The Issue The issue for consideration in this matter is whether Respondent’s alcoholic beverage license, Series 3-PS, No. 39- 01099, for the premises located at 13508 Florida Avenue, Tampa, should be disciplined because of the matters alleged in the Administrative Action filed herein.
Findings Of Fact At all times pertinent to the allegations herein, Petitioner, Division of Alcoholic Beverages and Tobacco, was the state agency in Florida responsible for the licensing of outlets for the retail sales of alcoholic beverages, and for the enforcement of the liquor laws of this state. By stipulation of fact, the parties agreed than on or before August 7, 1996, Benjamin Nenno, a male under the age of 18 at the time, became involved in an investigation of Respondent’s retail sales facility in issue by the Division. On the evening of August 7, 1996, Nenno was briefed and searched by agents of the Division and allowed to carry with him only a certain amount of cash and a driver’s license which clearly showed him to be under 21. He was instructed by the agents to indicate he was only 17 if he were to be asked by a store employee and to produce the driver’s license if it were to be requested. Specifically, he was instructed not to make any misrepresentation of fact in order to get the clerk to make a sale to him. Thereafter, Nenno entered the Respondent’s store number 620, located at 13508 Florida Avenue in Tampa and asked to purchase a bottle of Captain Morgan’s Special Rum, an alcoholic beverage which would be unlawful for him to purchase. When he did so, the Respondent’s clerk, identified as Freddy Posey, asked to see Nenno’s identification and Nenno produced the driver’s license which reflected he was under 21. Posey looked at it but made the sale anyway. The sale was witnessed by Special Agent Randall West who confirmed the facts stated above. When Nenno left the premises he met with Special Agents West and Miller who confiscated the beverage. West then entered the store and issued a notice of Violation as well as a vendor check list to Posey which was to be filled out by him and returned to the Division. The investigation continued on August 13, 1996 when Nenno, again under the control of the Division personnel, was again searched and instructed and sent back into the Respondent’s premises by Agents Hamilton and Fisher to again attempt to purchase a bottle of Captain Morgan’s Special Rum. This time Nenno dealt with James Davison, an employee of the Respondent, who asked Nenno to produce a driver’s license. When Nenno did as he was asked, Davison looked at it but nonetheless made the sale even though the license clearly showed Nenno was under 21. This sale was witnessed by Agent Fisher. In this case, however, after having made the sale, Davison came outside the store after Nenno, but after looking around the parking lot, re-entered the store. The Division agents again issued a Notice of Violation and a checklist which was subsequently returned to the Division filled out. On August 20, 1996, the investigation continued with the Division agents this time using Nicole Finch, a female under age 21, who was instructed and briefed as Nenno had been. She, too, was left with only some cash and her driver’s license which reflected her to be under 21. This time, Finch entered the Respondent’s store Number 621 in the company of Agent West and purchased a 200 ml bottle of Bacardi Rum, an unlawful alcoholic beverage for her to buy, from Steven Wilder, the clerk on duty. Before making the sale, Wilder asked to see Finch’s driver’s license, which she showed to him, but after seeing it, he still made the sale. When she left the store, Ms. Finch met Special Agents West and Fischer who subsequently issued a Notice of violation to the Respondent. When questioned by West, Wilder indicated he had received no training nor was he aware of any training program in place regarding sales to underage persons. Special Agent West, who has been an investigator with the Division for more than 18 years, and who has participated in many beverage investigations such as this, entered the Respondent’s store on August 7, 1996 after Nenno had left. He arrested the clerk, Mr. Posey and issued the Notice of Violation. In the course of the transaction, he questioned Posey about how he was trained regarding the sales of alcohol to minors with specific emphasis on whether Respondent has an ongoing training program and whether there were signs or other notices proscribing the sale of alcohol to minors. In response to these questions, Posey indicated he had received verbal training but no formal classroom or video training and had been given no forms to read and sign regarding this. When West looked for signs relating to the practice of checking patrons’ identification or indicating a policy of “no sales to those under 21”, he could find no signs posted or buttons worn by employees to notify prospective patrons of the company’s practice, though the Florida Beverage law does not require buttons to be worn. West made the same observations when he entered the store after the August 20, 1996 purchase by Finch. On this second occasion, in response to West’s questions about the training given by Respondent, Wilder, the clerk involved in that sale, indicated no training programs were in place. At that time, Mr. West could see no changes that had been made in the premises since he was last there on August 7, 1996. Further, West could not find any indication that the Respondent had posted a qualifying birth date for the purchase of alcoholic beverages. In response, Respondent offered into evidence a copy of a sign which, it claims, is posted on the cash register in each store, which refers to the requirement for a person to be 21 years old, (born before the purchase date in 1975) to purchase alcohol. Mr. West, who went behind the cash register to obtain information from the liquor license, did not see a copy of this sign posted in Respondent’s store on either August 7 or August 20, 1996. The Notice of Violations issued by the Division agents were to put the licensee on notice that a violation had occurred so that the employee cannot keep the information from the license holder. Agent Fisher observed the sale to Nenno which took place on August 13, 1996. When he went into the store after the purchase took place, Fisher asked the sales clerk if he had asked to see Nenno’s identification and he had. Fisher also asked the clerk about training offered by Respondent regarding the checking of identification. This employee, who has worked for the company for approximately 16 years, indicated he had seen at least one video which concerned checking identification and admitted he had been required to sign a certificate that he was aware of the rules. Agent Fisher also looked for signs in the store regarding the Respondent’s policy regarding sales to minors but did not see