The Issue Whether Respondent is unfit or incompetent to practice pharmacy for the misuse or abuse of any medicinal drug appearing in any Schedule set forth in Chapter 893, Florida Statutes, in violation of Section 465.016(1)(d)(2), Florida Statutes. Whether Respondent failed to maintain on a current basis a complete and accurate record of each controlled substance manufactured, received, sold, delivered or otherwise disposed of, in violation of Section 893.07 and therefore, Section 465.016(1)(e), Florida Statutes.
Findings Of Fact The Respondent, Rocky F. Schierhoff, was licensed by the Board of Pharmacy as a pharmacist on January 17, 1979, and was issued license number PS 0017217, and at all times relevant hereto was a licensed pharmacist. The Respondent was employed as a pharmacist by Walker Memorial Hospital, Avon Park, Florida and was assigned as the staff pharmacist at the Lake Placid Medical Center Pharmacy in Lake Placid, Florida for approximately one and one-half years until April 18, 1990. The Lake Placid pharmacy is an institutional as well as a community type pharmacy. The Respondent was the sole pharmacist in charge the Lake Placid pharmacy including all medications, inventories, day-to-day ordering and receiving of drugs for the Lake Placid pharmacy. It was the responsibility of either the Respondent or Mr. Donald Boger, Director of Pharmacy, Walker Memorial Hospital, to fill out all DEA order forms. The Respondent was placed on suspension from Lake Placid pharmacy on April 16, 1990. On April 18, 1990, a shortage of Meperidine 100 from the Lake Placid pharmacy was discovered. The Meperidine shortage was discussed with the Respondent on April 19th at which time the Respondent admitted he was aware of the shortage but did not know the proper procedure for recording it and did not record the shortage. April 20, 1990, an audit of the Lake Placid pharmacy was conducted by the Director of the pharmacy which revealed shortages of Hydrocodone, generic Fiorinal and Fioricet. At the Lake Placid pharmacy, during the time of his employment there, it was the Respondent's responsibility to record, or at least report shortages or theft at the pharmacy. On July 10, 1990, an audit was conducted of the Lake Placid pharmacy by Investigator James Potter of the Department of Professional Regulation. The results of the audit conducted by Mr. Potter, of the Lake Placid pharmacy, on July 10, 1990, revealed the following shortages for the period ending June 1, 1990. Fastin short 270 Fiorinal short 159 Fioricent short 300 Tylenol short 73 Hydrocodone liquid short 1,547 oz. Meperidine 300 mg short 56 syringes Meperidine 50 mg short 360 milliliters Meperidine 75mg short 141 milliliters Meperidine 100mg short 540 milliliters Morphine 8mg short 60 milliliters Morphine 10mg short 9 milliliters From the time of the Respondent's suspension until the DPR audit, Donald Boger was in charge of dispensing medications at the Lake Placid pharmacy, who recorded all transactions that took place in the pharmacy for the period April through June, 1992. Fastin is a Schedule III prescription drug, and is a medicinal drug as defined in Section 465.003(7), Florida Statutes. Fiorinal is a medicinal drug as defined under Section 465.003(7), Florida Statutes, and falls within Schedule III prescription drugs. Fioricent is also a medicinal drug as defined by Section 465.003(7), Florida Statutes, and falls within Schedule III prescription drugs. Tylenol Number 3 is also a medicinal drug as defined by Section 465.003(7), Florida Statutes, and falls within Schedule III prescription drugs. Hydrocodone is also a medicinal drug as defined by Section 465.003(7), Florida Statutes, and falls within Schedule III prescription drugs. The Respondent was incapable of determining how many drugs were in the pharmacy, but relied on the computer records as his system for keeping track of the drug inventory. Responsibility for operation of the pharmacy lies not only with the consultant pharmacist, but also with the Respondent. No evidence was presented which demonstrated that Respondent was unfit or incompetent to practice pharmacy.
Recommendation Based on the foregoing, it is RECOMMENDED that the Board of Pharmacy enter a Final Order finding that Respondent Rocky Schierhoff, has violated Section 465.016(1)(e), Florida Statutes (1991). It is further RECOMMENDED that the Respondent should be reprimanded by the Board for failure to maintain proper records, and the Respondent should be assessed an administrative fine of $1000.00 dollars and placed on probation for a period of two years with such reasonable terms and conditions as the Board may prescribe. DONE AND ENTERED this 31st day of March, 1992, in Tallahassee, Leon County, Florida. DANIEL M. KILBRIDE 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 31st day of March, 1992. COPIES FURNISHED: Tracey S. Hartman, Esquire Dept. of Professional Regulation 1940 N. Monroe Street, Suite. 60 Tallahassee, Florida 32399-0792 Rocky R. Schierhoff 407 S. Egret Street Sebring, Florida 33872 Jack McRay, General Counsel Dept. of Professional Regulation 1940 N. Monroe Street, Ste. 60 Tallahassee, Florida 32399-0792 John Taylor Executive Director Dept. of Professional Regulation 1940 N. Monroe Street, Ste. 60 Tallahassee, Florida 32399-0792
Conclusions The Petitioner, The Health Center of Blue Water Bay, Inc. filed a Notice of Dismissal on April 1, 2014, attached as Exhibit “1.” Based on the foregoing, this file is CLOSED. DONE and ORDERED on the /8% day of __ fund , 2014, in Tallahassee, Florida. ELIZABETH DUDEK, SECRETARY Agency for Health Care Administration Filed June 24, 2014 12:08 PM Division of Administrative Hearings A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Copies furnished to: Peter A Lewis, Esquire 302 North Shannon Lakes Drive Suite 101 Tallahassee, Florida 32309 (Via U.S. Mail) Bureau of Health Quality Assurance 2727 Mahan Drive, Mail Station 9 Tallahassee, Florida 32308 (Interoffice Mail) Stuart Williams, General Counsel Agency for Health Care Administration 2727 Mahan Drive Building 3, Mail Station 3 Tallahassee, Florida 32308 (Interoffice Mail) Kim Kellum, Chief Medicaid Counsel Agency for Health Care Administration 2727 Mahan Drive Building 3, Mail Station 3 Tallahassee, Florida 32308 (Interoffice Mail) Shena Grantham, Esquire Agency for Health Care Administration 2727 Mahan Drive Building 3, Mail Station 3 Tallahassee, Florida 32308 (Interoffice Mail) Karen Chang, Bureau Chief Medicaid Program Analysis 2727 Mahan Drive Building 2, Mail Station 21 Tallahassee, Florida 32308 (Interoffice Mail) Zainab Day, Medicaid Audit Services Agency for Health Care Administration 2727 Mahan Drive, Mail Station 21 Tallahassee, Florida 32308 (Interoffice Mail) State of Florida, Division of Administrative Hearings The Desoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (Via U.S. Mail) Agency for Health Care Administration Bureau of Finance and Accounting 2727 Mahan Drive Building 2, Mail Station 14 Tallahassee, Florida 32308 (Interoffice Mail) CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished to ft the above named addressees by U.S. Mail on this the ZD day of fas 2014. Richard SXoop, = Ly Ageney Clerk State of Florida Agency for Health Care Administration 2727 Mahan Drive, Building #3 Tallahassee, Florida 32308-5403 (850) 922-5873
The Issue The issue to be determined is the amount Respondent, Agency for Health Care Administration (“AHCA”), is to be reimbursed for medical expenses paid on behalf of Dee Ann Barnes (“Ms. Barnes”), pursuant to section 409.910, Florida Statutes (2019).1
