The Issue Whether the Petitioner is liable for documentary stamp taxes and interest to the Respondent totaling $80,405.54, plus additional interest accruing from the date of the assessment, as reflected in the Notice of Proposed Assessment dated January 24, 2011.
Recommendation Based on the foregoing, Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order finding that Jorge Ramos does not owe documentary stamp taxes on the October 18, 2007, Warranty Deed and withdrawing the assessment in the amount of $80,405.54, plus interest at $11.89 per day from January 25, 2011. DONE AND ENTERED this 1st day of June, 2012, in Tallahassee, Leon County, Florida. S JUNE C. McKINNEY Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 1st day of June 2012.
Findings Of Fact The Respondent, Cerelle Paulson, holds a teaching certificate numbered 390656, authorizing the performance of substitute teaching, valid through June 30, 1985. The Respondent was employed by the Dade County School Board (DCPS) at the time of her suspension and dismissal on or about February 17, 1982. The Petitioner Dade County School Board is a local school district and government agency charged with the hiring and regulation of the practice and conduct of school teachers and other personnel in its employ, with the concomitant power to dismiss teachers and other personnel from its employ upon good cause. The Petitioner Department of Education, Education Practices Commission is an agency of the State of Florida charged with licensure of teachers and with formulating, regulating and enforcing standards of practice and conduct for teachers so licensed. The Respondent applied for food stamps with the Department of Health and Rehabilitative Services (HRS) on November 20, 1977; January 30, 1978; and March 21, 1978. The process for applying for food stamps involves two steps. First, the applicant must fill out an application; second, the applicant's application is reviewed and discussed with a food stamp eligibility worker. On each of the above dates, the Respondent was certified to receive food stamps for a prospective certification period of three months. On the food stamp application, the Respondent was required to fill out a section disclosing income and certify what income she expected to earn during the forthcoming certification period. The Respondent's food stamp applications, on the three dates involved herein, did not reveal that she listed any income from the DCPS. In fact, the Respondent did earn income through employment with the DCPS between November 28, 1977, and March 21, 1978, the period in question, as a substitute teacher. From November 28, 1977, through January 31, 1978, the Respondent was employed intermittently as a "regular" substitute. On January 31, 1978, her status was changed to that of "permanent" substitute for a period of time which terminated on March 3, 1978. From March 3, 1978, through March 21, 1978, she reverted to "regular" substitute teacher status for each day during that period that she worked for the DCPS. Respondent held a genuine belief that her income with the DCPS was irregular and that she was unable to project what her income would be in a prospective manner for each upcoming certification period, hence she did not fill in the income section on her food Stamp applications for the relevant periods. The nature of a job of "regular" substitute teacher is such that such a teacher is called either on the day of the job for which she is needed for one day's work or at the most, one day in advance. The Respondent was unable to project permanent substitute teaching income as a "permanent" substitute teacher for the period January 31, 1978 through March 3, 1978, because, upon giving a permanent substitute assignment, a person who has been a regular substitute theretofore must be transferred onto the regular payroll of DCPS, which is a process which typically involves a delay in the receipt of payment for that work for weeks or even months. It is true that the Respondent did fill in the "income section" on her food stamp application forms, but she discussed the nature of her irregular employment with her food stamp eligibility workers or case workers assigned to her applications. She was told in those instances that she should provide only projected income which she could ascertain she would be earning on a regular basis. The Respondent also showed her past "payroll stubs" to her food stamp eligibility workers, at some point during the certification period, again being told that she had to project what she would make in order to include it on her application. The Respondent was aware of her duty to report changes in income and had, in the past, demonstrated a good faith attempt to do so as evidenced by her voluntary reporting of a change in her daughter's income, in approximately March, 1977, her daughter being a member of her household, and further, by her discussion on a number of occasions with her case workers of the impossibility of being able to project any income because of her intermittent substitute teaching. She was of the belief that only regular projectable income was reportable for food stamp application purposes. It was her understanding that her eligibility workers had informed her that they did not consider the DCPS income, which was unprojectable because of its intermittent irregular character, as countable for figuring eligibility for food stamps. Jo Ann Colebrook (Petitioner's witness) interviewed the Respondent on November 28, 1977, regarding her eligibility for food stamps. This was the only occasion when Ms. Colebrook interviewed the Respondent and only with regard to the first of the three month certification periods in question. Ms. Colebrook, in espousing HRS's position that such DCPS income was reportable in figuring eligibility for food stamps, established the undisputed fact that the Respondent did not report that income, but admitted that she had no independent recollection of the conversation with the Respondent on that date and that her knowledge was based only upon her reference to records (Respondent's application and signed "rights and responsibilities" form submitted that day). She had no recollection of the specifics of the conversation with the Respondent on the only day she interviewed her. The Respondent also held a genuine belief that her DCPS income was not legally "countable" for food stamp program purposes. She had this belief because her employment with DCPS was part