Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: The Respondent, Department of Labor and Employment Security, is the agency responsible for carrying out the duties and responsibilities assigned by the Governor of Florida under the Job Training Partnership Act, Public Law, 97- 300, as amended. In administering the JTPA, Respondent provided Petitioner, along with others, a RFP, which among other things, solicited proposals for programs to provide training and employment for older individuals as provided for by Section 124, JTPA, Title I. Paragraphs 111(1-7) of the RFP lists the requirements that must be addressed in the proposal and be judged affirmatively by Respondent in order for the proposal to be designated responsive and subject to further review and scoring. One of the requirements is the review by, and concurrence of, the CEO prior to submitting the proposal. The purpose of requiring CEO and Private Industry Council (PIC) Concurrence Statements at time of submission is to insure that no applicant uses State approval to "arm twist" the local PIC and CEO into approval. Petitioner submitted its proposal to the appropriate PIC for review and concurrence, thinking that the CEO Concurrence Statement would be obtained by the PIC. Upon return of the proposal by the PIC, there was no executed CEO Concurrence Statement included and, upon inquiry, Petitioner was informed by Joseph M. Brannon, Executive Director, PIC, that a CEO Concurrence Statement was not required for a JTPA Title I Program. At this point, Petitioner did not inquire of Respondent as to the need for the executed CEO Concurrence Statement even though the RFP indicated that the CEO Concurrence Statement was required at the time of submission. Joseph M. Brannon is not an agent of the Respondent and had no authority to change any of Respondent's RFP requirements. Although the proposal had been reviewed by, and had the concurrence of, the local PIC, the proposal, as timely submitted by the Petitioner on February 6, 1987, did not contain the CEO Concurrence Statement. The CEO, Harry H. Waldon, did execute, after the fact, a CEO Concurrence Statement dated January 14, 1987, which is the same date of the PIC Concurrence Statement and this CEO Concurrence Statement was transmitted to the Respondent by Mr. Brannon on March 6, 1987, some sixteen (16) days after the deadline of 3:00 p.m. on February 18, 1987. The evidence is insufficient to show that the CEO reviewed and concurred in the proposal prior to submission even though he was present at the meeting when the local PIC reviewed and concurred in the proposal. Even though Thomas E. Skinner, Jr. is the Executive Director of the Private Industry Council of Service Area 6, his testimony, which I find credible, was that his staff handled these matters and he was not aware of the necessity of CEO Concurrence Statement for a JTPA, Title I program. However, on this occasion, Mr. Skinner was acting on behalf of the Petitioner and it was his responsibility to submit a proposal that was responsive to Respondent's RFP, notwithstanding the conflicting advice from Joseph Brannon concerning the executed CEO Concurrence Statement. Although Respondent, independently of the RFP, advised proposal applicants of the necessity of achieving the 75 percent of performance goals in the previous year if requesting continued funding, a requirement for responsive proposals, there was credible evidence that Respondent did not relax the necessity of timely meeting this requirement by the date of proposal submission or relax any other requirement set out in the RFP. Petitioner's proposal was rated as non-responsive by the Respondent for failure to timely submit an executed CEO Concurrence Statement. The criteria adopted by the Respondent in the RFP is in accordance with the JTPA and the Governor's goals.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record and the candor and demeanor of the witnesses, it is, therefore, RECOMMENDED that the Respondent enter a Final Order finding Petitioner's proposal as non-responsive and denying Petitioner's request for further review and scoring. Respectfully submitted and entered this 3rd day of June 1987, in Tallahassee, Leon County, Florida. WILLIAM R. CAVE 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 3rd day of June 1987. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 87-I684BID The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties in this case. Rulings on Proposed Findings of Fact Submitted by the Petitioner Adopted in Finding of Fact 3. Adopted in Finding of Fact 2. Adopted in Findings of Fact 4 and 7. Adopted in Finding of Fact 5. Adopted in Finding of Fact 4. Adopted in Finding of Fact 9. Adopted in Finding of Fact 8. Adopted in Finding of Fact 10. Rulings on Proposed Findings of Fact Submitted by the Respondent Adopted in Finding of Fact 3. Adopted in Finding of Fact 8 but clarified. Adopted in Finding of Fact 8 but clarified. Adopted in Finding of Fact 4. 5-7. Rejected as immaterial and irrelevant. Adopted in Finding of Fact 4. Adopted in Finding of Fact 6. Rejected as legal argument. Adopted in Finding of Fact 3. Adopted in Findings of Fact 7 and 8. COPIES FURNISHED: Hugo Menendez, Secretary 206 Berkeley Building 2590 Executive Center Circle East Tallahassee, Florida 32399-2152 Thomas E. Skinner, Jr. Qualified Representative Amex Enterprises, Inc. Post Office Box 47035 Jacksonville, Florida 32247-7035 Carolyn Cummings, Esquire Florida Department of Labor and Employment Security Suite 131, Montgomery Building 2562 Executive Center Circle, East Tallahassee, Florida 32399-0657
The Issue The issue in this case is whether Petitioner, Conval-Care, Inc., is entitled to the payment of attorney fees and costs pursuant to Section 57.111, Florida Statutes, from the Agency for Health Care Administration, the successor in interest to the Respondent, the Department of Health and Rehabilitative Services.
Findings Of Fact By letter dated November 4, 1991, the Department of Health and Rehabilitative Services (hereinafter referred to as the "Department"), notified Conval-Care, Inc. (hereinafter referred to as "Conval-Care"), that it intended to impose an administrative fine on Conval-Care pursuant to Section 409.913(9)(c), Florida Statutes. Conval-Care contested the proposed fine and requested a formal administrative hearing, including a request that it be awarded attorney fees and costs pursuant to Section 57.111, Florida Statutes. The matter was designated case number 92-0126 and was assigned to the Honorable Judge Robert T. Benton, then Hearing Officer Benton. On June 30, 1993, following a formal hearing held on March 24, 1993, Hearing Officer Benton entered a Recommended Order recommending dismissal of the sanctions letter of November 4, 1991. The findings of fact made by Hearing Officer Benton, in Conval-Care, Inc. v. Department of Health and Rehabilitative Services, DOAH Case No. 92-0126, are hereby adopted to the extent relevant to this proceeding. On September 19, 1993, the Department entered a Final Order. The Department accepted and incorporated into its Final Order the findings of fact made by Hearing Officer Benton. The Department, however, rejected Hearing Officer Benton's conclusions of law to the extent that he not had concluded that Conval-Care lacked authority to reject the demand for its records which was the subject of the proceedings. The Department concluded that, in light of the fact that Conval-Care had acted on the advice of counsel, it would reduce the fine from $25,000.00 to $5,000.00. The Department's decision was appealed by Conval-Care. On December 16, 1994, the District Court of Appeal, First District, filed an opinion reversing the Department's Final Order. Mandate from the First District was entered January 3, 1995. On February 14, 1995, Conval-Care filed a Petition for Attorneys Fees and Costs in this case. Conval-Care requested an award of $15,000.00 as a small business party pursuant to the provisions of Section 57.111, Florida Statutes. Attached to the Petition were the Final Order entered by the Department, the Recommended Order, the First District's Opinion and Mandate, an Attorney's Affidavit stating the nature, extent and monetary value of the services rendered and costs incurred in the proceedings, the Petition for Formal Administrative Hearing filed by Conval-Care in 1991 and the Department's November 4, 1991 sanctions letter. On March 2, 1995, the Agency for Health Care Administration, the successor in interest of the Department (hereinafter referred to as "AHCA"), filed a Response in Opposition to Petition for Attorney's Fees and Costs. 