any. When he participated in the operation there on August 20, 1996, he asked the clerk on duty at that time if he had been trained regarding buyers’ identification and was told that since he had been hired by the company in January 1996 he had worked in the warehouse exclusively and had subsequently worked in the store only two days. He had been given no training at all in customer identification before he started working in the store. When Fisher looked behind the counter for some sort of warning sign, he could find none, nor could he find any in the back near the beer cooler. Mr. Davison worked for the Respondent for approximately 16 years prior to his discharge because of the instant sale to a minor. He had worked as manager of store number 620 for about two years before his firing, and his job was to maintain stock and insure the store was properly manned at all times it was open. He employed two other individuals at the liquor outlet to cover the entire week. Only one person was on duty at a time. On the day he made the sale which caused him to be fired, he was the only person on duty. Periodically, he would receive a document from the company containing the company’s policies which he was to read and sign, but nothing more than that, and even they did not come very often. He claims, and it is found, that he was never told he was to train his employees regarding sales of alcohol to minors. He claims that he was never shown a training video even though he signed the document saying he did. He did that because on the one occasion he asked a manager about it, he was told to sign it and not worry about it. Even though each store had a VCR, the entire training process to which Davison was exposed consisted of the reading and signing of this document which was given to him by Mr. Odorosio, the store manager. None of the training reflected on his personnel records as having been given him was, in fact, not given. Davison claims that when he was hired 16 years ago he was not given any training about sales of alcohol to minors and has never been given any since. However, he admits that each store is furnished a chart reflecting the various endorsements to driver’s licenses which are used. He also noted that his store had one sign relating to lawful alcohol sales, given to him by a beverage salesman, which, about two months before the incident, he put on the front of the counter where the customers could see it. He claims that on the evening the agents came to the store, they did not ask to see it. If they had done so, he would have shown it to them. Davison recognized one of the signs placed in evidence as one he has seen in other of Respondent’s stores. He has never seen the other one. As Davison recalls it, Respondent’s policy is to terminate anyone caught selling alcohol to minors. After the incident of August 7, 1996, Mr. Odorosio advised him to be on the lookout because he felt the Division agents would be back. Davison admits having made the sale to the teenager in question. However, he claims, the individual had just had a birthday which Davison mistakenly believed was the 21st. In fact it was the individual’s 17th birthday. He also claims that in the two years he worked at store 620, he always asked potential underage patrons for identification unless he knew the person. He claims he has always refused to sell alcohol and would not knowingly sell alcohol to minors. In fact, on the night he sold to Nenno, August 13, 1996, when he realized he had sold to a minor, he went outside, he claims, to find Nenno and give him back his money. The four-year difference in age belies Davison’s claim of mistake and that claim is rejected. Mr. Wilder, the assistant manager on the grocery store night shift since January 30, 1996, had worked in the liquor store, temporarily, for only a day and a half at the time of the incident. He was filling in until a new clerk could be brought in from another store. When he received his orientation training in January 1996, he was shown a video and exposed to a group class on paperwork, the handbook of rules and regulations, and the sale of alcohol, after which a test was administered. That was the only time he was shown any video or was involved in any personnel meeting relating to alcohol sales. When he went to work at the liquor store, he was given training only on the operation of the cash register. The liquor store registers do not have the capability to punch in the buyer’s date of birth. However, the day he started in the liquor store, Mr. Odorosio told him to always check a purchaser’s identification and never to sell to anyone under the age of 21. This was the day before he sold the rum to Ms. Finch, and he claims this sale was caused by human error. That very day, he claims, he had make “cheat sheets” which showed the lawful dates for the purchase of tobacco and alcohol, and claims he merely read from the wrong sheet. Officials of the Division have made themselves available to work with retailers of alcoholic beverages to bring them up to the sales standards set for a reasonable industry standard as outlined in the Florida Statutes. The information contained on the alcohol compliance instructional guidelines utilized by Respondent on which clerks and cashiers acknowledge their understanding that violation of those policies may result in termination of their employment is not sufficient orientation from an educator’s standpoint. In the opinion of Agent Miller, the minimum acceptable standards call for training of personnel in alcohol control three times a year, as once a year is not enough. Mr. Miller indicates he has discussed the Respondent’s situation with Mr. Heuermann, the Respondent’s vice-president in charge of personnel training, at Heuermann’s behest on approximately four occasions, and explained his concerns over the violations and what Respondent could do to improve its program. The first discussion took place in June 1996, shortly after an arrest of another Respondent employee and two months before the instant arrests. At that time they discussed what could be done to alert personnel and modify registers to require checking of ID. It was reported at that time that some employees were overriding this; however, the company is in the process of converting all their cash registers to those which require the customer’s birth date be inserted. They were put in grocery stores first and not in the liquor stores because the liquor stores use a different system. As funds for conversion become available the registers in the liquor stores will also be converted. Company trainers also discusse training standards for employees and Respondent’s need to insure that the lowest level of employees, who deal with the public, are properly trained. Though Mr. Miller made several suggestions as to what Respondent could do to improve its educational program, neither he nor any