Findings Of Fact Prior to December 5, 1979, Robert E. Wood was incorporated under the name of Air Unlimited, Inc., to operate an aircraft fixed base operation at the Opa Locka Airport. He purchased the company in January or February 1979 but failed to inform the Department of State to mail correspondence concerning the company's registration to his address. In the course of operating Air Unlimited, Mr. Wood sold a Cessna 172 to Dr. Johnson. There is a dispute between the parties over whether or not the plane was sold as new or as used. That dispute remains unresolved today. Dr. Johnson through is business dealings with Air Unlimited, Inc., became aware that the name Air Unlimited, Inc., was being used by an aircraft servicing company in Dade County. The company as operated by Mr. Wood and known by Dr. Johnson provides fueling, repair, rental, and other aircraft services. Dr. Johnson also knew that considerable good will is attached to the name Air Unlimited, Inc. The deadline for the submission of Air Unlimited's 1979 annual report was June 30, 1979. Air Unlimited failed to file its report by that date. On December 5, 1979, the Secretary of State dissolved Air Unlimited as a corporation because it failed to file its 1979 annual report. On February 6, 1980, at 11:05 a.m. Dr. Donald E. Johnson requested the Secretary of State to reserve for him the name of Air Unlimited, Inc., for a period of ninety (90) days. At 4:50 p.m. February 5, 1980, Robert Wood sent the overdue Air Unlimited report and back corporate taxes to the Secretary of State. The evidence does not indicate when it was received. As indicated by Dr. Johnson's own testimony the reason he chose to reserve the name Air Unlimited, Inc., was because it had been in use before, the public knew it, and he thought it would help in his new business of leasing aircraft. It is the practice of the Department of State that as soon as a corporation is dissolved, its name is immediately available for reservation by a new company.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the State of Florida, Department of State revoke the reservation of the corporate name, Air Unlimited, Inc., by Dr. Donald E. Johnson. DONE AND ENTERED this 20th day of November 1980 in Tallahassee, Florida. MICHAEL PEARCE DODSON 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 26th day of November 1980.
Findings Of Fact On November 24, 1976, petitioner purchased an airplane (the Corsair) in Florida from R. D. Whittington Aircraft Sales, Inc., for which he paid eighty thousand dollars ($80,000.00). Sales tax has never been paid on account of this transaction. Before the purchase, petitioner asked George W. Sullivan, an airplane mechanic and test pilot, to evaluate the Corsair as an investment for resale. After petitioner acquired the Corsair, he caused three new cylinders to be installed and had the carburetor, the magneto and the propeller overhauled. Within three or four months of petitioner's acquisition, several prospective purchasers had inspected the Corsair. In the spring of 1977, petitioner began displaying the Corsair. At various times, petitioner engaged other pilots to ferry the Corsair to aircraft shows at Cherry Point, North Carolina, Greenville- Spartanburg, South Carolina, and elsewhere. At the time of the hearing, the Corsair had been flown approximately 43 hours since petitioner had acquired it, ten to twelve hours of which petitioner flew himself, in the course of displaying the Corsair and checking out repairs. Petitioner has traded in airplanes for the last several years and has been recognized as a dealer in aircraft by the Internal Revenue Service. Petitioner, who moved to Florida from California, applied to respondent for a dealer's certificate promptly upon learning that he was required to do so. On November 24, 1976, however, petitioner was not registered as an aircraft dealer with respondent. After an unsuccessful attempt to register effective retroactively to July 1, 1972, petitioner registered as a dealer with respondent, effective October 1, 1977. According to respondent's records, R. D. Whittington Aircraft Sales, Inc., was not registered as a dealer with respondent on November 24, 1976, and has not registered since. Petitioner obtained an address for R. D. Whittington Aircraft Sales, Inc., from respondent and, on or about, December 20, 1977, sent by certified mail a blanket resale and exemption certificate to the address respondent had furnished. A return receipt indicated that the certificate was delivered as addressed. In the past, respondent has treated sales to dealers as exempt from sales tax where the purchaser furnished the seller a resale and exemption certificate at the time of the sale and even when the certificate has been furnished afterwards, where the purchaser was registered as a dealer with respondent at the time of the transaction. The foregoing findings of fact should be read in conjunction with the statement required by Stuckey's of Eastman, Georgia v. Department of Transportation, 340 So.2d 119 (Fla. 1st DCA 1976), which is attached as an appendix to the recommended order.
Recommendation Upon consideration of the foregoing, it is RECOMMENDED: That respondent's proposed assessment be upheld. DONE and ENTERED this 11th day of August, 1978 in Tallahassee, Florida. ROBERT T. BENTON, II Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32301 904/488-9675
The Issue The issue is whether Petitioner owes tax, penalty, and interest under Section 212.05(1)(a)2., Florida Statutes,1/ for an aircraft that it allegedly purchased and used in Florida.
Findings Of Fact Petitioner is a national banking and trust company headquartered in Utah. It does not have any operations or personnel in Florida. Petitioner routinely serves as “owner trustee” for non- U.S. citizens who want to register aircraft with the Federal Aviation Administration (FAA). Petitioner charges a fee (typically $4,000) to set up the trust, as well as an annual fee (typically $2,000) for its services as “owner trustee.” Petitioner holds legal title to the aircraft in its capacity as “owner trustee” because the FAA regulations do not allow non-U.S. citizens to register aircraft. Petitioner does not have any operational control over the aircraft even though it holds legal title. The tax assessment at issue in this case relates to a Cessna Citation 650 jet, tail number N385EM (hereafter “the aircraft”), which Petitioner holds legal title to as “owner trustee” pursuant to a Trust Agreement dated April 28, 2007. The trustor and beneficiary under the Trust Agreement is MAW.ZC, LLC, which is a Delaware limited liability company, controlled by a non-U.S. citizen, Nelson Ceballos. The sole purpose of the trust was to “ensure the eligibility of the Aircraft for United States registration with the [FAA].” The aircraft was purchased from Southern Jet Center (SJC) in Sanford, Florida, on May 3, 2007, for $3.74 million. The “purchaser” identified on the Bill of Sale was “Wells Fargo Bank Northwest, NA as Owner Trustee under Trust Agreement dated 4/28/07.” MAW.ZC, LLC, was not mentioned on the Bill of Sale. Petitioner’s witness, Jon Croasman, testified that MAW.ZC, LLC, negotiated the purchase of the aircraft with SJC, and then assigned the purchase right to Petitioner as “owner trustee” so that the aircraft would not lose its tail number and it would be easier to register the aircraft with the FAA. The record does not contain a written purchase agreement between MAW.ZC, LLC, and SJC or a written assignment of the purchase right from MAW.ZC, LLC, to Petitioner. According to Mr. Croasman, SJC was “kind of an unsophisticated seller” and it did not require these documents. Mr. Croasman was the only witness with personal knowledge of the events surrounding the purchase of the aircraft who testified at the final hearing. His testimony was logical and persuasive and is accepted as credible despite the absence of corroborating documentation. Petitioner did not pay anything to SJC for the purchase of the aircraft. The entire $3.74 million purchase price was paid by MAW.ZC, LLC. Petitioner was the purchaser of the aircraft in name only. The real purchaser was MAW.ZC, LLC. On May 4, 2007, Petitioner filed an application to register the aircraft with the FAA. The applicant listed on the application form was “Wells Fargo Bank Northwest, National Association, not in its individual capacity but solely as Owner Trustee under a Trust Agreement dated as of 4/28/07.” On the same day, the FAA issued a certificate of registration for the aircraft. The certificate was issued to “Wells Fargo Bank Northwest NA Trustee.” Registration of an aircraft with the FAA has no bearing on its ownership. Indeed, the official registration document for the aircraft issued by the FAA states: “This certificate is issued for registration purposes only and is not a certificate of title. The Federal Aviation Administration does not determine rights of ownership as between private parties.” On May 7, 2007, Petitioner filed with the Department an Affidavit for Exemption of Aircraft Sold for Removal from the State of Florida by a Nonresident Purchaser (hereafter “the Removal Affidavit”). The affidavit identified the purchaser of the aircraft as “Wells Fargo bank Northwest, NA, not in its individual capacity but solely as Owner Trustee