10 In its Response, AHCA admitted all of the allegations contained in paragraphs 1 through 6 and 8 through 9 of the Petition. AHCA denied the allegations of paragraph 7 of the Petition. Paragraph 7 of the Petition alleged the following: 7. The action of DHRS, in filing the admini- strative complaint against CCI, was not sub- stantially justified because there was no reasonable basis in law or fact to support the issuance of its letter seeking to impose an administrative fine upon CCI. Attached to the Response was an Affidavit from John M. Whiddon in support of its position that its actions were substantially justified. The Affidavit does not add any alleged credible justification not presented to Hearing Officer Benton or the First District Court of Appeal. AHCA did not assert in it Response the following: that the costs and attorney's fees claimed in Conval-Care's affidavit were unreasonable; that Conval-Care is not a prevailing small business party; that circumstances exist that would make an award unjust; or that AHCA was a nominal party only. AHCA also did not "either admit to the reasonableness of the fees and costs claimed or file a counter affidavit [specifying each item of costs and fee in dispute] along with its response." Finally, AHCA did not request an evidentiary hearing in its Response. The only issue which AHCA asserted in its Response was at issue in this proceeding is whether AHCA's actions were substantially justified. On April 6, 1995, an Order to Provide Information was entered. Although the parties had not requested an evidentiary hearing, the undersigned entered the Order soliciting input from the parties before the undersigned decided whether a hearing was necessary on the one issue raised by the Department. In the Order, the parties were given an opportunity to provide input concerning the procedures they believed should be followed to resolve this matter. The parties were specifically requested to answer certain specified questions, including the following: 1. Do the parties believe that an [sic] hearing is necessary to resolve any factual disputes and/or for purposes of oral argument before a decision is rendered? * * * 5. Do the parties agree that the documents attached to the Petition and the Response should be considered in rendering a decision in this case? . . ." Conval-Care filed a response to the April 6, 1995 Order indicating that there was no need for a hearing. Conval-Care asserted that a hearing would be improper unless Conval-Care consents to one. Conval-Care also asserted that all of the documents attached to petition should be considered. AHCA filed a response to the April 6, 1995 Order indicating that "[t]he Respondent feels a hearing in this matter is essential." AHCA did not provide any explanation of why it believed a hearing was necessary or any discussion of whether a hearing was authorized under the applicable statutes and rules. AHCA also indicated in its response that it "agrees that the documents attached to the Petition and Response should be considered in this case " On May 19, 1995, an Order Concerning Final Order was entered. Based upon a review of the pleadings and the lack of explanation from either party to justify an evidentiary hearing, it was concluded that no evidentiary hearing was necessary. Therefore, the parties were informed in the May 19, 1995 Order that a hearing would not be held in this case. The parties were also informed that they could file proposed final orders on or before May 30, 1995. Conval-Care filed a proposed order. AHCA did not. Neither Conval-Care nor AHCA timely requested an evidentiary hearing in this case. Both parties agreed that the documentation filed with Conval- Care's Petition and AHCA's Response could be relied upon in reaching a decision in this case. Based upon AHCA's failure to contest most of the relevant issues in this proceeding, the only issue which requires a decision if whether the Department's actions against Conval-Care were substantially justified. The documents, including the Mr. Whiddon's Affidavit filed by AHCA with its Response, sufficiently explain why the Department took the actions it took against Conval-Care which led to this proceeding. No evidentiary hearing was, therefore, necessary. The weight of the evidence failed to prove that the Department's actions in this matter were substantially justified. The Department could have sought the information it wanted by pursuing available discovery. Counsel for Conval-Care even remained the Department of the availability of discovery. The Department, however, rather than pursuing the information which it indicated it needed, elected to pursue a punitive action against Conval-Care rather than obtaining the information through discovery. The Department's reason for pursuing punitive actions against Conval-Care was not convincing to Hearing Officer Benton. Despite this fact, the Department entered a Final Order upholding its actions and imposing a fine of $5,000.00 for refusing to provide it with information which it could have obtained through other means. The First District Court reversed the Department's Final Order opining that the Department "lacked a legitimate investigatory purpose for demanding the records" which gave rise to its action against Conval-Care. Finally, the entire record in this case failed to indicate that there was any basis in law or fact to substantially justify the actions of the Department.
The Issue As the parties have stipulated, the issue in this case is whether Respondent Florida Housing Finance Corporation (the “Corporation”) properly interpreted Rule 67-48.032(2), Florida Administrative Code, and the corresponding provisions on the same subject found in paragraph 2, at page 2, of the Corporation’s 2000 Qualified Allocation Plan (collectively, the "Instructions"), when it applied the Instructions to determine the substantial interests of Petitioners and Intervenors.
Findings Of Fact The evidence presented at final hearing established the facts that follow. The Corporation and Its Duty to Allocate Federal Income Tax Credits The Corporation is a public corporation that administers governmental programs relating to the financing and refinancing of housing and related facilities in Florida. It is governed by a nine-member board composed of eight persons whom the governor appoints plus the Secretary of the Department of Community Affairs, sitting ex-officio. Among other things, the Corporation is the state's designated "housing credit agency" as defined in the Internal Revenue Code. As such, the Corporation has the responsibility and authority to establish procedures necessary for the allocation and distribution of low-income housing federal tax credits, which are created under and governed almost entirely by federal law. These tax credits, which are designed to encourage the development of low-income housing for families, provide a dollar-for-dollar reduction of the holder’s federal income tax liability and can be taken each year, for up to ten years, that the low-income housing project for which the credits were awarded continues to satisfy Internal Revenue Code requirements. Housing tax credits are allotted annually to the states on a per capita basis and then awarded, through state-administered programs, to developers of rental housing for low-income and very low-income families. Once awarded, there is a market for these tax credits; consequently, a developer may sell them at a discount to obtain immediate cash for its project. As a populous state, Florida receives between $18 million and $18.5 million in federal tax credits each year. The Corporation allocates the state's share of tax credits to eligible recipients pursuant to a Qualified Allocation Plan ("QAP") that federal law requires be prepared. The QAP, which must be approved by the governor, is incorporated by reference in Rule 67-48.025, Florida Administrative Code. In accordance with the QAP, the Corporation employs various set-asides and special targeting goals that play a substantial part in determining which applicants will receive tax credits in a particular year. While targeting goals are "aspirational" in nature, set-asides are relatively inflexible. Thus, special targeting goals may be met if credits are available. In contrast, credits that were reserved (or "set- aside") for specific project types will be awarded to applicants whose developments fall within the defined set-aside. The set-asides that have spawned the instant dispute are the Geographic Set-Asides and the Non-Profit Set-Aside. The Geographic Set-Asides require that a pre-determined portion of the available tax credits be awarded to applicants in each of the following county groups: Large County, Medium County, and Small County. In 2000, the allocation percentages for these groups were 64%, 26%, and 10%, respectively. The Non-Profit Set-Aside, which is a function of federal law, requires that at least 12% of the credits be awarded to non-profit applicants. None of the other set-asides is either at issue here or affects the analysis or outcome. The same is true of the special targeting goals. For simplicity's sake, therefore, special targeting goals will be ignored in the discussion that follows, and it will be assumed, unless otherwise stated, that the Geographic and Non-Profit Set-Asides are the only factors (besides merit) that affect the Corporation's award of tax credits. The Petitioners and Intervenors (Collectively, "Petitioners") Lakesmart is a Florida limited partnership which has as one of its general partners a non-profit corporation. In the 2000 application cycle, Lakesmart applied to the Corporation for an award of tax credits from the Medium County allocation. Lakesmart is a "Non-Profit Applicant" for purposes of the Non- Profit Set-Aside. RPK is a Florida limited partnership. In the 2000 application cycle, RPK applied to the Corporation for an award of tax credits from the Large County allocation. For purposes of the Non-Profit Set-Aside, RPK is a "for-profit Applicant." Meadow Glen and Coral Village are Florida limited partnerships. Each has a