Findings Of Fact The following findings are based on testimony, exhibits accepted into evidence, admitted facts set forth in the Pre-hearing Stipulation, and matters subject to official recognition. Facts Pertaining to the Underlying Personal Injury Litigation and the Medicaid Lien Ms. Barnes was a guest at a friend’s home during the evening of March 29, 2014. While leaving the friend’s home early the next morning, Ms. Barnes slipped on a combination of ice and mold that was allegedly on the walkway outside the front door. The temperature had been below freezing that night, and Ms. Barnes had been aware of the freezing temperature and had driven on icy roads on the way to her friend’s home. However, she did not recall seeing or experiencing ice while entering the residence via the walkway several hours prior to her fall. During previous trips to the friend’s home, Ms. Barnes had never noticed any problem with mold or slippery conditions. Ms. Barnes’s friend asserted that he had no knowledge of any defective condition prior to Ms. Barnes’s fall and that he was unaware of any ice or mold on his walkway. Ms. Barnes gave him no notice of any dangerous conditions prior to her fall. The fall resulted in Ms. Barnes suffering a fractured humerus, cervical kyphosis, a broad-based disc osteophyte, foraminal stenosis, and extensive radiculopathy. Her initial medical treatment consisted of one or more emergency room visits, orthopedic treatment, and chiropractic care. Ms. Barnes ultimately received a referral to a neurosurgeon, who performed an anterior discectomy and a two-level fusion at C5 through C7 on February 17, 2016. However, Ms. Barnes continued to experience pain and other problems due to her fall. Accordingly, Ms. Barnes’s neurosurgeon recommended pain management treatment, and a pain management physician has determined that Ms. Barnes will require treatment for the rest of her life. That treatment will include facet injection and cervical rhizotomy every 6 months. Ms. Barnes is 56 years old, and her life expectancy is more than 27 years. While Ms. Barnes believed that the value of her injuries exceeds $300,000.00, she was uncertain that a jury would have the same opinion and settled a claim against her friend for $75,000.00. Florida’s Medicaid program paid $14,640.89 for medical expenses associated with Ms. Barnes’s fall and has imposed a lien seeking to recover that entire amount. As required by section 409.910(17)(b), Ms. Barnes has deposited all of the money claimed by AHCA in an interest-bearing trust account for AHCA’s benefit pending this administrative determination. Applying the formula set forth in section 409.910(11)(f) would require Ms. Barnes to satisfy the full amount of AHCA’s $14,640.89 lien. Valuation of the Personal Injury Claim Aaron Watson, of the Watson law firm in Pensacola, Florida, has 10 years of experience in the personal injury field and has represented thousands of personal injury plaintiffs. Mr. Watson has represented clients with cervical injuries like those of Ms. Barnes and opined that $350,000.00 was a conservative valuation of her injuries. That valuation accounts for Ms. Barnes’s pain and suffering, past medical expenses, and future medical expenses. Mr. Watson also opined that Ms. Barnes probably settled her claim for $75,000.00 because of uncertainty about liability. In other words, Mr. Watson opined that a jury could have found that Ms. Barnes, rather than her friend, was primarily at fault and reduced her damages accordingly. Austin Ward is a partner in the Ward & Barnes law firm in Pensacola. He has 12 years of experience in the personal injury field and has represented over 1,000 personal injury plaintiffs. Like Mr. Watson, Mr. Ward has represented clients with cervical injuries, and he opined that the total value of Ms. Barnes’ injuries could be conservatively estimated as being between $300,000.00 and $500,000.00. While the cause of Ms. Barnes’s injury was clear, Mr. Ward opined that Ms. Barnes probably settled her claim for $75,000.00 because of issues regarding the assignment of liability and uncertainty about a jury’s ultimate findings. For example, ice on a walkway leading to a home is an “act of God” rather than a defect with a defendant’s home, and there was no evidence indicating Ms. Barnes’s friend was aware of the walkway’s condition prior to her fall. Also, Ms. Barnes had traversed the area where she was hurt a few hours prior to the accident. As a result, she was probably in a better position than her friend to know about the walkway’s condition. Findings Regarding the Testimony Presented at the Final Hearing Mr. Watson and Mr. Ward opined about the total value of Ms. Barnes’s damages.2 However, neither of them testified as to what portion of Ms. Barnes’s $75,000.00 settlement amounts to a recovery of her past medical expenses. Also, neither Mr. Watson nor Mr. Ward presented any testimony about how one could calculate what portion of Ms. Barnes’s settlement represents a recovery of past medical expenses. Therefore, Ms. Barnes failed to prove by a preponderance of the evidence that AHCA should recover less than the full amount of its $14,640.89 lien.
Conclusions THE PARTIES resolved all disputed issues and executed a settlement agreement, which is attached and incorporated by reference. The parties are directed to comply with the terms of the attached settlement agreement. Based on the foregoing, this file is CLOSED. 4 DONE AND ORDERED this 26day of february 2017, in Tallahassee, Leon County, Florida. EliZabeth Dudek, Secretary Agency for Health Care Administration 1 Filed March 3, 2014 12:59 PM Division of Administrative Hearings A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Copies furnished to: Peter A. Lewis, Esquire 3023 N. Shannon Lakes Drive, Suite 101 Tallahassee, Florida 32309 palewis@petelewislaw.com (Via electronic mail) Willis F. Melvin, Jr. Assistant General Counsel Zainab Day, Acting Audit Administrator (Interoffice mail) Finance & Accounting (Interoffice mail) CERTIFICATE OF SERVICE | HEREBY CERTIFY that a true and correct copy of the foregoing has been served one the above-named persons by Electronic Mail or interoffi ail as indicated on this the day of eresewr se 2077. Richard Shoop, Ager’ State of Florida Agency for Health Care Administration 2727 Mahan Drive, Building #3 Tallahassee, Florida 32308-5403 (850) 412-3630
Conclusions THE PARTIES resolved all disputed issues and executed a Settlement Agreement. The parties are directed to comply with the terms of the attached settlement agreement. Based on the foregoing, this file is CLOSED. DONE and ORDERED on this the 2{, U, day of - J lJ_h (2 ---' 2014, m Tallahassee, Florida. ELIZ RETARY Agency for Health Care Administration A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO A JUDICIAL REVIEW WHICH SHALL BE INSTITUTED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF AHCA, AND A SECOND COPY ALONG WITH FILING FEE AS PRESCRIBED BYLAW. WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE AGENCY MAINTAINS ITS HEADQUARTERS OR WHERE A PARTY RESIDES. REVIEW PROCEEDINGS SHALL BE CONDUCTED IN ACCORDANCE WITH THE FLORIDA APPELLATE RULES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE ORDER TO BE REVIEWED. Copies furnished to: Shena Grantham, Esquire Agency for Health Care Administration 2727 Mahan Drive, MS#3 Tallahassee, Florida 32308 Peter A. Lewis, Esquire Law Offices of Peter A. Lewis, P.L. 3023 North Shannon Lakes Drive, #101 Tallahassee, Florida 32303 (U.S. Mail) CERTIFICATE OF SERVICE == ' I HEREBY CERTIFY that a true and correct copy of the foregoing has been furnished to ------==-- the above named addressees by U.S. Mail on this th f 2014. Richard Shoop, Esquire Agency Clerk State of Florida Agency for Health Care Administration 2727 Mahan Drive, Building #3 Tallahassee, Florida 32308-5403
The Issue Whether the Suwannee River Water Management District's (SRWMD's) decision to award the contract contemplated in its Request for Proposals, RFP No. 05/06-036WR, Hydrologic Services and Recorder Station Maintenance (Maintenance Contract), to Hydrologic Data Collection (HDC) is contrary to the agency's governing statutes, the agency's rules or policies, or the proposal specifications.
