Findings Of Fact In 1987, Petitioner grew thirty (30) pounds of marijuana with a fair market value of $20,000. The marijuana was grown within the State of Florida. In 1988, Petitioner grew 116 pounds of marijuana with a fair market value of $500 per pound for a total of $58,000. This marijuana was also grown within the State of Florida. The growing of marijuana is a taxable event in Florida pursuant to Section 212.0505, Florida Statutes. The tax is assessed at the fair market value of the marijuana grown. Additionally, there are surcharges and penalties assessable under the same statute for growing marijuana. The tax attributable to Petitioner's enterprise is as follows: 20% tax of fair market value $15,600.00 5% penalty per month up to 25% of tax due 3,900.00 Additional 50% penalty 7,800.00 1% interest per month as of date of final hearing (October 24, 1989) ($5.13 per day) from date of hearing) 2,746.14 Total $30,046.14 Petitioner did not demonstrate any defense to the assessment of this tax by the Department and did not demonstrate a defense to the payment of the above assessment. Petitioner, therefore, owes the Department $30,046.14 in penalties and taxes plus interest at the rate of $5.13 per day from October 24, 1989.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is: RECOMMENDED that the Department enter a Final Order upholding the jeopardy assessment, dated March 8, 1989, assessing the Respondent $30,046.14 in penalties and taxes plus $5.13 per day from October 24, 1989. DONE and ENTERED this 31 day of January, 1990, in Tallahassee, Leon County, Florida. DIANE CLEAVINGER 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 31 day of January, 1990. APPENDIX TO CASE The facts contained in paragraphs 1, 2, 4, 7, 8, 10, 11, 12, 13, 14, 15, 16, 17, 18, 21, 22, 24, 25 and 26 of Respondent's Proposed Recommended Order are adopted, in substance, insofar as material. The facts contained in paragraphs 3, 5, 6, 9, 19, 20 and 23 of Respondent's Proposed Recommended Order are subordinate. COPIES FURNISHED: William D. Moore General Counsel Department of Revenue 203 Carlton Building Tallahassee, Florida 32399-0100 Katie D. Tucker Executive Director 104 Carlton Building Tallahassee, Florida 32399-0100 William Clayton Sapp #114370 Cross City Correctional Institution Work Camp P.O. Box 1500-236WC Cross City, Florida 32628 Lee Rohe, Esquire Department of Legal Affairs The Capitol - Tax Section Tallahassee, Florida 32399-1050
The Issue Whether the proposed rules that comprise Florida Administrative Code Chapter 64-4 (Proposed Rules) constitute an invalid exercise of delegated legislative authority?
Findings Of Fact Based upon the testimony and documentary evidence presented at hearing, the demeanor and credibility of the witnesses, and on the entire record of this proceeding, the following findings of fact are made: The Parties The Florida Department of Health is an executive branch agency of the State of Florida created pursuant to section 20.43, Florida Statutes.1/ The Department is primarily responsible for implementation of the Compassionate Medical Cannabis Act of 2014, as codified at section 381.986. Petitioner Costa Farms, LLC, is a limited liability company with its principal place of business at 21800 S.W. 162nd Avenue, Miami, Florida 33170. Costa Farms is a nursery that possesses a valid certificate of registration with the Department of Agriculture pursuant to section 581.131, Florida Statutes; has operated as a registered nursery for 30 years; and is operated by a nurseryman. Petitioner Plants of Ruskin, Inc., is a Florida corporation whose business address is 901 4th Street, N.W., Ruskin, Florida 33570. Plants of Ruskin is a nursery that possesses a valid certificate of registration with the Department of Agriculture pursuant to section 581.131; has operated as a registered nursery for 30 years; and is operated by a nurseryman. Petitioner/Intervenor, Florida Medical Cannabis Association, Inc., is a Florida corporation whose business address is 1299 Fairbanks Avenue, Suite A, Winter Park, Florida 32789. FMCA represents a substantial number of its members that will be regulated by and are substantially affected by proposed chapter 64-4. The subject matter of proposed chapter 64-4 is within the Association’s general scope of interest and activity. Petitioner/Intervenor Tornello Landscape Corp. a/k/a “3 Boys Farm Company,” is a Florida corporation doing business at 704 21st Avenue, S.E., Post Office Box 789, Ruskin, Florida 33570. Tornello Landscape is a nursery under section 581.131; has operated as a registered nursery for 30 years; and is operated by a nurseryman. Intervenor Tree King-Tree Farm, Inc., is a Florida corporation with a principal place of business located in Pasco County, Florida, at 4903 State Road 54, New Port Richey, Florida 34652. It also alleges to have been owned and operated by a nurseryman for 30 continuous years with greater than 400,000 plants in cultivation. The Compassionate Medical Cannabis Act of 2014 During the 2014 legislative session, the Florida Legislature passed Senate Bill 1030 entitled the “Compassionate Medical Cannabis Act of 2014,” chapter 2014-157, Laws of Florida (the “Act”). The Act represents an historic and momentous change for the State of Florida regarding the regulation and use of cannabis, previously a Schedule-1 drug in all forms. To provide relief for patients with debilitating diseases, the Act allows for the use of low-THC cannabis by qualified patients for medical use when ordered by a Florida physician. The Act authorizes licensed physicians to order low-THC cannabis beginning January 1, 2015, for qualified patients under specified conditions, primarily those suffering from cancer or severe and persistent seizures and muscle spasms. The Act charges the Department with the vast majority of responsibilities associated with implementation. The Department is required to establish a compassionate-use registry by January 1, 2015. The Department is also required to establish the Office of Compassionate Use within the agency and work with the state university system to bring FDA-approved investigational new drugs for the treatment of refractory epilepsy to Florida. The Act also appropriated $1 million to the Department’s Biomedical Research Council to further state university research related to cannibidiol and its effect on childhood epilepsy. Finally, the Act requires the Department to authorize, by January 1, 2015, the establishment of five dispensing organizations to grow, refine, and dispense low-THC cannabis to qualified Florida patients. The Department’s Rule Development Process Immediately after the 2014 legislative session, the Department started its work to establish a regulatory structure for approving five dispensing organizations. The Department researched statutes and rules in other states where cannabis had already been legalized in some form. None could be easily patterned because no other state had limited the number of dispensing organizations to five and restricted medical use to only low-THC cannabis derivative products. Through the Department’s research, it also recognized the necessity of establishing a robust regulatory structure because cannabis, in any form, remains illegal under federal law with no accepted medical use. Prior to July 1, 2014, Florida’s state and local law enforcement agencies worked in partnership with federal authorities to regulate cannabis through enforcement of identical narcotics laws. The passage of the Compassionate Medical Cannabis Act of 2014 fundamentally altered the long-standing narcotics enforcement partnership between the federal law enforcement agencies and state and local law enforcement agencies. The Department reviewed several memoranda and other guidance from the United States Department of Justice issued in response to laws in several other states legalizing the manufacture, distribution, dispensing, and possession of cannabis. Especially important to the Department were the eight federal enforcement priorities consistently identified by the Department of Justice in its memoranda: Preventing distribution of cannabis to minors; Preventing cannabis revenue from going to criminal enterprises such as gangs or cartels; Preventing the diversion of cannabis to other states; Preventing state-authorized cannabis activity from serving as a front for the trafficking of other illegal drugs; Preventing violence and the use of firearms in the cultivation and distribution of marijuana; Preventing drugged driving and other adverse public health consequences associated with cannabis use; Preventing the growing of cannabis on public lands; and Preventing cannabis possession or use on federal property. It was clear from the federal guidance that it was the responsibility of the state to ensure protection of the eight federal enforcement priorities through the enactment of a robust regulatory structure that maintains the enforcement partnership between state and local law enforcement agencies and federal authorities. A failure to do so would create a very real risk for challenge by the federal government to the regulatory structure established by the state. Thus, in developing its proposed rules, the Department was appropriately mindful of the illegality of low-THC cannabis under federal law and the necessity for a robust regulatory structure that protected the eight federal enforcement priorities. The Department estimated that the cost of setting up the “robust regulatory structure” was in the range of $750 thousand to $1.5 million. Another fundamental consideration for the Department was whether any rule promulgated as part of the new regulatory structure could impose regulatory costs that would trigger the legislative ratification requirement described in section 120.541, Florida Statutes. Because the Act required the authorization of five dispensing organizations by January 1, 2015, the Department believed it was precluded from promulgating any rule that imposed regulatory costs on the dispensing organization applicants that would trigger a legislative ratification requirement. Another overall consideration for the Department was the lack of a legislative appropriation to support the Department’s efforts. The Department was required to use existing resources to establish the regulatory structure and meet the other requirements of the Act. The necessity to use existing resources, the time limitation, and the unique statutory structure also limited the Department’s ability to hire “cannabis experts” to assist with the rulemaking process and development of merit selection standards to be used in evaluating applications. The Department issued draft proposed rules for selecting dispensing organizations and other aspects of the program on July 2, 2014. It conducted rule development workshops on July 7 and August 1, 2014. Each of the workshops was attended by over 200 people, with more than 100 persons offering verbal comments on the draft rules. On August 29, 2014, the Joint Administrative Procedures Committee (JAPC) issued a letter commenting at length on the proposed rules, to which the Department responded on September 10, 2014. The Department held a public hearing on the proposed rules on September 5, 2014. It subsequently issued a Notice of Change/Withdrawal reflecting some technical changes to the proposed rules on September 9, 2014. Department General Counsel Jennifer Tschetter had primary responsibility for preparing the proposed rules. Her career has been as a lawyer with experience in agency rulemaking; she does not claim any prior expertise in nursery operation, supply of medical cannabis, business plans, or finance. The Department had no such expertise when the bill passed in May 2014, and due to fiscal and other constraints, the Department did not hire a consultant to assist it in developing comparative review standards to be utilized in evaluating applications. On July 2, 2014, the Department appointed Linda McMullen to be the Director of its Office of Compassionate Use. Ms. McMullen was previously a Department staff lawyer under Ms. Tschetter; her career has been as a lawyer. She did not claim experience in program areas relating to supplying medical cannabis. Cultivation and Production of Low-THC Cannabis The low-THC cannabis product that the selected dispensing organizations will be responsible for growing, extracting, and delivering is targeted for a very vulnerable population, including children suffering from cancer and chronic and uncontrollable seizures. Since the low-THC cannabis derivatives will be given to persons with serious medical conditions, it is imperative that the product not contain any impurities that could trigger an adverse reaction in the patient. However, there is a dearth of information as to what pesticides, fungicides, fertilizers, or other inputs may safely be used in cultivating cannabis in Florida. Robert Tornello, an expert in nursery operations, credibly testified about this problem as follows: But what this refers to in cannabis, is it’s not that we are going into unknown waters as far as just the growing part of it. Where we are going is into an area, because of the amount of years that this particular plant has been labeled as a schedule 1 drug, including industrial hemp, which is grown all over the world, the problem we’ve got is that the Environmental Protection Agency, EPA, is the one who writes and approves guidelines for any of the inputs that you would use on a plant. For example, if you were growing apples, you could actually be able to cross reference apples with whatever visual problem that you see and you would come up with a list of -- potentially there are deficiencies that may occur and how to fix those with either synthetic or organic compounds, or there would be a list of different possible pathogens or issues that would show you all the different pesticides that could be used, as well as fungicides. And when we get back to cannabis, because of its being a schedule 1 drug for so many years, there are absolutely no, as in zero, chemical compounds that have been tested for rates as far as minimums or maximums, and as well as efficacy. And as well as -- now I am getting feedback (from his microphone). So, my point is that without any testing that has ever been done on cannabis, we have a unique situation. This is one that I brought up with both Jennifer and Linda at the hearings. And my concern is not just what growers are being told to do or suggested they can or cannot do. The most important precedent that we have to deal with is the law. And the law clearly states -- in Florida we have a statute, I believe it’s 487, that the division of or actually part of the Department of Agriculture, and in that statute it tells you all about the uses of pesticides and applications, things that can be done, that can’t be done, and the methods and applications. It’s a little bit long- winded, almost as I am right now. But the point is that it clearly states in several of the subchapters, as it does also with the environmental protection rules, is that if a pesticide or compound or fungicide or anything even organic compounds are not listed for that particular plant, they cannot be applied