of a "trial work period plan" which had been authorized for her by the Department of Vocational Rehabilitation as part of a plan approved by that department to ultimately help her to procure a teacher's certificate in order to teach and support herself. This plan was designed to help her become self-sufficient and overcome a disability for which she had been receiving social security benefits for a number of years. The claimant at the time was approximately 50-years of age with two children and had been disabled since 1973 with spinal arthritis. The Department of Vocational Rehabilitation had advised her in 1972 that if she maintained sufficient grades in one quarter of college, they would enroll her in a vocational rehabilitation program. This she did, maintaining a "B" average so that, in the second quarter of college, the Department of Vocational Rehabilitation began paying tuition as well as subsidization for books, gas and meals while she attended college. During the period in question in this case, the Respondent was in the process of an administrative appeal against the Social Security Administration seeking a determination as to whether her DCPS income was rightfully countable and could serve to diminish her social security benefits. Administrative Law Judge Henry entered an Order in May, 1978, on that issue. The judge in that order found that the undertaking by the Department of Vocational Rehabilitation to further her education so as to qualify her for a teaching job indicated that a "well- thought-out plan" had been initiated by that department projecting a college course at Florida International University preparatory to receiving a teaching certificate. The Respondent finished that course, but did not have quite enough requirements to obtain a teaching certificate and so completed her education at Barry College. The judge found that the circumstances surrounding the attendance at Florida International University and at Barry College and the subsidizing of tuition and books by the Department of Vocational Rehabilitation indicated a well-reasoned plan of self-support with substitute teaching providing support and serving to supplement courses being taken in order to prepare her for a degree. The judge then decided that the Respondent had earned income from substitute teaching which should not be considered in determining countable income for purposes determining further eligibility for full social security benefits, since such earned income was needed to fulfill an approved plan for self-support and education training under Department of Vocational Rehabilitation regulations. Thus, the Respondent believed her income from substitute teaching should similarly not be counted for food stamp purposes either. She informed her food stamp eligibility workers of this belief and when the administrative law judge issued his order, provided them with a copy of it and asked for a determination from HRS. In August, 1978, after the periods at issue herein, Ron Burnstein, Food Stamp Supervisor, ultimately informed her that HRS nevertheless considered that earned income to be reportable for food stamp eligibility purposes. Mr. Burnstein also informed her in that letter of August 10, 1978, that her case for food stamp purposes would remain active and previous notification to her that her case was closed could be disregarded. Thus, at least up until August 10, 1978, the Respondent held a genuine belief (as corroborated by that letter; Respondent's late Exhibit C) that her earned income with DCPS was not countable for purposes of determining eligibility for food stamps. Thus, HRS ultimately took the position that the Respondent had been overpayed because of the hours worked for DCPS and not reported on the three subject applications. The overpayment was in the amount of $887. The Respondent learned, in 1982, that a refund would be required by HRS of the $887 and paid back the entire amount of the overpayment. Approximately four years elapsed before the Respondent was made aware that HRS demanded the overpayment refund. The Respondent never availed herself of her rights to a hearing with HRS concerning the question of overpayment, which right she was informed of on her "rights and responsibilities form," because for approximately four years after the now questioned payments, she was never aware that she had received anything to which she was not entitled. Thus, although the Respondent did not disclose her income on the application forms for the purpose of receiving food stamps, she, on a number of occasions, discussed the fact that she was working intermittently and irregularly as a substitute teacher with her welfare eligibility case workers and all were informed that she was on the substitute teacher list for the DCPS. She did not report her income because she had a genuine belief that it was unreportable as not being regular income and not projectable. She did disclose the fact of her intermittent employment on a day-to-day basis as a substitute teacher.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence in the record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is, therefore RECOMMENDED: That the Respondent, Cerelle Paulson, be reinstated as an employee with the Dade County School System with the restoration of any back pay due her and that the Notice of Charges of the school board and the amended administrative complaint filed by the Department of Education, Education Practices Commission be DISMISSED. DONE and ORDERED this 27th day of July, 1983, in Tallahassee, Florida. P. MICHAEL RUFF Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 FILED with the Clerk of the Division of Administrative Hearings this 27th day of July, 1983. COPIES FURNISHED: Jesse J. McCrary, Jr., Esquire 3050 Biscayne Boulevard 3000 Executive Bldg. - Suite 300 Miami, Florida 33137 J. David Holder, Esquire Post Office Box 1694 Tallahassee, Florida 32301 Sarah Lea Tobocman, Esquire 1782 One Biscayne Tower Two South Biscayne Boulevard Miami, Florida 33131 Dr. Leonard Britton, Superintendent Dade County Public Schools 1410 Northeast Second Ave. Lindsey Hopkins Building Miami, Florida 33132 The Honorable Ralph D. Turlington Commissioner of Education The Capitol Tallahassee, Florida 32301
The Issue The issues are whether the Petitioner, Alice P. Whitehead, is indebted to the Department of Health and Rehabilitative Services (DHRS) for $1,362 and whether her lottery winnings should be withheld and applied to the debt.
