The Issue The issue for disposition in this case is whether Respondents have implemented agency statements that meet the definition of a rule, but which have not been adopted pursuant to section 120.54.
Findings Of Fact Petitioner, Robert Wood, P.E., is a Florida-licensed professional engineer, holding license No. PE 31542. A large part of Petitioner?s work involves the design of aluminum-framed structures. Respondents, DBPR and FBPE, are charged with regulating the practice of professional engineering in the State of Florida, pursuant to chapters 455 and 471, Florida Statutes, and the rules promulgated thereunder, Florida Administrative Code Chapter 61G15. The FEMC is a public-private partnership established by the legislature to provide administrative, investigative, and prosecutorial services to the FBPE. By statute, the FEMC operates under a written contract (Contract) with the DBPR, which Contract is approved by the FBPE. Term of the Contract From the creation of FEMC in 1997 until 2000, the legislature provided that the required written contract was to be “renewed annually.” In 2000, the legislature amended section 471.38 to require that the written contract be an “annual contract.” In 2003, the legislature again amended section 471.38 to repeal the requirement that the contract be an annual contract. There is currently no specified term or time for renewal for the required written contract. The DBPR and the FEMC have elected to continue to enter written contracts with a term of one year. Determination of Legal Sufficiency Since its creation in 1997, section 471.038 has provided that “[t]he corporation may not exercise any authority specifically assigned to the board under chapter 455 or this chapter, including determining probable cause to pursue disciplinary action against a licensee, taking final action on license applications or in disciplinary cases, or adopting administrative rules under chapter 120.” The only change to that restriction was made in 2000, when the term “corporation” was changed to “management corporation.” In 2000, the legislature also enacted the Management Privatization Act, section 455.32, Florida Statutes. That Act was intended to establish a model for the creation of non-profit corporations with which the DBPR could contract for “administrative, examination, licensing, investigative and prosecutorial services to any board created within the department.” The similarities between section 471.38 and section 455.32 make it obvious that the latter was largely patterned after the former. Among the duties to be performed by a “corporation” under section 455.32(10) is to: . . . make a determination of legal sufficiency to begin the investigative process as provided in s. 455.225. However, the department or the board may not delegate to the corporation, by contract or otherwise, the authority for determining probable cause to pursue disciplinary action against a licensee, taking final action on license actions or on disciplinary cases, or adopting administrative rules under chapter 120. In previous years, at least through 2001, the written contract between the DBPR and the FEMC provided that “FEMC shall not exercise the police powers inherent in the Department and the FBPE including a determination of legal sufficiency or insufficiency of a disciplinary complaint.” At some time after the passage of the Management Privatization Act, the contractual “police powers” restriction was changed, and now reads, as reflected in the current Contract, as follows: Except when providing those prosecutorial and investigative services set forth in this Agreement, FEMC shall not exercise the police powers inherent in the Department and the FBPE under Chapters 455 or 471, Florida Statutes, including determining probable cause to pursue disciplinary action against a licensee, other than failure to comply with final orders of the Board as set forth in Rule 61015-18.005(2), Florida Administrative Code, taking final action on license applications or in disciplinary cases, or adopting administrative rules under Chapter 120, Florida Statutes. Prosecutorial servicing shall only be executed in the name of FBPE. That contractual restriction is consistent with the statutory limitation on the powers of the FEMC set forth in section 471.38. In its current form, the Contract establishes the services that are to be provided by FEMC to the DBPR and the FBPE. The list of prosecutorial services to be provided by FEMC include coordinating with investigators, reviewing and taking “appropriate action” on complaints, and preparing cases for presentation to the FBPE probable cause panel. The list of investigative services to be provided by FEMC include receiving complaints, interviewing complainants, witnesses, and subjects of complaints, issuing subpoenas, preparing investigative reports, and taking other actions leading to the prosecution of a case. The Contract does not specifically address the issue of determining legal sufficiency. The typical procedures of the FEMC in performing its investigatory functions are initiated when the FEMC receives a complaint by various means, including telephone, e-mail, or submission of a written complaint. Written complaints are normally directed to the FEMC chief prosecutor, who assigns them to an investigator for initial review. If the complaint is verbal, the investigator fielding the call will ask