to that plant; because nobody knows, just without at least a hundred tests and those have been approved then by the departments, of what is minimums or maximums for applications and the efficacy and what amount of residual chemical may show up or is allowable, most importantly, a product. And where this is so critical on the Bill 1030, the Charlotte’s Web law, is that we are talking about the growing of a plant that most of us -- and in this particular case with regard to cannabis, I also truthfully do not grow, but it’s important to understand that with cannabis, you can’t apply anything to it without -- you can’t guess at it. Because if you do and you think that the application rate is safe or one that you’ve used on a plant that you would think is the same leaf structure or type, or genera, you could be very, very wrong and, as a result, the pesticides that are absorbed by the actual plant by contact, plus what’s on there as residual, would then translocate through the extraction process. And then when we get into extraction and you have an oil, as in the case with the Charlotte’s Web bill, then we are looking at -- which I was happy to see that they listed as a parts per billion test for pesticides, because any little bit of chemical that could be on any of these plants and that can be absorbed through by the caregiver to the patient, ultimately if you have an autoimmune disease or have a neurological disease, those either have metal compounds or those particular synthetics can be a trigger. (Transcript, pgs. 107-110). Many registered nurseries in Florida have experience only in growing ornamental plants. The evidence established that some of the nurseries that meet the 30-year registration requirement and the 400,000 plant threshold set forth in the Act have little or no experience growing food products or plants that can be used for medicinal purposes or human consumption. The significant chemical and safety issues inherent in growing medical cannabis require skills and expertise that are not typically required for growers of strictly ornamental (as opposed to ingestible) plants. As Mr. Tornello credibly testified: But knowing what we know about the nursery business in general and also enjoying those hearings which were also educational, is that quite a few of the nurserymen were very candid about speaking, and clearly stated that they are just a nurseryman and they know understand plants and, given enough time and enough money, they would develop enough experience to eventually become proficient in growing this. And to me, in my heart, I felt bad for some of these guys because, you know, this is not -- growing at these levels is not easy. It requires on average three hours of paperwork a day. It’s just agonizing, the paperwork. The audits, we have 13 books that are this thick of books that are forensically gone through by the food safety people, as well as refrigeration and harvest groups and things of this nature. So when I saw all this happening, I knew that the lottery became strictly a chance-based scenario and it wasn’t merit-based or experience-based. And to me, I had to object to it. (Transcript, pgs. 121, 122). Cannabis is a product that is not native to Florida, and the ability to grow the product safely and effectively depends on a number of complex factors which are not addressed in the proposed rules. Michael Rimland, accepted as an expert in nursery operations and in the development of new non-native plant varieties for production in Florida, described the risks in growing low-THC cannabis in Florida for a nursery that does not have experience in introducing and cultivating non-native varieties: First would be failure, actually crop loss, not be able to actually produce the plant. And the plant would die from cultural conditions not being adapted properly, physiological conditions not being adapted properly, or some other type of issue that they just have not learned how to produce it. Or it could be crop timing; the crop is a very sensitive crop when it comes to timing. Basically it’s eight weeks. Eight weeks in one vegetative form, eight to ten weeks in flowering form. Could also be in the quality of the product that’s produced, without understanding again the protocols that are required to produce it perfectly and timing is a huge factor in producing it perfectly. (Transcript, p. 64). Mr. Rimland also testified that not all nurseries with 30 years’ experience in Florida will have the same likelihood of success in efficiently producing low-THC cannabis for medical use. Because cannabis is not native to Florida, an important factor in predicting success is the nursery’s demonstrated ability to successfully produce a large number and variety of non-native genera and species. It is not sufficient simply to hire someone who has produced medical cannabis in another state, because growing conditions in Florida such as humidity, temperature, light conditions, and insect and disease thresholds are very different from those found elsewhere. Mr. Rimland testified that there are at least 20 different varieties of low- THC cannabis, all of which have different production requirements, so the dispensing organization will have to address these issues in introducing different varieties to meet patient needs. A lack of specialized knowledge regarding introduction of non-native genera and species in Florida risks inability to produce the plant at all; delays in production; reduced crop quality; and increased price for the product, all of which may affect patient access. Additionally, the infrastructure required to safely and successfully cultivate cannabis is significantly different than what is required to grow ornamental plants. As explained by Mr. Tornello: The things that are different are primarily going to be the first initial set up. The greenhouses, as I said earlier, need to be pretty much hermetically sealed to avoid any pests or any kinds of problems; and you have to have vestibules again with alcohol mats so people don’t track in anything from the ground, because there’s a lot of different soil-borne pathogens that can come into a humid or a growing situation that could become virile. (Transcript, p. 130). Pedro Freyre, Costa Farms’ Vice President of its Foliage Division, also credibly testified concerning factors that predict whether a nursery will be able to dependably produce medical cannabis. According to Mr. Freyre, nurseries with established operations and experience in introducing new varieties of plants are better prospects for success in producing medical cannabis. Mr. Freyre agreed that there are numerous challenges to growing medical cannabis in Florida, such as climate control, pest control, contamination controls, establishing correct and adequate patient protocols, security structure, source materials, risk of loss of key personnel, and financial perils. A nursery with substantial financial resources, according to Mr. Freyre, is better able to weather initial growing pains, comply with regulations, and produce consistent high-quality products. Such nurseries may be better equipped and staffed to provide reliable inventory control. The nursery’s location, transportation system, and costs would all affect patients’ access to the product. Selection of Medical Cannabis Dispensing Organizations Section 381.986(5) directs, in pertinent part, that “by January 1, 2015, the Department shall” do the following: Authorize the establishment of five dispensing organizations to ensure reasonable statewide accessibility and availability as necessary for patients registered in the compassionate use registry and who are ordered low-THC cannabis under this section, one in each of the following regions: northwest Florida, northeast Florida, central Florida, southeast Florida, and southwest Florida. The department shall develop an application form and impose an initial application and biennial renewal fee that is sufficient to cover the costs of administering this section. An applicant for approval as a dispensing organization must be able to demonstrate: The technical and technological ability to cultivate and produce low-THC cannabis. The applicant must possess a valid certificate of registration issued by the Department of Agriculture and Consumer Services pursuant to s. 581.131 that is issued for the cultivation of more than 400,000 plants, be operated by a nurseryman as defined in s. 581.011, and have been operated as a registered nursery in this state for at least 30 continuous years. The ability to secure the premises, resources, and personnel necessary to operate as a dispensing organization. The ability to maintain accountability of all raw materials, finished products, and any byproducts to prevent diversion or unlawful access to or possession of these substances. An infrastructure reasonably located to dispense low-THC cannabis to registered patients statewide or regionally as determined by the department. The financial ability to maintain operations for the duration of the 2-year approval cycle, including the provision of certified financials to the department. Upon approval, the applicant must post a $5 million performance bond. That all owners and managers have been fingerprinted and have successfully passed a level 2 background screening pursuant to s. 435.04. The employment of a medical director who is a physician licensed under chapter 458 or chapter 459 to supervise the activities of the dispensing organization. * * * (d) Adopt rules necessary to implement this section. There are approximately 75 nurseries that possess a valid certificate of registration for the cultivation of more than 400,000 plants, are operated by a nurseryman as defined in section 581.011, and have been operated as a registered nursery in Florida for at least 30 continuous years. These 75 nurseries represent the potential pool of applicants seeking to become one of the five dispensing organizations authorized under the Act. Proposed rule 64-4.002(4)(a) provides that “[i]f more than one applicant for a dispensing region is qualified and its application is timely received, the department will provide a computer program method for a double random lottery-type selection by public drawing to designate the approved applicant and the order of the other applications within each dispensing region.” Pursuant to proposed rule 64-4.002(1), the Department will require applicants to submit a one-page application form which identifies the applicant and key personnel, with attached exhibits prescribed by the proposed rules as follows: Plan for cultivating, processing, and dispensing low-THC cannabis, including a business plan showing the applicant’s expected production, rule 64- 4.002(2)(b); Security and safety plan with at least certain listed features, rule 64- 4.002(2)(c); Quality assurance plan, rule 64- 4.002(2)(d); Documentation of the applicant’s ability to obtain and maintain the premises, facilities, resources, and personnel necessary to operate a dispensing organization, with, at a minimum, specific disclosures regarding facilities and employees, rule 64- 4.002(2)(e); Inventory control plan documenting the applicant’s ability to maintain accountability of all raw materials, finished products, and any byproducts, rule 64-4.002(2)(f); Documentation that the applicant possesses infrastructure reasonably located to dispense products to registered patients, and a transportation plan, if applicable, 64- 4.002(2)(g); Documentation that the applicant has equipment, training, ability, and personnel necessary to safely produce low-THC cannabis derivative products, rule 64-4.002(2)(h); Documentation of the applicant’s financial ability to maintain operations for the two year approval cycle, rule 64-4.002(2)(i); Documentation of the applicant’s ability to post a $5 million performance bond, the sole condition of which is to cover any cost incurred in disposing of inventory should the applicant fail to perform and need to be replaced, rule 64-4.002(2)(j). The above-listed nine categories of documentation are the only guidance to applicants on what information they must submit in order to be found qualified to be randomly selected by lottery as a dispensing organization under the rule. Likewise, this is the only guidance to Department evaluators on what they should consider in order to pass or fail applications for random selection approval. Ms. McMullen could not elaborate on what would specifically qualify an applicant for the lottery under the rule. Ms. Tschetter explained that evaluators will not be using any guidelines other than these rules to determine which applications qualify for random selection. JAPC asked the Department how it intended to apply these general standards to evaluate applications: 64-4.002(4)(a): This rule paragraph indicates that the department will substantively review and evaluate all timely received applications to determine if the applicant is qualified To substantively evaluate the applications and exhibits, it appears that there must be stated standards and criteria in the rule text. See § 120.52(8)(d), Fla. Stat. (emphasis added). Ms. Tschetter’s response to JAPC’s inquiry did not identify any specific standards or criteria, but rather stated: 7. 