other Division agent was asked to participate in the training. According to Mr. Heuermann, Respondent has over 100 grocery stores and 34 liquor stores and employs approximately 10,000 people, only 1,500 to 2,000 of whom are involved in the sale of alcohol. No one under the age of 18 is hired to work in a liquor store. Company trainers check to insure the age of employees as does the main office. By the same token, the company would not hire anyone as a liquor store manager who had been convicted within the prior five years of a violation of the liquor law, of prostitution, drugs or a felony. The company’s application for employment has a space for listing such an offense and the company completes a background check on its applicants. Respondent contends it has a formal training program for alcohol law compliance. The orientation program for all new employees includes a video tape, a work sheet, and instructional guidelines, all dealing with alcohol compliance, to be signed by all new hires. At training, the trainer goes through the employee handbook, which treats alcohol compliance, sexual harassment, AIDS, ADA, etc., and this training is required of all new employees, both managerial and non-managerial, but it is sketchy at best. Until 1995, such training as existed was centralized but then was made the responsibility of the individual store manager. Sometime thereafter, the training was placed under the human resources directorate and it is again centralized whenever possible, as in the metropolitan areas where employees from several stores easily can be brought together for training. The company also has a formal substance abuse policy under which the use of illegal drugs or alcohol at work is prohibited because of its impact on safety and other workers. When Mr. Heuermann was advised by the store manager of the incident involving Mr. Posey he immediately instructed the manager to fire Posey and sent the information concerning the incident to all his managers for use in training in the individual stores. He also instructed the district managers to reinforce alcohol training in the stores because he wanted to insure this training met all requirements. He called Mr. Miller at the Division to see what could be done and implemented everything Miller suggested. When Heuermann learned of the Davison case he again reviewed the facts and determined to fire Davison as well. He met with the senior vice-president of operations for Respondent who directed that no one but management personnel be put in that store and reemphasized the need for training. Heuermann also went to the store and advised the district manager that his job was in jeopardy if another violation occurred. When the third violation thereafter occurred, Mr. Heuermann called Agent Miller, Mr. Odorisio, Mr. Metcalfe and the corporations CEO. At that time, Miller made some suggestions which included a paycheck reminder which Heuermann implemented with a copy being stapled to every one of the 10,000 paychecks issued that month. Mr. Heuermann noted that after the incident involving Mr. Posey, Agent Miller advised him that Division agents would be back. Heuermann passed that information on to the district and store managers and instructed them to advise their employees to be careful. Jacqueline N. Iglesias, Respondent’s district training coordinator since October 1996’ was previously the orientation director. Employee training for the Respondent’s Hillsborough district, as noted previously herein, is done in group sessions involving between 12 and 25 people, on Mondays, Thursdays and Saturdays for three-hour sessions conducted twice a day on those days. The instruction covers safety, alcohol compliance and employee appearance and standards. With regard to the instruction concerning alcohol compliance, a form containing relevant information is used along with a video presentation and a multiple choice examination on the provisions of the alcohol compliance law which is administered while the video is playing. The video shown covers hours of sale, sales to minors, sales to those already intoxicated and how to handle unruly patrons. The course material advises the employee to call management in a questionable situation. It also covers acceptable and altered identification, what to look for and what to do in a case of suspected alteration. Specifically, employees are advised to refuse a sale to anyone whose identification is suspect, and employees are warned of the consequences, including job loss, if strict compliance with the law and the company’s policies are not followed. This training program has been in effect since August, 1996. Before that time, the training was done by the individual managers who, according to Iglesias, covered the same information. Though this program appears thorough at first blush, in reality it is considerably less than comprehensive and appears to have been minimally effective. An example of this can be seen in the history of Mr. Posey. Mr. Posey went through the company’s training program training when he was first hired. Company records reflect that he missed seven of the questions on the checklist test but, nonetheless, was still hired since performance on the test is not used to disqualify prospective employees. He supposedly was thereafter given supplemental on the job training under an experienced cashier at his employment location. Kevin Sosa has been employed as a full time liquor store clerk at Store 619-620 for more than two years. He identified a decal which, for some time, including in August 1996, was stuck to the check-out counter just in front of the register. Sosa also claimed that there is, in addition, a decal on the beer cooler located in the back of the store, in the back hallway and on the wall near the register which refer in some way to the legal age for purchasing alcohol. With regard to these signs, Special Agent Hamilton, who participated in the operation involving Mr. Davison on August 13, 1996, did not observe any signs in the store as were described by Mr. Sosa even he claims he looked for them. However, he admitted he did not go behind the counter to where the cashier stood to see if any signs were posted there, nor did he specifically look near the beer cooler. Mr. Sosa also has seen the alcohol compliance guidelines which he has been required to sign at least two or three times during the term of his employment and which he has seen more frequently when training others. He has also been exposed several times to the training guidelines which accompany the alcohol video. The last time he saw it was during the summer of 1996 after the incidents in question, but on each occasion nothing more was done than to show the video. After Mr. Posey was caught and after another incident at another company store, but before the incident involving Mr. Davison took place, he and Davison often discussed how easy