Findings Of Fact Petitioner Hydrogage, Inc. (Hydrogage), is a Florida corporation with its principle place of business located at 2726 Lithia Pinecrest Road, Valrico, Florida 33954. On March 31, 2006, Respondent issued a request for proposals: RFP Number 05/06-036, Hydrologic Services and Recorder Station Maintenance. Petitioner timely submitted its proposal prior to the May 9, 2006, 3:45 p.m. deadline. Two other proposals were also timely submitted: one by HDC and one by Microcom Design, Inc. (Microcom). Petitioner's proposal contained all of the elements requested by RFP 05/06-036WR. SRWMD has a policy that is used when procuring services via competitive procurement, which is labeled as "6.6.4 RFP Other Services (Policy 6.4.4)." That policy provides in pertinent part: 10. A Selection Committee consisting of three members of Senior Management or appropriate alternates shall act as a corporate body to evaluate the proposals, rank the respondents, and select the individual or firm with the best relative ability to perform the services desired. The meeting or meetings in which the selection committee performs the above procedures are public meetings and may be observed by Contractor Respondents. In the case where presentations are required from the entities on the short list, three Selection Members must be present at short list presentations. Beyond this statement, there is no guidance in Policy 6.4.4 concerning how Selection Committees are to evaluate responses to an RFP. Likewise, the RFP at issue provides little guidance beyond the review form itself. The RFP states: Evaluation by District Selection Committee: The District Selection Committee composed of three (3) persons will review the qualifications of respondents and compare the proposals based on the items listed in Exhibit B, "Review Form," in Section 6. This form will be used by the Selection Committee in ranking the proposals. * * * Rejection of Responses: Pursuant to Rule 40B-1.812, Florida Administrative Code, the District reserves the right to reject any and all bids or other proposals submitted in response to District invitation. District also reserves the right to waive any minor deviations in an otherwise valid proposal. Florida Administrative Code Rule 40B-1.812, referenced by the RFP, provides: The District shall reserve the right to reject any and all bids or other proposal submitted in response to District invitation, and such reservation shall be indicated on all advertising and invitations. The District may waive minor irregularities in an otherwise valid bid. A minor irregularity is a variation from the terms and conditions which does not affect the price of the bid, or give the bidder an advantage or benefit not enjoyed by other bidders, or does not adversely impact the interest of the District. Variations which are not minor may not be waived. A bidder may not modify bid after opening. Mistakes clearly evident on the face of the bid documents, such as computation errors, may be corrected by the District. The review form in Exhibit B of the RFP lists three categories for evaluation of proposals: 1) "Qualifications and Relevant Experience" (70 possible points); 2) "Financial Considerations" (25 possible points); and 3) "Data Delivery" (5 possible points). A similar review form to the one used for this procurement has been used by past Selection Committees reviewing proposals for the services at issue, with the distinction that the current procurement added a Data Delivery category for ability to use the Hydstra format. Previously, the review form contained only two categories: Qualifications and Relevant Experience (70-75 possible points); and 2) Financial Considerations (25-30 possible points). With one exception, it appears that the Selection Committees considered the qualifications of past bidders corporately consistent with Policy Number 6.6.4. This was not the first time Hydrogage submitted a proposal to perform these services. On several different occasions since 1997, Hydrogage submitted proposals that were accepted as timely and complete, but were not considered the winning proposal. On those occasions Hydrogage routinely requested the proposals submitted by other companies, as well as the review forms completed by the Selection Committees, in order to improve on its proposals for future submittals. The review forms used by past Selection Committees contained some variations but were generally consistent. For the Qualifications and Relevant Experience category, there are six subcategories reflected on the review sheet: proposed staff experience with similar projects; demonstrated understanding of scope of work; ability to perform all tasks in scope of work; references; availability/responsiveness of qualified personnel; and resources/equipment availability. These same subcategories are listed on the current review form. The review form for RFP 96/97-29WR included a listing of the points the Selection Committee could award for each subcategory under Qualifications and Relevant Experience, with the subcategory "proposed staff experience with similar projects" broken down even further according to the type of equipment to be used. For the Financial Considerations category, the lowest cost proposal was awarded the full thirty points, and each remaining proposal was awarded points in proportion to how its cost proposal corresponded to the lowest one. The review forms for RFP 96/97-29WR were signed by all three reviewers. The winning proposal was submitted by Sutron Corp., with Hydrogage placing second. The review form for RFP 99/00-41WR contained the same subcategories under Qualifications and Relevant Experience, but did not break down the points attributable to each subcategory. The review form simply listed the total points available for the entire category. Reviewers on the Selection Committee signed individual review forms, with only one reviewer detailing the points he awarded for each subcategory. The winning proposal was submitted by Sutron Corp., with Hydrogage listed as third. Hydrogage submitted the lowest cost proposal for this RFP, and Sutron Corp. submitted the third lowest. The review form for RFP 02/03-008WR contained the same categories but did not break down the points attributable to each subcategory. Like the review form for 99/00-41WR, it simply listed the total points available. Review forms for this bid were signed by all three reviewers. RFP 02/03-008WR was awarded to Safe Harbor Associates, and Hydrogage's proposal was ranked second. Hydrogage filed a protest to the award and after a hearing before the Water Management District Governing Board, all proposals were rejected and the project was re-bid through RFP 02/03-040WR. As with RFP 02/03-008WR, for 02/03-040WR no detail was provided on the review forms for the points attributable to each subcategory in the Qualifications and Relevant Experience component, and all three Reviewers signed each review form. The project was awarded to HDC, with Hydrogage coming in fourth. Petitioner did not challenge the specifications of the current RFP. Petitioner's representative believed that, consistent with past practice of the District and its rules and policies governing procurement procedures, the proposals would be scored using the same method by each Selection Committee member because they would make their decision as a group and that the financial aspect of the bid would be scored on a proportionate basis based on the relationship to the lowest bid. The budgets submitted by the three proposers under the Financial Considerations category of the current RFP were a) Hydrologic Data Collection - $72,910.00; b) Hydrogage - $81,149.40; and c) Microcom Design, Inc. - $185,241.00. All three Reviewers of the Selection Committee awarded 25 points to HDC for its cost proposal under Financial Considerations. Two of the Reviewers awarded Hydrogage 13 points and the third awarded 22 points. The first two Reviewers awarded zero points and five points, respectively, to Microcom. Unlike HDC, Hydrogage could deliver data in Hydstra format. The ability to do so meant that SRWMD personnel did not have to convert the data received into Hydstra format, which could save the District between $1,500 and $2,000 per year. Both Hydrogage and Microcom received five points from each member of the Selection Committee in the Data Delivery category, whereas HDC could not deliver data in this format and received no points from any member of the Selection Committee. With respect to the current solicitation, the review sheets for each reviewer were signed separately. The reviewers independently considered the proposals submitted and met individually with SRWMD staff to discuss references. The public meeting by the Selection Committee was limited to a tabulation of the scores previously determined by each individual Reviewer. In other words, the Selection Committee did not "act as a corporate body to evaluate the proposals, rank the respondents, and select the individual or firm with the best relative ability to perform the services desired," as required by Policy 6.6.4. Kirk Webster is the Deputy Executive Director of the Department of Water Resources for the SRWMD, and was a member of the Selection Committee. Mr. Webster has worked for the SRWMD since 1976 and has served on several Selection Committees, including those assigned to evaluate 96/97-29WR, 99/00-41WR and 02/03-008WR. Mr. Webster awarded HDC 