64-4.002(2), 64-4.003 -- Evaluation Criteria Each of the documentation requirements identified in proposed rule 64-4.002(2), as changed, will be evaluated on a pass/fail basis. The documentation will either be present; or it will not. Each of the Department’s decisions about whether the documentation is sufficient will be subject to review at the Division of Administrative Hearings pursuant to section 120.57, Florida Statutes. Similarly, the evaluation of biennial renewal applications will be on a pass/fail basis and subject to review at DOAH. There is no need for additional criteria. The rules give no specific direction as to what financial information is required of an applicant, or for what period of time. There is no minimum requirement for applicants’ financial ability. The financial information can be either historical or projected. There is no requirement that the financial statements be audited to assure the information is accurate. The Department intends to evaluate each application independently, not comparatively, to determine if the applicant has the ability to provide the low-THC product for two years under its specific business plan. The Department anticipates that financial requirements will vary from applicant to applicant, and should be determined independently for each business plan. Thus, requirements will be ad hoc and non- uniform, floating with the unique features of each proposed business plan. Ms. McMullen explained that each applicant will be judged on its own proposal. Prior to an applicant being selected as a dispensing organization, evaluators will not visit the nursery site to verify the applicants’ capabilities. And although applicants must theoretically demonstrate the ability to perform in their application, the Department does not require that an operation be up and running prior to approval. The applicant must have a licensed M.D. or D.O. as its medical director, but there is no specific required medical experience, duties, or work hours. When asked about the Department’s “qualitative analysis” of applications, Ms. McMullen testified that the screening panel will only check the applications for minimum qualifications or requirements: Q: So the qualitative analysis that you’re speaking of here is simply are they minimally qualified under our interpretation of the statute, which have they met the statutory criteria sufficient to be an applicant? A: Correct. (Costa Farms Ex. I: McMullen Dep. p. 86) * * * Q: Would you agree that the absence of any fee requirement would encourage someone who has minimal qualifications to apply when there’s really nothing to lose, you don’t have an application fee to lose? A: All this – if they meet the minimum requirements of the statute and the rule, then their application will be accepted. (Costa Farms Subst. Exh. II, McMullen Dep. p. 63) Ms. Tschetter did not interpret the statute to require the Department to pick the best or most dependable applicant. Rather, she felt that the screening process will ensure that applicants that are passed to the lottery pool will be “good enough” and that whether one applicant is better than another is just a matter of opinion. At the public hearing held on September 5, 2014, the Department made a PowerPoint presentation. Included in the presentation was a description of the “Qualification Process – 64-4.002” with bullet points stating “At least 3 Department evaluators,” “Public meeting” and “Will comply with requirements of section 120.60(1), Florida Statutes.” If the Department finds an application is defective, incomplete, or insufficient to qualify, it intends to allow the applicant 15 days to correct, supplement, or remedy the application, under authority of section 120.60(1). The proposed rules do not contain any guidance on procedures to be used in this evaluation – for example, who appoints the panel members, who the panel members will be, whether the panel members will have any expertise, whether panel members’ evaluations are independent or joint, whether panel decisions to disqualify an applicant must be unanimous or majority vote, whether panel decisions will be subject to further administrative review and by what process, and when decisions may be challenged. Ms. McMullen confirmed that the Department intends to appoint a three-person panel to screen applications to determine if they meet basic requirements to be eligible for the lottery pool. She expects to participate in the screening process, but did not know how this screening process will work or what her role will be. The Department did not propose rules, nor does it plan to adopt rules to elucidate its panel-review procedure to determine if applicants are qualified for the lottery. Under proposed rule 64-4.002(4)(a), all applicants that are deemed to pass general minimum requirements will qualify to be placed in the lottery pool, and the winner then selected at random: If more than one applicant for a dispensing region is qualified and its application is timely received, the department will provide a computer program method for a double blind random lottery-type selection by public drawing to designate the approved applicant and the order of the other applications within each dispensing region. (emphasis added). Each applicant in the lottery pool will have an equal chance to be selected. Applicants not selected by the lottery will not be approved as a dispensing organization. Applicants are not required to pay any application fee to have their applications reviewed and placed into the lottery pool. Only the lottery winner is required to pay an “application fee,” in the amount of $150,000 before it is authorized to be the exclusive dispensing organization for its region. If the winner fails to pay the application fee, the applicant picked second in the lottery is selected; if a default occurs later, a new lottery is conducted for that region. Although the license is granted for two years, pursuant to proposed rule 64-4.003, an approved dispensing organization will have perpetual renewal rights, unless it commits a serious violation or is unwilling or unable to continue. Costa Farms’ Pedro Freyre has a background in finance and the business side of operating nurseries. Mr. Freyre testified it was not clear to him what the proposed rule requires applicants to provide as a “business plan,” a “quality assurance plan,” “reasonably located infrastructure” or “financial statements” in connection with the application. Mr. Freyre also testified that in order to attract established Florida nurseries to become dispensing organizations for lawful cannabis products, the Department should allow a winning applicant to assign its operating rights to a related single-purpose entity owned by the same owners, so the existing nursery can maintain its banking relationships. Ms. Tschetter agreed that a qualified nursery selected as a dispensing organization will be allowed to transfer operating rights to an affiliated single-purpose entity, under the Department’s form to request to alter a dispensing organization. David Cooper, Ph.D., professor of economics at Florida State University, credibly summarized the likely economic effects of the lottery system as reducing competition between providers and raising prices to consumers, which could potentially impair access to the medication: [U]se of a random selection process (i.e. a lottery) to select an oligopolistic and permanent regional franchise under a general qualifications standard . . . will encourage inefficient (i.e. high cost) providers to enter the lottery. The likely outcome is a reduction in the disciplining effect of competition and, as a direct result, higher prices in all regions of the state. Consumers who would benefit from access to this medication will either be forced to pay higher prices or, even worse, be unable to afford the product. Poor choice of a mechanism to choose providers means that access will be denied to some patients who would receive medication under a better system. * * * Unfortunately it is extremely unlikely that the low cost providers are chosen under the lottery system . . . . Even if we get lucky, the outcome is still likely to be worse with the lottery . . . because of a lack of effective competition . . . . The lottery system leads to even worse outcomes when potential providers are uncertain about their costs, testing standards and potential demand. Because the costs of entry are low due to the structure of the bond and the low filing fees, this becomes much like the old lottery ad where “all you need is a dollar and a dream.” The lottery is likely to be flooded with inefficient producers. The best case scenario is that these providers become weak competitors who do little to discipline pricing. The worst case scenario is that they have underestimated their costs and rapidly go bankrupt, leaving a void in their territory and reducing competition across the state. (CF Ex. VI -20 pp. 1-2). According to Dr. Cooper, the proposed rules also promote collusion among providers, which can artificially restrict competition and consumer access to the product: The preceding assumes that the five providers are acting independently and competing prices down. Matters become far worse if the 25% rule is in place, [proposed rule 64.001(1)][2/] as this makes it relatively easy for providers to collude. The worst case scenario is that 75% of each provider is held by an outside entity. At this point, providers have little incentive to undercut the prices of other competitors as they are essentially robbing profits from themselves . . . . This once again reduces their incentives to compete (Id. p.2) And the proposed rules discourage competition in product quality: The adherence to a quality threshold to qualify for the lottery is potentially harmful as well. With no incentive to provide anything other than minimum acceptable quality, there is little reason for providers to research methods of improving quality or to invest in equipment to improve their quality . . . . It is safe to assume that efficient providers not only have lower costs for minimal quality, but also have better capability to provide high quality at a reasonable cost. By randomly tossing these providers out of the market, it becomes less likely that high quality will be provided even if consumers might be willing to pay more for access to a higher quality product. (Id. p.2) Dr. Cooper concluded that the proposed lottery rule, alone and in combination with other proposed rules, will not promote consumers’ access to the medication: [I]f potential providers with efficient operations (i.e. low costs, ability to provide high quality) are given no advantage in entering the market, the likely outcome is lack of competition and low access to a needed medication. (Id. p.2) Using standard economic analysis, Dr. Cooper testified that the Department should want five efficient low-cost providers that are financially stable, willing and able to compete statewide on price and quality; but that the proposed lottery rule and related rules enlarging the lottery pool (such as no application fee and limited performance bond) will encourage inefficient nurseries to apply, and encourage more efficient nurseries to offer less competitive proposals than they would if selection were based on competitive review of the merits. He explained the dangers arising from rules relating to applicants’ ownership or financial control structure that permit and encourage providers to have common ownership and to collude as to price, which can reduce consumers’ access to the product, or to collude by territorial allocation if providers decline to compete in one another’s regions. The price that patients must pay for the low-THC cannabis is a factor in accessibility, particularly as insurance does not cover this medication. The uncertainty over whether the five chosen suppliers will be able to meet demand for the product magnifies concerns over access and price. Ms. McMullen was uncertain that the five dispensing organizations will be able to supply enough product to meet the need of eligible patients, noting there is a waiting list for this product in Colorado. She assumed that dispensing organizations will expand to meet whatever demand arises. Even so, a dispensing organization may fail to produce an adequate or timely supply, and shortages can occur without warning if a product batch fails testing. Moreover, the proposed rules require destruction of all inventory if a license is revoked or a dispensing organization does not stay in business. None of the proposed rules require applicants to show ability to cover any particular number of patients or any increase in number, or to cover patients in other regions in the event one or more other regional dispensing organizations cannot meet all needs in that region or cannot perform at all. Ms. McMullen confirmed that nothing in the rules prevents collusive applications in which one nursery or one out- of-state investor owns 75% of all applicants. For its part, the Department believes lottery selection is appropriate because applicants may propose different approaches to producing medical cannabis, and it is difficult for the Department to adopt uniform standards to evaluate all approaches. Ms. Tschetter and Ms. McMullen both expressed an opinion that all applicants who pass general standards in the proposed rules are equally qualified, using variations on the phrase, “different but not better” and “they are all great . . . just different”. The undersigned rejects as non-credible the proposition that all applicants who meet the minimum initial application requirements set forth in rule 64-4.002 are equally qualified to cultivate, process, and dispense low-THC cannabis. Rather, many of the general statutory criteria – e.g., the applicant’s security and safety plan, inventory control plan, location and transportation plan, and financial ability – can be compared on the merits using ordinary business judgment without special knowledge of technical methods of production or preference for any one technical approach. While the Department’s present inexperience in technical program areas may make comparison more difficult, it can avail itself of expert assistance to determine which applicants have superior programs and the best chance of success. Without the lottery system for choosing dispensing organizations, one of the Department’s concerns is that the selection process would be drawn out into an extended review period followed by legal challenges to the ultimate selection. Thus, the Department’s objective is to establish a regulatory structure that neither invites litigation nor prolongs the process. The Department concluded that the lottery system would provide the fairest way to choose among qualified applicants, and would provide the best mechanism to get the medicine to patients as quickly as possible. The Initial Application Fee Proposed rule 64-4.002(4)(b) requires only the five chosen applicants to pay the $150,000.00 application fee; all other applicants who are not selected are not to be charged anything. JAPC asked the Department to explain why, when the statute requires an initial application fee, the proposed rule imposes an application fee only after applicants are selected? Ms. Tschetter responded that she believed it was reasonable to impose the initial application fee as a post-approval condition since the Legislature made the performance bond a post-approval condition. Ms. Tschetter’s rationale in this regard is rejected inasmuch as the initial application fee to cover the Department’s regulatory costs has no logical connection to the $5 million performance bond. The Performance Bond Section 381.986(5)(b)5. requires each dispensing organization to post a $5 million performance bond, with no limiting condition. Yet proposed rule 64-4.002(2)(j) limits the condition of the performance bond to the expense of destroying low-THC cannabis inventory if the dispensing organization fails to perform or fails to destroy its inventory when required. The performance bond will not guarantee performance or cover costs of default or increased cost to patients. Ms. Tschetter candidly acknowledged that she was uncertain as to why the Legislature chose to require a $5 million performance bond, particularly in light of other states’ bond requirements which are as low as $10,000.00. The Department’s reason for proposing a rule to limit this bond is that it did not want to force anyone to deliver these services, and that it seemed “illogical” and “unnecessary” to do so because, if one dispensary defaults, the Department can appoint a successor, or consumers can just look to one of the other regional dispensing organizations to fill their prescriptions. The Department’s reasoning ignores the potential that there will be significant delays in appointing a new dispensing organization and having it become operational. In the meantime, other regional dispensing organizations may elect not to serve that territory, or do so only at an increased price.
The Issue Should discipline be imposed against Respondent's license as a limited surety agent for violation of Section 648.45(2)(a) (e), and (k), Florida Statutes (2006)?