the complainant to file a written complaint. If a complaint is unaccompanied by information to substantiate the claims, the investigator typically requests supporting documentation, which may be a set of engineering plans, a report, or similar evidence of the facts underlying the complaint. In a procedure implemented by the FEMC in 2012, after receipt of the complaint and supporting documentation, the investigator forwards the complaint to an engineering expert retained by FEMC for a pre-review. The expert prepares a preliminary report which is then considered in the determination of legal sufficiency. Prior to implementation of the 2012 pre- review procedure, the determination of legal sufficiency was made without the benefit of a pre-review report in the manner otherwise described below. After receipt of the complaint, the supporting documentation, and, since 2012, the pre-review report, the investigator presents the complaint to the FEMC chief prosecutor. If the chief prosecutor determines that the complaint is not legally sufficient, the investigator is instructed to draft a memorandum for the chief prosecutor to review, which is in turn submitted to the FBPE Executive Director for signature. If the chief prosecutor determines that the complaint is legally sufficient, he or she verbally authorizes the investigator to place the engineer on notice of the investigation. At that point, the complaint is investigated using the investigative tools available to FEMC as set forth in the Contract. If sufficient evidence that a violation has occurred is found, the investigation culminates in a recommendation to the FBPE probable cause panel for a decision as to whether the panel believes there to be probable cause to proceed with disciplinary action. The decision to proceed with a disciplinary proceeding requiring a point of entry to challenge the action is entirely that of the FBPE probable cause panel. Probationary Project Review On November 4, 2009, FBPE entered a disciplinary final order regarding Petitioner that incorporated a stipulated settlement agreement, and imposed sanctions on Petitioner, including probation. By his entry of the settlement stipulation, Petitioner agreed to a “project review” at six and eighteen-month intervals. The project review consisted of the submission by Petitioner of a list of all completed projects. That list was provided to an engineering expert, who then selected two of the projects for a more comprehensive review. The steps to be performed by Petitioner and the FBPE are generally described in Project Review Process Guidelines that were provided to Petitioner by FBPE as an attachment to the notice of the two projects selected for comprehensive review. As a result of the project review, the two projects were determined to violate engineering standards, which resulted in the FEMC making a recommendation of probable cause to the FBPE probable cause panel. The probable cause panel found probable cause, leading to the issuance of an Administrative Complaint against Petitioner. Petitioner introduced evidence of one other case in which a project review was required as a condition of probation. In that case, an administrative law judge, after having determined that the professional engineer committed violations of section 471.033 and Florida Administrative Code Rule 61G15- 19.001, recommended imposition of “probation for two years with appropriate conditions for this case.” The Final Order, entered on March 12, 2008, imposed the recommended probation “with a plans review at 6 months and 18 months from the date of this Order.” The basis for the imposition of that sanction was not explained. There was no evidence introduced at the final hearing as to any other specific case in which a project review was required, other than the case involving Petitioner. The 2012 FEMC Annual Report, which is a business record of the FEMC, indicated that between July 1, 2011 and June 30, 2012, the FEMC was involved in the investigation and/or prosecution of 32 cases in which Administrative Complaints were filed against engineers. Disciplinary sanctions imposed against engineers during that one-year period included, among others, twenty-five reprimands, six license suspensions, eight probations, seven license restrictions, two voluntary license relinquishments, and four license revocations. Also included among the sanctions imposed during that period were three project reviews. The sanction of project review is one that is, statistically, used sparingly by the FBPE. There was no evidence introduced to establish the criteria, if any, for the imposition of a project review as a condition of probation, or to demonstrate that it was generally applied in any specific circumstances.