it was to become complaisant and not check identification properly. Both recognized they had to be careful. They were frustrated and somewhat angry with the Division over these arrests because they felt anyone could make a mistake and fail to check identification. The efforts at control and procedures described as being in place at Respondent’s stores were reiterated in the testimony of Mr. Stickles, second assistant manager at Respondent’s store in issue, who indicated that numerous and repeated efforts are made to train employees in the proper compliance with the alcohol laws and to get out appropriate and necessary information. Included within these measures used are the use of the company’s DBX system by which individual managers can electronically communicate with headquarters and other managers to identify problems and suggested solutions; memoranda on pertinent topics sent through the mail; consistent verbal reminders from management to clerks; provision of extra stickers for registers and elsewhere in the stores; reminders on employee paychecks and, after the first incident, a mandatory repeat viewing of the alcohol control video by all employees. Aside from the above, however, Mr. Stickles could point to little in the way of formal training. Mr. Odorisio, the store manager at the facility in question related his practice of insuring that all new employees are sent to the centralized orientation program conducted by the company. He attends periodic manager meeting at least three times a year after which he briefs his clerks on any relevant material he picked up. After the incident involving Mr. Posey he again briefed the remaining clerks, including Davison and Sosa, repeatedly advising them that the Division agents would be back and to be sure to card all suspicious customers Mr. Montoto, Respondent’s district manager over the store in question, indicated his efforts to insure proper alcohol compliance included, in addition to those previously noted, a requirement that all employees have attended the pre-hiring orientation program; conduct of store manager meetings at least two or three times a year; and specific posting of managers in the stores who were trained in how to handle alcohol compliance.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Division of Alcoholic Beverages and Tobacco enter a final order imposing an administrative fine of $3,000 against Respondent’s alcoholic beverage license number 39-01099, series 3-PS. DONE and ENTERED this 4th day of March, 1997, in Tallahassee, Florida. ARNOLD H. POLLOCK 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) 921-6947 Filed with the Clerk of the Division of Administrative Hearings this 4th day of March, 1997. COPIES FURNISHED: Miguel Oxamendi, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-1007 Craig E. Behrenfeld. Esquire Barnett, Bolt, Kirk & long 601 Bayshore Boulevard, Suite 700 Tampa, Florida 33606 Lynda L. Goodgame General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-1007 Richard Boyd Director Division of Alcoholic Beverages and Tobacco 1940 North Monroe Street Tallahassee, Florida 32399-1007
The Issue This case concerns the application of William E. Morey, who does business as Morey's Restaurant, to acquire a new series 2-COP beverage license from the Respondent, State of Florida, Department of Business Regulation, Division of Alcoholic Beverages and Tobacco, in which the Respondent has denied the license application on the grounds that the granting of such a license would be contrary to provisions of Section 561.42, Florida Statutes, and Rule 7A-4.18, Florida Administrative Code. These provisions of the Florida Statutes and Florida Administrative Code deal with the prohibition of a financial interest directly or indirectly between distributors of alcoholic beverages and vendors of alcoholic beverages.
Findings Of Fact The Petitioner, Willian E. Morey, applied to the State of Florida, Departent of Business Regulation, Division of Alcoholic Beverages and Tobacco, for the issuance of series 2-COP alcoholic beverage license. By letter dated, January 23, 1979, the Director of the Division of Alcoholic Beverages and Tobacco denied the application based upon the belief that such issuance wood violate the provisions of Section 561.42, Florida Statutes, and Rule 7A-4.18, Florida Administrative Code. The pertinent provision of Section 561.42, Florida Statutes, states: 561.42 Tied house evil; financial aid and assistance to vendor by manufacturer or distributor prohibited; procedure for en- forcement; exception.-- (1) No licensed manufacturer or distributor of any of the beverages herein referred to shall have any financial interest, directly or indirectly, in the establishment or business of any vendor licensed under the Beverage Law, nor shall such licensed manu- facturer or distributor assist any vendor by any gifts or loans of money or property of any description or by the giving of rebates of any kind whatsoever. * * * In keeping with the general principle announced in Section 561.42, Florida Statutes, the Respondent has enacted Rule 7A-4.18, Florida Administrative Code, which states: 7A-4.18 Rental between vendor and distri- butor prohibited. It shall be considered a violation of Section 561.42, Florida Sta- tutes, for any distributor to rent any property to a licensed vendor or from a licensed vendor if said property is used, in whole or part as part of the licensed premises of said vendor or if said property is used in any manner in connection with said vendor's place of business. The facts in this case reveal that William E. Morey leases the premises, for which he has applied for a license, from Anthony Distributors, Inc., of 1710 West Kennedy Boulevard, Tampa, Florida. Anthony Distributors, Inc., is the holder of a J-DBW license to distribute alcoholic beverages in the State of Florida. This license is held with the permission of the State of Florida, Division of Alcoholic Beverages and Tobacco. Consequently, the issuance of a series 2-COP license to William E. Morey at a time when he is leasing the licensed premises from a distributor of alcoholic beverages, namely, Anthony Distributors, Inc., would be in violation of Section 561.42, Florida Statutes, and Role 7A-4.18, Florida Administrative Code.
Recommendation It is recommended that the Petitioner, William E. Morey's application for a series 2-COP beverage license be DENIED. DONE AND ENTERED this 10th day of August, 1979, in Tallahassee, Florida. CHARLES C. ADAMS Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: Willian E. Morey d/b/a Morey's Restaurant 4101 North 66th Street St. Petersburg, Florida 33709 Mary Jo M. Gallay, Esquire Staff Attorney Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301
The Issue Whether the Application for Alcoholic Beverage License dated March 9, 1988, filed by Ocie C. Allen, Jr., should be approved by the Respondent?