Findings Of Fact On January 6, 2003, DFS issued Respondent a series 2-34 limited surety agent (bail bond) license. That license remains valid. On May 3, 2006, in State of Florida vs. Vincent Lamone Addison, in the Circuit Court, 14th Judicial Circuit of the State of Florida, in and for Gulf County, Case No. 06-0107CF, Respondent was charged by information with: Count I, Possession with intent to sell/deliver within 1000 feet of place of worship or convenience business; Count II, Possession of marijuana in excess of 20 grams, offenses contrary to Section 893.13, Florida Statutes (2005), third degree felonies. In the same information, in Count III, it was charged that he did obstruct (an) officer without violence, a violation of Section 843.02, Florida Statutes (2005), a first degree misdemeanor. On December 18, 2006, the assistant state attorney in Circuit Court Case No. 06-107CF, filed a Motion to Consolidate, asking that the Court enter an order consolidating the count for possession of a controlled substance with intent to deliver, with the count related to possession of more than 20 grams of marijuana. On December 19, 2006, in Circuit Court Case No. 06- 107CF, a Plea, Waiver and Consent was signed by Respondent as defendant in that case, attested by his counsel and the assistant state attorney, and found by the Circuit Court Judge to be a plea freely and voluntarily made and sworn to and subscribed before the court and approved and accepted by the court related to possession of marijuana, a third degree felony with a statutory maximum imprisonment of five years. The plea was made upon the agreement that the adjudication be withheld, with service of three-years' probation, to terminate after 18 months if all conditions were complete and no violations of the probation had occurred. In addition, by order of the Circuit Court Judge, certain charges/costs/fees were imposed in Circuit Court Case No. 06-107CF. When Respondent executed his Plea, Waiver and Consent in Circuit Court Case No. 06-107CF, it reflected that the charge of "Obstruct officer without violence" had been stricken by line and initials provided, by what appears to be the defense counsel and the assistant state attorney in the case. In Circuit Court Case No. 06-107CF, as reflected in an order by the Circuit Court Judge referring to those proceedings, entered December 19, 2006, upon his appearance before the Court with representation, it indicates a plea of nolo contendere was entered. It pertained to Count I. On the form order, it refers to "Sales/Del/Poss/cannis-w/in-100Ft. Church 893.13(1)(a) 3F." Under that reference is found "Poss. Marijuana in Excess 20 grs. 893.13(6)(a) 3F". The numbers refer to Section 893.13(1)(a) and (6)(a), Florida Statutes (2005), and "3F" refers to third degree felony. In this order it was reflected that the adjudication of guilt was withheld, and that the defendant received three-years' probation, to terminate after 18 months upon satisfaction of conditions of probation. The court order refers to fees required by the court to satisfy its terms for accepting the plea. On December 21, 2006, in Circuit Court Case No. 06- 107CF, the Circuit Court Judge entered an Order Withholding Adjudication of Guilt and Placing Defendant on probation. In this order it reflects entry of a plea of nolo contendere to the offense of "Possession of more than 20 grams, 3rd-Degree Felony," for which the Respondent received three years of probation. Other conditions of the probation were reflected in this order, to include the costs and fees imposed by the Court. On January 12, 2007, precisely the same order was entered by the Circuit Court Judge. In addition to the nolo contendere plea in Circuit Court Case No. 06-107CF, Respondent in his testimony at hearing in the present case, acknowledged that the drug offense took place in Port St. Joe, Florida. He was arrested on April 21, 2006. Respondent did not contest the charges because marijuana was found on the console of his car and some was in his front pocket. Respondent's understanding of his nolo contendere plea was that it was to possession of marijuana exceeding 20 grams. The amount was somewhere in the range of 118 to 120 grams. In the present case, Respondent through his testimony, explained that he had been diagnosed with lupus and that he smoked marijuana to help his body function while confronting his disease. Respondent is aware that possession of marijuana in Florida is illegal, even if intended for the purpose he had in mind to provide him relief from the pain of lupus. Respondent is not acting in the capacity of a bail bond agent at this time. That loss of income has had significant impact on his earning capacity. Mr. Tynalin Smiley, who resides in Port St. Joe where the Respondent lives, has known the Respondent from the time Respondent was born. They are good friends. Mr. Smiley belongs to the same church as Respondent. He visits in Respondent's home at times. He believes that Respondent is a respectable person in the community. Mr. Robert Humphrey, who resides in Dothan, Alabama, met Respondent in 1996 when Respondent did an internship from Troy State University. Mr. Humphrey and Respondent worked in the area of juvenile justice, going into schools and providing counseling to students. Over the years Mr. Humphrey has kept in contact with Respondent. Occasionally Mr. Humphrey and Respondent are together socially. They go out to dinner. Respondent has attended Mr. Humphrey's church. Mr. Humphrey looks upon himself as being a big brother to Respondent. Mr. Humphrey has observed that Respondent remains active in the Respondent's community. Mr. Humphrey believes that Respondent regrets his choice that led to the action against him, that involving the marijuana possession that has been discussed.
Recommendation Upon consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That a final order be entered Respondent in violation of Section 648.45(2)(a), (e) and (k), Florida Statutes (2006) and revoking Respondent's limited surety agent (bail bond) license. DONE AND ENTERED this 27th day of July, 2007, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS 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 27th day of July, 2007. COPIES FURNISHED: William Gautier Kitchen, Esquire Gregg Marr, Esquire Department of Financial Services Division of Legal Services 200 East Gaines Street Tallahassee, Florida 32399-0333 Vincent Lamone Addition Post Office Box 483 Port St. Joe, Florida 32457 Honorable Alex Sink Chief Financial Officer Department of Financial Services The Capitol, Level 11 Tallahassee, Florida 32399-0300 Daniel Sumner, General Counsel Department of Financial Services The capitol, Level 11 Tallahassee, Florida 32399-0307
The Issue Whether Petitioner is subject to the sales tax imposed on controlled substances by s. 212.0505, Florida Statutes, and if so, what is the appropriate tax.
Findings Of Fact On September 12, 1989, a search and destroy team assembled in Sebring, Florida, to survey Highlands County for evidence of the growing or possession of illegal drugs. The survey team consisted of a helicopter, pilot and crew chief from the Florida National Guard; and the ground crew of representatives from the Highlands County Sheriff's Office, State Highway Patrol, Fish and Game Commission, Florida Law Enforcement Officers and federal agents. The search commenced in the southwest quadrant of Highlands County with the helicopter and trained spotters flying a search pattern so as to view from the air any illegal substances being grown. On one, if not the first, leg of the search pattern, the helicopter, flying at an altitude of 500 feet, passed over the property on which Petitioner lives; and one of the observers spotted what he identified as marijuana growing near one of the outbuildings on this property. The marijuana patch was circled for both spotters as well as the pilot and crew to better see the growing marijuana. The ground party was alerted by radio of the find. They proceeded to the location and entered onto the property. There they met Petitioner, proceeded to the area where the marijuana was growing, and cut down the marijuana plants. Some 171 cut plants were counted, wrapped in bundles of approximately 10 plants each, and loaded into the back of a pickup truck. The deputies asked Petitioner if he would unlock the building next to where the marijuana plants were growing and he, knowing they could get a search warrant if necessary, unlocked the door. Inside they found some lights obtained for the purpose of growing marijuana indoors and other material listed on Exhibit 3A, all of which were confiscated. Petitioner was placed under arrest and the marijuana and other property seized was taken to the sheriff's office. The vehicle carrying the marijuana was weighed before the marijuana was unloaded and again immediately following the unloading. The difference in the weight of the vehicle with and without the marijuana was 450 pounds. Subsequent thereto, someone from either the sheriff's office or the Florida Department of Law Enforcement advised the Department of Revenue Collections and Enforcement agent in Lakeland, Florida, and the Notice of Assessment was prepared and served on Petitioner. To establish the value of the marijuana seized, the agent preparing the assessment used information received from the FDLE that the average street price in the district in which the marijuana was seized was $600 per pound in 1989. The document containing this information was admitted into evidence as Exhibit 6 after testimony was presented that each year the FDLE directs its five regional offices to submit street prices for various illegal drugs sold on the streets during that year. Exhibit 6 shows the marijuana street price at $600 per pound in the Tampa district (which includes Highlands County) as of June 7, 1989. To obtain the estimated retail price of the marijuana seized, the agent multiplied $600 per pound by 450 pounds. This price is for marijuana which has been processed and is ready for use. No evidence was submitted showing what parts of the marijuana plant are used in preparing the marijuana rolled into "joints" or smoked in a pipe. Nor was evidence presented showing how many pounds of processed and ready-to-use marijuana can be obtained from a given number of pounds of growing marijuana plants. In his testimony, Petitioner readily admitted that he had planted and cultivated the marijuana seized on September 12, 1989. He also testified that this is the first and only time he has ever attempted to grow marijuana; that he obtained the marijuana seeds and a book on how to grow marijuana from an advertisement in a magazine; that he had never sold marijuana in the past; that he had made no effort to locate a purchaser; or that he had any inkling of how to find a buyer for the plants after they were harvested or how much such plants were worth for use by marijuana users. Petitioner also testified the marijuana was planted a long distance from the nearest traveled road and from the nearest boundary of Petitioner's property; and that there was a canopy provided by trees among which he had planted the marijuana plants, and he didn't think the plants would be readily visible from the air. Petitioner's testimony that the helicopter passed over his property at tree top level, which he estimated at less than 75 feet, is rejected as being in conflict with the altimeter height provided by the helicopter pilot. In the U. S. District Court, Southern District of Florida, Petitioner pleaded guilty to possession of more than 100 marijuana plants.
Recommendation It is recommended that the assessment against Joe "Little Joe" Hatch of $270,999.02 plus interest from September 12, 1989, be dismissed. ENTERED this 26th day of March, 1990, in Tallahassee, Florida. K. N. AYERS Hearing Officer Division of Administrative Hearings The Desoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 26th day of March, 1990. APPENDIX Respondent's proposed findings are generally accepted and included in the Hearing Officer's findings of fact, except the following which are rejected. 12-18. Accepted as street value of processed marijuana. 26. Last sentence rejected as contrary to the record that the charge was possession of over 100 marijuana plants. Petitioner failed to timely submit a proposed recommended order. COPIES FURNISHED: Raymond E. LaPorte, Esquire 410 Ware Boulevard, Suite 601 Tampa, FL 33619 Steve Kackley, Esquire 357 S. Orange Avenue Sebring, FL 33870 Lee R. Rohe, Esquire Assistant Attorney General Tax Section, Capitol Building Tallahassee, FL 32399-1050 William D. Moore General Counsel Department of Revenue 203 Carlton Building Tallahassee, FL 32399-0100 Executive Director Department of Revenue 104 Carlton Building Tallahassee, FL 32399-0100 =================================================================
The Issue The issues presented for resolution in this proceeding concern whether the Respondent's alcoholic beverage licensure should be subjected to disciplinary sanctions because of alleged misconduct involving the sale and use of controlled substances on a licensed premises, more specifically delineated in the Notice to Show Cause filed in this proceeding by Petitioner.