65 of 75 points for Qualifications and Relevant Experience, and awarded Hydrogage 60 points. Mr. Webster considered the subcategories in this category to be of varying levels of importance, and did not necessarily separate out points for each subcategory. Nor did he deduct points for specified deficiencies in a proposal, but viewed the overall category as a composite. He did not award a perfect score in the Qualifications and Relevant Experience category to any bidder, because in his view there are no perfect companies. With respect to the Financial Considerations category, he awarded HDC the full 25 points available because it submitted the lowest bid. He awarded Hydrogage 22 points: approximately 10 percent fewer points than HDC because its bid was approximately 10 percent higher than HDC's. Based on his prior experience on selection committees, he used a mathematical calculation that was in direct proportion to the bid amounts of the three proposals submitted. Mr. Webster's method of awarding points in the Financial Considerations category was consistent with past practice of the SRWMD. John Dinges, Director of Resource Management for the SRWMD, also served on the Selection Committee. Mr. Dinges previously served on the Selection Committee for 02/03-008WR. He felt that the six subcategories in the Qualifications and Relevant Experience category were factors to consider, but not necessarily entitled to the same point value. If a proposer left a subcategory out of the RFP response, he would have awarded fewer points for the overall category. Mr. Dinges awarded the full 70 points in this category for all three companies. With respect to the Financial Considerations category, Mr. Dinges did not use a proportional method of awarding points as Mr. Webster. Instead, he awarded HDC the full 25 points for the lowest cost proposal. For Hydrogage, he "split the difference" between 0 and 25 and rounded up to thirteen. He awarded 5 points to Microcom, whose financial proposal was over twice as high as either other proposal, because it had submitted a proposal. Because Policy Number 6.4.4 does not specify how to calculate the financial component, Dinges felt that a Reviewer should not look at past practice of the agency but should look at the RFP itself and use his or her own judgment. Carolyn Purdy, the third Reviewer, is the Executive Office Coordinator for the District. Ms. Purdy has been employed by SRWMD for over 30 years and has served on several Selection Committees before this one, including the ones assigned to review proposals for 99/00-41WR and 03/04-40WR. Ms Purdy also awarded all three proposals the 70 points in the Qualifications and Relevant Experience category. In the Financial Considerations category, she awarded HDC 25 points, and like Mr. Dinges, "split the difference" between 0 and 25 and rounded up, awarding 13 points to Hydrogage. She awarded no points to Microcom. When serving on the Selection Committee for 99/00-41WR and 03/04-40WR, she had used the same or a similar method for evaluating the Financial Considerations category as that used by Mr. Webster in this case. She had no real explanation for changing her scoring method, other than that the SRWMD policy gives no criteria for scoring and she thought this was fair. One of the subcategories listed for the Qualifications and Relevant Experience category on the review form was "references." The Selection Committee members reviewed only Policy 6.4.4, the actual RFP and the three proposals submitted by HDC, Hydrogage and Microcom. The individual members did not check references supplied by the companies bidding on the project, but relied on staff to do so. Tom Mirti, the SRWMD's water resources networks program manager and hydrologist, was tasked with checking the references contained in the proposals. Mr. Mirti then met with each member of the Selection Committee to report the results of his reference checks. Hydrogage's proposal contained a section entitled "Client References" listing the names, addresses and telephone numbers for contact people at other water management districts, as well as a summary of the work performed for those districts. In addition, Hydrogage's proposal contained a listing of "Streamgaging/ADCP/Dye Dilution Clients" for the years 2004-2006 under its description of its work experience. Microcom also submitted a list of prior projects with contact information for each. HDC, on the other hand, in a section entitled "References," provided what is better described as a bibliography. It did not submit a list of business references or the names and telephone numbers of any other entities for whom it had performed similar work. The RFP specified that the proposal document must provide "Information on the geographic location of the contractor's firm and staff (resumes and experience on similar projects) that the contractor currently has available to perform the work." Arguably, providing information in response to this requirement would also provide the references that the review form identified as one of the criteria for evaluating the Qualifications and Relevant Experience component of the proposals. HDC's proposal, however, did not list "similar projects." Instead, the proposal relied heavily on the aggregate experience of the staff members identified for the project, referring repeatedly to "over 245 years of stream gaging experience with the USGS and private sector," and stating that it is "currently conducting stream gaging activities at 69 daily discharge stations, 8 periodic discharge stations, 9 acoustic velocity stations, 5 raingage stations and 2 water quality monitor stations in Florida and south Georgia." Clients for this work are not identified. Mr. Webster and Mr. Dinges believed that the term "references" on the review form meant references to other clients for whom a company had performed work. Both agreed that if a proposal left something out that was required, including references, points should be deducted for the deficiency. However, neither deducted points from HDC for not including business references. Ms. Purdy also believed that the response should include references to other agencies for whom the proposer had performed work, but felt that HDC's submission of bibliographical entries was reasonable because the people preparing the response are scientists. More importantly, she felt no need to check business references for HDC because it had worked for the SRWMD in the past and its representatives "do good work." Mr. Dinges and Mr. Webster expressed a similar view. Indeed, Mr. Webster testified that he would rely on the fact that a contractor had worked for the SRWMD in the past, perhaps to the detriment of other companies, if it had done good work. Regardless of the value each Selection Committee member would attribute to references, the RFP and past practices of the Division require that some deduction be made for failing to provide this information. No such deduction was made to HDC's score for this deficiency by any member of the Selection Team. Tom Mirti, the staff person tasked with checking the references, acknowledged that HDC did not submit business references. However, in light of the work HDC had done for the District previously, he decided that he could serve as a reference for HDC. He had in the past given HDC's name to other entities because he liked the quality of its work, and called those to whom he had given HDC's name to confirm that the work HDC had done was satisfactory. The information that Mirti supplied, i.e., serving as a reference himself and contacting other entities regarding HDC, was not information readily available from the response to the RFP itself. Mr. Mirti's actions, while well- intentioned, served to supplement HDC's proposal and provided to HDC an advantage not enjoyed by other bidders. Likewise, the failure to provide references was not an error, such as a computation error, that could or should be corrected by the Division. When the totals for all three reviewers are added up for each proposal, HDC received 280 points, Hydrogage received 263 points, and Microcom received 230 points. If two of the Selection Committee members, consistent with their own prior practice and with the prior practice of the SRWMD, had awarded points in the Financial Considerations category in proportion to the lowest bid, Hydrogage would have received more overall points than any other bidder. Similarly, where a point value for references has been identified in past solicitations, the subcategory was generally awarded 10 points. There is no requirement that 10 points be deducted, but all three Reviewers agreed that some deduction should have been made. If points had been deducted from HDC's score for failure to provide references, its point total may have been lowered so that Hydrogage may have received the highest overall total.
Recommendation Upon consideration of the facts found and conclusions of law reached, it is RECOMMENDED: That a final order be entered that rescinds the recommendation that RFP No 05/06-036WR be awarded to Hydrologic Data Collection, Inc. DONE AND ENTERED this 13th day of September, 2006, in Tallahassee, Leon County, Florida. S LISA SHEARER NELSON 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 13th day of September, 2006.
The Issue Whether Respondent properly denied Petitioner's application for licensure as a Life and Variable Annuity and Health Insurance Agent.