Findings Of Fact Ocie C. Allen, Jr., d/b/a OCA, filed an Application for Alcoholic Beverage License dated March 9, 1988 (hereinafter referred to as the "Application"), with the Division. In the Application, Mr. Allen indicated under "Type of Application" that the Application type was "Other - ownership change because of contract and change of location." Mr. Allen listed himself as the "Applicant" and signed the Application as the "Applicant." The "Current License Number" listed in the Application to be transferred to Mr. Allen is 62-03498, current series 4 COP. The holder of this license was Terri Howell. At the end of the Application there is an "Affidavit of Seller(s)" to be executed by the licensee from whom the license is to be transferred. This affidavit has not been completed in the Application. The purchase price for the business was listed as $86,250.00. By letter dated March 16, 1988, the Division returned the Application to Mr. Allen and informed him that it was being returned for the following reasons: (1.) Need copy of loan in the amount of $86,250.00. (2.) If there are other agreements concerning this change, we will need copies. (Closing Statements) (3.) Need Affidavit of Seller signed by Ms. Howell making sure signature has been notarized on both applications. (4.) If no business name, please use applicants [sic] name also in that blank. Mr. Allen returned the Application to the Division with a letter dated March 21, 1988, and indicated, in part, the following: The Loan of $86,250.00 is 75% of the appraised value for which a 4 COP license was sold in Pinellas County prior to Ms. Howell winning the drawing. This amount is reduced by the amounts she has received from the operation of Spanky's. Thereby the actual amount owed by me to Ms. Howell is $86,250.00 LESS the amount she has received during the operation of Spanky's, approximately, $60,000.00. The Application was not modified by Mr. Allen. In a letter dated March 24, 1988, the Director of the Division requested the following additional information from Mr. Allen: (1.) Need Affidavit of Seller signed by Ms. Howell making sure signature has been notarized on both applications. (2.) Complete (No.5) Type of License Desired: (Series ). By letter dated March 28, 1988, Mr. Allen responded as follows to the Division's request for information: Enclosed is the application for transfer. Ms. Howell signature [sic] on the Independent [sic] Contractor Agreement is the only signature of hers that will be furnished to you. By letter dated April 4, 1988, the Division informed Mr. Allen that Terri Howell, the licensee, needed to sign the Affidavit of Seller. The Division notified Mr. Allen that it intended to deny the Application in a letter dated May 31, 1988. Mr. Allen was provided a Notice of Disapproval of the Application in a letter dated June 29, 1988. The following reasons were given for denial of the Application: Application to transfer the license does not bear the signature of the current licensee and, therefore does not evidence a bonafide [sic] sale of the business pursuant to [Section] 561.32, Florida Statutes. Application incomplete as applicant has failed to provide complete verification of his financial investment. Also, applicant has failed to provide records establishing the annual value of gross sales of alcoholic beverages for the three years immediately preceding the date of the request for transfer. The Division is, therefore, unable to fully investigate the application pursuant to Florida law. By letter dated July 19, 1988, Mr. Allen requested a formal administrative hearing to contest the Division's denial of the Application. Mr. Allen sent a letter to the Division dated October 27, 1988, with an Affidavit requesting permission to pay a transfer fee of $5,000.00 "in lieu of the 4-mill assessment."
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be issued in this case dismissing the case with prejudice. DONE and ENTERED this 17th day of January, 1989, in Tallahassee, Florida. LARRY J. SARTIN Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 17th day of January, 1989. COPIES FURNISHED: Ocie C. Allen, Jr. Post Office Box 10616 Tallahassee, Florida 32302 Lt. B. A. Watts, Supervisor Division of Alcoholic Beverages and Tobacco Department of Business Regulation 345 S. Magnolia Drive, Suite C-12 Tallahassee, Florida 32301 Harry Hooper Deputy General Counsel Department of Business Regulation The Johns Building 725 South Bronough Street Tallahassee, Florida 32399-1007 Leonard Ivey, Director Department of Business Regulation The Johns Building 725 South Bronough Street Tallahassee, Florida 32301-1927 Joseph A. Sole General Counsel Department of Business Regulation The Johns Building 725 South Bronough Street Tallahassee, Florida 32301-1927
The Issue By notice to show cause, petitioner charged that respondent, individually or through the acts of its agent/employee, violated the provisions of Section 562.11(1)(a), Florida Statutes, by selling an alcoholic beverage on its licensed premises to a person under the age of 21. Respondent requested a formal hearing on the charges, and the matter was referred to the Division of Administrative Hearings. At the hearing, petitioner called three witnesses and offered three exhibits which were admitted into evidence. Respondent testified on his own behalf and offered no exhibits. A transcript of the hearing was not ordered, and the parties were granted leave until August 21, 1989 to file proposed findings of fact. Petitioner timely filed proposed findings of fact and conclusions of law. A ruling on each of petitioner's proposed findings of fact has been made and is reflected in the Appendix to this recommended order. On August 24, 1989, respondent filed a letter which is here deemed to be his proposed findings of fact; however, his filing was untimely.