Findings Of Fact The Respondent, JIMMIE WILLIAMS, owns the club or tavern known as the "Copa Cabana", doing business at 2901 North Haynes Street, Pensacola, Florida. That establishment holds a Series 2-COP alcoholic beverage license number 27- 00239, authorizing the sale of beer and wine on the premises. The Respondent is the sole owner of the Copa Cabana. Burnett Patterson, at times pertinent hereto, during September 1988 through February 1989, was a patrol deputy with the Okaloosa County Sheriff's Department. While a deputy with that Department, he engaged in special drug investigations. During the course of this employment, he became involved in numerous undercover operations designed to curb traffic and use of controlled substances. He thus became familiar with the appearance, properties and paraphernalia associated with crack cocaine and marijuana. On September 2, 1988, he met with Law Enforcement Investigator, Paul Blackmon, of the DABT. Investigator Blackmon asked Deputy Patterson to assist in a drug investigation of the Copa Cabana. At approximately 8:00 p.m. on that date, Deputy Patterson entered the Copa Cabana licensed premises in an undercover capacity. While in the licensed premises, inside the Copa Cabana, he observed patrons of that establishment openly smoking marijuana and crack cocaine. He observed one black male patron walking around inside the licensed premises holding a piece of crack cocaine visibly in his front teeth in order to advertise it for sale. This activity was done in the presence of the licensee/Respondent, Jimmie Williams. The undercover agent further observed numerous persons selling marijuana and cocaine inside, as well as outside the licensed premises. These persons made no attempt to conceal their illegal actions. It has not been demonstrated who owned or controlled the grounds immediately outside the door of the licensed premises. On September 16, 1988, at approximately 8:15 p.m., Deputy Patterson again entered the licensed premised in an undercover capacity. Upon entering the licensed premises, he observed 15 to 20 patrons inside and observed the Respondent working at the bar. Deputy Patterson went to the restroom inside the Copa Cabana and observed two black males cutting crack cocaine into small pieces, mixing them with marijuana, and rolling the resulting material into cigarettes or "joints" for smoking. Deputy Patterson purchased one piece of crack cocaine for $20.00 from a patron known as William Barker while inside the restroom. While inside the licensed premises, Deputy Patterson observed patrons openly smoking crack cocaine and marijuana. He was approached by other patrons, who asked if he wanted to purchase controlled substances. The substance purchased was analyzed and tested positive for cocaine. On September 19, 1988, at approximately 7:40 p.m., Deputy Patterson again entered the licensed premises in an undercover capacity. Upon entering, he made contact with patron, Jerry Green, who was accompanied by a patron known as "Killer." Deputy Patterson purchased one "baggie" of marijuana for $10.00 from "Killer." This transaction, along with the open smoking of marijuana, took place in the presence of the Respondent. Deputy Patterson also observed numerous controlled substance transactions taking place outside and near the entrance of the licensed premises. The substance he purchased was analyzed and proved to be marijuana. On September 24, 1988, at approximately 3:30 p.m., Deputy Patterson again entered the license's premises. He observed several patrons entering and exiting the restroom area. He entered the restroom and made contact with patron, John Butler. John Butler asked Deputy Patterson what he was looking for, and the Deputy replied "crack." Deputy Patterson was sold one piece of crack cocaine by John Butler and another unknown patron for $20.00. Deputy Patterson observed several patrons entering the restroom and purchasing crack cocaine. Jimmie Williams was inside the licensed premises during the time Deputy Patterson was present and making these observations. Deputy Patterson further observed several narcotic transactions outside the front entrance of the licensed premised. The substance purchased by Deputy Patterson was analyzed and tested as positive for the presence of cocaine. On October 8, 1988, at approximately 4:10 p.m., Deputy Patterson again entered the licensed premises in an undercover capacity. Prior to entering, he was asked by several patrons loitering near the entrance of the Copa Cabana if he wanted to purchase controlled substances. Once inside the licensed premises, he entered the restroom, where he made contact with patron, Calvin Black. Deputy Patterson purchased one piece of crack cocaine from Calvin Black for $20.00. Deputy Patterson then departed the restroom and observed patrons openly smoking marijuana while playing pool. Deputy Patterson contacted patron, Terry Boutwell, by the pool table. Terry Boutwell sold Deputy Patterson one baggie of marijuana for $10.00 at that location. Upon leaving the building, Deputy Patterson was again approached by persons outside the entrance to the Copa Cabana and asked if he wanted to purchase controlled substances. During all of the aforementioned events, including the sale of marijuana and the smoking of marijuana in the vicinity of the pool table, the Respondent was inside the licensed premises. Both the substance purchased from Calvin Black and that purchased from' Terry Boutwell were subsequently analyzed and proved to be controlled substances. On January 28, 1989, at approximately 5:00 p.m, a confidential informant, Alonzo Blackman, was designated to conduct a controlled substance purchase inside the licensed premises from the licensee, Jimmie Williams. The confidential informant was given specific instructions to buy only from Williams. Prior to departing the Sheriff's Department, he was thoroughly searched. It was determined that he had no controlled substances or money on his person. He was provided with a concealed, wireless voice transmitter. He was also given $50.00 of the Sheriff's Department's money for the purpose of purchasing crack cocaine. Subsequently, the confidential informant departed the Sheriff's Department with Deputy Gwen Salter. The pair was followed and traced by Escambia County Sheriff's Deputy Mark Shaeffer. Deputy Shaeffer was equipped with a radio receiver and monitored transmissions emitted from Alonzo Blackman's transmitter. Deputy Shaeffer observed Alonzo Blackman park behind the Copa Cabana to the rear of the building on a back street and depart Deputy Salter's vehicle. He observed Alonzo Blackman walk through the wooded area behind the Copa Cabana and disappear around the side of the building, moving toward the front of the Copa Cabana building. After Alonzo Blackman was out of sight around the corner of the Copa Cabana building, Deputy Shaeffer could hear normal outdoor sounds, as well as Alonzo Blackman's footsteps through the transmitter. Shortly thereafter, he heard the sound of a juke box playing and loud voices consistent with the noises one would expect when a person entered a bar. Within two or three minutes thereafter, Deputy Schaeffer observed Alonzo Blackman come back in sight around the corner of the licensed premises and enter Deputy Salter's vehicle. Deputy Schaeffer followed the two back to the Sheriff's Department, keeping Alonzo Blackman in visual sight the entire time. When Alonzo Blackman and Deputy Salter returned to the Sheriff's Department, Alonzo Blackman presented Deputy Schaeffer with a slab of rock cocaine and no longer had the $50.00 given to him by the Sheriff's Department. Subsequently, the substance purchased was analyzed and tested positive for the presence of cocaine. The Petitioner adduced a hearsay statement from Deputy Schaeffer to the effect that Alonzo Blackman had told him that he had purchased the rock cocaine in question from the Respondent. That statement was not admitted into evidence since it was not corroborative hearsay for the purposes of Section 120.58, Florida Statutes. The hearsay statement concerning the alleged purchase from the Respondent is not corroborative of the testimony concerning the other independent events in question in this proceeding involving the sale and use of controlled substances on the licensed premises by others. The only testimony or evidence directly concerning the alleged purchase of cocaine from the Respondent was that related by confidential informant, Blackman, to Deputy Schaeffer. The only other evidence purporting to show that the Respondent sold a slab of rock cocaine was the testimony by Deputy Schaeffer revealing what he saw and heard over his radio receiver. All he saw was Alonzo Blackman passing around the side of the building aid later returning around the back corner of the building. He heard his footsteps as he passed around and presumably entered the building, judging from the change in sounds received. There was no evidence that any voices or other noises transmitted to Deputy Schaeffer's listening station consisted of the actual drug transaction and specifically that any of the voices or sounds he might have heard were those of the Respondent in conducting that transaction. Since Deputy Schaeffer's testimony, itself, does not implicate the Respondent in selling the drug, the hearsay statement of the confidential informant, Alonzo Blackman, who could not be located at the time of the hearing, cannot be admissible corroborative hearsay. Thus, it was not established that on this occasion, the slab of rock cocaine was actually purchased from the Respondent. On February 8, 1989, at approximately 5:00 p.m., Alonzo Blackman was again designated to conduct a controlled substance purchase inside the Copa Cabana from the Respondent. He was given the same specific instructions, and Deputy Schaeffer made the same visual and auditory observations as he had with regard to the alleged transaction of January 28, 989. The same factual findings apply, and are made, with regard to this transaction as were made above concerning the January 28, 1989 transaction. The alleged fact that the purchase was made from Jimmie Williams was again predicated on the hearsay statement of Blackman, which was not corroborative and was uncorroborated. It cannot be used to support a finding that the Respondent sold the cocaine in question. On February 7, 1989, at approximately 8:00 p.m., Escambia County Investigators, Tyron Wicks, Melvin Possey and J. Johnson, conducted a "routine drug sweep" of the Copa Cabana. This type of operation was a routine matter for Investigator Wicks in the six months prior to February 7, 1989. Upon entering the licensed premises, Investigator Wicks went directly to the men's restroom where he observed four patrons having a conversation while looking into a paper bag. Investigator Wicks seized the paper bag which contained nine plastic baggies of marijuana ready for distribution and charged him with possession of 20 grams of marijuana with the intent to distribute. Investigator Wicks is familiar with the smell of marijuana smoke; and during "drug sweeps" conducted in the licensed premises, estimated to be 20 or 30 such operations for the previous six months, he smelled such smoke in the licensed premises on a number of occasions. On these occasions, he had also found marijuana and crack and razor blades, as well as pipes and cans used for smoking crack, on the floor of the licensed premises. He has seen people buy drugs at the Copa Cabana while he has been present there with the Sheriff's Department Narcotics Unit during the years 1988 and 1989. Sergeant Bobby Jackson of the Narcotics Division of the Escambia County Sheriff's Department has bean a law enforcement officer for approximately 14 years. He is familiar with the smell and appearance of marijuana and crack cocaine. He has been involved in 20 to 30 raids at the licensed premises. On at least 15 occasions, officers in his party have found controlled substances. The Respondent was always present when these raids took place. On many of the raids, Sergeant Jackson smelled the odor of marijuana smoke in the licensed premises. He is certain that the Respondent was present on these occasions. During these raids, he has observed marijuana cigarette butts on the floor of the licensed premises and has often found people inside bagging marijuana. Prior to the suspension of the beverage license on February 10, 1989, Sergeant Jackson received quite a few complaints about the licensed premises; and each time he visited it, he would observe a great number of people standing around inside and outside the licensed premises. It has been quite different since the suspension of the license and the shutdown of operations at the Copa Cabana. Sergeant Jackson has received very few complaints since February 10, 1989. Sergeant Jackson, however, never received any complaints from the Respondent about drug use in the establishment. John Green is a black male, whose mother lives approximately a block from the licensed premises. He has been a friend of the Respondent for approximately 15 years. During the period of January and February of 1989, he patronized the licensed premises six days a week, every week. He would go there after work and stay until approximately 9:00 p.m. He states that he always saw the Respondent behind the bar. John Green stated that the bar was a self- service bar where patrons could get beer out of the cooler in front of the bar and pay for it at the counter. He maintained that he had never seen Deputy Patterson and that, in his opinion, marijuana smoke smells just like Kool cigarette smoke. He drinks beer every night, including the times when he patronized the Copa Cabana. He testified under oath that he had never seen anyone use drugs in the licensed premises and that on one occasion, however, he had thrown someone out of the licensed premises for using drugs. Dorothy Mouton lives approximately six miles from the Copa Cabana and works at Washington Junior High School in an administrative capacity. She knows the Respondent, who also works there as a coach. She, in the past, has stopped at the Copa Cabana to eat a snack and converse the During the period of August of 1988 to February of 1989, she went to the Copa Cabana every week. According to Ms. Mouton, the Respondent had a stool behind the bar and would get beer from the cooler for patrons who requested beer. She claimed that she was able, by her experience, to identify marijuana smoke and crack cocaine. She maintained that she never saw any drug of either sort in the licensed premises She also testified that it was her habit to depart the licensed premises every day between 6:00 p.m. and 6:30 p.m. Chris Dortch is a 27 year old black male who has known the Respondent for a long period of time. He helped the Respondent operate the Copa Cabana when he first established it. He lives approximately four blocks from the Copa Cabana. He goes to the licensed premises every day and sometimes stays until it closes. He has always observed the Respondent staying behind the bar counter while he is on duty. This witness also claimed under oath that he had never seen any cocaine or marijuana smoked in the licensed premises and had never smelled any marijuana smoke within the licensed premises. He testified that he saw police officers in the licensed premises at least ten times, but never observed any arrests. Elizabeth Freeman lives around the corner from the licensed premises and has lived there approximately four years. During the period of September of 1988 to February 10, 1989, she went to the club every day for about an hour where she would talk to Williams and play video games. She claimed that she observed Williams, on occasion, move from behind the counter into the public area of the tavern. She also testified that she has never seen any indications of drug use on the premises. Shirley Washington was in the habit of going to the club during the period of August of 1988 to February of 1989 at approximately 4:30 p.m. and generally would stay until closing, usually around 9:00 p.m. She was a member of a social group called "The Copa Cabana Queens." It was her habit, during this period of time, to drink four to five six-packs of beer each day. She is familiar with the smell of crack cocaine smoke and marijuana smoke. She testified that she had never observed any marijuana or crack cocaine within the licensed premises. She has been a friend of the Respondent for approximately 25 years. The Respondent is an instructor and coach with the Escambia County School Board. He has owned the Copa Cabana for 15 years. It is a recreation center, lounge, notion store and meeting place. He also has live entertainment and occasionally, a fashion show. His license authorizes him to sell and serve beer and wine. He is the only employee, but Ms. Washington minds the bar for him when he is temporarily away from it (in the restroom, etc.). He testified that he never observed Deputy Patterson until the day of the hearing. He testified that no drugs had ever been in the licensed premises and that he had never dealt in drugs. The testimony of Deputies Patterson and Schaeffer, Investigator Wicks, Sergeant