for MAW.ZC, LLC.” The aircraft remained in Florida undergoing repairs at SJC from the date of purchase until July 2, 2007, when it was flown to Venezuela where it was based. It is undisputed that the aircraft left Florida within 20 days after the initial repairs were completed and, therefore, the sale was exempt from the sales tax. The Department informed Petitioner in a letter dated July 13, 2007, that the aircraft could not be brought back into Florida for a period of six months without its becoming subject to Florida’s use tax. Petitioner forwarded this letter to Mr. Ceballos, since he and MAW.ZC, LLC, were responsible for the operation of the aircraft. Petitioner did not exercise any control over the operation of the aircraft after its purchase. In April 2007, prior to the purchase of the aircraft, Petitioner and MAW.ZC, LLC, entered into an Aircraft Operating Agreement. This agreement was executed in conjunction with the Trust Agreement in anticipation of the purchase of the aircraft. The Aircraft Operating Agreement gave MAW.ZC, LLC, “an exclusive right to possess, use and operate the Aircraft.” The agreement required MAW.ZC, LLC, to pay all costs associated with the operation and maintenance of the aircraft. And, with respect to the operation of the aircraft, the agreement required only that MAW.ZC, LLC, cause the Aircraft to be operated by competent personnel in accordance with the manufacturer’s manuals and FAA and other government regulations. On June 15, 2007, Petitioner authorized Captain Alexander Nunez to pilot the aircraft “wherever necessary and specifically including but not limited to Venezuelan air space.” Petitioner interprets the Trust Agreement and the Aircraft Operating Agreement to preclude it from exercising any control over the operation of the aircraft even though Section 9.01(a) of the Trust Agreement gives Petitioner “absolute and complete discretion” in connection with matters involving the ownership and operation of the aircraft so as to protect the interests of the United States. According to Mr. Croasman, the language in Section 9.01 is required verbatim by the FAA for the sole purpose of ensuring that Petitioner, as “owner trustee,” will be able to operate the aircraft without violating its obligations under the Trust Agreement in the unlikely event that the U.S. government needs to use the aircraft for some reason.2/ And, as Mr. Croasman pointed out, Section 9.01(a) requires Petitioner to “exercise this discretion in all matters involving ownership and operation of the Aircraft by the Owner Trustee with due regard for the interests of the Trustor.” The Trust Agreement and the Aircraft Operating Agreement provided that MAW.ZC, LLC, was responsible for keeping records concerning the use of the aircraft. MAW.ZC, LLC, was also responsible for paying any taxes or expenses related to purchase or use of the aircraft. The aircraft crashed in Venezuela on February 18, 2008, killing Mr. Ceballos, Captain Nunez, and the copilot. The original flight records for the aircraft were destroyed in the crash, and no copies of those records were presented at the final hearing. No witness with personal knowledge regarding the operation of the aircraft was presented at the final hearing. The only evidence presented concerning the operation of the aircraft was flight data obtained from two Internet sources, FlightAware and fboweb.com. The FlightAware data was obtained by Department staff as part of their monitoring of the aircraft’s operation during the six-month period after its initial departure from Florida. The fboweb.com data was provided to the Department by David McDonald, the attorney for MAW.ZC, LLC, and Mr. Ceballos, who was acting as Petitioner’s authorized representative during the investigation and protest phase of this case. There is no evidence that Mr. McDonald had any personal knowledge of the information contained in the fboweb.com data, and he did not present it to the Department as his understanding of the aircraft’s operation. Indeed, the letter by which Mr. McDonald transmitted the fboweb.com data to the Department stated that he was “having trouble trying to decipher the information provided by fboweb.com” and that he was providing it to the Department because it appeared to be inconsistent with the FlightAware data conveyed to him by the Department staff. Mr. McDonald never expressly contested the assertion by the Department staff that the aircraft returned to Florida within the six months after it initial departure. His failure to do so was not, under the circumstances, an admission or acquiescence to the Department’s position that the aircraft did return to Florida within that period. Indeed, he informed the Department staff on several occasions that he had not been able to obtain information concerning the aircraft’s operation because the aircraft’s flight records were destroyed in the crash. No credible evidence was presented as to what the FlightAware or fboweb.com services are, or how they obtain the flight data included in their records. For example, when asked to explain her “understanding of what Flight Aware is,” the Department witness used to introduce the data testified only that “[i]t’s a service that the Department subscribes to to track the flights for the aircraft.” The FlightAware data indicates that the aircraft made eleven flights into Florida between September 2007 and January 2008: Flight Date Destination 1 9/22/07 from Arturo Michelena International Airport (Arturo) in Venezuela to Kendall-Tamiami Executive Airport, and then to Simon Bolívar International Airport in Venezuela by way of Ft. Lauderdale Executive Airport on the same day 2 9/29/07 from Arturo to Hollywood International Airport (FLL), and then to Simon Bolivar International Airport the following day 3 10/1/07 from Arturo to FLL, and then back to Arturo the same day 4 10/4/07 from Arturo to FLL, then to Orlando Sanford International Airport (SFB) the following day, with a return to Arturo by way of FLL and Nassau International Airport on October 14 5 10/15/07 from Arturo to FLL, then to SFB on the same day 6 12/16/07 from Arturo to FLL, then to SFB the same day, with a return to Arturo on December 20 7 12/21/07 from Arturo to FLL, and then back to Arturo on the same day 8 12/23/07 from Arturo to FLL, and then back to Arturo on the same day 9 1/3/08 from Punta Cara International Airport to FLL, then to SFB on the same day, with a return to Arturo by way of FLL on January 6 10 1/10/08 from Arturo to FLL, and then back to Arturo on January 12 11 1/13/08 from Arturo to FLL, and then back to Arturo on the same day The fboweb.com data is, as Mr. McDonald noted, difficult to decipher. However, it appears to include most, if not all, of the flights that were listed in the FlightAware data. The fboweb.com data also lists flights on September 8- 9, 2007, between Arturo, FLL, and SFB. Those flights were not listed in the FlightAware data. No findings can be made as to whether the aircraft was indeed in Florida on the dates reflected in the FlightAware or fboweb.com data because that data is uncorroborated hearsay. Even if the FlightAware and fboweb.com data could be relied upon to establish that the aircraft was in Florida on the dates referenced above, only the September 8-9 flights listed in the fboweb.com data and the first eight flights listed in the FlightAware data would be relevant. The other three flights listed in the FlightAware data -– 1/3/08, 1/10/08, and 1/13/08 - – occurred more than six months after the aircraft’s initial departure from Florida on July 2, 2007. Mr. McDonald was able to locate and provide to the Department repair invoices related to only four of the nine relevant flights listed in the FlightAware and fboweb.com data – - 9/8/07, 10/4/07, 10/15/07, and 12/16/07. On each of those occasions, there is documentation showing that the aircraft underwent repairs at SJC in Sanford. There is no evidence that the aircraft underwent repairs in connection with the other five flights listed in the FlightAware data -– 9/22/07, 9/29/07, 10/1/07, 12/21/07, and 12/23/07. Mr. McDonald provided an invoice for a part that was purchased for the aircraft at FLL on September 29, 2007, but there is no evidence that the part was installed in Florida on that trip. No sales or use tax was paid on the aircraft by Petitioner or any other entity or person to Florida or to any other state or country. Petitioner does not dispute the amount of the tax, penalty, or interest calculated by the Department in the Notice of Reconsideration. The tax is $224,400, which is six percent of the sales price of the aircraft; the penalty is $224,400, which is 100 percent of the tax as required by Section 212.05(1)(a)2., Florida Statutes; and interest is accruing at a rate of $67.44 per day, with $27,273.10 of interest having accrued through the date of the Notice of Reconsideration. These amounts were assessed against Petitioner in its capacity as “owner trustee,” not its individual capacity.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department issue a final order rescinding the assessment at issue in this case. DONE AND ENTERED this 19th day of August, 2009, in Tallahassee, Leon County, Florida. S T. KENT WETHERELL, II Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 19th day of August, 2009.