Findings Of Fact On February 12, 1993, Whitehead submitted a claim to the Lottery based on a Play-4 ticket she held for a Lotto drawing. The ticket reflected that she was eligible for a prize of $2,500. DHRS certified to the Lottery that Whitehead owed the State $1,362.00. That sum represents an overpayment of food stamps and AFDC benefits to Petitioner. Pursuant to Section 24.115(4), Florida Statutes, the Lottery transmitted the prize to DBF. By letter dated March 12, 1993, DBF notified Whitehead that it was in receipt of her prize from the Lottery and that it intended to apply $1,362.00 of the award toward the unpaid food stamp and AFDC debt. Enclosed with the letter was State of Florida warrant number 2057985 in the amount of $1,138.00 payable to Whitehead. That warrant was partial payment of the lottery prize and represented the difference between the amount of the prize and the amount of the food stamp and AFDC debt that DHRS had certified as being due. In a letter received by DBF on March 31, 1993, Petitioner indicated she was unaware of any indebtedness to the state and requested a hearing. A referral was made to the Overpayment/Overissuance, Fraud and Recoupment Unit on June 23, 1980, for an overpayment of AFDC and an overissuance of food stamps to Whitehead. Additionally, a referral was made to the Overpayment/ Overissuance, Fraud and Recoupment Unit on October 30, 1979, for an overissuance of food stamps. Whitehead was notified of the overpayment of AFDC benefits and of the overissuance of food stamp benefits via notices dated August 27, 1980, and January 9, 1980. Whitehead was overissued food stamps in the amount of $750.00, and she received an overpayment of AFDC benefits in the amount of $623.00. Whitehead has paid $20 toward the original debt. The current balance due to DHRS on this debt is $750 for the food stamp overissuance and $612.00 for the AFDC overpayment for a total amount of $1,362.00. Whitehead does not dispute that she owes a debt to DHRS, but she does not want to pay it because she is unemployed and is caring for her 83-year-old mother, a victim of Alzheimer's disease. She says she has no income.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Banking and Finance enter a Final Order and therein: Confirm the debt of Alice P. Whitehead to Department of Health and Rehabilitative Services in the amount of $1,362.00. Withhold $1,362.00 from Whitehead's lottery winnings. Transmit that $1,362.00 to Department of Health and Rehabilitative Services in satisfaction of Whitehead's debt. DONE and ENTERED this 19th day of July, 1993, in Tallahassee, Florida. DIANE K. KIESLING 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 19th day of July, 1993. APPENDIX TO THE RECOMMENDED ORDER IN CASE NO. 93-2662 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on the proposed findings of fact submitted by the parties in this case. Specific Rulings on Proposed Findings of Fact Submitted by Respondents 1. Each of the following proposed findings of fact is adopted in substance as modified in the Recommended Order. The number in parentheses is the Finding of Fact which so adopts the proposed finding of fact: 1-8(1-8). COPIES FURNISHED: Alice P. Whitehead, Pro Se 510 West 19th Street Jacksonville, Florida 32206 Scott C. Wright Assistant General Counsel James C. Agazie Certified Legal Intern Office of the Comptroller The Capitol, Suite 1302 Tallahassee, Florida 32399-0350 Katrina M. Saggio Economic Services Attorney Department of Health and Rehabilitative Services 1317 Winewood Boulevard Building 6, Room 466 Tallahassee, Florida 32399-0700 Laura P. Gaffney Senior Attorney Department of the Lottery 250 Marriott Drive Tallahassee, FL 32399-4011
Findings Of Fact The individual taxpayers purchased a motel giving not secured by a mortgage on the motel as a portion of the consideration paid to the grantors. The individual taxpayers subsequently conveyed an undivided one-half interest in the motel to 6804 East, Inc., a corporation wholly owned by the individual taxpayers. Although no consideration was recited in the conveyance, the corporation assumed responsibility for 50 percent of the mortgage indebtedness which was stipulated to have been $96,250. Subsequently, 6804 East, Inc. transferred the property to 6804 Motel, Inc., another corporation wholly owned by the individual taxpayers. Again, no consideration was recited in the conveyance; however, 6804 Motel, Inc. assumed responsibility from 6804 East, Inc. for 50 percent of the indebtedness on the property. The Department of Revenue asserts that documentary stamp taxes are due on both of the transfers pursuant to Section 201.02, Florida Statutes, there having been only nominal documentary stamp taxes placed on the documents. The individual taxpayers and 6804 Motel, Inc., controvert the assessment of taxes on the basis that there was no consideration because the individual taxpayers were never relieved of any responsibility for the debt because they fully owned the two corporations and because they had such an equity investment in the purchase that they could not stand aside and see the corporations default. 6804 Motel, Inc. also questions the assessment of the taxes against it as the grantee in the transfer from 6804 East, Inc. In support of their arguments, the taxpayers introduced evidence that the individual taxpayers intended, prior to purchase, to convey an interest in the motel to 6804 East, Inc., and that after the transfer to 6804 Motel, Inc., the individual taxpayers paid all deficit operating expenses for the motel.
Recommendation Based upon the foregoing findings of fact and conclusions of law the Hearing Officer recommends that the petition of the taxpayers in this case is denied and that the documentary stamp taxes, as proposed in assessments M-65 and M-66, together with a 25 percent penalty and 1 percent interest per month on the unpaid tax be assessed. DONE AND ORDERED this 3rd day of August, 1978, in Tallahassee, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of August, 1978. COPIES FURNISHED: Ralph Monroe 7211 North Dale Mabry Tampa, Florida 33614 Maxie Broome, Jr., Esquire Assistant Attorney General The Capitol Tallahassee, Florida 32304
The Issue The issue in this unadopted-rule challenge is whether Respondent, in connection with the administration of the stamp tax, has formulated a statement of general applicability for allocating undifferentiated, lump-sum payments made in purchase- and-sale transactions involving joint real estate/personal property transfers; which meets the statutory definition of a rule but has not been adopted pursuant to the rulemaking procedure; and, as used by Respondent, has the effect of creating an entitlement to collect tax on 100% of the undifferentiated consideration.