Jackson, and Law Enforcement Investigator Ralph Kelly, to the effect that controlled substances were openly and notoriously used and sold on the premises in question, conflicts in a general sense with the testimony of Respondent's witnesses to the effect that they never saw any marijuana or crack cocaine on the premises or smelled any and so forth. This conflict in the testimony of the witnesses of the Petitioner and Respondent must be resolved by determining which are more credible. Determining the credibility of witnesses is an important and exclusive task of the fact finder Guidelines for resolving credibility issues are provided in Volume 24, Florida Jurisprudence 2nd, Sections 688-696, and grand jury instruction 2.04 on page 779 of West's Florida Criminal Laws and Rules (1989), which sets forth areas to consider in determining whether a witness is credible. Those areas include: whether the witness had an opportunity to observe and know the things about which he testifies' whether his memory seemed accurate; whether he was straight forward in his answers; whether he was interested in the result of the case at issue; whether it is consistent with other testimony and evidence adduced; and whether he has, at some different time, made an inconsistent statement from the testimony given before the court. Firstly, concerning the testimony of John Green, it can be seen that he testified to having patronized the establishment during the period of January and February of 1989 and purported never to have seen Deputy Patterson. This is not surprising since there was no testimony by the Deputy that he was in the licensed premises during those two months. Therefore, John Green would have had no opportunity to observe Deputy Patterson at the time he frequented the licensed the premises. John Green also testified that he drank beer in the licensed premises every night and, thus, could quite likely have suffered a diminution of his powers of observation as a result of drinking beer. Dorothy Mouton maintained that she went to the Copa Cabana every week during the period of August of 1988 to February of 1989. She stated that she went there between the time she got off work until 6:00 p.m. or 6:30 p.m. Her time in the licensed premises was, therefore, very limited; and everything alleged by the Petitioner's witnesses could easily have occurred without her being on the licensed premises to observe the alleged violations. Elizabeth Freeman stated that she went to the Copa Cabana for about an hour each day during the time alleged in the Notice to Show Cause. If her testimony that she saw no drugs used on the licensed premises is accepted as true that still does not resolve the problem that the amount of time that she spent on the licensed premises was quite limited. The violations testified to by the Petitioner's witnesses could have occurred during her absence from the licensed premises. Shirley Washington claimed that she was at the Copa Cabana every day from 4:30 p.m. to approximately 9:00 p.m. during the time pertinent to the charges in the Notice to Show Cause. She also testified that she would drink four to five six-packs of beer every day. That could easily diminish her powers of observation and, no doubt, did. None of the witnesses for the Respondent could describe the events of any particular day alleged in the Notice to Show Cause. Their testimony was rather of a very general nature and not date or time-specific. On the other hand, the Petitioner's witnesses were trained law enforcement officers and observers, who kept meticulous records of their participation in the events in question and who gave detailed testimony as to the time, date and circumstances of each event that took place on the licensed premises and later became the subject of the charges in the Notice to Show Cause. There is no evidence that any of the law enforcement officers were drinking or otherwise had impaired powers of observation during the pertinent times. The Respondent's witnesses' memories and resulting testimonies appeared very general at best. Concerning the issue of whether the witnesses might have some interest in how the case should be resolved, it should be pointed out that the Respondent's witnesses were all old friends of the Respondent. John Green has been a friend of the Respondent for 15 years. Dorothy Mouton is a co-worker of the Respondent's at Washington Junior High School and must be counted as a friend of the Respondent. Chris Dortch has apparently known the Respondent since he was a small child. Elizabeth Freeman has been his friend and customer for the past four years. Shirley Washington has been the Respondent's friend for 25 years. All of these people are not only friends of the Respondent, but apparently considered the Copa Cabana a sort of favorite resort or meeting place away from home and clearly wanted to continue the benefit of the close friendly relationship. The Petitioner's witnesses, on the other hand, were professional police officers, none of whom had any relationship with the Respondent or the Copa Cabana. There was no evidence that any of the officers were somehow targeting the Respondent for special prosecution efforts. It rather appears that the events which came to light, as described in their testimony and the Notice to Show Cause, were discovered through routine police operations. Further, Deputy Patterson testified concerning the issue of whether the Respondent exhibited proper diligence in supervising and maintaining surveillance over the licensed premises. He stated that when the Respondent sold' a beer, he would do so by receiving the money for the beer and then moving outside of the bar to the cooler, kept in the room near the bar, to obtain the beer and give it to the customer. The Respondent's witnesses, however, addressed this matter with differing testimony. John Green, stated that customers would get the beer themselves from the cooler and then go to the counter to pay for it. Dorothy Mouton stated that the Respondent would get the beer from the cooler himself, which required him to walk outside the area behind the bar into the area of the room, in which the bar was located, to the cooler, which would allow him to view the rear room and restroom area of the licensed premises. Chris Dortch testified that the Respondent stayed behind the counter during beer sales. Elizabeth Freeman stated that she had observed the Respondent move from behind the counter into the open area of the licensed premises in the act of getting a beer for a customer. Thus, the Respondent's witnesses' testimony as to this question was inconsistent in terms of rebutting the testimony of Deputy Patterson as to the manner in which beverages were sold by the Respondent, as that relates to the Respondent's physical position in the licensed premises and ability to see what activities transpired in the rear room, the area of the restroom entrance and the pool table. In any event, the foregoing analysis reveals that the testimony of the Petitioner's witnesses is more credible. It is concluded that that of the Respondent's witness, and the Respondent himself, show a lack of knowledge, clear memory, and consistency, at best, without reaching the question of whether any of the Respondent's witnesses deliberately falsified their testimony. Accordingly, the testimony of the Petitioner's witnesses, to the extent that it conflicts with that of the Respondent's witnesses, is accepted as more credible.
Recommendation Having considered the foregoing Findings of Fact and Conclusions of Law, the competent, credible evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is, therefore, RECOMMENDED: That the Respondent, JIMMIE WILLIAMS, d/b/a Copa Cabana, be found guilty of the offenses set forth in Counts II and III of the Notice to Show Cause. It is further recommended that Count I of the Notice to Show Cause be dismissed. It is further recommended that the alcoholic beverage license held by the Respondent be revoked and that a civil penalty of $2,000.00 be assessed against the Respondent. DONE AND ENTERED this 26th day of January, 1990, in Tallahassee, Leon County, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 26th day of January, 1991. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 89-719 Petitioner's Proposed Findings of Fact 1.-6. Accepted. Accepted, but not as probative of the ultimate fact of the sale of rock cocaine by the Respondent, himself. Accepted, but not as probative of the ultimate fact of the sale of rock cocaine by the Respondent, himself. Accepted. Accepted. Accepted, but not as probative of any material issue presented for adjudication. 12.-16. Accepted, in that these proposed findings of fact describe the testimony of these witnesses. However, these witnesses have been determined to be not credible. 17. Accepted, to the extent that it is arc accurate description of the Respondent's testimony. Respondent's Proposed Findings of Fact 1.-4. Accepted. Accepted. Rejected, as subordinate to the Hearing Officer's findings of fact on the subject matter and as not Entirely in accordance with the clear and convincing evidence. 7.-9. Rejected, as subordinate to the Hearing Officer's findings of fact on the subject matter and hot in accordance with the clear and convincing evidence. Rejected, as not materially dispositive of the issues presented. Rejected, as subordinate to the Hearing Officer's findings of fact on the subject matter and not, itself, materially dispositive. Rejected, as not, .in itself, materially dispositive. Accepted, in part, but the evidence in this case does not delineate the extent of the premises owned or controlled by the Respondent, and to that extent, it is rejected. Rejected, as subordinate to tide Hearing Officer's findings of fact on the subject matter and as to it's purported material import. Rejected, as to its material import in relation to the remainder of Deputy Patterson's testimony. Rejected, as contrary to the clear and convincing evidence. Rejected, as subordinate to the Hearing Officer's findings of fact on the subject matter and not in accordance with the clear and convincing evidence. Rejected, as subordinate to the Hearing Officer's findings of fact on the subject matter. Rejected, as subordinate to the Hearing Officer's findings of fact on the subject matter and not being an accurate reflection of the overall sense of the witnesses' testimonies. Rejected, as subordinate to the Hearing Officer's findings of fact on the subject matter. Rejected, as being contrary to the greater weight of the clear and convincing evidence. Accepted, but not, itself, dispositive of material issues presented, except to the extent that it has not been proven that the Respondent, himself, offered any drugs for sale. Accepted. Rejected, as subordinate to the Hearing Officer's findings of fact on the subject matter and as not being, itself, dispositive of material issues presented. Rejected, as immaterial. Even if this is true, it does not overcome proof that the Copa Cabana club's operations constitute a nuisance. COPIES FURNISHED: Harry Hooper, Esq. Deputy General Counsel Department of Business Regulation 725 South Bronough Street Tallahassee, FL 32399-1007 Leo A. Thomas, Esq. Levin, Middlebrooks, Mabie, Thomas, Mayes & Mitchell, P.A. P.O. Box 12308 Pensacola, FL 32581 Leonard Ivey, Director Department Of Business Regulation The Johns Building 725 South Bronough Street Tallahassee, FL 32399-1000
The Issue Whether or not the Department of Revenue has accurately and appropriately assessed Petitioner tax, penalty, and interest for unlawful production of marijuana.
Findings Of Fact During 1988, Petitioner cultivated a patch of marijuana located in abandoned phosphate pits in Loncala, northwest Marion County. On or about September 16, 1988 Investigator Glenn Hurst of the Ocala Police Department discovered and seized the marijuana referred to above. The marijuana seized by Officer Hurst ranged in height from approximately twelve to fourteen feet. The marijuana seized covered a tract of four acres within the above- described land. The seized marijuana when weighed by Officer Hurst weighed 2,910 pounds. The marijuana, when seized, was cut off at the base of each plant with a machete so that the roots were not seized with the plants themselves. The property where the marijuana was seized was under lease to one Sammy Long of Sumter County. At the time of seizure of the subject marijuana, the property under lease to Sammy Long was owned by one Stanley Cowherd of Planters Boulevard, Boca Raton. The property under lease to Sammy Long was being utilized by him for the grazing of cattle. Fred Brown, a longtime friend of Petitioner and of Sammy Long, assisted Petitioner in the cultivation of the subject marijuana. Kim Nixon, or Kim Mixon, was also involved in the cultivation of the subject marijuana with Petitioner and Fred Brown. In early August of 1988, Fred Brown moved a small trailer onto the Cowherd/Long property and lived in it during August and during the fall. The trailer was located approximately a mile from the marijuana patch. There were two electric meters on the property. One of the electric meters served a well pump used to pump water into a cattle trough. The meter and pole were located within several feet of Brown's trailer. The meter was already active when Brown brought in his trailer. The other electric meter and pole were located close to the marijuana patch. The meter served a pump for watering the marijuana patch. The electric meter near the patch had been inactive until March 30, 1988 when Petitioner applied for an electric meter from the Sumter Electric Cooperative (SEC). Petitioner did not have any cattle grazing on the subject property either before or after he applied for the meter. Fred Brown did not have any cattle grazing on the subject property either before or after Petitioner applied for the electric meter. When Officer Hurst arrived at the marijuana patch on September 16, 1988, he found that the meter Petitioner activated served a pump which was connected to an underground sprinkler system. The underground sprinkler system was located within the subject marijuana patch. On the same date, Officer Hurst found an old water trough near the meter activated by Petitioner, but the trough water was stagnant. Thus, Petitioner had not used the meter to fill the trough near the marijuana patch. Petitioner's fingerprints were found on the original of the electric meter application. The fingerprints of Fred Brown were also found on the original of the same application. On April 26, 1986, Petitioner was arrested for cocaine possession. Fred Brown was arrested on August 15, 1985 for possession of marijuana over 20 grams. Petitioner had hunted doves during the 1980's on the Cowherd/Long property and was familiar with the property prior to the September 1988 seizure of the subject marijuana. Fred Brown had also hunted and been familiar with the same property prior to the September 1988 seizure. Petitioner was responsible for cultivating the subject marijuana seized on September 16, 1988 by Officer Hurst. Pursuant to Section 212.0505 F.S., the estimated retail value of the subject marijuana is $244,300.00 as stated on the Revised Assessment dated March 27, 1990, which was introduced as the Department of Revenue's sole exhibit. The Revised Assessment was sent to Petitioner's former attorney, Ed Scott, on March 27, 1990 and received by him on March 30, 1990. The retail price estimated by the Respondent was based upon 12% of the total marijuana weight of 2,910 pounds. The factor of 12% represented that portion of the marijuana plants which is considered, by the Department, as usable for consumption after processing of the plants. The Revised Assessment is mathematically correct. The Revised Assessment is legally valid. Per the Revised Assessment, the 20% tax was imposed upon the estimated retail value to arrive at a base tax of $48,860.00. Per the testimony of Kevin Jackson, the total amount of tax owed by Petitioner to the Department of Revenue amounts to $94,450.42, including penalties and interest, as of March 27, 1990. No surcharge was applicable in this case. Interest on the above amount continues to accrue at a rate of $16.06 per day, making the total as of the date of formal hearing $100,215.96. (TR-12- 13) The Revised Assessment is prima facie correct in these proceedings. It is noted that all of Petitioner's "admissions," upon which many of the foregoing findings of fact were based, were couched in terms of "marijuana," which is not named in any applicable statute. (The genus "cannabis" is defined at Section 893.02 F.S. "Cannabis" is the material to be taxed under Section 212.0505(1) F.S., which statute incorporates Section 893.02 F.S. by reference.) No evidence was presented to establish that "marijuana" and "cannabis" are the same substance and the Department of Revenue made no request to officially recognize that they are one and the same. However, because of Petitioner's admissions to the prima facie correctness of the Revised Assessment, its mathematical correctness, and its legal validity against him, no further findings with regard to the nature of marijuana are necessary.