The Issue The issue in the case is whether Albert E. and Renee Warner's application for an Airspace Obstruction Permit should be granted.
Findings Of Fact Charles W. Brammer owns the Tampa North Aero Park, Inc., which is a Florida-licensed public use landing strip surrounded by private home sites. The landing strip is located in Pasco County. Albert E. Warner and Renee Warner own a lot adjoining the Tampa North Aero Park, Inc. The Warners desire to construct and live in a single family home on the lot identified as Lot 123, Quail Hollow Village Subdivision. According to the Warners, the structure will be concrete block with a wood frame roof. The highest peak of the roof will be no more than 30 feet above ground level (98 feet above mean sea level.) Mr. Brammer is essentially concerned that his airport remain licensed for public use, and is wary of encroachments which may alter its licensing status in the future. The location of the proposed construction exceeds certain federally-established standards and triggers regulatory review of the Warner project. In November of 1995, the Warners began the process of obtaining the permits required for construction of the home at the airstrip. The evidence establishes that the Warners have been cooperative and forthcoming in their attempts to meet regulatory requirements related to their proposed construction. The Warners provided all information as requested by the Department. One of the requirements is that the Federal Aviation Administration (FAA) review the proposal and issue a "Determination of No Hazard to Air Navigation." On March 27, 1996, the FAA issued the "Determination of No Hazard to Air Navigation." The document states that an aeronautical study has been completed (study #96-ASO-286_OE) and identifies the location of the proposed residence as approximately 0.14 nautical miles northeast of the Tampa North Aero Park Airport. The FAA determination contained an incorrect latitude and longitude for the location of the proposed construction. The "Determination of No Hazard to Air Navigation" sets forth the factors considered by the FAA and concludes as follows: Therefore, it is determined that the proposed structure would have no substantial adverse effect on the safe and efficient utilization of the navigable airspace by aircraft or on the operation of air navigation facilities and would not be a hazard to air navigation. By letter of July 12, 1996, the Department issued notice of its intent to grant the Warner application for an Airspace Obstruction Permit. The letter states as follows: We have review results of the Federal Aviation Administration Aeronautical Study of your proposed construction. They have issued a determination your construction can be accommodated without a significant adverse impact on the safe and efficient use of navigable airspace for Tampa North Aero Park and is thus not a hazard to air navigation. We have been unable to identify any aviation activity not addressed by the Aeronautical Study that would necessitate altering flight operations to accommodate your proposed construction or be otherwise adversely impacted by its height at the location proposed.... The Department's permit contained the same incorrect latitude and longitude for the location of the proposed construction as had been set forth in the FAA determination. A condition of the permit requires the structure to be lighted with a red beacon and marked as an obstruction. At some point after issuing the initial determination, the FAA issued a correction to the determination. There is no date on the correction which identifies the date of issuance. Other than the location, the FAA's correction made no changes to the initial determination. The correction states as follows: This corrects a minor change in the latitude and longitude based on survey data provided regarding actual runway location and which moves proposal 2 feet closer to runway. Because this minor move will not change the results of the determination, a new circularization and determination was not considered necessary. All else remains same as on original determination. The Department has not issued a corrected notice of its intent to issue the Warner permit. Although the permit applicants have provided the information requested by the Department, the evidence fails to establish that the applicants have met the criteria set forth by statute for the issuance of an Airspace Obstruction Permit. The evidence fails to establish that the Department gave adequate consideration to the requirements of Section 333.025, Florida Statutes, in reviewing the permit application filed by the Warners.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Transportation enter a Final Order denying the Warner application for Airspace Obstruction Permit. RECOMMENDED this 4th day of March, 1997, in Tallahassee, Florida. _ WILLIAM F. QUATTLEBAUM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32301-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 4th day of March, 1997. COPIES FURNISHED: Ben G. Watts, Secretary Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450 Pamela Leslie, General Counsel Department of Transportation 562 Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450 Charles W. Brammer, Pro Se Tampa North Aero Park 4241 Birdsong Avenue Tampa, Florida 33549 Albert E. Warner, Pro Se Post Office Box 7084 Wesley Chapel, Florida 33543 Francine M. Ffolkes, Esquire Department of Transportation Haydon Burns Building, Mail Station 58 605 Suwannee Street Tallahassee, Florida 32399-0458
Findings Of Fact In the Spring of 1978, Roach purchased 1965 Piper aircraft No. 3406W from an out-of-state broker. On the assumption that sales tax had been collected, and not being familiar with Florida's Sales/Use tax laws, Roach took no other action. This aircraft was sold in August of 1978 and 1972 Piper No. 5309T was purchased in September of 1978; this aircraft was purchased under the same circumstances. No records were kept of the purchase price of either aircraft. DOR wrote Roach in August and September of 1978 regarding 3406W, without result. Thereafter, DOR used the average book value of $19,000 to arrive at a tax due of $760.00 Roach paid $720 tax on July 15, 1979; he contended that 3406W had $1000 less equipment than the average book valued aircraft. Prior to this time Roach became aware that tax was due but indicated he was financially unable to pay. On July 18, 1979, DOR sent Roach the proposed assessment for $40.00 tax, $190.00 penalty and $83.60 interest. Meantime, DOR was writing Roach regarding the second aircraft, 5309T, with no response being received until August 8, 1979. A proposed assessment was issued for $1500 tax, $375 penalty and $394.93 interest on September 10, 1979. During the subsequent informal conference, Roach advised that the tax due was in fact $1520, which was paid on October 4, 1979. Revised assessment dated October 22, 1979, was for $380 penalty and $400.20 interest. DOR's witness, Assistant Area Supervisor, Collection and Enforcement Division, received the matter from higher headquarters in December of 1979. He merely indicated that someone else in DOR used the "blue book" to determine value; he presented no evidence contrary to Roach's estimated value of $18,000 for the first aircraft or regarding the imposition of the penalty.
The Issue The issue is whether the Department of Transportation (the "Department") properly issued an Airport Site Approval Order to Monroe Airport, a private airport in Putnam County, in accordance with section 330.30, Florida Statutes, and Florida Administrative Code Rule 14-60.005.