non-profit corporation as one of its general partners. Both applied to the Corporation in the 2000 application cycle for an award of tax credits from the Medium County allocation. Each is considered a "Non-Profit Applicant" for purposes of the Non-Profit Set-Aside. Evaluation, Ranking, and the Tentative Funding Range To distribute the finite amount of tax credits available each year, the Corporation has designed a competitive process whereby potential recipients file applications that the Corporation grades according to selection criteria set forth in the QAP. Points are assigned based on compliance with these criteria. At the end of the evaluation process, each applicant that met the threshold requirements will have earned a final score that determines its rank in terms of relative merit, with higher-scored projects being "better" than lower-scored projects. Because of the set-asides, however, credits are not awarded simply on the basis of comparative scores. Instead, the Geographic Set-Asides require that the applicants be sorted and ranked, according to their scores, within the Large County, Medium County, and Small County groups to which they belong and from whose credit allocations the successful applicants will be funded. As a result, therefore, if the several applicants with the three highest scores in the entire applicant pool were all in the Large County group and the applicant with the fourth highest score were in the Small County group, for example, then the latter applicant would be ranked first in the Small County group. This means, to continue with the example, that if the first- and second-ranked projects in the Large County group were to exhaust the credits allocated to that group, then the applicant with the third highest score overall would not be funded, while the applicant with the fourth highest score in the applicant pool (but ranked first in a county group) would be funded. 16/ After the Corporation has sorted the applicants by county group and ranked them, within their respective groups, from highest to lowest based on the applicants' final scores, it draws a tentative funding line within each group. Applicants above these lines are within the tentative funding range and thus apparently successful. Conversely, an applicant below the tentative funding line in its county group will not receive tax credits unless, to satisfy a set-aside or fulfill a special targeting goal, it is moved into the funding range. In the 2000 application cycle, a preliminary outcome which had occurred only once before, in 1997, happened again: the aggregate of credits requested by the non-profit applicants within the tentative funding range did not amount to the Non- Profit Set-Aside percentage — 12% in 2000 — of total available credits. Therefore, the Corporation needed to elevate as many apparently unsuccessful non-profit applicants into the funding range — and concomitantly to remove as many apparently successful for-profit applicants from the funding range to make room for the favored non-profit applicant(s) — as necessary to fulfill the 12% quota. An Aside on Categorical Ranking The separation of applicants into three groups according to the Geographic Set-Asides, and the effect that has on determining which applicants will receive credits, was mentioned above. To better understand the parties' dispute regarding the procedure for satisfying the Non-Profit Set-Aside when, as in 2000, it is necessary to award credits to a putatively unsuccessful non-profit applicant at the expense of a putatively successful for-profit applicant, a second, more detailed look at the implications of categorical ranking will be helpful. Because of the Non-Profit Set-Aside, the set of all qualified applicants ("Applicant Pool") is divided into two classes: non-profit and for-profit corporations. As will be seen, the class of non-profit corporations is further separated, for purposes of the Non-Profit Set-Aside, into two subclasses: domestic non-profits and out-of-state, or foreign, non-profits. Finally, to repeat for emphasis, all qualified applicants, regardless of class or subclass (if applicable), fall within one of three groups according to the Geographic Set-Asides: Small County, Medium County, and Large County. The following chart depicts the relevant classification of applicants within the Applicant Pool: Applicant Pool Non-profits For-profits Domestic Foreign Small County Medium County Large County Because, as the chart shows, each applicant fits into several categories, applicants may be ranked in order of their comparative scores in a variety of combinations, depending on how they are sorted, e.g. all applicants, all Large County for- profits, all foreign non-profits, etc. Once the Corporation has drawn the tentative funding lines (which, recall, are county group-specific) and determined preliminarily which applicants will receive funding and which will not, two additional categories exist: applicants within the funding range and applicants below (or outside) the funding range. Owing to the nature of the instant dispute, however, the only non-profits discussed below are those outside the tentative funding range, unless otherwise stated, and the only for-profits considered are those within the tentative funding range, unless otherwise stated. 1/ The above makes clear, it is hoped, that a reference to the "highest scored" applicant, without more, may describe many applicants, such as the highest scored domestic non-profit, the highest scored non-profit in the Small County group, the highest scored foreign non-profit in the Large County group, and so on. More information is needed to pinpoint a particular entity. For ease of reference, and to facilitate the discussion and disposition of the present dispute, the following abbreviations will be used in this Recommended Order as shorthand descriptions of applicants’ defining characteristics: Abbreviation Meaning NP Non-profit applicant FP For-profit applicant High- highest scored Low- lowest scored D domestic entity (i.e. organized under Florida law) F foreign entity (i.e. organized under the law of a state other than Florida) S, M, and L Small, Medium and Large County, respectively ! highest or lowest scored within the indicated category; e.g. High- NP(S!) means highest scored non- profit within the Small County group; Low-FP(S!) means lowest scored for-profit in the Small county group x, y variables Combining these abbreviations provides an increasingly precise description, as more information is added. For example: Combination Description High-NP Highest scored non-profit in some, unknown category High-NP[D!] Highest scored domestic non- profit, unknown group; is not necessarily the highest scored non-profit in the class of non- profits High-NP[F!] Highest scored foreign non-profit, unknown group; is not necessarily the highest scored non-profit in the class of non-profits High-NP[D!](S) Highest scored domestic non- profit, located in the Small County group; not the highest scored non-profit within the Small County group High-NP[D](S!) Highest scored non-profit in the Small County group; is a domestic corporation but is neither the highest scored non-profit nor highest scored domestic non-profit High-NP[D](S) Highest scored domestic non-profit in the Small County group; is neither the highest scored non- profit, the highest scored domestic non-profit, nor the highest scored non-profit in the Small County group Low-FP! Lowest scored for-profit in the class of for-profits Low-FP(M!) Lowest scored for-profit in Medium County group; is not necessarily the lowest scored for- profit in the class of for-profits The Controversy: Gored Oxen and Leapt-Over Frogs The solution to the problem that arose in the 2000 application cycle when an insufficient number of non-profit applicants wound up initially within the tentative funding range is found in two places: Rule 67-48.032, Florida Administrative Code, and the 2000 QAP. Although the language of the two is not identical, the parties agree that the rule and the pertinent QAP provisions have the same meaning, despite their differences in wording. The undersigned has concluded, however, that the differences, though subtle, substantially affect the outcome of this case. It is necessary, therefore, to read them carefully. Rule 67-48.032(2), Florida Administrative Code, provides in pertinent part: To ensure that the minimum 10% is set aside, the Corporation has determined that an initial allocation of 12% to qualified Non- Profits will be met. In order to achieve the initial 12% set aside, Applications from Applicants that qualify or whose General Partner qualifies as a Non-Profit entity pursuant to Rule 67.48.002(71), F.A.C., HUD Regulations, Section 42(h)(5)(c), subsection 501(c)(3) or 501(c)(4) of the Code and organized under Chapter 617, Florida Statutes, or organized under similar state law if organized in a jurisdiction other than Florida and meet scoring threshold requirements shall be moved into the funding range, in order of their comparative scores, with Applicants whose Non-Profit entity is organized under Florida law receiving priority over Non-Profit entities of other jurisdictions, until the set-aside is achieved. The last Non-Profit Development that is moved into the funding range in order to achieve the 12% initial set-aside shall be fully funded even though that