Findings Of Fact On February 23, 2015, Petitioner 1701 Collins (Miami) Owner, LLC ("Taxpayer"), a Delaware limited liability company, entered into a Purchase and Sale Agreement ("Agreement") to sell a going concern, namely a hotel and conference center doing business in Miami Beach, Florida, as the SLS Hotel South Beach (the "Hotel Business"), to 1701 Miami (Owner), LLC, a Florida limited liability company ("Purchaser"). Purchaser paid Taxpayer $125 million for the Hotel Business. The Hotel Business comprised two categories of property, i.e., real estate ("RE") and personal property ("PP"). The PP, in turn, consisted of two subcategories of property, tangible personal property ("TPP") and intangible personal property ("ITPP"). It is undisputed that the property transferred pursuant to the Agreement included RE, TPP, and ITPP. The sale closed on June 5, 2015, and a special warranty deed was recorded on June 8, 2015, which showed nominal consideration of $10. Pursuant to the Agreement, Taxpayer was responsible for remitting the documentary stamp tax and the discretionary surtax (collectively, "stamp tax"). Stamp tax is due on instruments transferring RE; the amount of the tax, payable per instrument recorded, is based upon the consideration paid for RE. Stamp tax is not assessed on consideration given in exchange for PP. The Agreement contains a provision obligating the parties to agree, before closing, upon a reasonable allocation of the lump-sum purchase price between the three types of property comprising the Hotel Business. For reasons unknown, this allocation, which was to be made "for federal, state and local tax purposes," never occurred. The failure of the parties to agree upon an allocation, if indeed they even attempted to negotiate this point, did not prevent the sale from occurring. Neither party declared the other to be in breach of the Agreement as a result of their nonallocation of the consideration. The upshot is that, as between Taxpayer and the Purchaser, the $125 million purchase price was treated as undifferentiated consideration for the whole enterprise. Taxpayer paid stamp tax in the amount of approximately $1.3 million based on the full $125 million of undifferentiated consideration. Taxpayer paid the correct amount of stamp tax if the entire consideration were given in exchange for the RE transferred to Purchaser pursuant the Agreement——if, in other words, the Purchaser paid nothing for the elements of the Hotel Business consisting of PP. On February 6, 2018, Taxpayer timely filed an Application for Refund with Respondent Department of Revenue (the "Department"), which is the agency responsible for the administration of the state's tax laws. Relying on a report dated February 1, 2018 (the "Deal Pricing Analysis" or "DPA"), which had been prepared for Taxpayer by Bernice T. Dowell of Cynsur, LLC, Taxpayer sought a refund in the amount of $495,013.05. As grounds therefor, Taxpayer stated that it had "paid Documentary Stamp Tax on personal property in addition to real property." Taxpayer's position, at the time of the refund application and throughout this proceeding, is that its stamp tax liability should be based, not on the total undifferentiated consideration of $125 million given in the exchange for the Hotel Business, but on $77.8 million, which, according to the DPA, is the "implied value" of——i.e., the pro-rata share of the lump-sum purchase price that may be fairly allocated exclusively to——the RE transferred pursuant to the Agreement. Taxpayer claims that, to the extent it paid stamp tax on the "implied values" (as determined in the DPA) of the TPP ($7 million) and ITPP ($40.2 million) included in the transfer of the Hotel Business, it mistakenly overpaid the tax.1/ On February 23, 2018, the Department issued a Notice of Intent to Make Refund Claim Changes, which informed Taxpayer that the Department planned to "change" the refund amount requested, from roughly $500 thousand, to $0——to deny the refund, in other words. In explanation for this proposed decision, the Department wrote: "[The DPA] was produced 3 years after the [special warranty deed] was recorded. Please provide supporting information regarding allocation of purchase price on or around the time of the sale." This was followed, on April 2, 2018, by the Department's issuance of a Notice of Proposed Refund Denial, whose title tells its purpose. The grounds were the same as before: "[The DPA] was produced 3 years after the document was recorded." Taxpayer timely filed a protest to challenge the proposed refund denial, on May 31, 2018. Taxpayer argued that the $125 million consideration, which Purchaser paid for the Hotel Business operation, necessarily bought the RE, TPP, and ITPP constituting the going concern; and, therefore, because stamp tax is due only on the consideration exchanged for RE, and because there is no requirement under Florida law that the undifferentiated consideration exchanged for a going concern be allocated, at any specific time, to the categories or subcategories of property transferred in the sale, Taxpayer, having paid stamp tax on consideration given for TPP and ITPP, is owed a refund. The Department's tax conferee determined that the proposed denial of Taxpayer's refund request should be upheld because, as he explained in a memorandum prepared on or around December 27, 2018, "[t]he taxpayer [had failed to] establish that an allocation of consideration between Florida real property, tangible personal property, and intangible property was made prior to the transfer of the property such that tax would be based only on the consideration allocated to the real property." The Department issued its Notice of Decision of Refund Denial on January 9, 2019. In the "Law & Discussion" section of the decision, the Department wrote: When real and personal property are sold together, and there is no itemization of the personal property, then the sales price is deemed to be the consideration paid for the real property. [2] Likewise, when the personal property is itemized, then only the amount of the sales price allocated for the real property is consideration for the real property and subject to the documentary stamp tax. The first of these propositions will be referred to as the "Default Allocation Presumption." The second will be called "Consensual-Allocation Deference." The Department cited no law in support of either principle. In its intended decision, the Department found, as a matter of fact, that Taxpayer and Purchaser had not "established an allocation between all properties prior to the transfer" of the Hotel Business. Thus, the Department concluded that Taxpayer was not entitled to Consensual-Allocation Deference, but rather was subject to the Default Allocation Presumption, pursuant to which the full undifferentiated consideration of $125 million would be "deemed to be the consideration paid for the" RE. Taxpayer timely requested an administrative hearing to determine its substantial interests with regard to the refund request that the Department proposes to deny. Taxpayer also filed a Petition to Determine Invalidity of Agency Statement, which was docketed under DOAH Case No. 19-3639RU (the "Rule Challenge"). In its section 120.56(4) petition, Taxpayer alleges that the Department has taken a position of disputed scope or effect ("PDSE"), which meets the definition of a "rule" under section 120.52(16) and has not been adopted pursuant to the rulemaking procedure prescribed in section 120.54. The Department's alleged PDSE, as described in Taxpayer's petition, is as follows: In the administration of documentary stamp tax and surtax, tax is due on the total consideration paid for real property, tangible property and intangible property, unless an allocation of consideration paid for each type of property sold has been made by the taxpayer on or before the date the transfer of the property or recording of the deed. If the alleged PDSE is an unadopted rule, as Taxpayer further alleges, then the Department is in violation of section 120.54(1)(a). The questions of whether the alleged agency PDSE exists, and, if so, whether the PDSE is an unadopted rule, are common to Taxpayer's separate actions under sections 120.57(1) and 120.56(4), respectively, because neither the Department nor the undersigned may "base agency action that determines the substantial interests of a party on an unadopted rule." § 