Findings Of Fact Petitioner applied for licensure as a Life and Variable Annuity and Health Insurance Agent. Petitioner's application was signed and mailed to the Department of Insurance on or about January 27, 1998. Petitioner's application for licensure was denied by the Department on or about May 5, 1998. Two months later, on July 6, 1998, the Department issued an Amended Denial Letter that set forth the basis for the denial. According to the Amended Denial Letter, Petitioner's license was denied because she failed to meet the licensure requirements set forth in Sections 626.611(1) and (7) and 626.785(1), Florida Statutes. As a basis for the alleged violations, the Department stated: The Office of the Attorney General filed a civil action against you as vice-president and a director of the H.O.M.E. Program, and the H.O.M.E. Program along with other directors, alleging that the Program was formed as a not-for-profit corporation. . . to help people buy a house for themselves to live in. The complaint alleges that the Program offered a variety of services for a "Service Fee," has not provided any services, and that those fees were deposited into an account with NationsBank and the money was then misappropriated by one Jerome Ellington. The Attorney General still has a case pending against the H.O.M.E. Program and has stipulated to dismiss the cause of action against you with prejudice only at the conclusion of the lawsuit against the remaining defendants. You Charita Strode, were terminated from employment with NationsBank for wiring funds out of the H.O.M.E. Program's account in November 1997, after specifically being told by the Regional Service Support Manager that the funds needed to remain in the account until all items had cleared. The bank was placed in a loss situation of over $6,000 and due to your behavior you were terminated because you abused your authority in order to achieve the funds transfer, and did not follow supervisory instructions. That is evidence of lack fitness and trustworthiness. Further, it was determined by the Unemployment Compensation Appeals Bureau that you were discharged for misconduct and the Appeals referee resolved the conflicts in favor of your former employer. Petitioner was employed by NationsBank in January 1994, and, except for a six-month voluntary leave of absence, worked there continuously until she was terminated in January 1998. Prior to going on voluntary leave, Petitioner was manager of the NationsBank Gunn Highway Banking Center. During her first year with NationsBank, Petitioner was a management trainee associate. Thereafter, Petitioner became a manager, a position in which she served for the remainder of her tenure with NationsBank. As a manager, Petitioner was assigned to several NationsBank banking centers and was responsible for the operations, sales, and service of the centers to which she was assigned. Additionally, Petitioner's responsibilities included training and supervising more than fifty associates. In the spring of 1997, Petitioner was promoted from bank officer to an assistant or associate vice-president. While employed at NationsBank, Petitioner received at least two awards for her job performance. In 1997, Petitioner was recognized by NationsBank as a member of Florida Team One, a commendation that recognizes excellence in sales. One of the banking centers managed by Petitioner also received an award for service quality, an award received by only 20 to 30 percent of NationsBank banking centers. In May 1997, Petitioner first met and became acquainted with Jerome Ellington, the owner and founder of the H.O.M.E. Program. According to its literature, the H.O.M.E. Program was a "Christian Home Building Program" designed to assist individuals in building or remodeling their homes. Petitioner was particularly interested in the program because of her desire to become a homeowner. Based on her interest, Petitioner asked Mr. Ellington questions about the H.O.M.E. Program, how to become a member, and how to help other people who might be interested in the program. Petitioner became a client of the H.O.M.E. Program. As a client, Petitioner was required to pay to the program an initial fee of $1700 and a monthly maintenance fee of approximately $170 for three months. Based on her belief that the H.O.M.E. Program was a legitimate organization whose purpose was to assist individuals in purchasing homes, Petitioner told several family members and friends about the program. She told these individuals that the program would allow them to purchase homes for themselves and encouraged them to "look into it." Eventually, like Petitioner, between six and eight of these individuals paid the required fees and became clients of the H.O.M.E. Program. In late June or early July 1997, Petitioner became involved with the H.O.M.E. Program, serving on the program's Financial Advisory Board. The purpose of the Financial Advisory Board was to act as an agent to control the finances of the H.O.M.E. Program. During the time Petitioner was a named member of the advisory board, it met in July or August 1997, to organize that board. Other than this initial organizational meeting, the advisory board never met nor did it ever function in any official manner. In late July 1997, at about the time the H.O.M.E. Program was incorporated, Petitioner was selected by Mr. Ellington to serve as a member and elected as vice-president of the H.O.M.E. Program's Board of Directors (Board or Board of Directors). While Petitioner was on the Board, it seldom met. In July or August 1997, the H.O.M.E. Program set up three bank accounts at NationsBank. Each of the accounts had three signators, all of whom were officers of the H.O.M.E. Program: Bernadette Orsley, treasurer; Jerome Ellington, president; and Petitioner, vice-president. The address of record listed on the H.O.M.E. Program account was 7819 North Dale Mabry Highway, Suite 208, Tampa, Florida. From August 1997 through January 1998, Petitioner took a voluntary leave of absence from NationsBank to do work for the H.O.M.E. Program and to explore the possibility of going into business for herself. Petitioner's work with the H.O.M.E. Program involved setting up "outside services to clients once they got into their homes." Jerome Ellington was the chief executive officer and president of the H.O.M.E. Program. During the time that Petitioner was on the H.O.M.E. Program's Board and the Financial Advisory Board, Petitioner found that Mr. Ellington was not open about the expenditures he claimed to be making on behalf of the H.O.M.E. Program. Attempts were made by Petitioner and one other Board member to develop, initiate, and implement better accounting practices, operational procedures, and financial controls for the H.O.M.E. Program. For example, one recommendation was that two signatures be required on all checks written on the H.O.M.E. Program accounts. However, these efforts proved futile because Mr. Ellington was unwilling to implement any changes and relinquish financial control of the program's finances. By letter dated October 28, 1997, NationsBank advised the H.O.M.E. Program that due to the chargeback activity involving its three accounts, the bank was closing the accounts, effective ten days from the date of the letter. The letter acknowledged that the relationship between NationsBank and the H.O.M.E. Program was "a contractual one and under the terms of our Deposit Agreement either party can terminate the relationship at any time without cause." Chargeback activity occurs when items that are deposited or credited to the account are returned to the bank dishonored for a variety of reasons. NationsBank's concern with the H.O.M.E. Program accounts was that the excessive chargeback activity might possibly place the bank at risk of loss. In October 1997, Patricia McSweeney, then Regional Service Manager for NationsBank, spoke to Petitioner about the H.O.M.E. Program accounts and reiterated the contents of the October 28, 1997, letter from NationsBank. Upon learning from Ms. McSweeney that NationsBank was closing the H.O.M.E. Program's three accounts, Petitioner requested that the bank allow the three accounts to remain open to receive two electronic deposits that were scheduled to be made in November 1997. The electronic deposits were to be made on or about November 5 and 20, 1997. Ms. McSweeney agreed to leave the H.O.M.E. Program accounts open to receive the November electronic deposits and told Petitioner that there could be no check activity on the accounts. This agreement between Petitioner and Ms. McSweeney modified the terms of the October 28, 1997, letter and the accounts remained open beyond the time designated in that letter. However, the modification was not memorialized in writing and no date was established for closing the H.O.M.E. Program accounts once the November electronic deposits were made. With regard to the agreement between Petitioner and Ms. McSweeney, there was a material misunderstanding of how the H.O.M.E. Program accounts were to be handled during this extension. Ms. McSweeney's intent and understanding was that the account would remain open on a "credits-only" basis so that the credits could be received and posted to the account, and then allowed to age. Moreover, Ms. McSweeney believed there would be no check activity in the H.O.M.E. Program account, thereby eliminating or reducing the likelihood that the bank would be placed in a loss situation. On the other hand, Petitioner understood the agreement to mean that no checks could be written on the account or deposited into the H.O.M.E. Program account. However, Petitioner also believed that once the electronic deposits were made to the account, funds could be withdrawn from the account to cover the H.O.M.E. Program's expenses. The anticipated electronic deposits were made to the H.O.M.E. Program account as scheduled on or about November 