may result in a higher Non-Profit set-aside. This will be accomplished by removing the lowest scored Application of a for-profit Applicant from the funding range and replacing it with the highest scored Non- Profit Application below the funding range within the applicable Geographic Set-Aside pursuant to the QAP. This procedure will be used again on or after October 1, if necessary, to ensure that the Agency allocates at least 10% of its Allocation Authority to qualified Non-Profit Applicants. Any for-profit Applicant so removed from the funding range will NOT be entitled to any consideration or priority for the receipt of current or future Housing Credits other than placement on the current ranking and scoring list in accordance with its score. Binding Commitments for Housing Credits from a future year will not be issued for Applicants so displaced. Paragraph 2, at page 2, of the Corporation’s 2000 QAP states: [The Corporation] has determined that an initial allocation of 12% to qualified Non- Profits will ensure that the 10% requirement will be met in the event that all Developments included in the initial 12% do not receive an allocation. In order to achieve the initial 12% set-aside a tentative funding line will be drawn. Then, Applications from Non-Profit Applicants that meet scoring threshold requirements shall be moved into the tentative funding range, in order of their scores with Applicants whose Non-Profit entities are organized under Chapter 617, Florida Statutes, having priority, until the 12% set-aside is achieved. This will be accomplished by moving the lowest scored Application of a for-profit Applicant in the funding range down in ranking so it is ranked below the lowest Non-Profit Applicant within the funding range and moving the highest scored Non-Profit Applicant organized under Chapter 617, Florida Statutes below the funding range within the applicable Geographic Set- Aside pursuant to the QAP up in ranking so it is ranked one ranking space above the for-profit Applicant that was moved down in ranking. If no such Applicant exists, the highest Non-Profit Applicant organized under similar statutes from another state which is below the funding range within the applicable Geographic Set-Aside pursuant to the QAP, will be moved into funding range in the same manner as stated in the previous sentence. This procedure will be used again on or after October 1, 2000, if necessary, to ensure that the [Corporation] allocates at least 10% of its Allocation Authority for 2000 to qualified Non-Profit Applicants. Any for-profit Applicant so removed from the funding range will NOT be entitled to any consideration or priority for the receipt of current or future housing credits other than placement on the current ranking and scoring list in accordance with its score. Binding Commitments for housing credits from a future year will not be issued for Applicants so displaced. The last Non- Profit Applicant moved into the funding range, in order to meet the initial 12% set- aside or in order to meet the minimum 10% set-aside after October 1, 2000, will be fully funded contingent upon successful credit underwriting even though that may result in a higher Non-Profit set-aside. After the full Non-Profit set-aside amount has been allocated, remaining Applications from Non-Profit organizations shall compete with all other Applications in the HC Program for remaining Allocation Authority. The Corporation's interpretation of Rule 67-48.032, Florida Administrative Code, and paragraph 2 of the 2000 QAP (collectively, the "Instructions") to determine the procedure for satisfying the Non-Profit Set-Aside in connection with the 2000 application cycle has caused considerable controversy — and led to this proceeding. The controversial interpretation was publicly manifested on September 15, 2000, when the Corporation published a preliminary ranking sheet on its web site which reflected adjustments that its staff had made to fulfill the Non-Profit Set-Aside. Within days, adversely affected applicants were complaining that the Corporation's staff had misinterpreted the Instructions. The Corporation's staff had construed the Instructions to mean that when it is necessary to displace a for-profit within the tentative funding range to satisfy the Non-Profit Set-Aside, the following procedure must be followed: Remove Low-FP!(x!) and replace it with High- NP[D](x). 2/ If there is no domestic non- profit in county group x, then replace Low- FP!(x!) with High-NP[F](x!). 3/ This construction permits High-NP[D!], if there is one, High- NP![F!] if not, to remain outside the funding range, because it might not be in county group x. In practice, the process that the Corporation’s staff had settled upon operated, in the circumstances presented, to the detriment of Petitioners. Here is how it worked. After the tentative funding range was established, the lowest scored for- profit in the class of for-profits was in the Small County group. 4/ There were no non-profits, domestic or foreign, in that group to elevate, however, and so Low-FP!(S!) could not be removed; the fall-back procedure was followed. See endnote 4. As it happened, RPK was Low-FP(L!) and had a lower score than Low-FP(M!). Thus, under the Corporation's staff's interpretation of the Instructions, as revealed by the rankings posted on September 15, 2000, High-NP[D](L!) was moved into the funding range in the place of RPK, even though High-NP[D](L!)'s final score was lower than that of Lakesmart — which was High- NP. (Coral Village and Meadow Glen were the second- and third-ranked domestic non-profits, respectively, in the Medium County Group. Sorted by class, Lakesmart, Coral Village, and Meadow Glen would be ranked first, second, and sixth in the class of non-profit applicants.) 5/ The second lowest-scored for-profit in the class of for-profits was also in the Large County group. Thus, it became Low-FP!(L!) after RPK was removed. It, too, was replaced by the Large County non-profits that became, in turn, High-NP[D](L!) as the next highest-ranked non-profit in that group was moved up into the funding range to satisfy the 12% Non-Profit Set-Aside. In all, the Corporation's staff proposed to elevate — and hence award tax credits to — four non-profit applicants whose final scores were lower than Lakesmart's and Coral Village's. One of those four putative beneficiaries had a lower final score than Meadow Glen's. Lakesmart and others who disagreed with the Corporation’s staff advanced an alternative interpretation of the Instructions. In their view, to ensure that the Non-Profit Set-Aside is met requires the following maneuver: Remove Low-FP(x!) and replace it with High- NP[D!](x). 6/ If there is no domestic non- profit outside the funding range, then replace Low-FP(x!) with High-NP. 7/ This interpretation admits the possibility that Low-FP! might remain in the funding range, because it might not be in county group x. Under this interpretation, favored by all Petitioners, Lakesmart and Coral Village would be elevated into the funding range, rather than being "leap-frogged" by lower-scored non- profits, and RPK would not be displaced. (Of course, Petitioners' interpretation would require that some other for- profit ox be gored — one having a higher score than RPK's.) These competing interpretations of the Instructions were presented to the Corporation's board for consideration at its public meeting on September 22, 2000. After a discussion of the issues, in which members of the public participated, the board voted unanimously to accept the interpretation that the staff had acted upon in preparing the September 15, 2000, rankings. Later in the same meeting the board adopted final rankings, which were prepared in accordance with the approved interpretation, that resulted in the denial of Petitioners' applications for tax credits. The 1997 Awards: Precedent or Peculiarity? Petitioners maintain that their interpretation of the Instructions is supported by a supposed precedent allegedly set in 1997 that, they say, was binding on the Corporation in 2000. In the 1997 cycle, it so happened that after drawing the tentative funding lines, the sum total of credits sought by non-profits within the preliminary funding range failed to reach the then-required threshold of 10%. Thus, for the first time, the Corporation faced the need to replace higher-scored for- profits (that were apparently in line for funding) with lower- scored non-profits that otherwise would not have received credits. The QAP that governed the 1997 awards provided for the Non-Profit Set-Aside but was silent on the procedure for satisfying it: The Agency will allocate not less than 10% of the state’s allocation authority to projects involving qualified, non-profit Applicants, provided they are non-profits organized under Chapter 617, Florida Statutes, and as set forth in Section 42(h)(5) of the Internal Revenue Code, as amended, and Rule Chapter 9I-48, Florida Administrative Code. Respondent's Exhibit 2, page 8. Rule 9I-48.024(3), Florida Administrative Code (1997), did contain directions for carrying out the required substitution. It prescribed the following procedure for elevating non-profits: If 10% of the total Allocation Authority is not utilized by Projects with Non-Profit Applicants, Applications from Non-Profit Applicants that meet scoring threshold requirements shall be moved into the funding range, in order of their comparative scores, until the 10% set-aside is achieved. This will be accomplished by removing the lowest scored Application of a for-profit Applicant from the funding range and replacing it with the highest scored Non-Profit Application below the funding range within the applicable Geographic Set-Aside pursuant to section (2) above. Petitioners' Exhibit 1. These provisions will be referred to hereafter as the "1997 Directions," to distinguish them from the Instructions. Gwen Lightfoot was the Corporation's Deputy Development Officer in 1997. In that capacity, she was directly responsible for implementing the rules relating to the award of low-income housing tax credits. To satisfy the Non-Profit Set- Aside, Ms. Lightfoot followed the 1997 Directions as she understood them. In so doing, she sorted the eligible non- profits by class (i.e. without regard to their respective county groups) and ranked them in score order, from the highest scoring project to the lowest scoring project. 