respondent regarding self-insurers' qualifications to self- insure. §§ 440.38(1)(b) and 440.385(3)(b)7., Fla. Stat. (2004).

83. FSIGA may recommend that Respondent require a self- insurer to deposit a qualifying security deposit to insure the payment of workers' compensation claims. §§ 440.38(1)(b)1. and 440.385(3)(b)7.c., Fla. Stat. (2004). If a self-insurer does maintain the requirements to self-insure, FSIGA may recommend an increase in security deposit, instead of revocation of authorization to self-insure, in an amount equal to 1.5 times the value certified in the latest actuarial opinion or in such other amount deemed necessary to ensure payment of compensation claims. §§ 440.38(1)(b)2. and 440.385(3)(b)7.c., Fla. Stat. (2004).

84. There is no requirement in the statute creating FSIGA that its executive director must receive board approval before issuing his recommendations to Respondent.

85. Respondent is required by law to accept FSIGA's recommendations unless it finds by clear and convincing evidence that the recommendations are erroneous. § 440.38(1)(b), Fla. Stat. (2004).

86. The evidence established that FSIGA performed a thorough review and analysis of the financial information submitted by Petitioner in 2002 in order to determine Petitioner's financial strength. The documents relied upon by FSIGA in making its initial determination and recommendation to Respondent in October 2002 were the audited financial statements of Petitioner for the three years ended December 28, 2001, which were prepared in accordance with GAAP.

87. Following the initiation of this proceeding, the evidence also established that FSIGA reviewed and analyzed Petitioner's audited financial statements for the years ended December 27, 2002, and December 26, 2003, as well as Petitioner's unaudited financial statement for the year ended December 31, 2004. FSIGA's review of the 2002, 2003, and 2004 financial statements did not alter FSIGA's opinion regarding Petitioner's lack of financial strength. With the exception of the unaudited 2004 financial statement, the later financial

    statements reviewed by FSIGA were prepared in accordance with GAAP.

88. At final hearing, Petitioner argued that it had the financial strength necessary to ensure payment of current and future workers' compensation payments not based on an assessment of GAAP-compliant financial statements. Instead, its expert testimony used EBITDA calculations that purport to show a much greater ability to generate cash, through operations than a GAAP-prepared cash flow statement. This and other assertions by Petitioner regarding its financial strength are unconvincing. Financial health to be a self-insurer is more appropriately assessed on the basis of GAAP-compliant financial statements. See N.C.M. of Collier County v. Department of Financial Services, Case No. 03-2886 (DOAH February 26, 2004), adopted in

    toto, (Final Order April 26, 2004).

    
    

89. The preponderance of the evidence pertaining to the financial condition of Petitioner from 1999 to the present demonstrates that Petitioner was in 2000, and is today, a financially troubled corporation. Although Petitioner has been able to meet its current financial obligations, in part because of a series of renegotiations with its creditors, Petitioner does not currently have the financial strength to ensure that it can meet its financial obligations, including its workers' compensation claim payments, in the future.

90. Petitioner has failed to prove by a preponderance of the evidence that it has the financial strength necessary to ensure the timely payment of all current and future workers' compensation claims.

91. In order to secure the payment of workers' compensation for Petitioner's injured employees, now and in the future, as required by Subsection 440.38(1), Florida Statutes (2004), it is necessary that Petitioner substantially increase its security deposit.

    Petitioner Has Not Maintained a Minimum Net Worth of at Least $1 Million

    
    

92. Florida Administrative Code Rule 69L-5.106(1), which sets forth criteria for the retention of self-insurer status, states that the self-insurer's "[f]inancial statement shall show at all times a net worth of at least $1,000,000."

93. A "financial statement" is a "report including the balance sheet, statement of operations, statement of cash flows, statement of changes in capital, and appropriate footnotes for the most recent fiscal year," prepared in accordance with GAAP. See Fla. Admin. Code R. 69L-5.101(4).

94. GAAP requirements do not permit valuation of property, plant, and equipment at appraisal, market, or fair values.

95. The term "net worth," when used in the rules pertaining to workers' compensation self-insurers, has

    consistently, over many years, been construed to mean shareholders' equity (i.e., assets minus liabilities). See, e.g., Department of Labor and Employment Security v. Deauville Hotel, Case No. 80-0344 (DOAH August 15, 1980), adopted in toto, (Final Order September 5, 1980) (workers' compensation self- insurer case, interpreting predecessor Florida Administrative Code Rule 38F-5.10: "[t]he owner's equity or net worth is computed by subtracting total liabilities from total assets." Recommended Order, paragraph 3).

96. In N.C.M. of Collier County v. Department of Financial

    
    

    Services, supra, N.C.M. challenged the Department's denial of its application for workers' compensation self-insurer status. The Department, in its Final Order, stated its concern in regard to a company in low net worth:

    [A] company with equity that is relatively low in comparison to its exposure might, over time, owe its injured workers as much as, or more than, the equity in the company. This situation increases the risk for injured workers and the Guaranty Association. Therefore, the consideration of N.C.M.'s net worth, taken in context with its workers' compensation exposure, assists in the overall analysis in determining whether a company has the financial strength to ensure payment of current and estimated future claims.