Recommendation Upon the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Department enter a Final Order upholding the Revised Assessment, assessing the Petitioner $100,215.96 as of the date of formal hearing plus statutory interest continuing to accrue from date of formal hearing. RECOMMENDED this 14th day of May, 1991, at Tallahassee, Florida. ELLA JANE P. DAVIS, 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 14th day of May, 1991. APPENDIX TO RECOMMENDED ORDER, CASE NO. 90-1589 The following constitute specific rulings pursuant to Section 120.59(2) F.S. upon the parties' respective proposed findings of fact (PFOF): Petitioner's PFOF: Petitioner submitted no PFOF. Respondent's PFOF: 1-37 Accepted as modified to more closely reflect the greater weight of the evidence as a whole. Those matters not supported by the record have been rejected as contrary to the record. COPIES FURNISHED: Lee R. Rohe Assistant Attorney General Tax Section, Capitol Building Tallahassee, Florida 32399-1050 Robert Maynard Harris 13980 S.E. 80th Avenue Summerfield, Florida 32691 J. Thomas Herndon Executive Director Department of Revenue 104 Carlton Building Tallahassee, FL 32399-0100 Vicki Weber, General Counsel Department of Revenue 204 Carlton Building Tallahassee, FL 32399-0100
Findings Of Fact Respondent David A. Avant, III, was arrested on October 16, 1989, and charged with one count of cultivation of marijuana (a third degree felony), and one count of possession of marijuana (a misdemeanor). The charges concerned one marijuana plant which was found on Avant's property by a game warden. Avant was arrested when he picked up the plant to throw it over his fence. The marijuana plant did not belong to Avant and it was not on his property with his permission. A search of Avant's truck by game wardens did not reveal any tools, buckets, etc., indicating that he was, in fact, cultivating and/or caring for the marijuana plant. Avant accepted a plea agreement offered by the State Attorney to save the money and expenses that would be required for a trial. Avant accepted the state attorney's plea agreement for reasons of economics and convenience. Avant entered a plea of nolo contedere to one felony count of cultivation of marijuana and one misdemeanor count of possession of marijuana. 1/
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered dismissing the Amended Administrative Complaint. DONE AND ENTERED this 24th day of June, 1991, in Tallahassee, Leon County, Florida. DON W. DAVIS 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 24th day of June, 1991.
Findings Of Fact At all times material to the allegations contained herein, Respondents held alcoholic beverage license No. 64-00029 for the Palatka Blue Diamond, located at 424 North 11th Street, Palatka, Florida. Alphonso S. Junious is a beverage investigator with the Fort Lauderdale office of the Division of Alcoholic Beverages and Tobacco and has been so since August 1971. [During that period of time, he has investigated seven cases for Petitioner which involved marijuana.] He has had considerable specialized training in drug identification, having been a drug and alcohol specialist while in the military, and since his discharge has taken several courses in drug identification and detection, including 80 hours training with the U.S. Drug Enforcement Agency. He is able to identify marijuana by sight and smell based not only on his formalized training and experience as an adult, but also from the fact that he used it when he was younger. On May 12, 1982, pursuant to instructions given him as a part of an investigation into Respondents' premises, he entered the Palatka Blue Diamond, went to the bar and ordered a beer. Leroy Lane and Queen Ester Simmons, whom he subsequently identified by name, were working behind the bar, selling drinks. While there, he noticed the smell of marijuana smoke and also saw people in the bar area making what appeared to him to be marijuana cigarettes. He identified them from the way they were rolled; a method consistent with what he recognized as hand-rolled marijuana cigarettes. The cigarettes were small and had crimped ends. The smokers utilizing these cigarettes were at the bar at the time in plain view of the bartenders, neither one of whom made any effort to stop this course of conduct. On May 14, 1982, he again went to the Palatka Blue Diamond and stood at the bar. The same two bartenders were there. He saw an unidentified black female sitting at the bar roll what appeared to him to be a marijuana cigarette. The paraphernalia with which she was making the cigarette was sitting out on top of the bar, and the bartenders were standing approximately 6 to 8 feet away. During the entire time he was there, he did not hear either bartender attempt to stop the young lady from making the cigarette. By the same token, he did not see her smoke it, either. He did, however, observe others smoking what appeared to be, and smelled to him like, marijuana while walking about the barroom and in the disco room. Some of these individuals could have been in view of the bartender, but the witness does not know if they were or if the bartenders in fact saw anything improper. Mr. Junious again was at the bar on May 16, 1982. At that time he observed a black male, subsequently identified to him as Luke Simmons, tending bar. Luke Simmons is Willie Lee Simmons, Jr., son of the licensee and Respondent Willie Lee Simmons. On this occasion, Officer Junious did not observe any marijuana being smoked, but he did observe Luke Simmons make sales of small manila envelopes to patrons at the bar. Junious could not hear the conversations regarding the sales and does not know what was in the envelopes sold to other people. However, somewhat later that day, he went over to Luke and asked Luke for a "nickel bag." In return, he was given a small manila envelope, folded and sealed at both ends, for which he paid $5. This bag closely resembled the bags he saw Luke Simmons sell to others. Junious did not look into the bag while on the premises, but it was subsequently turned over to the evidence custodian of the agency and thereafter properly identified as marijuana. Junious went back to the Palatka Blue Diamond on May 18, 1982, and again Luke Simmons was tending bar. Junious approached him and engaged him in general conversation. Again this evening, he saw several persons smoking what appeared to be hand-rolled marijuana cigarettes, and the smell of marijuana was prevalent both in the bar and in the disco room. Again, as in previous occasions, the individuals smoking these hand-rolled cigarettes were in plain view of the bartender had he looked, but Junious did not see or hear Luke Simmons attempt to stop any of this conduct. At approximately 9:30 that evening, Junious again approached Luke Simmons and asked for a "nickel bag" for which he paid Luke the sum of $5. In return, he got a similar manila envelope as on the previous occasion which was subsequently determined by the Florida Department of Law Enforcement crime lab in Jacksonville to contain marijuana. It was not until August 13, 1982, that Officer Junious went back to the Palatka Blue Diamond. When he entered on this occasion, he sat at the bar and ordered a beer. The bartender this time was a black female subsequently identified as Linda Simmons, who is not related to either Respondent. On this occasion, Linda Simmons was playing a card game which the witness called "Black Jack" with a black male at the bar. They appeared to be betting $1 per hand. Junious asked Linda if he could join the game and himself played two hands during which he bet on each hand and lost both times for a total of $2. Later that evening, he saw another black male subsequently identified as Rudy Swindler selling small manila envelopes similar to those he had purchased earlier in the year. He observed Linda in a conversation with Rudy and heard her try to convince him to give her three marijuana cigarettes. Rudy refused to do so, but offered to sell her a nickel bag. She did not offer to buy. Throughout this entire transaction between Swindler and Linda Simmons, at no time did Linda Simmons, acting in the capacity of an employee of the Respondent, make any effort to prevent Swindler from selling what both recognized as marijuana. Junious went back to the bar on August 26, 1982. When he entered this time, he immediately saw a black female identified as Marian MacRae and otherwise known as "Mulu," selling the similar type of manila envelope. Junious personally observed Mulu sell at least three while in the disco, but because of that location it is possible that the bartender, Linda Simmons, might not have seen her engaged in this type of conduct. This evening, Junious smelled what to him was marijuana pervading the establishment, but he cannot conclude that he actually saw anyone else smoking, selling, or in any way using that substance. When Officer Junious went into the bar again on September 3, 1982, he observed that the odor of marijuana was very heavy. Linda was the bartender along with Leroy Lane, and Junious saw people sitting at the bar smoking, as well as in other areas of the premises. The bartenders were between 4 and 6 feet away from people who were smoking. These cigarettes, smoked by these people sitting at the bar, were small, apparently hand-rolled, and twisted at the end; and Junious's training leads him to conclude that these cigarettes are usually marijuana. Another black female whose name is unknown came in and started tending bar. After this individual became the bartender, Officer Junious noticed an unidentified black male standing at the bar, selling the manila envelopes. This individual was close enough to Junious (directly opposite him) so that Junious could see what was going on. On this evening, he saw this individual make at least three sales of manila envelopes which he took from a cloth bag with a drawstrng. On this same date, there were at least five people selling these manila envelopes, including Marian MacRae, in the bar. Junious came back to the Palatka Blue Diamond on September 23, 1982. On this occasion, he did not observe anyone selling the manila envelopes, but he did see people sitting in the bar smoking what appeared to be, and smelled like marijuana. Linda Simmons and Leroy Lane were the bartenders that night, but it is quite possible that because of the fact that the smokers were in the disco, which was not readily observable from the bar, both Lane and Simmons might not have seen the smoking. However, in Junious's opinion, the smell of marijuana was so prevalent that it would have been difficult for them not to notice it. Junious again returned to the bar on September 24, 1982. As he walked up to the bar door from the outside, he saw a barbecue grill and a black male identified as "Short Man" tending the barbecue. Junious saw Short Man, otherwise identified as "Dunnell," selling the manila envelopes openly while working at the barbecue and while Junious was standing there talking to him. In fact, Junious himself bought a "nickel bag" from Dunnell, paying the $5. This bag was subsequently identified as containing marijuana. The barbecue was approximately 15 feet from the front door at the time that the sale was made. After leaving Dunnell, Junious went to his car and placed the manila envelope he had just bought inside. Then he went back to the Palatka Blue Diamond and, when he entered, he saw Marian MacRae again selling the manila envelopes both inside and outside the bar. While inside, she spent the majority of the time in the disco; and Junious later saw her seated with some other individuals smoking what appeared to be, and smelled like, marijuana. Junious noticed this when he passed her and went to sit at the next table to her, asking to buy from her a nickel bag. When he did this, she opened a black purse from which she took a small manila envelope, and he paid her the sum of $5. This envelope was subsequently identified as containing marijuana. When he came back into the bar after having put that manila envelope in the trunk of his car, he stood at the west end of the bar, from which he could see what was going on in the disco. He saw a black male, subsequently identified as "Quiller Elkins," shooting pool. This individual had a blue cloth bag with a drawstring in his pants pocket. When individuals would come up to him, he would take out the bag and make sales of small manila envelopes from it. Junious personally observed three of these sales being made before he went up to Elkins and commented on his pool skills. He also asked Elkins for a nickel bag, which he subsequently bought from Elkins for $5. This entire transaction was openly conducted, and Linda and Leroy were tending bar at the time. Because of the location of the pool table, he cannot be sure that this sale was observed. On October 15, 1982, Officer Junious went back to the Palatka Blue Diamond and found Linda Simmons and Leroy Lane again bartending. On this occasion, he observed the smoking by various people of what appeared to be, and smelled to be, marijuana, but saw no sales. The smokers were walking around inside and outside the bar, and others were inside the disco area. On no occasion did he see or hear the bartenders make any attempt to stop the patrons from smoking these cigarettes. When Junious went back to the Palatka Blue Diamond on October 22, 1982, Linda Simmons and Leroy Lane were again tending bar. On this occasion, Juniors did not see any sales of manila envelopes, but he saw people smoking what appeared to be, and smelled to be, marijuana; and again, as on previous occasions, in his opinion, the bartenders could see them smoking, but made no effort to stop them. His last visit to the Palatka Blue Diamond was on October 30, 1982, when again Linda Simmons and Leroy Lane were tending bar. On this occasion, he saw patrons smoking, but saw no sales. Again, as on previous occasions, he recognized the smell of the burning substance and the appearance of the cigarettes being smoked was that of the hand-rolled marijuana cigarette. On this occasion, while the bartenders could have seen what was going on, he does not know if, in fact, they did. In any case, no one in authority at the bar said anything about the smoking to any of the patrons. None of the cigarettes observed being smoked by Officer Junious nor the smoke, which he identified as marijuana smoke, was analyzed. However, the degree of expertise evidenced by Officer Junious, based on his experience and training, is sufficient to tip the evidentiary scale toward a finding that those hand-rolled cigarettes, which to him appeared to be marijuana cigarettes and to him smelled like marijuana cigarettes, were