Findings Of Fact At all times material hereto, respondent, Coast Line Petroleum, Inc. d/b/a Toms Texaco, held an alcoholic beverage license number 60-04813, series 2- APS for the premises known as Toms Texaco in Lantana, Florida at 401 N. Dixie Highway. Mr. Thomas Przybylski is the President of respondent and appeared on behalf of the licensee. On or around April 4, 1989, petitioner's investigator conducted an investigation of respondent's licensed premises to determine if respondent was selling alcoholic beverages to underaged persons. The investigation was prompted by complaints received by petitioner from the Lantana Police Department. Petitioner's practice in making such investigations was to employ an underaged person and send the underaged person onto the licensed premises to purchase an alcoholic beverage. The underaged person was instructed not to carry any form of identification and to respond truthfully if asked his age or for identification. Julio A. More was employed by petitioner as an Investigative Aide. On April 4, 1989, following petitioner's instructions, Mr. More, who was eighteen at the time and appeared to be no older than his age, entered the licensed premises at issue. It was a busy afternoon at Toms Texaco. Mr. More picked a beer out of the inventory and attempted to purchase it from Mr. Przybylski, who was working that afternoon. Mr. Przybylski asked Mr. More if he had any identification to which Mr. More replied that he had none. Mr. Przybylski then sold Mr. More the beer. Petitioner's investigator witnessed the sale and confiscated the tendered beer. Mr. Przybylski as an employee and officer of respondent sold an alcoholic beverage to an individual who was eighteen at the time of the sale. Accordingly, respondent is guilty of selling an alcoholic beverage to a person under 21 years of age. The proof demonstrated that petitioner has promulgated disciplinary guidelines for offenses similar to the one at issue; and that the appropriate penalty in this case would be the imposition of a fine of $1,000 and twenty-day suspension of the license.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that a final order be entered imposing on respondent an administrative fine of $1,000 and suspending respondent's license for a period of twenty days. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 7th day of September 1989. JANE C. HAYMAN 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 7th day of September 1989. APPENDIX TO RECOMMENDED ORDER IN CASE NO.89-3006 Petitioner's proposed findings of fact are addressed as follows: Addressed in paragraph 1. Addressed in paragraph 2. Addressed in paragraph 4. Addressed in paragraphs 3 and 4. Addressed in paragraph 4. Irrelevant. Adopted in paragraph 5. COPIES FURNISHED: Harry Hooper, Esquire Department of Business Regulation The Johns Building 725 South Bronough Street Tallahassee, Florida 32399-1007 Thomas John Przybylski, Jr. Coast Line Petroleum, Inc. 10670 Cypress Bend Drive Boca Raton, Florida 33498 Lt. Debbie Pfitzenmaier Elisha Newton Dimick Building 111 Georgia Avenue, Room 207 West Palm Beach, Florida 33401 Thomas A. Klein, Esquire Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32399-1007 Leonard Ivey Director The Johns Building 725 South Bronough Street Tallahassee, Florida 32399-1000 Joseph A. Sole General Counsel 725 South Bronough Street Tallahassee, Florida 32399-1000
The Issue The issue for determination is whether Respondent's alcoholic beverage license should be disciplined for violation of Chapter 561, Florida Statutes. Resolution of this issue requires a determination of whether Respondent correctly reported and remitted alcoholic beverage surcharges.
Findings Of Fact Respondent is Betty Schmidt. At all times pertinent to these proceedings, she held alcoholic beverage license no. 74-00275, Series 2-COP, for a licensed premises located at 1161 North U.S. 1, Ormond Beach, Florida. Petitioner's auditor, Muriel Johnson, performs audits on vendors monthly surcharge reports in order to confirm the accuracy of those reports and ensure compliance with statutory and administrative rule requirements. The audit in the instant case covered the reporting period of Respondent from September 1, 1994 through August 31, 1997. Alcoholic beverage licensees are afforded an opportunity to elect to report and pay the surcharge by either the purchase method or the sales method. Under the purchase method, a licensee pays the surcharge on alcoholic beverages purchased from authorized distributors. Under the sales method, licensees pay the surcharge on alcoholic beverages sold for consumption on the premises. Respondent elected to report via the sales method. A licensee's reporting under the sales method is audited by the Sales Depletion Method. Under this methodology, a beginning inventory is ascertained. Second, purchases made by the licensee for the audit period are computed. Third, an ending inventory for the audit period is ascertained. Fourth, Gross Gallonage Available For Sale is computed by adding the beginning inventory to the purchases made during the audit period and then subtracting the ending inventory. Fifth, the Net Gallonage Available For Sale during the audit period is calculated by subtracting from the Gross Gallonage an allowance for spillage and a cooking adjustment. The end result is termed the Adjusted Sales Gallonage from which amount the amount of surcharge owed for the audit period is determined. Because Respondent did not keep inventory figures, and based upon her assertion that her inventory was generally the same, Respondent and the auditor agreed upon zero as the starting inventory. Second, purchases of alcoholic beverages by Respondent during the audit period were computed based upon purchase figures provided by Respondent and verified independently through records obtained from distributors. Third, the ending inventory was agreed to be zero. Fourth, The gross gallonage available for sale was determined by adding the beginning inventory (zero) to the purchases made during the audit period and subtracting the ending inventory (also zero). Fifth, adjustments to net gallonage for sale included allowances for spillage and package sales. Notably, the audit revealed that Respondent was treating liquor mixers as wine coolers and paying a lower tax on that basis when in fact wine coolers are taxed at the rate of one ounce of liquor per container at a higher rate. Adjustments for this practice were also made. Finally, the total surcharge due for the audit period was calculated and compared to the amount already reported in order to determine the amount of under- reported or over-reported tax. Respondent sets up various disbursement stations for beer on her property during “bike week” in Daytona Beach. With only one cash register, the sales at the various stations are maintained by hand on clipboards. Additional staff is employed at this time and Respondent is not personally present at each station to monitor sales reporting. Frequent sources of alcoholic beverage sales that are not captured by a license’s cash register include theft, breakage, leakage, spillage, overpouring of drinks, and free drinks. The amounts of alcoholic beverage that are lost to a cash register in these ways are captured by Petitioner’s sales audit method. While Respondent keeps good records, no cash register method can ever capture all of the alcoholic beverages available for consumption on premises and consequently there will always be some discrepancy as the result of a sales method audit. As established by results of Petitioner's audit, Respondent underpaid surcharges for the audit period in the amount of $890. Additionally, it is established that Respondent owes $557.66 in penalties and $193.33 in interest on the payment deficiency.