120.57(1)(e)1., Fla. Stat. Accordingly, the Rule Challenge was consolidated with Taxpayer's refund claim for hearing. It is determined that the Department, in fact, has taken a PDSE, which is substantially the same as Taxpayer described it. The undersigned rephrases and refines the Department's PDSE, to conform to the evidence presented at hearing, as follows: In determining the amount stamp tax due on an instrument arising from the lump-sum purchase of assets comprising both RE and PP, then, absent an agreement by the contracting parties to apportion the consideration between the categories or subcategories of property conveyed, made not later than the date of recordation (the "Deadline"), it is conclusively presumed that 100% of the undifferentiated consideration paid for the RE and PP combined is attributable to the RE alone. According to the PDSE, the parties to a lump-sum purchase of different classes of property (a "Lump—Sum Mixed Sale" or "LSMS") possess the power to control the amount of stamp tax by agreeing upon a distribution of the consideration between RE and PP, or not, before the Deadline.2/ If they timely make such an agreement, then, in accordance with Consensual-Allocation Deference, which is absolute, the stamp tax will be based upon whatever amount the parties attribute to the RE. If they do not, then, under the Default Allocation Presumption, which is irrebuttable, the stamp tax will be based upon the undifferentiated consideration. The Department has not published a notice of rulemaking under section 120.54(3)(a) relating to the PDSE. Nor has the Department presented evidence or argument on the feasibility or practicability of adopting the PDSE as a de jure rule. It is determined as a matter of ultimate fact that the PDSE has the effect of law because the Department, if unchecked, intends consistently to follow, and to enforce compliance with, the PDSE. Because, in the Department's hands, the PDSE creates an entitlement to collect stamp taxes while adversely affecting taxpayers, it is an unadopted rule.
The Issue At issue in this case is whether respondents committed the offenses alleged in the Administrative Action, and, if so, the penalty which should be imposed.
Findings Of Fact At all times material to this case, respondents held alcoholic beverage license number 60-05592, series 2-APS, for use at the premises of K Beverage & Food, located at 2511 West Gate Avenue #9, West Palm Beach, Florida. This license was issued November 18, 1991, by the Florida Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco. On or about August 22, 1991, K Beverage & Food was authorized by the United States Department of Agriculture, Food and Nutrition Service ("F.N.S."), to accept food stamps. In the application, respondents, acting through Mr. Hassan, acknowledged that they had read and fully understood the Food Stamp Program regulations. As part of the authorization process, Mr. Hassan attended a meeting and education course on the Food Stamp Program regulations applicable to retail grocers, and he signed an acknowledgment that he understood these regulations. The F.N.S. Compliance Section routinely conducts investigations of authorized stores to ensure compliance with all applicable federal rules and regulations. The compliance investigation of K Beverage & Food commenced on March 31, 1993, when Senior Investigator Rene Berlingeri entered the store at approximately 2:30 p.m. A man was working at the checkout counter when Mr. Berlingeri brought three food and four non-food items to the counter for purchase. The clerk rang up the total price for the seven items. Mr. Berlingeri offered food stamps in payment, and the clerk accepted them without comment. The clerk put the food stamps in the drawer of the cash register. On April 8, 1993, Mr. Berlingeri visited K Beverage & Food for the second time. The store clerk at that time was a woman who identified herself as Isabel. Mr. Berlingeri again selected three food and four non-food items for purchase. Isabel rang up the total price for the seven items and, without comment, accepted food stamps as payment. On April 13, 1993, Mr. Berlingeri visited K Beverage & Food; Isabel was the clerk on duty. He selected three food items and four non-food items. Isabel rang up the total price of the seven items and again, without comment, accepted food stamps as payment. As she was bagging his purchases, Mr. Berlingeri selected a six-pack of beer, and, without comment, Isabel accepted food stamps as payment. On April 15, 1993, Mr. Berlingeri visited K Beverage & Food. Isabel was again working as clerk. He selected one food item and three non-food items, including a six-pack of beer. Isabel accepted food stamps as payment for the total price of the four items, without comment. Mr. Berlingeri then asked if she would exchange food stamps for cash, and he gave her a book of food stamps with a face value of $50. Isabel gave him $45 in cash from the cash register and put the book of food stamps into the cash register. On April 20, 1993, Mr. Berlingeri entered K Beverage & Food at approximately 10:15 a.m. and asked Isabel if she would purchase $200 worth of food stamps. At Isabel's request, he returned at approximately 11:40 a.m. He gave Isabel food stamps with a face value of $200; she gave him $140 in cash, which she took from under the counter. She told Mr. Berlingeri that, if he ever wanted to exchange more food stamps for cash, he should come to K Beverage & Food at about the same time of day. On July 17, 1993, Mr. Berlingeri made his final investigative visit to K Beverage & Food. The clerk on duty, who identified himself during the transaction as "Sam", gave Mr. Berlingeri $130 in cash in exchange for food stamps with a face value of $200. Sam put the food stamps under the counter, but Mr. Berlingeri did not see the place from which Sam obtained the cash. During the transaction, Sam acknowledged that he knew Isabel; he asked Mr. Berlingeri to keep the transaction confidential. On July 23, 1993, Mr. Berlingeri returned to K Beverage & Food to identify the persons involved in the food stamp transactions. The clerk on duty told Mr. Berlingeri that the owner of K Beverage & Food had another store, called A1A Food Discount Beverage, and Mr. Berlingeri went there. He approached a woman who identified herself as Sandra Marcel Hassan; Mr. Berlingeri verified the identification from a Florida driver's license. While Mr. Berlingeri was in A1A Food Discount Beverage, the person known to him as "Isabel" came into the store. She produced a Florida driver's license that identified her as Maria Isabela Besola. The clerk that Mr. Berlingeri dealt with at K Beverage & Food in March and the clerk who took part in the July 17 transaction were not identified. During the period in which the transactions set out in paragraphs 3 through 9 occurred, Mr. Hassan was present at K Beverage & Food only in the mornings, when he prepared the bank deposit, and in the afternoons after 5:00 p.m., when he came in to work. Mr. Hassan was not present in the store when any of the transactions at issue occurred, nor was there evidence that respondent Sandra M. Bomio Hassan was present at K Beverage & Food at any of the times relevant to this case. Respondents knew that it is a violation of Food Stamp Program regulations for a retail food store to accept food stamps in exchange for ineligible, non-food items and in exchange for cash. Six violations occurred at K Beverage & Food over a period of 21 days, with a seventh violation occurring 60 days later, and three different clerks were involved in the violations. The repeated violations were conducted in an open and flagrant manner. Even though respondents were not on the premises when the violations occurred, it may be reasonably concluded that, due to the number of violations and the open manner in which they occurred, respondents condoned or negligently overlooked the violations by failing to exercise due diligence in supervising their employees and in monitoring the licensed premises.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco, enter a Final Order finding respondents Sandra M. Bomio and Hapy Hassan, d/b/a K Beverage & Food, guilty of violating section 561.29(1)(a), Florida Statutes, and imposing an administrative fine in the amount of $1,000. DONE AND ENTERED this 31st day of May 1995, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 31st day of May 1995.