8/ Then, Ms. Lightfoot moved the highest scoring non-profit in the class of non-profits to a position immediately above the for-profit with the lowest score in the same geographic set-aside as the favored non-profit so that the non-profit project would be fully funded. That is, she replaced Low-FP(x!) with High-NP!(x!). This process was repeated, moving the next highest ranked non-profit to a position immediately above the lowest-ranked for-profit in the same geographic set-aside as the elevated non-profit, until the Non-Profit Set-Aside was met. Although the Corporation presently argues that its board was not fully informed in 1997 as to the procedure that Ms. Lightfoot followed in fulfilling the mandate of the Non- Profit Set-Aside, a preponderance of evidence established that Ms. Lightfoot's actions were within the scope of her authority and taken in furtherance of her official duties; that the board was aware of what she had done; and that the board took no action to change the results that followed from Ms. Lightfoot's interpretation and implementation of the 1997 Directions. Ms. Lightfoot's application of the 1997 Directions, in short, was not the unauthorized act of a rogue employee. Rather, as a matter of fact, her action was the Corporation's action, irrespective of what any individual board member might subjectively have understood at the time. In the years following the 1997 awards, Rule 9I- 48.032, Florida Administrative Code, was re-numbered Rule 67- 48.032 and amended three times, the most recent amendment becoming effective on February 24, 2000. As a result, the 1997 Directions evolved into the language of Rule 67-48.032(2) which, though not identical, retains the essential meaning of its predecessor. During the same period, the QAP was also amended three times, the version controlling the 2000 application cycle having been approved by the governor on December 16, 1999, and adopted by reference in the Florida Administrative Code on February 24, 2000. Unlike the revisions to Rule 9I-48.032(3), however, the changes in the QAP that relate to the issue at hand are significant, because the 2000 QAP sets forth a procedure for fulfilling the Non-Profit Set-Aside when the collective amount of credits sought by non-profits in the tentative funding range falls short of the mandated mark, whereas the 1997 QAP did not.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Corporation enter a final order dismissing the petitions of Petitioner Lakesmart, Petitioner RPK, and Intervenors Meadow Glen and Coral Village. DONE AND ENTERED this 7th day of February, 2001, in Tallahassee, Leon County, Florida. JOHN G. VAN LANINGHAM 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 7th day of February, 2001.
The Issue At issue is whether Petitioner is entitled to an award of attorney's fees and costs pursuant to Section 57.111, Florida Statutes, the "Florida Equal Access to Justice Act."
Findings Of Fact Findings relating to the underlying disciplinary action The Department of Health, Division of Medical Quality Assurance, Board of Dentistry (Department), is a state agency charged with the duty and responsibility for regulating the practice of dentistry pursuant to Section 20.43 and Chapters 455 and 466, Florida Statutes. At all times material hereto, Petitioner, Mounir Albert, D.D.S. (Dr. Albert), was licensed to practice dentistry in the State of Florida, having been issued license number DN 0010217. On September 2, 1997, the Department issued an Administrative Complaint against Dr. Albert (Agency Case Number 95-12645). The complaint charged that Dr. Albert was subject to disciplinary action under the provision of Subsection 466.028(1)(aa), Florida Statutes (1995), for having violated Subsection 455.241(1), Florida Statutes, by having failed, upon request, to furnish a patient in a timely manner, without delays for legal review, copies of all reports and records relating to the patient's examination or treatment, including x-rays and insurance information. For such violation, the Department proposed that one or more of the following penalties be imposed: . . . revocation or suspension of . . . [Dr. Albert's] license, restriction of . . . [Dr. Albert's] practice, imposition of an administrative fine, issuance of a reprimand, placement of . . . [Dr. Albert] on probation, and/or any other relief that the Board deems appropriate. Dr. Albert disputed the allegations of fact contained in the Administrative Complaint, and the matter was referred to the Division of Administrative Hearings (DOAH) for the assignment of an administrative law judge to conduct a formal hearing. The matter was assigned DOAH Case No. 97-5001, and a hearing was duly held on February 5, 1998. On March 9, 1998, a Recommended Order was rendered, which concluded that, while Dr. Albert failed to furnish the patient records on request, the Administrative Complaint should be dismissed. Central to such conclusion was the finding that: . . . while subsection 455.241(1) obligates the health care provider to provide, upon request, copies of a patient's medical records, subsection 455.241(4) also authorizes the health care provider to charge, for such service, the cost of duplication. Reading the provisions in pari materi, it is reasonable to conclude that, absent payment of the cost of duplication, a health care provider is under no obligation to provide a patient with copies of his records. Since the patient failed to pay Dr. Albert for the cost of duplication, as requested, it was resolved that Dr. Albert had not violated Subsection 455.241(1) as alleged in the Administrative Complaint. On June 9, 1998, the Board of Dentistry entered a Final Order in the underlying case. The Final Order approved and adopted the Findings of Fact and Conclusions of Law set forth in the Recommended Order, and dismissed the Administrative Complaint. Judicial review of the Final Order was not sought, and Petitioner timely filed the subject petition for attorney's fees and costs pursuant to Section 57.111, Florida Statutes. Findings relating to the claim for attorney's fees and costs Pertinent to Dr. Albert's claim for attorney's fees and costs, the Department has conceded that the underlying action was initiated by the Department, that Dr. Albert prevailed in the underlying case, and that the claim for attorney's fees and costs was timely filed.1 The Department has, however, denied that Dr. Albert was a "small business party" and, therefore, a "prevailing small business party," as those terms are defined by Section 57.111, Florida Statutes, and has affirmatively averred that its actions were "substantially justified." Given the circumstances, an award of reasonable attorney's fees and costs would be appropriate provided Dr. Albert can establish, by a preponderance of the evidence, that he was a "prevailing small business party" in the underlying proceeding and, if so, the Department fails to establish that its actions were "substantially justified." Addressing first Dr. Albert's status, it must be concluded that the proof fails to support the conclusion that at the time the underlying proceeding was initiated, or at any other time material hereto, Dr. Albert (the party to the underlying proceeding) was a "small business party," as that term is defined by Section 57.111(3)(d), Florida Statutes, and, consequently, the proof fails to support the conclusion that he was a "prevailing small business party," as required for compensation under the Florida Equal Access to Justice Act. See Section 57.111(4)(a), Florida Statutes. In so concluding, it is observed that the proof demonstrates that, at all times material, Dr. Albert practiced dentistry as an employee of a professional service corporation, Mounir Albert, D.D.S., P.A. (the corporation or business), as authorized by Chapter 621, Florida Statutes, and was not shown to be the sole proprietor of, or operate his dental practice or any other enterprise, as an unincorporated business. Having resolved that Dr. Albert was not shown to be a "prevailing small business party," and was, therefore, not eligible for an award of attorney's fees and costs under the Florida Equal Access to Justice Act, it is not necessary to address whether the Department's actions were "substantially justified," when the underlying proceeding was initiated.