Findings Of Fact The Department is the agency of the State of Florida granted authority to issue Airport Site Approval Orders, license public airports, and register private airports. § 330.30, Fla. Stat. A "public airport" is an airport, publicly or privately owned, that is open for use by the public. A "private airport" is an airport, publicly or privately owned, that is not open for use by the public but may be made available to others by invitation of the owner or manager. § 330.27(5)&(6), Fla. Stat. With some exceptions not relevant to this case, the owner or lessee of any proposed airport must obtain site approval from the Department "prior to site acquisition or construction or establishment of the proposed airport." § 330.30(1), Fla. Stat. Section 330.30(1) provides that applications for approval of a site "shall be made in a form and manner prescribed by the department." The statute requires the Department to grant the site approval if it is satisfied: that the site has adequate area for the proposed airport; that the proposed airport will conform to licensing or registration requirements and will comply with local land development regulations or zoning requirements; that all affected airports, local governments, and property owners have been notified and any comments submitted by them have been given adequate consideration; and that safe air-traffic patterns can be established for the proposed airport with all existing airports and approved airport sites in its vicinity. § 330.30(1)(a), Fla. Stat. Michael Monroe is the owner of property in Crescent City on which he proposes to place a private airport. Mr. Monroe has in fact constructed an airstrip on the property. In constructing his airstrip in 2008, Mr. Monroe caused the dredging and filling of jurisdictional wetlands without a permit. An enforcement action by the Department of Environmental Protection led to a consent order dated October 28, 2009. The consent order required payment of a civil penalty and required Mr. Monroe to undertake various actions in mitigation of his unpermitted wetlands activities. The Department's Aviation Office sent a cease and desist letter to Mr. Monroe, dated April 27, 2010, and signed by Micki Liddell, then the Department's Private Airport Registration Manager. The letter stated as follows, in relevant part: This letter is follow-up to our telephone conversation of this date regarding a citizen complaint received by the Florida Department of Transportation (FDOT) April 27, 2010, concerning allegations of flight operations to and from your property. The law (section 330.30, F.S.) states that the owner or lessee of any proposed airport shall obtain approval of the airport site by the Department and subsequently shall have either a public airport license or private airport registration "prior to the operation of aircraft to or from the facility." Our records show that neither an Airport Site Approval Order nor airport license or private airport registration have been issued by the Department for your residence. Flight operations to and from your residence would confirm that your residence is being used as an "airport" and being unauthorized by the Department would constitute a violation of Florida law and could put a site approval request in jeopardy. In that regard, the Department hereby advises you to cease all flight operations to and from your residence until such time as you have followed the appropriate procedures to obtain airspace approval from the Federal Aviation Administration (FAA), local zoning approval, airport site approval and private airport registration from the Department, provided your site meets the criteria of chapter 330, Florida Statutes. At the final hearing, Mr. Monroe testified that he had flown planes in and out of his property on four occasions prior to the issuance of the cease and desist letter. He stated that he has only flown a plane out of his property on one occasion since receiving the cease and desist letter, and that he had received verbal approval from the Department for the flight. On July 30, 2010, Mr. Monroe received airspace approval from the FAA for a private use landing area, with the following provisos: a) all operations will be conducted in VFR weather conditions; b) the landing area will be limited to private use; and c) an operational letter of agreement ("LOA") will be entered between Mr. Monroe, and the owners of nearby airfields Eagle's Nest Aerodrome, Mount Royal Airport, Jim Finlay Airport, and Thunderbird Airpark, to provide for compatible traffic pattern operations, considering common radio frequencies, traffic pattern altitudes, and other items as appropriate. The FAA also recommended certain approach slope ratios and centerline separation from roads and other objects. On November 15, 2010, the FAA issued an amended determination providing a fourth condition to its approval: that all arrivals, departures and traffic pattern operations remain clear of a nearby military restricted area. In August 2010, Mr. Monroe applied to the Putnam County Zoning Board of Adjustment for a special use permit ("SUP") to allow a private airport on his property, which was zoned Agricultural. At its public meeting on October 20, 2010, the Zoning Board unanimously denied the SUP after hearing Petitioner and a representative of the U.S. Navy speak in opposition. The Navy had initially contended that the airport would be located within the restricted airspace of the Lake George bombing range. Further review confirmed that the airport was outside that particular restricted airspace, but the Navy continued to assert that the airport was within the generally restricted airspace of its military operating area. After clarifying that the airport property was not in restricted airspace, Mr. Monroe reapplied for the SUP in September 2011. By Final Order dated November 16, 2011, the Zoning Board issued SUP-11-009 to Mr. Monroe and his wife, finding that the Putnam County Land Development Code allowed for a private aircraft landing facility by SUP in an Agricultural zoning district and that the proposed special use "will not adversely affect the general public health, safety and welfare of the residents of Putnam County." Appended to the Final Order were minutes of the public hearings, schematics of Mr. Monroe's property, and a Department of Environmental Protection closure request form stating that the conditions of the October 28, 2009, consent order had been satisfactorily completed. On January 27, 2012, Mr. Monroe submitted a site approval application to the Department, using the interactive internet-based system established under rule 14-60.005(3)(b). Rule 14-60.005(4) sets forth the following as conditions for site approval: The Department shall grant site approval for a proposed airport that complies with all the requirements of section 330.30, Florida Statutes, subject to any reasonable conditions necessary to protect the public health, safety, or welfare. Such conditions shall include operations limited to VFR flight conditions,[2/] restricted approach or takeoff direction from only one end of a runway, specified air-traffic pattern layouts to help prevent mid-air collision conflict with aircraft flying at another nearby airport, airport noise abatement procedures in order to satisfy community standards, or other environmental compatibility measures. Rule 14-60.005(5)(a)-(m) sets forth the supporting documentation that an applicant for a public airport site approval must submit to allow the Department to make its site approval determination and "to ensure the applicant's satisfaction of conditions" set forth in subsection (4) above. The supporting documentation is as follows: Property Rights. Provide a copy of written legal confirmation of ownership, option to buy, or lease agreement for the real property that comprises the site on which the proposed airport would be located. Although adequate safety areas surrounding an airport site are important and a factor in the Department’s approval determination, the applicant is not required to hold property rights over those real property areas that would constitute runway approach surfaces. Facility Diagram. Provide a scale drawing showing the size and dimensions of the proposed facility; property rights of way and easements; lighting, power, and telephone poles; location of building(s) on property and surrounding areas; and direction, distance, and height of all structures over 25 feet within 1,000 feet of the site perimeter. Geodetic Position. Provide a copy of a U.S. Geological Survey quadrangle map or equivalent with the proposed site plotted to the nearest second of latitude and longitude. Location Map. Provide a copy of a map or sketch, at least 8.5 x 11 inches in size, showing the location of the proposed site, with respect to recognizable landmarks and access roads to the site clearly marked. Aviation Facilities. Provide a list of names and mailing addresses for adjacent airports, including a sample copy of the letter submitted as proposal notification to these airports, and attach a copy of all airport reply correspondence. For a proposed airport or seaplane landing facility, list all VFR airports and heliports within five nautical miles and all IFR airports within 20 nautical miles. For a proposed heliport, list all VFR airports and heliports within three nautical miles and all IFR airports within 10 nautical miles. Local Government. Provide a copy of each of the letters of notification, showing the recipient's name and mailing address, that have been submitted to each zoning authority having jurisdiction, for the municipality and county in which the site lies or which is located within five nautical miles of the proposed airport site. The applicant shall also include a copy of all related correspondence from each city or county authority, including a statement that the proposed airport site is in compliance with local zoning requirements or that such requirements are not applicable. Adjacent Property. Provide a list of the names and mailing addresses of all real property owners within 1,000 feet of the airport site perimeter, or within 300 feet of the heliport or helistop site perimeter, including a single copy of the letter of notification submitted as notification to these adjacent real property owners, and include a copy of all real property owner correspondence in reply. If notification was provided by a local government as part of its review and approval process for the airport, provide written confirmation of the fact, in lieu of the above required