in fact marijuana cigarettes; and this finding is hereby made. With regard to the purchase from Quiller Elkins on September 24, 1982, Officer Junious does not know if anyone working for the Simmonses at that time saw him make that purchase or, even if they had seen the purchase made, that they would know what the purchase was. There is no evidence to establish that, in any case, Quiller Elkins was an employee of the Respondents. With regard to the purchase outside the establishment from the barbecue cook, Short Man, again Junious does not know if anyone in authority from inside the bar saw the sale being made or for that matter, if they had seen it, would know what was in the envelope. There is no evidence that Marian MacRae (Mulu) was an employee, and Officer Junious himself does not know whether she was or not. However, on the several occasions he was there, he never saw her tending bar or doing any other work there. He also cannot say that any employee of the establishment saw him make the buy from Mulu on August 26, at least. He also cannot state with any degree of certainty whether any of the employees saw him make the purchase from Rudy with regard to that purchase. This individual does not deny using marijuana with Officer Junious. While he does not recall the exact date, he states that Junious asked him if he, Rudy, knew where he could get any marijuana and he, Rudy, got it for him. They smoked it together on two separate occasions in Rudy's car. While Swindler's recitation that he smoked with Junious is somewhat suspect because of several inconsistencies, there is little doubt that he sold either directly or as an intermediary. In fact, Junious indicates Rudy was a connection with whom he, Junious, palled around while in Palatka on the investigation. He used Rudy to introduce him around in the neighborhood. Willie Lee Simmons, Sr., one of the Respondents and a longtime resident of Palatka, Florida, has been a co-owner of the Palatka Blue Diamond since 1970 or 1971, and he has had a state beverage license since that time. Though he is one of the owners of the establishment, he works there only on Sunday afternoons to tend bar, working from 5:30 in the evening until midnight for the last 7 or 8 years. During all this time, no one has ever approached him to buy marijuana; he does not smoke it himself; nor does he have any familiarity with it. He has seen people smoking there, but was under the impression that what was being smoked were cigarettes. He is in the migrant labor business, as well as a part-owner of the bar, and he recognizes many of his bar patrons as his employees in the field. These migrant workers, he says, often smoke a type of tobacco called "Bugle" tobacco, which they hand-roll into cigarettes. He feels these hand-rolled tobacco cigarettes could well be confused with marijuana cigarettes. Mr. Simmons contends he has a completely clean record in Putnam County and with the Division of Alcoholic Beverages and Tobacco. If he had had any knowledge that marijuana cigarettes were being smoked in his bar, he would have stopped it immediately, but he has never been given any indication that marijuana was a problem in his establishment. The police, who have been in his bar on many occasions, have never mentioned to him the smell of marijuana, nor have there ever been, to his knowledge, any marijuana arrests or searches conducted in his establishment prior to those set out in the Notice to Show Cause. Johnny Lee Simmons, the son of Willie Lee Simmons, is also a part- owner of the Palatka Blue Diamond. He works on Sundays during the day before his father comes on duty at night. He knows what marijuana is and has seen other people smoke it. He believes he could identify the smell of marijuana smoke. He admits that his patrons smoke in the bar. In fact, the bar sells cigarettes and cigars, as well as "Bugle" tobacco, a cheap, low-grade loose tobacco referred to by the other Mr. Simmons. On several occasions, he has stopped the smoking of what he thought was marijuana in the bar and found out that it was Bugle tobacco. When he does catch someone smoking marijuana, he immediately puts them out of the bar and, in fact, Mulu has been put out several times for trying to sell marijuana in the premises. To counter the threat of marijuana transfer, Leroy Lane was hired to keep out minors and drugs, and in this witness's opinion, has done a pretty good job of it. Mr. Simmons feels he has done a good job in exercising control over the place to keep narcotics out, but he admits that neither he nor anyone else is perfect. Sometimes he does not get it all. He contends he has contacted the police on several occasions to get help with drug traffic and gambling. He used to sell cards in the bar and has seen card games conducted there. However, when he reread the manual furnished by the Petitioner, which indicated that gambling is not appropriate or permitted, he immediately got rid of the cards; no longer sells them; and no longer permits card playing in the premises. His sister, the lady allegedly involved in the gambling transaction, is not a gambler. In his opinion, the card games she was in were probably friendly games engaged in to pass the time during the slack periods. To his recollection, the only gambling ever conducted in the Palatka Blue Diamond was carried on by old retired men who spent a lot of time there and who passed the time playing cards. These individuals got angry with him, he contends, when he stopped it The denial of the Simmonses that marijuana is frequently utilized in the Palatka Blue Diamond was supported by the testimony of John J. Melton, a Deputy sheriff with the Putnam County Sheriff's Office, who, himself, is familiar with both the appearance and the smell of marijuana and has made arrests for the possession of marijuana in the past. Officer Melton goes into the Palatka Blue Diamond frequently--three to four times a week--and has done so both on and off duty for the past three years. If he goes in while on duty, he is there for between 15 and 20 minutes; if off duty, for between three and four hours. In any case, he has never seen anyone selling the small manila envelopes when he was in there, nor has he ever seen any card playing or gambling going on. If he were to see anyone involved in any unlawful activity, he would arrest them if in uniform and on duty. If not, he would notify the manager. He does not believe that anyone would smoke in front of anyone who they knew to be a police officer. Palatka is a small town and, by his own admission, he and other police officers are well known to the general public both when in and out of uniform. Consequently, his testimony establishes only that no illegal activity went on while he was in there. These sentiments were echoed by Abraham Smith, a retired U.S. Customs agent who has a working familiarity with marijuana, its appearance, and its smell from his 32 years in Customs work. Since he moved to Palatka in May of 1982, he has been in the Palatka Blue Diamond three to four times a week for an hour or two at the time. He is familiar with the types of small manila envelopes used for the sale of small amounts of marijuana and has seen them many times, but never in the Palatka Blue Diamond. He has never smelled marijuana nor seen marijuana in that establishment. Harold Lightfoot, the salesman for the Eli Witt Tobacco Company who has been selling to the Palatka Blue Diamond for 15 years, including to the prior ownership, comes in once a week in the early afternoon. He also knows what marijuana is and can recognize the appearance and smell, but has never smelled the odor in the Palatka Blue Diamond nor ever seen any sales of manila envelopes while there. Another frequent patron is James Williams, Jr., a retired Army noncommissioned officer who has patronized the Palatka Blue Diamond daily since his retirement from the Army in June 1980. He usually goes in for several hours in midday and then for several hours in the evening. He is familiar with the appearance and smell of marijuana because of the training he received in the military and is also familiar with the small manila envelopes used in marijuana sales. To his knowledge, he has never smelled marijuana smoke in the Palatka Blue Diamond nor has he ever seen sales of small manila envelopes. Leroy Lane, the lead bartender at the Palatka Blue Diamond for the past six to nine years, lives upstairs from the bar and tends bar from early evening to closing. He has seen several marijuana cigarettes outside the bar. He is familiar with its appearance and its smell, and he has seen people in the bar start to smoke marijuana. When he observes it, he puts them out and, if they refuse to leave, calls the police. For the past three to four years, there have been signs on the wall prohibiting the use or sale of marijuana on the premises, placed there at the direction of the owners and, also at their direction, he patrols the bathrooms. Mr. Lane knows of Marian MacRae (Mulu) by reputation. At first he stated he would not know if he would recognize her if he saw her, but later indicated that she is outside the bar frequently. Because of her reputation, when she comes in the bar, he asks her to leave. He denies knowing Short Man and several other regular patrons by name because he does not ask customers their names nor does he ask them the stories of their lives. His credibility is not significant. Queen Esther Simmons, the wife of Johnny Simmons for 16 years, is also a bartender in the Palatka Blue Diamond. She swaps shifts with Linda Simmons, the sister of Johnny and the daughter of Willie Simmons. Queen Esther contends she has never seen marijuana nor has she seen any transfers of the envelopes in the bar. She claims she does not know what a marijuana cigarette is nor has anyone ever told her what they look like so she could keep them out. It is Leroy Lane's job to do that. However, never having seen nor smelled marijuana, if she smells what she thinks is marijuana, she calls out, "If anyone here is smoking marijuana, leave or I'll call the police." Queen Esther Simmons' credibility is totally lacking, and her testimony has no probative value whatsoever.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore, RECOMMENDED THAT: Respondents' alcoholic beverage license No. 64-00029 be revoked. RECOMMENDED this 19th day of June 1984, in Tallahassee, Florida. ARNOLD H. POLLOCK 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 19th day of June 1984. COPIES FURNISHED: Louisa E. Hargrett, Esquire Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Angus W. Harriett, Esquire 314 St. Johns Avenue Palatka, Florida 32077 Mr. Gary R. Rutledge Secretary Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Mr. Howard M. Rasmussen Director, Division of Alcoholic Beverages and Tobacco Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301
Findings Of Fact Respondent, Annelle C. Jones, is now, and has been at all relevant times, a licensed practical nurse, having been issued license number PN 1091101. Ms. Jones resides in Winter Haven, Polk County, Florida. On September 28, 1992, a final judgment was entered dissolving the marriage of Gary Jenkins and Annelle Jones. It was an acrimonious divorce and he vowed to "get even". That same evening, September 28th, the Department of Health and Rehabilitative Services sent a child protective services worker to Ms. Jones' home to interview her child about a report they received that she used marijuana. The next day, September 29, 1992, Deputy J. D. Maney of the Polk County Sheriff's office went to Ms. Jones' residence on a tip that she was growing marijuana. She admitted him into her residence and gave permission for his search. On a bed in the bedroom, Deputy Maney found a purse which Ms. Jones identified as hers. She agreed to dump out the contents, and in the bottom, mixed with sand and dust, was a flattened small marijuana butt. Deputy Maney found marijuana leafy material on the window sill. In the back yard he found seven marijuana plants growing in cut-off milk jugs. They were alive, but barely alive. There were some dead plants that had been stripped and tossed under an oak tree. Deputy Maney did a field test on the plants, confirming they were marijuana, and arrested Ms. Jones. Ms. Jones was released on her own recognizance and was given a drug screen, the result of which was negative. She was later tried and was found guilty of one count of manufacture (growing) marijuana. The sentence imposed on April 2, 1993, was three years probation, with conditions that Ms. Jones avoid alcohol or illegal drugs and maintain employment. After consistently producing negative drug test results and otherwise complying with probation conditions, Ms. Jones has been released from probation and is in the process of obtaining her master's degree in social work. Ms. Jones vehemently denies using illegal drugs, and there is no direct evidence that she has used them. She also claims that the plants and residue found at her home were her ex-husband's. That bare allegation is not enhanced by any corroborative evidence or explanation from Ms. Jones. She did not explain, for example, why she did not dispose of the marijuana at any time prior to the deputy 's search. She asserted to the deputy and at the hearing that she knew why he was at her home since HRS had already been there on a tip that she was growing marijuana. Yet even after HRS came, the plants still remained. She also did not explain the presence of the marijuana in her purse. Marijuana (cannabis) is a controlled substance under chapter 893, F.S. Pursuant to section 893.03(1), F.S. it has no currently accepted medical use in treatment in the United States. Ms. Jones did not claim that her possession was for a legitimate purpose.
Recommendation Based on the foregoing, it is hereby, RECOMMENDED: That a final order be entered finding that Annelle C. Jones violated section 464.018(1)(i), F.S. and that the following penalties be imposed: reprimand and $100.00 fine. DONE AND RECOMMENDED this 28th day of December, 1994, in Tallahassee, Leon County, Florida. MARY CLARK 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 28th day of December, 1994. COPIES FURNISHED: Douglas M. Cook, Director Agency for Health Care Administration 2727 Mahan Drive Tallahassee, FL 32308 Harold D. Lewis, Esquire Agency for Health Care Administration 325 John Knox Road Tallahassee, FL 32303 Sam Power, Agency Clerk Agency for Health Care Administration The Atrium, Suite 301 325 John Knox Road Tallahassee, FL 32303 Joseph S. Garwood, Sr. Atty. Agency for Health Care Admin. 1940 N. Monroe Street Tallahassee, FL 32399-0792 Annelle C. Jones 520 33rd Street, N.W. Winter Haven, FL 33880-1809