Findings Of Fact On August 17, 1989, the Executive Board acting for the Local Elected Officials of the Heartland Employment and Training Consortium, voted to terminate Clifton Thomas, Jr., from his position as Executive Director of the Heartland Private Industry Council. At the time of his termination from employment, Mr. Thomas was being paid the sum of $47,528 per annum. Mr. Thomas' salary was established on an annual basis by the Executive Board. On or about December 1, 1989, Mr. Thomas, acting through his attorney, Mr. Robert McKee, notified E. John Dinkel, III, acting as counsel for the Executive Board, that he intended to file a law suit against the Heartland Employment and Training Consortium and its Executive Board. The complaint to be filed in the United States District Court, Middle District of Florida, Tampa, Division, demanded equitable relief and damages and alleged that Mr. Thomas was fired without justification and "was not accorded due process." Mr. Dinkel, acting as counsel for the Executive Board, was able to obtain agreement from Mr. McKee, acting as counsel for Mr. Thomas, that the complaint would be dropped upon payment of $24,096 to Mr. Thomas. At a regularly scheduled meeting of the Heartland Private Industry Council held on December 14, 1989, the Council voted to concur in a payment of $24,096 to Mr. Thomas to avoid the cost of litigation. It was understood and agreed that a statement would be signed by Mr. Thomas denying any liability or wrongdoing by any of the parties to the action. At a specially convened meeting of the Executive Board of the Heartland Consortium held on December 15, 1989, the Board unanimously agreed to the settlement. On December 21, 1989, a check in the amount of $21,598.40 was issued to Mr. Thomas. This amount represented the agreed upon amount minus a levy from the Internal Revenue Service. The check (#010471) was charged to the pooled administrative funds from allocations through State of JTPA formula monies. In consideration of the above payment, Mr. Thomas gave up his threatened law suit and signed a statement, dated December 22, 1989, denying any wrongdoing on the part of the Executive Board, the Heartland Private Industry Council and any officers or employees of the Board or Council. In the annual audit of the Heartland Private Industry Council conducted by Grant Thornton, Accountants and Management Consultants, the use of JTPA monies to pay the former Executive Director was questioned. The auditor stated: "The use of JTPA funds in settlement of legal claims was determined by Florida Department of Labor and Employment Security to be an unallowable cost under State and Federal law as indicated in a letter to the Council's attorney dated November 6, 1989, therefore this is a questioned cost." On September 30, 1991, the Heartland Private Industry Council received notification from Patricia S. Gilbert, Director, DLET that the costs questioned by the auditor were disallowed. No reason other than that cited by the auditor was given. On October 24, 1991, Heartland Private Industry Council, Inc., notified the Department of Labor of their intent to appeal the disallowed cost. On November 1, 1991, Jack E. Lyons, Executive Director of the Heartland Private Industry Council, wrote a letter to Secretary Scruggs, questioning the applicability of the statutes, both State and Federal, that were cited by the auditor in the statement of questioned costs. At a regularly scheduled meeting of the Heartland Private Industry Council held on April 17, 1992, the Council denied any misapplication of Federal JTPA dollars and voted to not permit the Executive Director to settle the disallowed costs by payment from non-JTPA dollars. The attached documentation styled Index of Exhibits, containing fourteen (14) exhibits is incorporated by reference into the proposed Statement of Facts.
Recommendation It is recommended that a Final Order be entered finding the payment to Clifton Thomas, Jr., of $24,096 in settlement of his law suit against the Heartland Private Industry Council Inc. to be a nonallowable cost and improperly charged to federally provided funds. RECOMMENDED this 29th day of July, 1992, 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 29th day of July, 1992. COPIES FURNISHED: Larry R. Jackson, Esquire 300 Parkview Place Lakeland, FL 33805 Carolyn Cummings, Esquire Hartman Building, Suite 307-2102 Capitol Circle SE Tallahassee, FL 32399 Frank Scruggs, Secretary 303 Hartman Building 2012 Capital Circle SE Tallahassee, FL 32399-2152 Cecilia Renn Chief Legal Counsel 307 Hartman Building 2012 Capital Circle SE Tallahassee, FL 32399-2152
Findings Of Fact Richard K. Black submitted his application for a Class "A" Private Investigative Agency license and a Class "C" Private Investigator license to the Department of State on November 11, 1982, together with all the fees. By letter dated November 19, 1982, the Department advised Mr. Black of the approval of the issuance of the Class "A" license subject to certain qualifications, which were not challenged by Mr. Black and are not at issue. By letter dated November 18, 1982, the Department advised Mr. Black that it had denied his application for licensure as a Class "C" Private Investigator because Mr. Black failed to meet the experience requirements of Section 493.306(4), Florida Statutes. Mr. Black made a timely request for a formal hearing pursuant to Section 120.57, Florida Statutes. The parties have stipulated that Mr. Black is qualified to hold a Class "C" Private Investigator license except for his lack of experience. Investigative activities of a private investigator include, but are not limited to, searching records, interviewing witnesses, making personal observations of physical evidence, conducting surveillances, and reporting the results and conclusions of these activities. While a student at Broward Community College during 1974 and 1975, Mr. Black served as a member of the "504 Committee," a volunteer organization whose purpose is to assist persons protected by Section 504 of the Federal Rehabilitation Act of 1973. Mr. Black's primary duties with said committee consisted of receiving complaints of alleged violations of the Rehabilitation Act concerning lack of physical access to public facilities, taking physical measurements of said facilities, performing library research to determine the applicability of the Act to said facility, and attempting to obtain compliance of the owner of the facility when a violation was found. Of these duties, the interviewing process and taking physical measurements would be qualified experience. No evidence was presented by Mr. Black regarding the specific amount of time which he devoted to these functions. While a student at Broward Community College during 1976 and 1977, Mr. Black engaged in a volunteer voter registration project for the handicapped. Mr. Black's primary duties in this regard consisted of obtaining voter registration data from public records, identifying areas in which registration of the handicapped was low, conducting house-to-house registration drives in said areas, writing letters, and arranging car pools. None of these activities qualify as experience for licensure as a private investigator. Mr. Black served as a volunteer firefighter for the North Andrews Volunteer Fire Department from 1972 to 1976. During this time, he attended a bomb and arson investigation seminar and assisted in a few arson investigations. Mr. Black did not document the specific number of investigations which he conducted or the amount of time spent in said investigations. During 1979 and 1980, during the tenure in office of Sheriff Ken Katsaris, Mr. Black served as a volunteer "special deputy" in Leon County. Mr. Black's primary duties consisted of inspecting polling places in the county to determine if proper access existed for the physically handicapped and reporting non-complying conditions to the Sheriff. While not all of Mr. Black's activities were qualified experience, he spent approximately 120 total hours on all activities in this project in 1980. For approximately three months, from August until October 1981, Mr. Black served as a nonpaid intern with the Florida Parole and Probation Services. Approximately 50 percent of this time was devoted to the qualified activities of locating probationers and parolees and assisting in investigations. Mr. Black assisted in processing service-connected or related disability claims for disabled veterans on a volunteer basis in the Leon County area. He assisted on five or six cased during the last several years. No evidence was submitted to document the specific amount of time Mr. Black devoted to the investigation of these claims. Mr. Black assisted the Alburquerque, New Mexico, police in locating the whereabouts of a fugitive from justice. This assistance was as a volunteer, and Mr. Black testified that he spent 20 to 25 hours a week for three months on this project. While attending Florida State University, Mr. Black participated in various programs to assist handicapped students. These activities are similar to the activities in which Mr. Black engaged as described in Paragraph 6 above. No evidence was presented as to the amount of time spent in qualified investigative activities during this time period. Mr. Black completed a four-day course in crisis intervention in 1981. Mr. Black obtained a Bachelor of Science degree in psychology from Florida State University. Although some of his course work in general subjects would be the same as the general course work required for a degree in criminology and some of the psychology courses which Mr. Black took would be helpful to an investigator, none of the course work which Mr. Black took is directly related to training as a private investigator. In evaluating the experience requirement for a Class "C" Private Investigator experience which is substantially identical and equal in force, power, effect and import as the experience gained in actually performing the services of a private investigator as a Class "CC" intern investigator. In evaluating the amount of time spent in investigative activities, the Department applies a standard 40-hour work week to the hours submitted by the applicant. The Department does not count volunteer experience in evaluating whether an applicant has met the time requirement unless the number of hours worked and the supervision exercise can be fully documented. Mr. Black has never been licensed as a Class "CC" intern investigator.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the application of Richard K. Black for licensure as a Class "C" Private Investigator be denied. DONE and RECOMMENDED this 20th day of May, 1983, in Tallahassee, Leon County, Florida. STEPHEN F. DEAN, 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 20th day of May, 1983. COPIES FURNISHED: Mr. Richard K. Black 249 Oakview Drive Tallahassee, Florida 32304 Stephen Nall, Esquire Office of General Counsel Department of State The Capitol Tallahassee, Florida 32301 The Honorable George Firestone Department of State The Capitol Tallahassee, Florida 32301
The Issue Whether the Petitioner has the three years of experience as an employment clerk of its equivalent as required by 449.023(1), Florida Statutes.