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered requiring payment by Respondent in the amount of $1641.10, the amount of total tax and liabilities claimed by Petitioner to be due. DONE AND ENTERED this 23rd day of November, 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 23rd day of November, 1998. COPIES FURNISHED: Elsa Lopez Whitehurst, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-1007 Betty Schmidt Smiley's Tap 1161 North U.S. 1 Ormond Beach, Florida 32174 Richard Boyd, Director Division of Alcoholic Beverages and Tobacco Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Lynda L. Goodgame, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
Findings Of Fact Petitioner originally held alcoholic beverage license no. 26-532, Series 4-COP, as an individual. He transferred this license to M & S, Inc., a Florida corporation, about one year ago. Petitioner is a 50 percent shareholder in this corporation. Jimmy G. Maddox holds the other 50 percent stock interest. Petitioner and Maddox are currently engaged in civil litigation involving the corporate licensee. Respondent referred to this civil suit in its notice disapproving the transfer application, citing the pending litigation as a basis for disapproval. Petitioner has not purchased the license from the corporation or entered into any agreement in contemplation of license transfer. Rather, he believes he is entitled to the return of the license because he received no consideration for the prior transfer from either the corporation or Maddox. Alternatively, Petitioner asks that the prior transfer to the corporation be set aside due to this lack of consideration.
Recommendation From the foregoing findings of fact and conclusions of law, it is RECOMMENDED: That Respondent enter a Final Order denying Petitioner's request for transfer of alcoholic beverage license no. 26-532, Series 4-COP. DONE and ENTERED this 6th day of April, 1982 in Tallahassee, Florida. R. T. CARPENTER, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 6th day of April, 1982. COPIES FURNISHED: James A. Fischette, Esquire Suite 1916 Gulf Life Tower Jacksonville, Florida 32207 James N. Watson, Jr., Esquire Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Herbert T. Sussman, Esquire 3030 Independent Life Building Jacksonville, Florida 32202 Mr. Charles A. Nuzum, Director Division of Alcoholic Beverages and Tobacco 725 South Bronough Street Tallahassee, Florida 32301
The Issue The issue in the case is whether the allegations set forth in the Department's Administrative Action dated January 21, 1999, are correct.
Findings Of Fact At all times material to this case, Respondent DePaul, Inc. operated the Copper Penny Pub, 10553 Spring Hill Drive, Spring Hill, Florida (the "licensed premises"). The Respondent held license number 37-00584, Series COP4. In or before September 1998, the Petitioner selected the Respondent for audit based on the Respondent's failure to file required monthly sales reports. By letter dated September 2, 1998, the Petitioner notified the Respondent of the audit. According to the letter, the audit would occur on September 24, 1998, at the licensed premises. The letter stated that the following items would be reviewed: All alcoholic beverage purchase invoices. Petty cash records. Business checkbooks or check stubs. Records of alcoholic beverages used in cooking (if any). Any worksheets you might use to prepare the report. The enclosed Pre-Audit Questionnaire completely filled out. The Pre-Audit Questionnaire allows a licensee to identify package sales. Package sales are those in which alcoholic beverages are sold in the original sealed containers for consumption off the licensed premises. A COP4 series licensee can sell packaged alcoholic beverages for consumption off premises. Package alcohol sales are deducted from total sales during the audit, and are not included in the surcharge tax liability. The Pre-Audit Questionnaire directs the licensee to identify documents that will be used to support the package sales deduction. The Respondent did not complete or submit the Pre-Audit Questionnaire. A licensee must establish entitlement to a package sales deduction. Generally a licensee is required to maintain a log of package purchases, and support the logged transactions with daily cash register tapes, identified as "Z" tapes. The Respondent produced no package sales records to the Petitioner during the audit. Even though the Respondent did not provide records supporting a package sales deduction, the auditor allowed a two-percent credit for package sales. There are two audit methodologies used in conducting the tax audit, the "sales" method, and the "purchase" method. The choice of audit methodology is left to the licensee. The Respondent selected the purchase method audit. In a purchase method audit, the licensee is required to pay surcharge taxes based on the gallons of alcoholic beverages purchased monthly. Division Tax Auditor Maggie Herrera conducted the audit. According to Ms. Herrera, the licensed premises is a bar located in a strip shopping center. The "package store" is located outside and about thirty feet away from the bar. The "package store" is about the size of a one-car garage. In order to make a package sale, the bartender must leave the bar, walk to the package store, unlock it, retrieve the packaged goods, re-lock the door, and return to the bar. According to Ms. Herrera, the package store contained one-liter bottles of liquor on shelves with prices marked with masking tape on the bottles. The store also contained two cases of "hip flask" 375-ml size bottles, one case of 50-ml bottles, "a lot" of brandy and dust-covered bottles of mixers. During the several hours Ms. Herrera's was present at the licensed premises, only one package sale (a flask size bottle) was made. Ms. Herrera