Findings Of Fact During its 1980 Session, the Florida Legislature adopted the Florida Energy Efficiency and Conservation Act, Sections 366.80 through 366.85, Florida Statutes. The Act, which became effective July 1, 1980, mandated that the Florida Public Service Commission develop and adopt goals and plans related to the conservation of electric energy and natural gas usage. The Act required that initial goals be adopted no later than September 1, 1980. In order to comply with these legislative mandates, the Public Service Commission adopted Emergency Rules 25 ER 80-9 through 25 ER 80-14 through its Order No. 9512 issued September 2, 1980 (September 1, 1980, was an official state holiday). The emergency rules set general and specific goals to be met by electric and natural gas utility systems. General goals were set out in Rule 25 ER 80-9(2) as follows: Generating Utilities Review and revise utility operat- ing practices such as maintenance sched- uling, daily and longer term unit com- mitment practices through the power broker system to facilitate economic dispatch on both a daily and extended basis and to reduce oil consumption to the extent cost effective. Plan development of the bulk power system over time so that the most cost effective combination of generating units, associated facil- ities and other technologies is developed for meeting generation requirements. Increase the efficiency of each generating unit and associated prac- tices to the extent cost effective. All Utilities Aggressively integrate nontradi- tional sources of power generation into the various utility service areas to the extent cost effective, including planning site development to facili- tate development of potential cogen- erators near generation units. Increase the end use efficiency of energy consumption and power demand to the extent cost effective. Increase the efficiency of trans- mission and distribution systems to the extent cost effective. Aggressively pursue research, development and demonstration pro- jects jointly with others as well as individual projects in individual service areas. In this context, the Commission anticipates that an aggres- sive research program would include both technological research, research on load behavior and related problems and market related research. General Authority: 366.05(1), 366.82(1)-(4), F.S. Law Implemented: 366.82(1)-(4), F.S. Specific goals were set in Rule 25 ER 80-10 to reduce the growth rates of "weather-sensitive peak demand" of total electric consumption and of oil consumption. These goals were stated as follows: To reduce the average annual growth rate of kilowatt demand to less than the average annual growth rate of kilo- watthour consumption and to reduce the average annual growth rate of kilowatt- hour consumption to less than the aver- age annual growth rate in number of customers. The specific goals for the 1980-85 period are to reduce growth rates so that the total KW demand in 1985 does not exceed that of 1984 by more than 2.212 percent and the total KWH consumption in 1985 does not exceed that of 1984 by more than 2.6 percent. Peak demand in 1985 shall not exceed 23,188 MW and total consumption in 1985 shall not exceed 116,733 gigawatthours To reduce the use of oil as gen- erating fuel to the greatest practi- cable and cost effective extent. The overall goal for the 1980-85 period is to develop or implement programs to reduce the use of oil by 25 percent by 1990. In order to meet this goal, generation capacity in excess of that allowed by the first goal may be installed to the extent cost effective. Utilities were required to submit plans and programs desk to address the general goals, and to meet the specific goals. The emergency rule did not mandate any specific plans programs to be used by utilities in meeting the goals, but rather left the nature of programs that would be utilized to the discretion of the individual utilities. Following the adoption of the emergency rules, the Public Service Commission initiated permanent rule making proceedings. By its Order No. 9552 entered September 17, 1980, the Commission proposed to adopt Rules 25-17.01 though 25-17.06 as permanent rules. Notice of these proposed rules was published in the September 19, 1980, edition of the Florida Administrative Weekly. The proposed rules were substantively, identical to the emergency rules which had already been adopted. The Commission thereafter conducted public hearings on the proposed rules. Many interested persons, including the City of Gainesville, presented testimony and documentary evidence which was considered by the Commission. The Commission adopted Rules 25-17.01 through 25-17.05 through its Order No. 9634 issued November 13, 1980. The rules were filed with the Secretary of State. The rules as adopted were not identical to the rules that had been proposed for adoption. Specific differences between the adopted and proposed rules will be discussed hereafter. A statement reflecting that the rules as adopted were not identical to those proposed was published in the November 14, 1980, issue of the Florida Administrative Weekly. A description of the changes in the proposed rules was filed with the Joint Administrative Procedures Committee of the Florida Legislature. No person formally requested a detailed statement of the changes in response to the Order adopting rules, or in response to the publication in the Florida Administrative Weekly. A copy of the Order was distributed to all utilities affected by the rules, including Petitioner. The Public Service Commission prepared an Economic Impact Statement in support of the permanent rules as they were originally proposed. The Economic Impact Statement was available for inspection at the time the rules were formally proposed. Additional or modified statements of the economic impact of the rules were not prepared during the course of the rule making proceeding. The only specific cost to the Public Service Commission of implementing the rules set out in the economic impact statement is salaries of