submittal by the applicant. Public Notice. Provide a copy of the notice and of the letter, showing the recipient's name and mailing address, requesting publication of notification of the proposed airport site in a newspaper of general circulation in the county in which the proposed airport site is located and counties within five nautical miles of the proposed airport site. If this condition has been accomplished by a local government as part of its review and approval process for the airport, provide written confirmation of the fact, in lieu of the above required submittal by the applicant. Waste Sites. Provide written confirmation that the runway(s) on the proposed airport would not be located within 5,000 feet of any solid waste management facility for a proposed airport serving only non-turbine aircraft, or within 10,000 feet of any solid waste management facility for a proposed airport serving turbine-driven aircraft. Air Traffic Pattern. Provide written confirmation, including a graphical depiction, demonstrating that safe air traffic patterns can be established for the proposed airport with all existing and approved airport sites within three miles of the proposed airport site. Provide a copy of written memorandum(s) of understanding or letter(s) of agreement, signed by each respective party, regarding air traffic pattern separation procedures between the parties representing the proposed airport and any existing airport(s) or approved airport site(s) located within three miles of the proposed site. Safety Factors. Provide written confirmation that the runway and taxiway design criteria and airport design layout of the proposed airport have appropriately taken into account consideration of the manufacturer's performance characteristics for the type(s) of aircraft planned to be operated; the frequency and type(s) of flight operations to be anticipated; planned aviation-related or non-aviation activities on the airport; and any other safety considerations, as necessary, to help ensure the general public health, safety, and welfare of persons located on or near the airport. Security Factors. Provide written confirmation that the proposed airport site owner or lessee will take appropriate steps to help protect the general public health, safety, and welfare through secure airport operations and that they will develop and implement adequate airport security measures to safeguard airport and aviation-related assets from misappropriation or misuse in order to prevent potential loss or public endangerment. FAA Approval. Provide a copy of the notification to the FAA regarding the proposed airport site and a copy of the FAA's airspace approval correspondence given in response. Rule 14-60.005(6) provides that an applicant for private airport site approval is subject to the same requirements as stated for a public airport site approval applicant. However, private airport applicants are not required to submit a hard copy, written site approval application nor the supporting documentation set forth in the preceding paragraph. Private airport site approval applicants are required to "retain for their records all of the required documentation related to the site approval application, in order to be able to respond to any possible future local, state, or federal inquiry." The private airport site approval applicant submits his application through a Department website. Once the applicant obtains a user ID and password to the site, he proceeds to an interactive site approval screen that requires him to provide the following data: type of facility (airport, heliport, or ultralight); personal information (name, address, phone number, fax number, and email address); facility data (facility name, physical location, geographical information -- latitude, longitude, and elevation -- and primary type of facility use); and landing area data (runway/helipad magnetic bearing, length, width, and type of surface -- paved/unpaved). The applicant is also required to certify that he has completed all the conditions set forth in rule 14-60.005(5)(a)- (m). The applicant must check a certification box next to each and every requirement of the rule. For example, as to the requirement of rule 14-60.005(5)(c), the applicant checks a box next to the following statement: Geodetic Position -- I certify that I have a copy of a U.S. Geological Survey quadrangle map or equivalent with the proposed site plotted to the nearest second of latitude and longitude. In other words, as a private airport applicant, Mr. Monroe was not required under the rule to submit the supporting documentation demonstrating his satisfaction of the conditions set forth in rule 14-60.005(5), but he was required to certify that at the time of his application he possessed all such documentation and was capable of submitting it in response to a governmental inquiry. On March 1, 2012, the Department issued an Airport Site Approval Order to Mr. Monroe, to be effective April 15, 2012. On April 6, 2012, Petitioner timely filed a challenge to the site approval order. Petitioner is the owner of property directly abutting the southeast corner of Mr. Monroe's property. Petitioner raises goats on her property, and contends that low- flying planes frighten her animals, causing them to stampede and injure themselves. Petitioner's challenge has stayed the effective date of the site approval order. David Roberts, the Department's aviation operations administrator, testified that in preparation for this proceeding he asked Mr. Monroe to produce all the documentation which he had certified to meet the requirements of rule 14-60.005(5)(a)- (m). The Department introduced into evidence all of the documents that Mr. Monroe provided in response to Mr. Roberts' request. As to rule 14-60.005(5)(a), Mr. Monroe provided copies of his deed for and mortgage on the Crescent City property sufficient to establish his property rights to the site on which the proposed airport is to be located. As to rule 14-60.005(5)(b), Mr. Monroe provided a hand drawing of the property indicating the configuration of the airstrip and showing the general locations of the entrance gate, barn, pond, bridge, and trailer on the property. The map is not drawn to scale and does not show property rights of way and easements or lighting, power and telephone poles. The map does not indicate the "direction, distance, and height of all structures over 25 feet within 1,000 feet of the site perimeter," but Mr. Monroe's testimony that there are no such structures is credited. As to rule 14-60.005(5)(c), Mr. Monroe provided a personally commissioned survey map of the property that the Department accepted as the "equivalent" of a U.S. Geological Survey quadrangle map. As to rule 14-60.005(5)(d), Mr. Monroe provided a map, but not one that showed "recognizable landmarks and access roads." As to rule 14-60.005(5)(e), Mr. Monroe submitted a list of five airports that met the notification requirement: Eagle's Nest Aerodrome, Mount Royal Airport, Jim Finlay Airport, Thunderbird Airpark, and Palatka Municipal Airport, also known as Kay Larkin Field. Mr. Monroe also included a sample copy of the letter providing proposal notification to these airports. The only direct reply correspondence that Mr. Monroe submitted was an emailed letter of congratulations from the manager of Palatka Municipal Airport, dated May 15, 2012. Mr. Monroe also submitted a June 10, 2012, email from Jim Manus of Royal Park Airport in support of Mr. Monroe's intent to align his common traffic advisory frequency ("CTAF") with that of Mount Royal and Eagle's Nest. The tone of Mr. Manus' correspondence indicates approval of Mr. Monroe's airport. No response was provided from Jim Finlay, Thunderbird, or Eagle's Nest.3/ As to rule 14-60.005(5)(f), Mr. Monroe provided copies of his letters of notification to the Marion County director of growth management and the Volusia County growth and resource management office. Volusia County responded by stating that it took no issue with the proposed airport and that the FAA had informed the county that it needed to take no action on the matter. Mr. Monroe provided no response from Marion County. As to the notice requirements of rule 14- 60.005(5)(g)&(h), Mr. Monroe provided a list of names and addresses of nearby property owners along with a letter of notification dated August 30, 2004, stating Mr. Monroe's intention to establish an airstrip on his property. He included no reply correspondence. Petitioner rightly argues that an eight-year-old letter cannot be held to meet the notice requirement of the rule. Though the rule does not state a temporal limitation as to the notice, the context of the notice requirement clearly requires the applicant to provide his neighbors with notice of the pending site approval. However, Mr. Monroe also provided the receipt from a newspaper notice that he ran in 2010 regarding his SUP application and he credibly testified that the county notified his neighbors prior to issuance of the SUP. Thus, the requirements of rule 14- 60.005(5)(g)&(h) were met. As to rule 14-60.005(5)(i), Mr. Monroe submitted documentation that demonstrated there are no active solid waste management facilities within the prescribed distances. As to rule 14-60.005(5)(j), Mr. Monroe provided a graphical depiction of the traffic pattern and approaches to his own proposed airport. The depiction also lists radio frequencies for Mr. Monroe's airport, Mount Royal, and Eagle's Nest. Mr. Monroe did not submit any documentation to demonstrate that safe traffic patterns can be established for the proposed airport with all existing airport sites within three miles of the proposed airport. Mr. Monroe also did not submit written memoranda of understanding or letters of agreement with the other airports as regards air traffic pattern separation procedures. As to rule 14-60.005(5)(k)&(l), Mr. Monroe submitted an opinion letter from aviation consultant Robert E. Babis, dated April 19, 2012, addressing safety and security factors at the proposed airport. Mr. Babis stated that he was a retired Department public transportation manager, a flight instructor, airport inspector, and aviation planner. Mr. Babis further stated that he has inspected and landed at over 200 private airports in Florida. Mr. Babis concluded that Mr. Monroe's airport "is a safe and secure facility with a very low risk for operational accidents or illegal activities." The Department reasonably accepted this letter as satisfying the criteria of rule 14-60.005(5)(k)&(l). As to rule 14-60.005(5)(m), Mr. Monroe