5 and 20, 1997. After the November 5, 1997, electronic deposit of between $8,000 and $10,000, on November 10, 1997, Petitioner went to the NationsBank Carrollwood Banking Center and withdrew approximately $9,000 from one of the H.O.M.E. Program accounts to make a payment to the H.O.M.E. Program's line of credit. Petitioner believed that this withdrawal was permissible and not inconsistent with or in violation of the agreement with Ms. McSweeney. Furthermore, when Petitioner made the withdrawal, she was unaware of any flag on the account and no bank representative informed her that the account was so designated. At no time, either on November 10, 1997, or later, did any NationsBank representative notify Petitioner that the account was flagged and that the $9,000 withdrawal was improper and should not have been allowed. On or about November 20, 1998, the second electronic deposit was received and posted to the H.O.M.E. Program account. On the morning of November 20, 1997, Petitioner telephoned the NationsBank's Gunn Highway Banking Center and spoke with Michelle Shumate. Petitioner and Ms. Shumate knew each other because prior to Petitioner's going on leave, she was a bank officer and/or manager of the Gunn Highway Banking Center. During her telephone conversation with Ms. Shumate, Petitioner requested that two cashier's checks be drawn from the H.O.M.E. Program account and that the checks be made payable to the H.O.M.E. Program. The funds were to be used for operating expenses of the H.O.M.E. Program. When Petitioner requested the two cashier's checks, she did not perceive the requested transaction as being inconsistent with or in violation of the agreement she and Ms. McSweeney had made. Petitioner's interpretation of the agreement was that the H.O.M.E. Program was only precluded from writing checks to third parties on checks issued on the program's accounts. Because the cashier's checks were certified funds, Petitioner knew that there was no potential, at that time, for a loss situation. After Ms. Shumate's telephone conversation with Petitioner, Ms. Shumate immediately called Ms. McSweeney, her supervisor, and advised her of Petitioner's request for two cashier's checks. At hearing, in explaining her reason for calling Ms. McSweeney, Ms. Shumate made no mention of the account being flagged. Rather, Ms. Shumate stated, "I had knowledge of chargeback activity of the account, and I made it a policy for myself that before doing anything for any H.O.M.E. Program accounts, I would call a supervisor." Based on Ms. Shumate's testimony and written statement concerning Petitioner's request for two cashier's checks, it appears that Ms. Shumate's decision to call Ms. McSweeney was not because the accounts were flagged, but rather because of her personal knowledge of the problems with the H.O.M.E. Program accounts. In response to Ms. Shumate's call, Ms. McSweeney told her that the H.O.M.E. Program accounts were "credit only" accounts and withdrawals or debits were not to be made on the account. Thirty minutes after Petitioner requested the cashier's checks, she came to the drive-through window of the NationsBank Gunn Highway Banking Center to pick up the checks. Ms. Shumate then told Petitioner that Ms. McSweeney had advised her that the H.O.M.E. Program account was a "credit only" account and that there could be no check activity on the account. Pursuant to Ms. McSweeney's directive, Ms. Shumate told Petitioner that if she had any questions, she should call Ms. McSweeney. Petitioner then immediately called Ms. McSweeney from her cellular telephone. However, when Petitioner was unable to reach Ms. McSweeney, she left a voice mail message for her. After leaving the Gunn Highway Banking Center, Petitioner then went to pick up a Ms. Barnes for a 9:00 a.m. meeting. When the meeting concluded, Petitioner took Ms. Barnes back to the H.O.M.E. Program Office located at 7819 North Dale Mabry Highway. Petitioner then went to the NationsBank Carrollwood Banking Center, the banking center closest to the H.O.M.E. Program Office. Petitioner signed in as a representative of the H.O.M.E. Program to request customer service. Petitioner then met with a consumer banker regarding having a wire transfer made from one of the NationsBank H.O.M.E. Program accounts to the program's new account at First Union. Petitioner gave the consumer banker the H.O.M.E. Program account number and the Petitioner and the consumer banker filled out the required forms necessary to effectuate the wire transfer. When the form was completed, the consumer banker initiated the wire transfer in the system and Petitioner left the Carrollwood Banking Center. Immediately prior to the wire transfer, the H.O.M.E. Program account from which the funds were taken had a balance of approximately $23,000. The amount that Petitioner had wire transferred from the NationsBank's H.O.M.E. Program account was $19,800. The purpose of the transfer was to put funds into the H.O.M.E. Program's account at First Union to meet the program's expenses. Petitioner was aware there had been a history of minimal chargebacks on the account, in the form of drafts. Based on this knowledge, when Petitioner initiated the wire transfer, she left a balance in the account that she believed would be sufficient to cover any potential chargebacks from the electronic drafts. Petitioner based the estimate on the past experience of the chargebacks from electronic drafts. When Petitioner requested that funds be removed from the H.O.M.E. Program account, she never anticipated that it would result in or contribute to a loss by NationsBank. When Petitioner requested the wire transfer, neither the consumer banker nor anyone else at the bank told her that the account was flagged and that funds could not be wired from the H.O.M.E. Program account. The transfer went smoothly and in accordance with NationsBank's routine business practices. On the afternoon of November 20, 1997, after the wire transfer was made, Petitioner spoke to Ms. McSweeney, who asked her why she had made the wire transfer. During that conversation, it became clear that there was a misunderstanding between Petitioner and Ms. McSweeney regarding how the H.O.M.E. Program's NationsBank accounts were to be handled in November 1997. Ms. McSweeney told Petitioner that she had told Petitioner "not to do that," apparently referring to their October agreement regarding Petitioner's request to allow the H.O.M.E. Program accounts to remain open in November. Petitioner then told Ms. McSweeney that she had never said that to her. Petitioner indicated to Ms. McSweeney that the H.O.M.E. Program needed funds from the account for its operating expenses and that she never would have asked that the accounts be allowed to remain open to receive the electronic deposits if the organization were absolutely prohibited from accessing the funds. In the days or weeks after the funds were wired from one of H.O.M.E. Program accounts at NationsBank, the chargebacks on the accounts were in excess of any amount that they had ever been. Between November 20, 1998, the date the wire transfer was made, and January 30, 1998, the date Petitioner's termination, NationsBank sustained a loss of approximately $6,000. This loss has not yet been recovered by the bank. Had the wire transfer not been made, NationsBank may not have sustained this loss. However, the approximate $6,000 loss by NationsBank may not be attributable to the November 20, 1997, wire transfer. Two other individuals on the H.O.M.E. Program accounts, including Jerome Ellington, were authorized signators on the H.O.M.E. Program accounts and could have made withdrawals. At the hearing, personnel of NationsBank did not state unequivocally that the other authorized persons on the H.O.M.E. Program accounts had not made withdrawals from the accounts between November 1997 and January 1998. NationsBank personnel did not rule out that such withdrawals had been made, but stated only that to confirm whether such withdrawals had been made, the bank records, which were unavailable, would have to be reviewed. If, in fact, such withdrawals were made, those withdrawals could have contributed to or been responsible for the bank's financial loss. In November 1997, the previously existing problems and disputes within the H.O.M.E. Program organization exacerbated. Mr. Ellington, president and founder of the H.O.M.E. Program, who had previously encouraged Petitioner's involvement in the program, both as a client and officer, now would no longer allow Petitioner to transact business on the H.O.M.E. Program accounts. Consequently, once the excessive chargebanks in the H.O.M.E. Programs account surfaced, Petitioner was unable to move funds back to NationsBank. Her requests to Mr. Ellington that he move funds to NationsBank were disregarded. When Petitioner was on the H.O.M.E. Program's Board of Directors, the Board not only failed to meet on a regular basis, but was also prohibited by Mr. Ellington from functioning as a governing body. Mr. Ellington controlled the H.O.M.E. Program, including the "purse strings" of the organization. Petitioner lost approximately $2,000, the total amount of the funds she invested as a client in the H.O.M.E. Program. Moreover, Petitioner also lost a substantial part of approximately $3,000 to $4,000 of her personal funds that she had used for the H.O.M.E. Program to cover some of its operating expenses. In one instance, during her early involvement with the H.O.M.E. Program, Petitioner co-signed a loan agreement for the organization to have a phone telephone system installed in the program's office. After the H.O.M.E. Program failed to make the payments, Petitioner paid off the loan and received no reimbursements. In the first week of December 1997, Petitioner received a copy of minutes from Special Meeting of the Board held on November 18, 1997. Petitioner received no notice of that