Findings Of Fact Sarah B. Bedingfield applied for licensure as a private employment agency and private employment agent pursuant to the provisions of Chapter 449, Florida Statutes. The evidence reveals that Sarah B. Bedingfield has extensive experience as an office manager but lacks specifically three years experience as an employment clerk or its equivalent. The Petitioner meets all other requirements of licensure as an employment agency and employment agent.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, the Hearing Officer would recommend that the application of Sarah B. Bedingfield as an employment agency and employment agent be denied. DONE and ORDERED this 27th day of November, 1978, in Tallahassee, Florida. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings 101 Collins Building MAILING ADDRESS: 530 Carlton Bldg. Tallahassee, Florida 32304 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of November, 1978. COPIES FURNISHED: Ms. Sarah B. Bedingfield 18700 South West 99th Road Miami, Florida Marvin Sirotowitz Division of Licensing The Capitol Gerald Curington, Esquire Department of State The Capitol Tallahassee, Florida
The Issue Whether Respondent violated Section 493.6118(1)(n), Florida Statutes, as alleged in Counts I, II, IV and V of the Administrative Complaint by subcontracting with individuals named therein to provide private investigative services at a time when they were not licensed as a Class "A" investigative agency. Whether Respondent violated Section 493.6118(1)(n), Florida Statutes, as alleged in Count III of the Administrative Complaint, by allowing an improperly licensed person, John Polk, to direct the activities of licensees, or exercise operational control over the regulated activities of Morse Security Group, Incorporated. Whether Respondent violated Section 493.6118(1)(s), Florida Statutes, as alleged in Count VI in the Administrative Complaint, by failing to report to the Department the termination of persons listed in that count. Whether Respondent violated Section 493.6118(1)(s), Florida Statutes, as alleged in the Administrative Complaint, by directing the activities of licensees, thereby acting as a manager, subsequent to the voluntary deactivation of his Class "C" private investigator's license and Class "M" private investigative/security agency manager's license. Whether Respondent violated Section 493.6118(1)(f), Florida Statutes, as alleged in the Administrative Complaint, by misrepresenting his agency by advertising in the Martindale-Hubbell Law Directory 1993, that his agency is "Florida's largest and oldest private investigative agency", when it is not. Whether Respondent violated Section 493.6118(1)(r), Florida Statutes, as alleged in the Administrative Complaint, by failing to certify the completion or termination of the internship of William J. Smithberger when he had the duty as a sponsor to do so.
Findings Of Fact Morse Security Group holds a Class "A" Private Investigative Agency License, Number AOO-00919, effective June 30, 1993, which was originally issued in 1976, and is currently active. Harvey Morse, the principal of Respondent, holds a Class "C" private investigator license, number COO-008861, effective November 24, 1992, which was originally issued in 1975, and was placed on inactive status by the Department on January 21, 1993. Harvey Morse also was issued a Class "DI" Security Officer Instructor License, No. DI89-00348, effective January 8, 1993, a Class "G" Statewide Firearms License, No. GOO-11067, effective December 6, 1991, which was placed on inactive status with the Department on January 21, 1993, and a Class "M" Private Investigative/Security Agency Manager license No. M85-00112, effective August 7, 1992, which was placed on inactive status with the Department on January 21, 1993. Craig Hull became employed with Respondent in February of 1993, as a part-time investigator. Hull worked under the direct supervision and control of Respondent, and held himself out to the public as an employee. When Hull entered into his contractual employment agreement with Respondent, he was given a vacation/sick day policy document noting his status as a full-time employee of Respondent. Hull executed an Employment Agreement which referred to him as the "employee" and also referred to him as an "independent subcontractor" for the purpose of withholdings. At the time of Hull's employment with Respondent, he held a Class "C" private investigator license. In all aspects of Hull's employment with Respondent, he conducted himself, and was treated as an employee. Hull did business for Respondent under the Respondent's corporate name; held himself out to the public as being Respondent's employee; signed contracts on behalf of Respondent; received letters and correspondence as an employee; was directed when and were to show up for work; how to answer to the telephone; when to answer the telephone; and in all other respects was under the direct control and supervision of Respondent. During the course of employment with Morse Security Group, Hull possessed no occupational license, business cards, stationery, telephone listing, brochures or printed material that identified him as having any relationship with Respondent other than employee and filed no fictitious name with the Department of State. In dealing with clients and the general public, Hull held himself out as an employee of Respondent and his business cards indicated that he was an employee of Respondent. Of the five cases that Hull handled on behalf of Respondent, he at no time attempted to limit the Respondent's liability to any of those clients by asserting that he was an independent contractor, or had any other relationship with Respondent other than employee. Respondent never identified Hull to others an anything other than an employee. At no time did Respondent attempt to limit its general liability to the public as to Hull's employment by the use of the term subcontractor. Respondent never attempted to perpetrate a fraud on the public by the use of the term subcontractor as to Hull's employment. Respondent's liability insurance in effect from 1991 through 1994, specifically covered Hull as an employee of Respondent. John K. Polk was employed by Respondent from February 5, 1992 through March 27, 1993. At the inception of Polk's employment, he entered into an employment contract with Respondent. The agreement for employment was entitled "Employment Agreement", and consisted of twelve paragraphs. Throughout the employment agreement Polk is referred to as employee and Respondent is referred to as employer except in paragraph 10. Paragraph 10 informed Polk that as employee he would be regarded as a subcontractor or independent contractor for the purposes of taxes, workers' compensation, licenses, permits, and insurance. During the course of Polk's employment his relationship with Respondent was governed by the employment agreement. In addition to the employment agreement signed by Polk, he received a separate document entitled, "Employee Vacation/Sick Leave Policy". The vacation/sick leave document further identified and regulated Polk as an employee. During the course of Polk's employment with Respondent Polk did not maintain a separate general liability policy. At no time during the course of Polk's employment with Respondent did Respondent attempt to limit its liability to its clients by treating Polk as anything other than as an employee. Polk never attempted to use the fact that the term "subcontractor" had been used in paragraph 10 of the employment agreement in order to limit Respondent's liabilities to clients. Polk's employee fidelity bond questionnaire for State Farm Fire and Casualty Company Insurance was submitted by Respondent listing Polk as an employee, and Polk was covered under the policy for any acts of negligence of omissions. During the period of Polk's employment with Respondent he held no separate occupational license. Polk's business cards and stationery was provided by Respondent, and identified Polk as an employee of Respondent. The business telephone employed by Polk during his employment with Respondent was identified as Respondent. Polk worked under the direct supervision and control of Respondent. At all times Polk held himself out as an employee to Respondent's clients. During the course of his employment with Respondent, Polk was covered under Respondent's general liability policy for any acts of negligence or omission committed by Polk. Randy Morgan was employed with Respondent as an investigator from January 1, 1991, to approximately December, 1992. Morgan did not have a written contract for employment with the Respondent. Morgan was compensated by the case on an hourly basis by Respondent. Morgan was responsible for withholding his own Social Security and federal income taxes. Morgan considered