submitted a copy of his amended FAA approval determination, dated November 15, 2010. Petitioner noted that Mr. Monroe has yet to fulfill one of the conditions of the FAA determination: he has yet to produce an operational LOA with the owners of Eagle's Nest, Mount Royal, Jim Finlay, and Thunderbird to provide for compatible traffic pattern operations, common radio frequencies, traffic pattern altitudes, and other items as appropriate. In summary, the evidence presented at the hearing demonstrated that, despite his certification otherwise, Mr. Monroe did not possess all the documentation required by rule 14-60.005(5)(a)-(m). Mr. Monroe did not meet the requirement of paragraph (b) that he provide a scale drawing showing property rights of way or easements, lighting, power and telephone poles. He did not meet the requirement of paragraph (d) that his map show recognizable landmarks and access roads. Most importantly, Mr. Monroe did not meet the requirement of paragraph (j) that he submit documentation demonstrating that safe traffic patterns can be established for the proposed airport with all existing airports within three miles. This failure, coupled with Mr. Monroe's failure to fulfill his commitment to the FAA that he would enter an LOA with the owners of four nearby airports, not to mention Mr. Monroe's history of building his airstrip and flying in and out of his property before obtaining legal permission to do so, indicates a casual approach to regulatory compliance that should give the Department pause in granting site approval. At the final hearing, Mr. Roberts of the Department testified that because a private applicant such as Mr. Monroe is not required to submit his supporting documentation to the Department to demonstrate compliance with rule 14-60.005(5)(a)- (m), the Department may not deny the site approval to Mr. Monroe once he has certified that he has all the documentation. Mr. Roberts testified that the Department's only recourse upon learning that Mr. Monroe in fact does not have the documentation would be to revoke the site approval order. The Department's rule sets forth the criteria for revocation of a site approval order. One of the grounds for revocation is a Department determination that "aircraft have operated on the site prior to airport licensing or registration, except as required for an in-flight emergency." Fla. Admin. Code R. 14-60.005(8)(b)3. By his own admission, Mr. Monroe flew into and out of his property prior to registration.4/ However, Mr. Roberts testified that the Department could not base a revocation action on those flights because they occurred prior to the date on which Mr. Monroe applied for site approval. Mr. Roberts could cite to no language in the rule that supported his restrictive view of the revocation provision. The Department does not persist in supporting Mr. Roberts' reasoning in its Proposed Recommended Order. The Department concedes that Mr. Monroe has failed to meet all the documentation criteria set forth in the rule and that it has the authority to deny the site approval order. The Department does not concede that the maps submitted in response to paragraphs (b) and (d) of rule 14-60.005(5) are deficient, but it does concede that Mr. Monroe failed to comply with paragraph (j) regarding the LOA setting forth jointly agreed-upon departure and arrival routes and common radio frequencies with the other nearby airports. The Department argues that Mr. Monroe should nonetheless be granted a Site Approval Order, subject to the condition that Mr. Monroe enter into an LOA establishing safe traffic patterns and radio frequencies with all airfields within three miles of his facility. The Department notes that if Mr. Monroe's application were denied in this proceeding, he could immediately procure the LOA and reapply. Granting the site approval in this proceeding would merely obviate the need for Mr. Monroe to take that largely redundant step. As authority for its contention that it may issue a site approval order prior to an applicant's compliance with all provisions of rule 14-60.005(5), the Department cites section 330.30(1)(d), which states: "Site approval may be granted subject to any reasonable conditions the department deems necessary to protect the public health, safety, or welfare."5/
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Transportation enter a final order denying the site approval application of Michael D. Monroe and withdrawing the Airport Site Approval Order issued to Mr. Monroe on March 1, 2012, Site Approval Number SW2012-FLA-0117-AP. DONE AND ENTERED this 21st day of February, 2013, in Tallahassee, Leon County, Florida. S LAWRENCE P. STEVENSON 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 21st day of February, 2013.
The Issue The issues for determination in this case are 1) whether Respondent Department of Environmental Protection, Hillsborough County, as the permitting authority, should issue a final Title V Air Operation Permit to Respondent Southeast Oil Development Corporation, for its fiberglass lay-up and abrasive blasting facility in Thonotosassa, Florida; and 2) whether the conditions contained in the Draft Title V Air Operation Permit proposed for issuance to Southeast Oil are sufficient to ensure compliance with applicable provisions of Chapter 403, Florida Statutes, and Chapter 62, Florida Administrative Code.
Findings Of Fact Petitioners, JAMES REINA, ANGELO M. REINA, NANCY C. REINA, HELEN REINA, and STEVE QUICK, are residents of Thonotosassa, in Hillsborough County, Florida, and reside within one-third mile of a fiberglass lay-up and abrasive blasting facility owned and operated by Respondent SOUTHEAST OIL & DEVELOPMENT CORPORATION. Petitioners’ residences are located to the southwest of the fiberglass facility. Respondent, SOUTHEAST OIL & DEVELOPMENT CORPORATION (SOUTHEAST), owns and operates a fiberglass lay-up and abrasive basting facility located at 11801 Elyssa Road, Thonotosassa, in Hillsborough County, Florida. Respondent, DEPARTMENT OF ENVIRONMENTAL PROTECTION, HILLSBOROUGH COUNTY (EPC), is the local regulatory agency authorized to act as the permitting authority for Title V Air Operations permits. EPC is processing and acting on the subject’s air permit on behalf of the Florida Department of Environmental Protection, pursuant to operating agreements between the state and local agencies. The SOUTHEAST facility operation which is the subject of these proceedings consists of taking a steel tank shell and abrasive blasting around the filer ports openings. The tank is then covered with a layer of mesh, mylar, and styrene based fiberglass resin. The tank is rotated to aid in an even application. Prior to shipment, wood crates are cut to protect the tank in transit. The SOUTHEAST facility has been in continuous operation, manufacturing tanks at this location since 1985. During the manufacturing process, there is no open air venting while chemicals are mixed. Manufacturing is conducted in an enclosed and covered facility. Chemical containers are tightly capped when not in use. The SOUTHEAST facility currently manufactures approximately 150 tanks on an annual basis. The tanks are primarily used for gasoline storage. Styrene is the chemical that produces a fiberglass odor during the tank manufacturing process. Under the terms and conditions of its current and proposed permits, SOUTHEAST is limited in the amount of styrene allowed to be used in the manufacturing process. Approximately three years ago, SOUTHEAST changed its formula for the manufacturing process. The current formula includes a secret ingredient designated “Ingredient A” which contains significantly less styrene than SOUTHEAST’S prior formula. The use of “Ingredient A” has resulted in less styrene emission during the manufacturing process. The fiberglass odor emitted during the manufacturing process is sporadic and dependent on the wind and weather conditions. Petitioners do not detect the odor on a continual basis, and for several months at a time, there is no noticeable odor. The objectionable nature of the odor is dependent on the various sensitivities of the Petitioners. On at least two occasions within the last year, some of the Petitioners have complained to EPC of the odor; however, EPC’s investigators who responded to the complaints in a timely manner were unable to detect significant levels of fiberglass odor at Petitioners’ residences. The investigators did not consider the odors detected as objectionable. The fiberglass odor emitted during the manufacturing process is not offensive to all of the neighboring businesses and residences. The owner of the business closest in proximity to SOUTHEAST has not made a complaint regarding an objectionable odor emission and does not consider the odor objectionable. There is no evidence that the odor emitted during the manufacturing process presents a health problem to the residents of the area. The permit proposed by EPC contains conditions controlling the emission of objectionable odors and places limits on the amount of styrene which may be utilized by SOUTHEAST during the manufacturing process.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Department of Environmental Protection enter a Final Order granting Southeast Oil’s Application for Title V Air Operation Permit for the fiberglass lay-up and abrasive blasting facility, with the conditions included in the December 13, 1996, Draft Permit with conditions. DONE AND ENTERED this 6th day of August, 1997, in Tallahassee, Leon County, Florida. RICHARD HIXSON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 6th day of August, 1997. COPIES FURNISHED: David M. Carr, Esquire 600 East Madison Street Tampa, Florida 33602 Richard E. Fee, Esquire Ganther and Fee, P.A. 101 East Kennedy Boulevard Barnett Plaza, Suite 1030 Tampa, Florida 33602 Sara M. Fotopulos, Esquire Vernon R. Wagner, Esquire Hillsborough County Environmental Protection Commission 1900 9th Avenue Tampa, Florida 33605 Perry Odom, General Counsel Department of Environmental Protection 3900 Commonwealth Boulevard Tallahassee, Florida 32399 James Reina, pro se 9947 Fowler Avenue Thonotosassa, Florida 33592 Angelo M. Reina, pro se Nancy C. Reina, pro se 9949 Fowler Avenue Thonotosassa, Florida 33592 Helen Reina, pro se 9951 Fowler Avenue Thonotosassa, Florida 33592 Steve Quick, pro se Betty Quick, pro se 9953 Fowler Avenue Thonotosassa, Florida 33592
The Issue Whether Petitioner is liable for sales or use tax, plus interest and penalties, as asserted by the Respondent's Notice of Decision dated March 16, 1995.