traveled to the licensed premises on two occasions to meet the Respondent. On the date of the first scheduled meeting, the Respondent did not appear. On the date of the second scheduled meeting, the Respondent presented approximately thirty distributor invoices to Ms. Herrera and told her he was leaving for his home to retrieve the remainder of the records. He left the licensed premises. She waited for several hours. The Respondent did not return and did not contact Ms. Herrera to explain his failure to return. Ms. Herrera preformed an audit of the Respondent, using standard audit procedures. Ms. Herrera utilized monthly surcharge reports filed by the Respondent for the period between January 1995 and December 1997, the distributor sales records for the Respondent's purchases, and records of tax payments made by the Respondent. According the audit, the Respondent owes remaining tax surcharge payments of $47,695.85, a penalty of $17,545.74 and interest of $5,514.60, for a total liability of $70,756.19. There is no evidence that the audit was done inappropriately, or that the audited tax liability is incorrect. The Respondent was notified of the tax liability by certified letter.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department of Business and Professional Responsibility, Division of Alcoholic Beverages and Tobacco, enter a final order imposing a total liability of $70,756.19, including unpaid tax liability, penalties, and interest. DONE AND ENTERED this 26th day of October, 1999, in Tallahassee, Leon County, Florida. WILLIAM F. QUATTLEBAUM 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 26th day of October, 1999. COPIES FURNISHED: Miriam S. Wilkinson, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 William T. Charnock, President 10154 Dunkirk Road Spring Hill, Florida 34608 Joseph Martelli, Director Division of Alcoholic Beverages and Tobacco Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Barbara D. Auger, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792
The Issue Whether the Respondent, Aristen Group, L.L.C., d/b/a Pangaea Gryphon (Respondent or Licensee), failed to remit monies owed to the Petitioner, Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco (Department or Petitioner) pursuant to the surcharge provisions found in Section 561.501(2), Florida Statutes (2007). If so, the Department seeks to discipline the licensee pursuant to Section 561.29, Florida Statutes (2007).
Findings Of Fact At all times material to the allegations of this case, the Petitioner is the state agency charged with the responsibility of regulating persons holding alcoholic beverage licenses. See § 561.02, Fla. Stat. (2007). At all times material to the allegations of this matter the Respondent has been a licensee holding license number 1616908, series 4-COP. When the Licensee filed its surcharge audit questionnaire it elected to file its surcharge tax based upon the "purchase method." The Department offers alcoholic licensees two methods to compute the alcoholic beverage surcharge tax. The methods are known as the "purchase method" and the "sales method." The "purchase method" calculates the surcharge due to the Department based upon everything purchased during a given month. For the "sales method" the surcharge tax is computed based upon the actual cash register records for the sales during the reporting period. The Department may audit any licensee to compare the amounts remitted with the records maintained by the licensee to verify the correct surcharge tax was paid. In this case, the Licensee was audited for the period September 23, 2004 through August 31, 2006. To verify the surcharge amount was properly remitted, the Department reviewed the records of the beverage distributors used by the Licensee. When the Surcharge Audit Questionnaire was submitted the Respondent identified five suppliers of alcoholic beverages from whom the Licensee purchased beverages for the audit period. Those suppliers then provided their records to establish the beverages sold to the Respondent during the audit period. Based upon those records the Department compared the volume purchased and calculated the surcharge tax due and owing to the state versus the surcharge tax paid to the Petitioner during the audited period. Based upon that comparison, the Department found that the Licensee had failed to remit the correct surcharge payment. More specifically, the Department calculated that the Respondent owed the State a surcharge principle in the amount of $7,975.70. Based upon that amount the Department assessed a penalty in the amount of $4,217.87 along with interest in the amount of $1,409.54. The Respondent does not dispute the calculations for penalty and interest if the principle amount is correct. James Napolitano is the accountant for the Respondent. He was authorized to appear at the hearing on behalf of the Licensee but was unclear as to how the Department computed the surcharge amounts. Mr. Napolitano did not dispute that the Licensee was to remit the surcharge tax based upon the "purchase method." Mr. Napolitano represented that all purchases were to be signed for and opined that if they were, in fact, received by the Licensee the surcharge computation may be correct. Copies of the documents relied upon by the Department were provided to the Licensee at its business address. Mr. Napolitano did not receive them until the date of the hearing. Mr. Napolitano represented he intended to review the invoice records to verify the shipments were actually provided to the Licensee. No further information was offered by the Respondent.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco, enter a Final Order providing that the Respondent owes the surcharge tax in the amount of $7,975.70, and assessing a penalty and interest based upon that amount. Further, the Final Order should provide a limited time for the repayment of the delinquent amount. Should the Licensee fail to timely remit the full amount, with penalty and interest, it is recommended that the license be suspended until such time as the amount is paid in full. DONE AND ENTERED this 3rd day of September, 2008, in Tallahassee, Leon County, Florida. J. D. PARRISH 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 3rd day of September, 2008. COPIES FURNISHED: Michael J. Wheeler, Esquire Assistant General Counsel Department of Business and Professional Regulation Northwood Centre, Suite 40 1940 North Monroe Street Tallahassee, Florida 32399-2202 James P. Napolitano 404 Jerusalem Avenue Hicksville, New York 11801 James P. Napolitano 5711 Seminole Way Hollywood, Florida 33314 Ned Luczynski, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Cynthia Hill, Director Division of Alcoholic Beverages And Tobacco Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