himself as an employee of Respondent, and was under the supervision and control of Respondent. At all times during the course of his employment Morgan held himself out as an employee of Respondent, not as a subcontractor. Robert O. Sutley was employed by Respondent from November of 1992, until approximately March, 1993. During his employment with Respondent, Sutley held "DD", "B", and "G" licenses from the Department. Sutley entered into an employment agreement with Respondent which consisted of twelve paragraphs entitled "Employment Agreement". Within the employment agreement, the term "independent contractor" was a term used in relation to the workers' compensation and the withholding of taxes. Respondent did not attempt to limit its liability to the general public in regard to Sutley. Throughout the course of his employment with Respondent, Sutley held himself out as an investigator employee of Respondent. During his employment with Respondent, Sutley was under the supervision and control of Respondent. Respondent was contacted on a cold call by Martindale-Hubbell Law Directory for the purposes of advertising. After negotiations, Respondent caused to be issued an advertisement in the Martindale-Hubbell directory. Respondent initially instructed Martindale-Hubbell to advertise that Respondent was "one of the oldest and largest investigative agencies in Florida". The basis for the requested advertisement that Respondent was one of the oldest and largest was Respondent's purchase of a statewide detective agency, which had been in business in Florida since the 1950's, and that Respondent has an affiliate office in Europe and other parts of the United States. Pinkerton's of Florida has been licensed in Florida as an investigative agency since 1968. Pinkerton's has employed over 25 investigator employees on an annual basis over the last five years. Prior to its publication in Martindale-Hubbell, Respondent was not aware of the contents of the advertisement. The ad, as published, stated that the Respondent was the oldest and largest investigative agency in Florida. Respondent became aware of the contents of the advertisement upon receipt of the complaint filed against him by the State. Respondent then sent a letter to Martindale-Hubbell, inquiring why the advertisement read "Florida's oldest and largest private investigative agency", as opposed to "one of Florida's largest and oldest private investigative agencies" as previously instructed by Respondent. Martindale-Hubbell acknowledged that the final draft of the advertisement had been done without Respondent's approval and that an error had been made by Martindale-Hubbell in the advertisement, as it appeared in their publication. Respondent instructed Martindale-Hubbell to cease further advertisement. Respondent reported on his letterhead stationery to the Department the termination of the following persons: Colard, Crews, Fitzgerald, Martin, Morgan, Polk, and Stebbins within the statutory time limit. When Respondent was advised by Mr. Matlack that the computer printout from the Department showed that the above named people were still on a list indicating that they were associated with Respondent, Respondent sent another letter dated April 27, 1993 to the Department advising them of the termination of those listed individuals. As of October 15, 1993, the above named persons were still listed as in Respondent's employ. During the period from January 1, 1993 to April 1993, Harvey E. Morse voluntarily deactivated Class "C" Private Investigator's License and Private Investigative Security Agency Manager's License. Morse voluntarily deactivated licenses upon his graduation from the police academy and his association with the Florida Highway Patrol as a full time auxiliary trooper. Upon voluntary deactivation of Morse's licenses, Morse notified each of the company's employees that Morse would not be involved in any more investigations, and that the employees were to receive their direction from either Dwayne Rutledge or Maria Morse. Morse continued to engage in non-regulated functions such as marketing, sales, computer functions, bookkeeping, and payroll and teaching, training and instruction. During the periods of voluntary deactivation of his license, Morse would run a driver's license record on the computer, receive a printout, and hand it to an employee. Morse refrained, however, from being involved in an investigation based upon that printout. Morse has refrained from involvement in any regulated activities from the time that he voluntarily deactivated his license. Once Morse voluntarily deactivated his license, the primary person responsible for investigations and management of employees was Dwayne Rutledge. During the period from September 1992 to January 1993, Harvey E. Morse supervised and trained John Polk. Morse was always available by way of pager or cellular phone, and in constant contact with John Polk during that time period. Further, Respondent installed a two-way radio system so that Morse could talk with and supervise John Polk on a constant basis. Morse was never more than 60 miles from John Polk during his internship from September 1992 till January 1993, and Morse was in daily contact with John Polk in regard to pending investigations, new matters, old matters, and the general business of the Respondent's office. On several occasions during the above stated time period, Polk would communicate with Morse while he was on patrol in a Florida Highway Patrol vehicle, and ask questions of Morse concerning how investigative matters should be handled. Polk was afforded certain latitude by Morse to make administrative decisions on a day-to-day basis as his training progressed, and Morse placed more confidence in Polk's abilities in certain areas. However, Morse still oversaw those decisions. At all times, Polk's supervision of Respondent's employees was under the direct supervision and control of Morse or other licensed managers in Respondent's employ. The purpose of the Respondent's purchase of a two way radio system was twofold: One, to communicate with other investigators during the course of an investigation; and the other was to afford constant communication among Morse, the office managers, Dwayne Rutledge and Maria Morse, and the investigators, in case of a question would arise in the performance of their duties. Rutledge, as well as Maria Morse, became employed as office manager(s) shortly after 1990, and both he and Mrs. Morse were continuously available to the employees and oversaw, in conjunction with the Morse, the performance of their regulated duties.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is WHEREFORE, it is RECOMMENDED: Petitioner having failed to prove by clear and convincing evidence that Respondent violated those sections as alleged in Counts I through IX of the Administrative Complaint, it is hereby recommended that said Counts be DISMISSED. DONE and ENTERED this 31st day of January, 1994, in Tallahassee, Florida. DANIEL M. KILBRIDE Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 31st day of January, 1994. APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-3890 The following constitutes my specific rulings, in accordance with section 120.59, Florida Statutes, on proposed findings of fact submitted by the parties. Proposed findings of fact submitted by Petitioner. Petitioner waived the filing of proposed findings of fact. Proposed findings of fact submitted by Respondent. Accepted in substance: Count I, unnumbered paragraphs 1, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18; Count II, paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 14, 15, 16, 17, 20, 22; Count IV, unnumbered paragraphs 1, 2, 3, 4, 6, 7, 8; Count V, unnumbered paragraphs 1, 2, 3, 4, 5, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18; Count VIII, unnumbered paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9; Count VI, unnumbered paragraphs 1, 2 (in part), 3, 5, 6, 7, 8, 9; Count VII, unnumbered paragraphs 1, 2, 3, 5, 6, 7, 8, 9, 10, 11, 12; Count III, unnumbered paragraphs 1, 2, 3, 5, 6, 7, 8, 10, 11, 12. Rejected as argument or conclusory: Count I, unnumbered paragraphs 2, 21; Count IV, paragraphs 9; Count V, paragraph 2(in part); Count VII, paragraphs 4; Count III paragraphs 4, 9. Rejected as redundant or surplusage, or irrelevant and immaterial: Count II, unnumbered paragraphs 13, 18, 19; Count IV, paragraph 5; Count VI, paragraph 4. COPIES FURNISHED: Henri C. Cawthon, Esquire Department of State Division of Licensing The Capitol Mail Station-4 Tallahassee, Florida 32399-0250 William J. Sheaffer, Esquire William J. Sheaffer, PA. 609 East Central Boulevard Orlando, Florida 32801 Honorable Jim Smith Secretary of State The Capitol Tallahassee, Florida 32399-0250 Phyllis Slater, Esquire General Counsel The Capitol, PL-02 Tallahassee, Florida 32399-0250