Findings Of Fact Petitioner is a Florida for-profit corporation whose sole stockholder is Corwin Zimmer. At all times pertinent to this proceeding, Petitioner operated an air taxi charter service out of the Fort Lauderdale, Florida, airport. Respondent is the agency of the State of Florida charged with the responsibility of enforcing the Florida Revenue Act of 1949, as amended, including the provisions of Chapter 212, Florida Statutes. At the times pertinent to this proceeding, Petitioner utilized three Learjets in its operations. At all times pertinent to this proceedings, each of these three jets was owned by a separate corporation and each corporation was owned by a single shareholder. Each jet was owned by a corporation to limit the liability of the individual shareholder. Each of the following owned one of these three jets: Alamo Jet, Inc., a Florida corporation wholly owned by Charles Schmidt; RLO, Inc., a Florida corporation wholly owned by Richard Owens; and Gulfstream Flight Services, Inc., a Florida corporation wholly owned by Dr. David Brown. These three corporations and their individual shareholders will be collectively referred to as the owners. These owners were unrelated to each other. Except for the agreements at issue in this proceeding, the owners were also unrelated to the Petitioner and Mr. Zimmer. None of the owners possessed the FAA licensure necessary to transport passengers for hire. At all times pertinent to this proceeding, each of the three owners had an agreement with Petitioner that was styled "Aircraft Management Agreement" (the agreement). Although written agreements could not be located for all three owners, Mr. Zimmer testified, credibly, that there existed a written agreement for each owner and that there was no material difference between the written agreement that was produced at the formal hearing and the other agreements. None of the owners fully utilized the jet it owned before entering into the agreement with Petitioner. As to each agreement, the owner was referred to as "owner" and his jet was described. Petitioner was referred to as "operator". The agreements do not contain the term "lease". The following are the responsibilities of the Petitioner as the operator pursuant to the agreement between Petitioner and Alamo Jet, Inc.: Place the Aircraft on its Air Carrier Certificate Number AT 705264 for the purpose of utilizing the aircraft in FAR 135 operations. Oversee all aircraft maintenance, aircraft records, aircraft time components, in accor- dance with the Learjet Model 55 maintenance program, Federal Aviation Regulations, and its operating certificate. Train flight crews, maintain crew records in accordance with Federal Aviation Regula- tions conduct initial, recurrent, six month proficiency flight checks. Provide the Owner with a flight crew at a rate of $450.00 per day, not to exceed $600.00 per month. Schedule all Aircraft, flight, crews and passenger activity through its dispatch department. Reimburse the Owner all moneys received from placing the Aircraft on the Garrett Engine Fleet Operations Program. Insure the Aircraft on its fleet operators policy and financially participate to recover the additional premium required for FAR 135 operations. Hanger the Aircraft at its Fort Lauder- dale facility at no charge to the owner. Provide fuel to the Owner at its Fort Lauderdale facility at $.25 above purchase cost. Insure that the aircraft [is] maintained in a like new condition with the exception of normal wear. Pay the Owner $800.00 per flight hour for the aircraft when it is utilized for FAR 135 operations. Provide the Owner with an aircraft state- ment and activity report by the 7th of the following month, and payment for the utiliza- tion of the aircraft by the 25th day of the month. Provide all charts, maps, and expendable storage at no charge to the Owner. Aggressively market the aircraft for maximum utilization. The Alamo Jet, Inc. agreement provided the following pertaining to aircraft flight utilization: Owner utilization: The Owner is responsible for all direct costs incurred from the flight. Maintenance Test Flights: The owner is responsible for all direct costs of operation. There will be no charge for the crew conducting the test flight. Flight Crew Training: The Operator shall be responsible for the direct cost of operation. This includes MSF payment, hourly maintenance cost, [and] fuel. FAR 135 Air Carrier Flights: The Operator is responsible for all cost incurred in addition to the payment of $800.00 per flight hour to the owner. The Alamo Jet, Inc. agreement provides that the Owner agrees to and is responsible for the following: Payment of the insurance premium less the additional amount required for commercial operations. Cost of maintaining the aircraft. To coordinate all flights with the Operators dispatch department. The Alamo Jet, Inc. agreement provides the following general conditions: Operator will aggressively market the charter utilization of the aircraft, and estimate its use at 600 hours the first year. No guarantee as to the amount of aircraft revenue hours are included in this agreement. Generally, Petitioner's flights are in the continental United States. During the audit period, each owner used its aircraft approximately ten days a month. Each owner could use its aircraft except when it was undergoing a major inspection or was down for maintenance. Other than those times, each owner had a key and unlimited access to its aircraft. Each owner had bumping privileges with respect to their aircraft. If an owner's aircraft was booked for a flight by Petitioner when the owner wanted to use it, the Petitioner would make the owner's aircraft available to the owner and re-book the passenger on another aircraft. Petitioner provided the pilot and crew when an owner wanted to use its aircraft at a per hour rate that was less than that charged for its taxi service. When an owner wanted to use his aircraft, he would contact one of Petitioner's employees to coordinate his use with the Petitioner. Mr. Zimmer testified that he did not intend the agreements with the owners to be leases. From the inception of the agreements, Mr. Zimmer viewed the arrangements as being contracts for the management of the aircraft so that his company and each owner could use its jet but also generate revenue when its jet was being used by Petitioner in its air taxi operations, referred to as FAR 135 operations. Mr. Zimmer testified that he intended that his relationship with the owners of the aircraft to be a marriage of operations and aircraft. Petitioner had the air carrier certificate, and the personnel and facilities to maintain the aircraft and provide air taxi service. 1/ During the audit, Mr. Dreker told Mr. Zimmer that the Respondent was treating the payments to the owners as lease payments. Before that time, no one had told Mr. Zimmer that the relationship constituted a lease. Each agreement required the owner to deliver its aircraft to Petitioner for use pursuant to the terms of the agreement. The owner gave up its exclusive possession, control, and dominion of its aircraft pursuant to the terms of the agreement. Petitioner controlled the use of the aircraft, subject to the terms of the agreement, which set forth the rights of the owner. Each agreement permitted the owner to fully utilize its jet. For the years 1987, 1988, 1989, 1990, and 1991, the Petitioner reported for federal income tax purposes in connection with its use of the three jets under the category "cost of goods sold - other costs - Jet Leases" the respective amounts of $650,531.00, $753,181.00, $923,374.00, $899,917.00, and $693,603.00. For the years 1987, 1988, 1989, 1990, and 1991, the Petitioner referred to the payments made to the owners as "Lease Payments". For the years 1987, 1988, 1989, 1990, and 1991, the Petitioner's books referred to the payments made to the owners as "Lease Payments". Mr. Zimmer was involved in the operation of the Petitioner from the time it was incorporated. He did not, however, become the sole stockholder until 1982. During 1982, Petitioner leased an airplane from American Jet in St. Louis, Missouri. The lease of that airplane is reflected on Petitioner's 1982 Federal income tax return, which was prepared by Rosen and Santini, P.A. Beginning in 1983, after Mr. Zimmer purchased the stock of the Petitioner, Robert J. Dreker, a CPA employed by Schmidt & Co., prepared all of Petitioner's federal tax returns. Petitioner's