    
    

    Final Order at 3, paragraph 3. This interchangeable use of the terms "net worth" and "equity" shows that in the workers' compensation self-insurer context, "net worth" means

    "shareholders' equity" as reflected on the self-insurer's financial statement. The testimony at hearing confirms what these cases demonstrate that Respondent and its predecessor agency have consistently interpreted "net worth" to mean unadjusted shareholder equity as shown on the financial statement.

97. An agency's interpretation of its own rule is entitled to deference, unless the interpretation is clearly erroneous. Pan American World Airways, Inc. v. Florida Public Services Commission, 427 So. 2d 716, 719 (Fla. 1983); Miles v. Florida

    A&M University, 813 So. 2d 242, 245 (Fla. 1st DCA 2002).

    
    

98. At the final hearing, Petitioner argued that net worth should be interpreted to mean fair market value of total assets, minus total liabilities.

99. It is a "fundamental principle of statutory construction (and, indeed, of language itself) that the meaning of a word cannot be determined in isolation, but must be drawn from the context in which it is used." Textron Lycoming

    Reciprocating Engine Division, Avco Corp. v. United Auto, Aerospace & Agriculture Implement Workers of American International Union, 523 U.S. 653, 657 (1998).

100. Florida Administrative Code Rule 69L-5.106(1) states that the "[f]inancial statement shall show, at all times, a net worth of at least $1,000,000." Thus, for purposes of Florida

     Administrative Code Rule 69L-5.106(1), net worth must be determined from the financial statement. The only place that a company's net worth is reflected on its "financial statement," as defined in Florida Administrative Code Rule 69L-5.101(4), is on the balance sheet as stockholder's equity.

101. This tribunal can only apply Petitioner's definition of net worth if Respondent's interpretation is clearly erroneous. Pan American World Airways, 427 So. 2d at 719; Miles, 813 So. 2d at 245. Respondent's interpretation is not clearly erroneous because under GAAP, a company does not make adjustments on its financial statement for appraised values of property, plant, and equipment. Respondent's interpretation is the only reasonable interpretation of its rule.

102. Further, in its Proposed Recommended Order, Petitioner, for the first time, seeks to challenge the validity of Florida Administrative Code Rules 69L-5.102(2)(a) and

     69L-5.106(1), which requires an applicant and an existing self-insurer to maintain a net worth of at least $1 million. This is improper. Although Subsection 120.56(3)(a), Florida

     Statutes (2004), permits a challenge to an existing rule at any time, Petitioner cannot collaterally attack the rule in this proceeding; and, also, Petitioner has failed to follow the procedures to initiate a rule challenge, as set forth in Subsection 120.56(1), (3)(a), Florida Statutes (2004).

     Cf. State Department of Health and Rehabilitative Services v. Barr, 359 So. 2d 503 (Fla. 1st DCA 1978). See also State

     Department of Health and Rehabilitative Services v. Professional Firefighters of Florida, Inc., 366 So. 2d 1276 (Fla. 1st DCA 1979).

103. Petitioner has not maintained a net worth of

     
     

     $1 million at all times. Because Petitioner does not meet the requirements imposed on self-insurers, Petitioner must increase its security deposit to an amount of $1.5 times the actuarially determined loss reserves. This will help to ensure that its injured workers' compensation claims will be paid now and in the future.

104. Petitioner must post an additional security deposit in the amount of $7,746,762.50, which is (1.5 x $6,831,175) less the $2,500,000 Petitioner currently has posted with FSIGA.

RECOMMENDATION

Based on the foregoing Findings of Facts and Conclusions of Law, it is

RECOMMENDED that

1. The chief financial officer issue a final order determining that: (i) Petitioner does not have the financial strength to ensure the timely payment of all current and future workers' compensation claims; and (ii) Petitioner has failed to maintain a net worth of at least $1 million; and

2. Because Petitioner has failed to meet the requirements to continue self-insuring, the final order should require Petitioner to post an additional security deposit in the amount of $7,746,762.50.

DONE AND ENTERED this 1st day of June, 2005, in Tallahassee, Leon County, Florida.

S

DANIEL M. KILBRIDE

Administrative Law Judge

Division of Administrative Hearings The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

(850) 488-9675 SUNCOM 278-9675

Fax Filing (850) 921-6847 www.doah.state.fl.us

Filed with the Clerk of the Division of Administrative Hearings this 1st day of June, 2005.

ENDNOTE

1/ From July 1, 2002, until January 7, 2003, the Division of Workers' Compensation was a division of the Department of Insurance; effective January 7, 2003, the Division of Worker's Compensation became a division of the newly-formed Department of Financial Services. Throughout this Recommended Order, Respondent will constitute a reference to the Department of Financial Services, although the predecessor agency actually sent the Order to Petitioner in October 2002.

COPIES FURNISHED:

Cynthia A. Shaw, Esquire Department of Financial Services

200 East Gaines Street Tallahassee, Florida 32399-4229

Timothy L. Newhall, Esquire Rayford Taylor, Esquire Stiles, Taylor & Grace, P.A. Post Office Box 1140

Tallahassee, Florida 32302-1140

Harry O. Thomas, Esquire Toni A. Funaro, Esquire

Radey, Thomas, Yon & Clark, P.A.

301 South Bronough Street, Suite 200 Post Office Box 10967

Tallahassee, Florida 32302

Honorable Tom Gallagher Chief Financial Officer

Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300

Carlos G. Muñiz, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

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.

Docket for Case No: 04-002384

Orders for Case No: 04-002384