The Issue The issue for determination is whether Petitioner should receive her lottery prize winnings of $2,500.
Findings Of Fact On June 17, 1996, Gussie Mae Dempson (Ms. Dempson) won a lottery prize in the amount of $2,500. By letter dated June 18, 1996, the Department of Health and Rehabilitative Services, now the Department of Children and Family Services (Children and Family Services) notified the Department of the Lottery (Lottery) that, among other things, Ms. Dempson was indebted to Children and Family Services in the amount of $4,622, as of June 18, 1996. Due to being notified of the debt owed by Ms. Dempson to Children and Family Services, the Lottery forwarded Ms. Dempson's lottery prize winnings to the Department of Banking and Finance, Office of the Comptroller (Banking and Finance). By letter dated July 5, 1996, the Banking and Finance notified Ms. Dempson that, among other things, her entire lottery prize winnings were being withheld due to the debt owed by her to Children and Family Services and that all of the winnings would be applied to the debt. The debt owed by Ms. Dempson to Children and Family Services originates from two accounts for Aid to Families with Dependent Children (AFDC) and two accounts for Food Stamps. AFDC Account No. 31-01057-52 Ms. Dempson was determined eligible for AFDC by Children and Family Services on AFDC Account No. 31-01057-52. She received AFDC for numerous months, including the months of October 1976, December 1976, February 1997 through July 1997, and January 1978, being issued allotments ranging from $119 to $88 per month. After issuance of the allotments, a review by Children and Family Services determined that Ms. Dempson had received an over-issuance through "client error" in the amount of $753. For October 1976, Ms. Dempson received $119, but was eligible for $0, resulting in an over-issuance of $119. For December 1976, Ms. Dempson received $88, but was eligible for $78, resulting in an over-issuance of $10. For February, March, April, and May 1977, Ms. Dempson received $88 per month, but was eligible for $0, resulting in an over-issuance of $88 per month or $352. For July 1977, Ms. Dempson received $92, but was eligible for $0, resulting in an over-issuance of $92. For January 1978, Ms. Dempson received $92, but was eligible for $0, resulting in an over-issuance of $92. Ms. Dempson was notified of the overpayment, her right to dispute the overpayment, and her responsibility for the overpayment. She made repayments to Children and Family Services from February 8, 1980 through April 20, 1981. Ms. Dempson's debt to Children and Family Services on this account was reduced to $333. An inference is drawn and a finding is made that Ms. Dempson did not dispute the over-issuance of $753 in AFDC. AFDC Account No. 31-01057-53 Ms. Dempson was subsequently determined eligible to receive AFDC by Children and Family Services on AFDC Account No. 31-01057-53 for numerous months, including the months of April 1992 through December 1992. She received allotments of $180 per month from April through November, and two allotments in December for $95 and $180. After issuance of the allotments, a review by Children and Family Services determined that Ms. Dempson had received an over-issuance through "agency error" in the amount of $1,715. For the months of March 1992 through November 1992, Ms. Dempson received $1,620, but was eligible for $0, resulting in an over-issuance of $1,620. In December 1992, Ms. Dempson received $275, but was eligible for $180, resulting in an over- issuance of $95. As a result, Ms. Dempson's total over-issuance for March 1992 through December 1992 was $1,715. By letter dated January 28, 1994, Children and Family Services notified Ms. Dempson, among other things, of the overpayment, her right to dispute the overpayment, and her responsibility of repayment. The letter was mailed to the last address provided by Ms. Dempson. No response was received by Children and Family Services. By a second letter dated April 4, 1994, Children and Family Services notified Ms. Dempson, among other things, of the overpayment and of the overpayment being a debt for which she was responsible for paying. The letter was mailed to the same address as the first letter in that no change in address had been provided to Children and Family Services by Ms. Dempson. Again, no response was received. An inference is drawn and a finding is made that Ms. Dempson did not dispute the over-issuance of $1,715 in AFDC. Since the notification letters, Children and Family Services has recouped some of the debt from subsequent AFDC checks to Ms. Dempson. Ms. Dempson does not recall receiving and endorsing the AFDC checks for the months of March 1992 through December 1992, and, therefore, denies receiving and endorsing the checks. The evidence is sufficient to support a finding and a finding is made that Ms. Dempson received and endorsed the checks.2 Food Stamp Account No. 31-01057-42 Ms. Dempson was determined eligible for Food Stamps by Children and Family Services on Food Stamp Account No. 31-01057- She received Food Stamps for numerous months, including the months of February 1991 through June 1991, November 1991 through January 1992, and October 1992 through December 1992. She received allotments ranging from $143 to $221 per month. After issuance of the allotments, a review by Children and Family Services determined that Ms. Dempson had received an over-issuance through "client error" in the amount of $1,278. Two separate instances of over-issuance had occurred on this account. One instance resulted in an over-issuance of $935 for the months of February 1991 through June 1991, as well as the months of November 1991 through January 1992. Another instance resulted in an over-issuance of $343 for the months of October 1992 through December 1992. For February 