meeting and, consequently, was not in attendance. The minutes of the meeting reflect that the only three Board members and/or officers present at the meeting were: Jerome Ellington, president; Jacqueline Garcia Ellington, secretary; and Bernadette Orsley, treasurer. Pursuant to the minutes of the November 18, 1997, Special Meeting of the Board, under the category of "New and Urgent Agenda Items," Mr. Ellington initiated a discussion regarding his dissatisfaction with Petitioner, one other Board member, and two staff members. The minutes reported that Mr. Ellington stated that the organization was facing "certain and immanent (sic) insurrection" by Petitioner and the other three individuals. Moreover, the minutes indicated that the labor force was "being manipulated into a confused state of loyalty and that this along with a confrontation of gross insubordination" by Petitioner and the other three individuals was "usurpatous (sic) to the general operations of the Firm and extremely deleterious to Client confidence." According to the minutes, following the discussion, Mr. Ellington moved to vote on the removal or termination of Petitioner and the other three individuals "in view of their attempted take over of the business and a number of other possible infractions of the law." Following Mr. Ellington's motion, by a unanimous vote of the three Board members/officers attending the Special Meeting, Petitioner and the other absent Board member were removed from the Board and the two staff members were terminated, effective immediately. Prior to Petitioner's receiving the minutes of the Special Meeting, she was unaware of her removal from the Board. On January 30, 1998, near the end of her voluntary leave, Petitioner met with officials of NationsBank. Petitioner was advised that her employment with NationsBank was being terminated, effective immediately, because she had failed to follow and had directly violated instructions of the service support manager, Ms. McSweeney. These charges stemmed from the incident involving the transfer of funds on November 20, 1997. Petitioner explained to NationsBank officials that she did not understand that the agreement with Ms. McSweeney prevented the removal of funds from the H.O.M.E. Program accounts. Petitioner also told the NationsBank officials that her behavior with regard to the accounts was consistent with her understanding of the agreement. In this regard, Petitioner informed NationsBank staff that prior to the wire transfer, in November 1997, she had made a withdrawal from the account to pay on the program's line of credit with no problem. Petitioner also told the bank officials that when that withdrawal was made, no one at the bank advised her that the withdrawal was improper or that the account was flagged. Notwithstanding Petitioner's explanation, NationsBank terminated Petitioner's employment, effective immediately. After Petitioner was terminated from NationsBank, she applied for unemployment benefits. The application was denied and Petitioner appealed. In the Notice of Decision issued on the matter, the appeals referee concluded that the Petitioner, claimant in that proceeding, "intentionally violated direct orders from her supervisor." Petitioner had fiduciary duties with regard to her position as vice-president and member of the Board and member of the Financial Advisory Board of the H.O.M.E. Program. However, for the reasons stated above, Petitioner's efforts to perform these duties were thwarted by tactics employed by Mr. Ellington. On January 10, 1998, Petitioner first learned that the Florida Attorney General's Office had been investigating the H.O.M.E. Program, when she was served with a civil action brought by the Attorney General. The Complaint, filed on December 13, 1997, named the H.O.M.E. Program, Inc., Jerome Ellington, and Board members, including Petitioner, as defendants. Among the allegations contained in the Complaint were that the funds collected by the H.O.M.E. Program had not been placed in an escrow account as had been represented to members and that the program had not initiated construction on any residence for any of its 140 clients. The Complaint also alleged that Mr. Ellington withdrew or transferred approximately $31,000 from a H.O.M.E. Program account and of that amount, $23,000 was transferred by Mr. Ellington from a H.O.M.E. Program's account at NationsBank to First Union on November 27, 1997. Moreover, the Complaint alleged that a substantial amount of those funds were used by Mr. Ellington for his personal expenses and approximately $17,000 of the program funds, at one time in Mr. Ellington's possession, remained unaccounted for. The Complaint contained no allegations that Petitioner or any other Board member had misappropriated H.O.M.E Program funds or, at any time, had organization funds in their possession which could not be accounted for. Pursuant to a Stipulated Settlement Agreement (Agreement) entered into on May 18, 1998, the Complaint was dismissed without prejudice against Petitioner "until the conclusion of the lawsuit against each of the remaining Defendants at which time the cause of action against [Petitioner] shall be dismissed with prejudice, provided that [Petitioner] has complied with the terms of the Agreement." In this regard, the Agreement requires the Petitioner to cooperate and assist the Attorney General's Office in the investigation and litigation relating to the Complaint. The Agreement acknowledged and expressly stated that Petitioner's acceptance of the Agreement did not constitute an admission that she violated the laws of Florida as alleged in the Complaint. To determine fitness and trustworthiness of applicants for insurance licenses, the Department looks at the applicant's history and activities in which the applicant participated. Also, the Department considers other issues, such as whether there were victims of the applicant's activities; whether someone was financially harmed; whether money and/or fiduciary duties were involved; and whether the actions were willful. In evaluating Petitioner's application, the Department had several concerns. First, the Department determined that Petitioner had willfully violated or refused to obey a supervisor's direct orders by moving funds out of the H.O.M.E. Program account and that as a consequence thereof, the bank lost several thousand dollars. In the Amended Denial Letter, the Department alleged that Petitioner accomplished this by "abusing" her position with the bank. From this uncorroborated information the Department received from NationsBank, the Department concluded that Petitioner's conduct demonstrated a lack of fitness and trustworthiness. Second, in making the final decision to deny Petitioner's application, the Department considered the fact that Petitioner had been a named defendant in the aforementioned Complaint filed by the Attorney General. Prior to the Department's issuing the Amended Denial Letter, it was aware that the Complaint had been dismissed as to Petitioner. Nonetheless, the Department found it significant that the Complaint had been dismissed without prejudice and that the Agreement had been reached in exchange for Petitioner's cooperation and testimony. The Department believed that the Agreement did not suggest that the underlying events that gave rise to the allegation in the Complaint did not occur. Finally, as a basis for its decision with regard to Petitioner's application, the Department relied on an Unemployment Appeals Bureau decision denying Petitioner unemployment benefits. The Department apparently found it significant that the referee in that proceeding found Petitioner's account of the events less credible than that of NationsBank and concluded that Petitioner "intentionally violated direct orders from her superior." Based on these considerations, the Department then concluded that the allegations raised in the Complaint demonstrated that Petitioner lacked the fitness to fulfill the fiduciary responsibilities required of an insurance agent. When the Department issued the Amended Denial Letter, it was unaware that Petitioner had been removed from the H.O.M.E Program Board in November 1997, because of her efforts to have the program implement financial controls for the funds it was collecting and expending. The Department was also unaware or failed to consider the short period of time Petitioner was associated with the Board, that Petitioner was a client of the H.O.M.E. Program, and that she lost money as a result of her involvement with the program.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department issue to Petitioner, Charita Michelle Strode, a license as a Life and Variable Annuity and Health Issuance Agreement. DONE AND ENTERED this 16th day of February, 1999, in Tallahassee, Leon County, Florida. CAROLYN S. HOLIFIELD 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 16th day of February, 1999. COPIES FURNISHED: Bill Nelson State Treasurer and Insurance Commissioner Department of Insurance The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Daniel Y. Sumner, General Counsel Department of Insurance The Capitol, Plaza Level 26 Tallahassee, Florida 32399-0300 Steve E. Baker, Esquire Delano Stewart, Esquire Stewart, Joyner, Jordan-Holmes, P.A. 1112 East Kennedy Boulevard Tampa, Florida 33672 Elenita Gomez, Esquire Mechelle R. McBride, Esquire Department of Insurance 612 Larson Building 200 East Gaines Street Tallahassee, Florida 32399-0333
The Issue Whether the South Florida Water Management District’s (“District”) intended award of a contract for aerial spraying services, granular application services, and aerial transport services, to Coastal Air Services, Inc. (“Coastal”), is contrary to the District’s governing statutes, rules, policies, or the bid specifications; and, if so, whether the decision was clearly erroneous, contrary to competition, arbitrary, or capricious.