books were set up before Mr. Dreker became its CPA. Mr. Dreker did not believe that referring to the payments to owners as lease payments in Petitioner's Federal tax return or in its chart of accounts was significant because the payments were clearly deductible for tax purposes. Consequently, he retained the nomenclature reflected on the 1983 tax return and in the chart of accounts as he found them. Petitioner's chart of accounts was maintained on a daily basis by a bookkeeper. Three individuals filled the bookkeeper position at different times, none of whom had any special training or experience in tax matters. Mr. Dreker was of the opinion that referring to the payments to owners as lease payments did not conform to generally accepted accounting principles and mischaracterizes the relationship. Mr. Dreker was of the opinion that the payments to owners should be called management expenses or owner revenue payments. Mr. Dreker or his accounting firm had never been employed to prepare a certified financial statement for the Petitioner. Respondent audited Petitioner for the period May 1, 1987, through April 30, 1992. The auditor, Cynthia McHale, reviewed Petitioner's books and records, including the agreement with Alamo Jet, and interviewed Mr. Zimmer. Based on that audit the Respondent determined that the agreements between Petitioner and the owners constituted leases and that Petitioner was liable for sales or use taxes on those leases. Ms. McHale understood that Mr. Zimmer and Mr. Dreker did not intend the agreements to be leases. The amounts determined to be due were reflected by the Notice of Decision dated March 16, 1995, which is the agency action challenged by Petitioner. Respondent asserts that Petitioner owes taxes in the amount of $238,454.24, penalty in the amount of $59,613.55, interest through August 12, 1993, in the amount of $102,633.11, for a total of $400,700.90, plus interest accruing from August 12, 1993, at the rate of $77.46 per day. Petitioner disputes that the agreements constitute leases and asserts that no tax is due. Petitioner does not challenge the underlying calculation that produced the figures contained in the Notice of Decision dated March 16, 1995. Pursuant to its agreement with the owners, the Petitioner provided hangar storage space for the storage of the jets. Respondent has not assessed any tax for that storage. Petitioner did not assess taxes on the charges made by Petitioner to the passengers using its air taxi service since these charges are specifically exempt from taxation. In 1981, Petitioner corresponded with Respondent about its need to register with Respondent for sales tax purposes. The Respondent's reply, dated July 30, 1981, advised that Petitioner did not need to register for sales tax purposes because the Petitioner's business was a nontaxable service. At about the time the sales tax on services went into effect, Mr. Dreker talked with two employees of the Respondent in separate conversations and described the Petitioner's operations to them. Based on those conversations, Mr. Dreker formed the opinion that Petitioner was not subject to either sales tax or service tax. Petitioner did not pay to the Respondent or to the owners a service tax on the payments made to the owners between July 1, 1987, and December 31, 1987, the dates the service tax was in effect in Florida. The 1981 correspondence and Mr. Dreker's telephone conversations are the only evidence that supports Petitioner's estoppel argument. Mr. Dreker did not receive a written response to his telephone inquiry and he did not send a written inquiry to Respondent requesting a Letter of Technical Advice, a request for a Technical Assistance Advisement, or a Declaratory Statement.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a final order that adopts the findings of fact and conclusions of law contained herein and sustains the assessments contained in the Notice of Decision dated March 16, 1995, that Petitioner owes taxes in the amount of $238,454.24, penalty in the amount of $59,613.55, interest through August 12, 1993, in the amount of $102,633.11, for a total of $400,700.90, plus interest accruing from August 12, 1993, at the rate of $77.46 per day. DONE AND ENTERED this 6th day of May 1996 in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON, 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 6th day of May 1996.
The Issue Whether Petitioners should be permitted to purchase an aircraft for leasing purposes without paying sales tax.
Findings Of Fact Centurion, as a legal entity, was first incorporated under the laws of the State of Florida on or about May 23, 1996. Eagle, the parent corporation of Centurion, is a separate legal entity, also incorporated under the laws of the State of Florida. Both entities have their headquarters in Tallahassee, Florida. An assessment of sales/use taxes, and associated interest, was issued by Respondent against Centurion and reflected in a Notice of Reconsideration (NOR), dated April 18, 1997. No tax assessment has been issued against Eagle. The assessment was based upon the purchase by Centurion, of a 1968 Cessna Aircraft, Model #210H, Serial #21059002, in Florida, from Frank A. Tillman, for $30,000. Centurion, the sole purchaser, took title to the aircraft when it was purchased from Frank Tillman. No sales tax was collected on the transaction. However, tax was remitted by Eagle on the subsequent re-leasing of the aircraft in Florida. At the time of the sale, Centurion, the purchaser, was not registered as a dealer. However, Eagle, the parent corporation, was registered as a dealer. Evidence is in conflict concerning the exact date of purchase of the aircraft,1 but the parties are in agreement and the evidence supports the finding that the aircraft was purchased before Centurion obtained a dealership registration on October 24, 1996. Centurion did not seek to register as a dealer until Respondent later launched inquiries about the purchase. On August 21, 1996, Respondent issued a tax assessment/billing against Centurion based upon an estimated aircraft purchase price of $60,000. However, based upon additional information provided by Eagle, Respondent learned that the purchase price was only $30,000 and the assessment was reduced. Respondent’s NOR reflects the computation of the assessment based upon the purchase price of $30,000. Petitioners did not act as a “joint venture” or “unit” in that they did not register jointly as a “dealer” at the time of purchase; they did not acquire joint title to the aircraft; and they did not jointly issue a certificate of resale at the time of purchase. The following elements of joint venture were not evidenced by Petitioners at the time of sale: (1) a community of interest in the performance of the common purpose; (2) joint control or right of control; (3) a joint proprietary interest in the subject matter; (4) a right to share in the profits and (5) a duty to share in any losses which may be sustained. Testimony by James B. Curasi on behalf of Petitioners that a joint venture was established contradicts statements made by him previously to Respondent. In a letter dated September 19, 1996, Petitioners’ representative and witness, James B. Curasi, informed the Department of Revenue that the aircraft was leased by Centurion to Eagle Aircraft. He stated that the relationship between Eagle and Centurion was that of lessor and lessee, rather than that of joint venture partners. Specifically, Curasi stated the following in the letter: Please be advised that this aircraft was purchased by Centurion Aviation Company, a related company, and leased to Eagle Aircraft. (emphasis supplied.) Testimony by Curasi to the contrary is not credited. Additionally, a blanket certificate of resale, presented to Respondent after this formal administrative proceeding commenced, is signed only in the name of Eagle Aircraft as “purchaser,” and states that “all material, merchandise, or goods purchased by the undersigned from Frank Tillman” shall be for exempt resale purposes.
Recommendation Based upon the findings of fact and the conclusions of law, reached, it is, recommended that a final order be entered sustaining Respondent’s assessment. DONE AND ENTERED this 16th day of June, 1998, in Tallahassee, Leon County, Florida. DON W. DAVIS 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 Filed with the Clerk of the Division of Administrative Hearings this 16th day of June, 1998.