1991, Ms. Dempson received $201 in Food Stamps, but was eligible for $90, resulting in an over-issuance of $111. For March 1991, Ms. Dempson received $201 in Food Stamps, but was eligible for $83, resulting in an over-issuance of $118. For April 1991, Ms. Dempson received $201 in Food Stamps, but was eligible for $118, resulting in an over-issuance of $83. For May 1991, Ms. Dempson received $201 in Food Stamps, but was eligible for $32, resulting in an over-issuance of $169. For June 1991, Ms. Dempson received $201 in Food Stamps, but was eligible for $83, resulting in an over-issuance of $118. For November 1991, Ms. Dempson received $221 in Food Stamps, but was eligible for $77, resulting in an over-issuance of $144. For December 1991, Ms. Dempson received $221 in Food Stamps, but was eligible for $136, resulting in an over-issuance of $85. For January 1992, Ms. Dempson received $213 in Food Stamps, but was eligible for $106, resulting in an over-issuance of $107. For October 1992, Ms. Dempson received $143 in Food Stamps, but was eligible for $0, resulting in an over-issuance of $143. For November 1992, Ms. Dempson received $143 in Food Stamps, but was eligible for $33, resulting in an over-issuance of $110. For December 1992, Ms. Dempson received $143 in Food Stamps, but was eligible for $53, resulting in an over-issuance of $90. Ms. Dempson was notified of the over-issuance, her right to dispute the over-issuance, and her responsibility for repayment. Through automatic deductions in her Food Stamps, Ms. Dempson has been repaying the over-issuance since March 1994. The automatic deduction began at $11 a month in her Food Stamp allotment until June 1994 when the deduction became and is currently $10 a month. An inference is drawn and a finding is made that Ms. Dempson did not dispute the over-issuance of $1,278 in Food Stamps. Food Stamp Account No. 31-01057-43 Ms. Dempson was determined eligible for Food Stamps by Children and Family Services on Food Stamp Account No. 31-01057- She received Food Stamps for numerous months, including the months of August 1992, October 1992 through December 1992, and January 1993 through June 1993, being issued allotments ranging from $203 to $292 per month. After issuance of the allotments, a review by Children and Family Services determined that Ms. Dempson had received an over-issuance through "agency error" in the amount of $1,692. For August 1992, Ms. Dempson received $240 in Food Stamps, but was eligible for $0, resulting in an over-issuance of $240. For October 1992, Ms. Dempson received $262 in Food Stamps, but was eligible for $143, resulting in an over-issuance of $119. For November 1992, Ms. Dempson received $262 in Food Stamps, but was eligible for $143, resulting in an over-issuance of $119. For December 1992, Ms. Dempson received $262 in Food Stamps, but was eligible for $143, resulting in an over-issuance of $119. For January 1993, Ms. Dempson received $292 in Food Stamps, but was eligible for $149, resulting in an over-issuance of $143. For February 1993, Ms. Dempson received $292 in Food Stamps, but was eligible for $97, resulting in an over-issuance of $195. For March 1993, Ms. Dempson received $292 in Food Stamps, but was eligible for $109, resulting in an over-issuance of $183. For April 1993, Ms. Dempson received $203 in Food Stamps, but was eligible for $10, resulting in an over-issuance of $193. For May 1993, Ms. Dempson received $203 in Food Stamps, but was eligible for $10, resulting in an over-issuance of $193. For June 1993, Ms. Dempson received $203 in Food Stamps, but was eligible for $15, resulting in an over-issuance of $188. By letter dated March 11, 1994, Children and Family Services notified Ms. Dempson, among other things, of the over- issuance, her right to dispute the over-issuance, and her responsibility for repayment of the over-issuance. The letter was mailed to the last address provided by Ms. Dempson. No response was received by Children and Family Services. An inference is drawn and a finding is made that Ms. Dempson did not dispute the over-issuance of $1,692 in Food Stamps. Outstanding Debt As of the date of the hearing, August 15, 1997, the total amount of the debt owed by Ms. Dempson to Children and Family Services was $4,473, representing AFDC Account No. 31- 01057-52 at $333, AFDC Account No. 31-01057-53 at $1,583, Food Stamp Account No. 31-01057-42 at $865, and Food Stamp Account No. 31-01057-43 at $1,692.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Banking and Finance, Office of the Comptroller enter a final order providing for payment to the Department of Children and Family Services of the lottery prize winnings of $2,500 claimed by Gussie Mae Dempson. DONE AND ENTERED this 26th day of November, 1997, in Tallahassee, Leon County, Florida. ERROL H. POWELL Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 26th day of November, 1997.
Recommendation Based upon the findings of fact and conclusions of law recited above, it is recommended that the assessments made by respondent for additional documentary stamp surtaxes and the corresponding penalties be upheld. Respectfully submitted and entered this 27th day of February, 1976, in Tallahassee, Florida. DIANE D. TREMOR Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32399-1550 COPIES FURNISHED: Mr. J. Ed Straughn Executive Director Department of Revenue The Capitol Tallahassee, Florida
The Issue Whether American National can litigate its entitlement to a documentary stamp tax refund pursuant to Section 120.57, Florida Statutes (1987)? If so, whether American National is entitled to a refund of some or all of the $5,475 it paid in recording the first modification and consolidation of notes, mortgages and assignment of leases and rents executed by American National and General Electric Credit Corporation (GECC) on July 11, 1986?