Findings Of Fact The Parties The District is an independent taxing authority created pursuant to section 373.069, Florida Statutes, with the authority to contract with private entities to maintain real property controlled by the District. See § 373.1401, Fla. Stat. HAI is a Florida corporation duly authorized to do business in the State of Florida with a business address of 1090 Airglades Boulevard in Clewiston, Florida. Coastal is a Florida corporation duly authorized to do business in the State of Florida with a business address of 7424 Coastal Drive in Panama City, Florida. The RFB On February 7, 2018, the District issued the RFB, soliciting bids for qualified respondents to provide the following: [F]urnish all labor, equipment, perform data entry and perform all operations for spraying of aquatic, ditchbank and invasive vegetation by helicopter and provide aerial flight services for site inspection and plant surveys. Both HAI and Coastal submitted timely bids, which the District deemed responsive and responsible under the terms of the RFB. The District deemed Coastal the lowest responsive and responsible bidder for aerial spraying, granular application, and aerial transport services. The District deemed HAI the lowest responsive and responsible bidder for spot spraying services. On May 11, 2018, the District posted its Notice of Intent to Award the respective contracts to Coastal and HAI. HAI challenges the award to Coastal because it is not a responsible bidder under the terms of the RFB. HAI’s challenge focuses on two items required to document the bidder’s responsibility to perform the requested services. First, the RFB requires the bidder to provide at least two helicopters certified pursuant to 14 CFR Part 133, Rotocraft External-Load Operations; and 14 CFR Part 137, Agricultural Aircraft Operations (Part 137 Certificate). Second, the RFB requires the bidder to demonstrate its ability to obtain required insurance coverage. Part 137 Certificate HAI contends that Coastal’s bid does not meet the responsibility provisions of the RFB because it did not include sufficient Part 137 Certificates for its subcontractor, HMC Helicopters (“HMC”). HAI contends the Part 137 Certificates are required to expressly state that aircraft are certified to dispense economic poisons. Petitioner’s argument fails for three reasons. First, the RFB does not require the bidder’s Part 137 Certificate to expressly endorse aircraft to dispense economic poisons.3/ Second, assuming the express endorsement was required, the requirement does not apply to HMC. The RFB defines the term “Bidder” and “Respondent” as “[a]ll contractors, consultants, organizations, firms or other entities submitting a Response to this RFB as a prime contractor.” (emphasis added). In its bid, Coastal is listed as the prime contractor, and HMC as a subcontractor. The RFB requires each Respondent to list at least two aircraft which are Part 133 and 137 certified. The requirement applies to Coastal as the primary contractor, not to its subcontractor. Coastal’s bid listed five aircraft with both Part 133 and 137 Certificates, actually exceeding the requirement for two such certified aircraft. Third, assuming an express endorsement for dispensing economic poisons was required, and that the requirement applied to HMC, HMC’s Part 137 Certificate documents HMC’s authority to dispense economic poisons. Pursuant to 14 CFR 137.3, “Agricultural aircraft operation” is defined as follows: [T]he operation of an aircraft for the purpose of (1) dispensing any economic poison, (2) dispensing any other substance intended for plant nourishment, soil treatment, propagation of plant life, or pest control, or (3) engaging in dispending activities directly affecting agriculture, horticulture, or forest preservation, but not including the dispensing of live insects. To obtain a Part 137 Certificate, the operator must pass a knowledge and skills test, which includes the safe handling of economic poisons and disposal of used containers for those poisons; the general effects of those poisons on plants, animals, and persons and precautions to be observed in using those poisons; as well as the primary symptoms of poisoning in persons, appropriate emergency measures in the case of poisoning, and the location of poison control centers. See 14 CFR § 137.19. However, if the operator applies for a Part 137 Certificate which prohibits dispensing of economic poisons, the applicant is not required to demonstrate the knowledge and skills listed above. See Id. HMCs’ certificates do not contain an express prohibition against dispensing economic poisons. The authorization for HMC’s aircraft to dispense economic poisons is inherent in its Part 137 Certificate. Coastal’s bid meets the solicitation requirement for at least two aircraft with Part 137 Certificates. Insurance Requirements The RFB requires each Respondent to “provide evidence of the ability to obtain appropriate insurance coverage.” Respondents may meet the insurability requirement by having their insurance agent either (1) complete and sign an insurance certificate which meets all of the requirements of Exhibit H to the RFB; or (2) issue a letter on the insurance agency’s letterhead stating that the Respondent qualifies for the required insurance coverage levels and that an insurance certificate meeting the District’s requirements will be submitted prior to the execution of the contract. In response to this requirement, Coastal submitted a letter from Sterlingrisk Aviation, dated March 6, 2018, stating, “All required coverage amounts are available to Coastal Air Service, Inc. to fulfill the requirements of this contract.” In the Re: line, the letter refers to the specific RFB at issue in this case. Coastal also submitted a certificate of insurance from Sterlingrisk Aviation demonstrating the levels of insurance coverage in effect at the time the bid was submitted, although the coverages are less than the amounts required under the RFB.4/ HAI takes issue with Coastal’s evidence of ability to obtain the required coverage because the letter from Sterlingrisk does not state “an insurance certificate reflecting the required coverage will be provided prior to the contract execution.” Based on the totality of the evidence, the undersigned infers that Sterlingrisk’s letter omits the language that a certificate “will be provided” prior to contract execution, because Sterlingrisk will issue an insurance certificate only when Coastal applies, and pays the premium, for the increased coverage limitations. The letter from Sterlingrisk substantially complies with the insurance requirements of the RFB, and constitutes competent, substantial evidence of Coastal’s ability to obtain the required insurance coverage. HAI introduced no evidence that Coastal obtained an economic advantage over HAI by failing to include language from its insurance agent that “an insurance certificate reflecting the required coverage will be provided prior to the contract execution.” Instead, HAI argued that by failing to enforce that provision of the RFB, the District cannot ensure the winning bidder will be responsible to undertake the contract. HAI argued that the District’s failure to adhere to this RFB requirement may create inefficiencies that “would result in the event that Coastal were unable to obtain the required insurance coverage” before execution of the contract. Coastal’s bid documents its eligibility for insurance coverage in the amounts required by the RFB. If Coastal does not provide said certificates, it will not be qualified for final execution or issuance of the contract.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Southwest Florida Water Management District enter a final order dismissing Helicopter Applicator, Inc.’s Petition. DONE AND ENTERED this 15th day of November, 2018, in Tallahassee, Leon County, Florida. S SUZANNE VAN WYK 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 15th day of November, 2018.
Findings Of Fact The Applicant and the Department submitted Proposed Findings of Fact pursuant to Rule 3C-9.11, Florida Administrative Code. The Applicant's Proposed Findings are accepted except where they might specifically conflict with the Findings of the Hearing Officer's Report or where they may constitute conclusions of law.