Findings Of Fact Real estate in Escambia County which petitioner American National now holds as trustee (the property) once belonged to U.S.I.F. Pensacola Corporation (USIFP). On September 1, 1969, USIFP gave Town and Country Plaza, Inc. (T & P) a note for $1,500,000 and executed a mortgage on the property in favor of T & P as security for payment of the note. A separate $300,000 note was promptly repaid. On July 5, 1973, U.S.I.F Wynnewood Corporation (USIFW), USIFP's successor in title, gave U.S.I.F. Oklahoma Corporation (USIFO) a note for $625,000, and executed a mortgage on the property in favor of USIFO as security for payment of its note. On July 8, 1982, shortly after Trust No. 0008 acquired the property, Jacksonville National Bank, as trustee, gave First National Bank of Chicago (FNBC) two notes, each secured by a separate mortgage. One note was for $767,481.98, and the other was for $2,000,000. These two notes, along with the two notes originally given to T & P and USIFO, which were both subsequently assigned to FNBC, were the subject of the July 8, 1982, consolidation, modification and extension agreement. Documentary stamp tax owing on account of these notes (the consolidated notes) was eventually paid in its entirety. All four mortgages with which the property was encumbered when petitioner American National succeeded Jacksonville National as trustee were duly recorded, intangible tax having been fully paid upon recordation. In January of 1984, FNBC assigned the consolidated notes and the mortgages securing their payment to VPCO Properties, Inc., which itself assigned them later the same month to VPPI TCH, Inc. In July of 1986, GECC, the present holder of the consolidated notes acquired the notes and became the mortagee on the mortgages securing their payment. As of July 11, 1982, when American National, as trustee of Trust No. 0008, borrowed an additional $1,150,000 from GECC, the outstanding principal balance on the consolidated notes aggregated $3,650,000. On that date, GECC and American National, as trustee, executed the so- called first modification and consolidation of notes, mortgages and assignment of leases and rents, Petitioner's Exhibit No. 1, which recited the parties' understandings both with respect to the new borrowing and with regard to the existing indebtedness the consolidated notes reflected. In addition to signing Petitioner's Exhibit No. 1, American National, as trustee, also executed and delivered to GECC a promissory note in the amount of $1,500,000. This note, which was not offered in evidence, has never been recorded, nor have documentary stamps ever been affixed to it. At GECC's insistence, American National paid a documentary stamp tax of $7,920 at the time Petitioner's Exhibit No. 1 was recorded in Pensacola. Of this sum, $5,475 was paid on account of the indebtedness the consolidated notes evidenced; $1,725 was paid on account of the new borrowing; and $720 was paid because of the provisions in Petitioner's Exhibit No. 1, contemplating an increase in the principal amount of indebtedness. Under the agreement certain interest payments can be deferred, not to exceed $480,000, any such deferments being added to principal. The agreement provides: Notwithstanding the foregoing, so long as Borrower is making all payments on this Note when due, without giving effect to grace periods or requirements of notice, if any, and is otherwise not in default, taking into account, applicable grace periods, if any, under the Mortgage and other Security Documents Borrower shall be entitled to defer payment, in any month, of interest in excess of interest computed at the "Applicable Base Percentage Rate" (hereinafter defined) so long as the total interest deferred under this paragraph ("Deferred Interest"), including any and all Deferred Interest which has been added to the principal balance hereof, as hereinafter provided, does not exceed the lesser of ten percent (10 percent) of the outstanding principal balance hereof, excluding any and all Deferred Interest which has been added to the principal balance hereof, or $480,000. Such Deferred Interest, including any and all Deferred Interest which has been added to the principal balance hereof, shall be due and payable when and to the extent that, in any subsequent month, the Contract Index Rate is less than the "Applicable Base Percentage Rate", with the balance of such Deferred Interest being payable as provided below or on the maturity hereof, whether by lapse of time, prepayment or acceleration. The "Applicable Base Percentage Rate" shall mean the following per annum rates of interest, computed as aforesaid, for the periods indicated: Applicable Base Period Percentage Rate Date of This Note June 30, 1987 10.0 percent July 1, 1987-June 30, 1988 10.5 percent July 1, 1988-June 30, 1989 11.0 percent July 1, 1989-June 30, 1990 11.5 percent July 1, 1990-Maturity Date (hereinafter defined) 12.0 percent Unless previously paid by Borrower, the outstanding balance of Deferred Interest not previously added to principal in accordance herewith, if any, shall be added to the principal balance hereof on the first day of each calendar quarter beginning with October 1, 1986, and shall accrue interest thereafter at the Contract Index Rate provided for principal, which interest shall be payable in the same manner as is applicable to interest on the original principal balance hereof. Notwithstanding the foregoing, Borrower may pay Deferred Interest at any time without penalty. Of the documentary stamp tax American National paid, $720 was on account of future advances that Petitioner's Exhibit No. 1 was designed to secure, in the event GECC made them.
Recommendation Based on the foregoing findings of fact and conclusions of law the Hearing Officer recommends that the office of the Comptroller and the Department of Revenue honor the claims for refund of the documentary stamp taxes in the amount of $1,027.50 and the surtax stamp taxes in the amount of $376.75, refunding these amounts to the Petitioner. DONE AND ORDERED this 12th day of September, 1978 in Tallahassee, Florida. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Maxie Broome Assist Attorney General Department of Legal Affairs The Capitol Tallahassee, Florida 32304 G. Kristin Delano, Esquire Post Office Box 180 St. Petersburg, Florida 33731