new employees who would be required. It is estimated in the statement that one-fourth of the time of a new supervisor, one-fourth of the time of a new marketing specialist, and one-half of the time of a utility systems engineer would be required. The salaries of these personnel for the 1980-81 through 1984-85 fiscal years are estimated in the statement. The estimated salaries of the marketing specialist and of the utility systems engineer were reversed in the statement, but the overall sum of the salaries appears accurate. The statement does not include an estimate of costs other than salaries of hiring these personnel, nor does the statement contain any estimate of the cost of paper work that would be required to implement the rules. Clearly, there would be some costs other than salaries involved in hiring new employees, including cost of retirement benefits and the like. Also clearly, there would be paper work costs connected with implementing the rules. No evidence was presented at the hearing to demonstrate that these costs would be significant, nor that the failure to include them in the Economic Impact Statement in any manner prejudices the Petitioner, City of Gainesville. The economic impact statement does not include any specific estimates of costs that would be incurred by utilities in implementing the rules. The statement includes a recognition that there would be such costs, that costs could be rather significant, and includes only conjecture that benefits that would accrue to the utilities would outweigh the costs. There are valid reasons for this lack of specificity. First, the rules leave to the individual utilities broad discretion in determining what plans or programs would be utilized to meet the goals established under the rules. There are many possibilities. Indeed, one purpose of allowing the utilities broad discretion in determining what plans and programs to utilize is to develop information as to how to best accomplish the conservation goals of the rules and of the Florida Energy Efficiency and Conservation Act. Since the utilities have broad discretion in determining plans and programs, it is not possible to give any accurate forecast of what costs utilities might accrue. Second, there is very little data available from which any useful forecast of cost of implementing plans and programs can be developed. This lack of information is recognized in the Act and in the rules, and it is a goal of both to develop the information. It has been estimated that in order to make any specific statement of the economic impact of the proposed rules in relation to plans and programs that might be anticipated would require the expenditure of hundreds of thousands of dollars simply to develop data. Such an expenditure would not be justifiable. The Economic Impact Statement does not include any specific estimate of the cost to electrical consumers of implementing the rules. It can be anticipated that plans and programs adopted by individual utilities would require the expenditure of money on the part of consumers to obtain energy efficient appliances. It is not possible to make any useful prediction of what these costs might be for the same reason that it is not possible to predict what the cost of implementing the rules might be for individual utilities. In the first pace, the utilities have broad latitude in determining what plans and programs to utilize. The nature of the program adopted by the utility would govern what costs consumers would need to incur. Furthermore, there is a lack of data in this area. While the costs of individual appliances could be accurately estimated, the amount of savings in utility costs cannot be utilizing present data and given the broad variables that exist in utility charges. Public Service Commission Rules 25-17.01 through 25-17.05, Florida Administrative Code, as adopted by Commission Order No. 9634 are not identical to the rules as proposed under Commission Order No. 9552. Most of the changes are of a non-substantive sort, serving to clarify the intent of the rules and the responsibilities of electrical and gas utilities in meeting the goals set out in the rules. For example, under adopted Rule 25-17.02, the responsibility of electric utilities to develop five-year goals and plans is clearly delineated, and the method for calculating consumption and growth rates is set out with a precision that was lacking in the rules as originally proposed. Some of the changes do, however, impose different substantive requirements upon utilities. The first of these is the goal for reducing consumption of electrical power. Under the proposed rules, a consumption goal was set in order to provide an allowable growth rate of consumption of 85 percent of projected growth rates for kilowatt-hour demand. The starting point for projections under the rule as adopted is the projected growth rate in residential customers. The 85 percent goal under the proposed rules was changed to require that electrical utilities reduce the growth rate of end use weather-sensitive peak kilowatt demand and of kilowatt-hour consumption to an average of 72.25 percent and 75 percent, respectively, of the average annual growth rate in the number of residential customers for the 1980-89 period. While the percentage is reduced, what the percentage relates to is changed, and the period of the projection is changed. The result is that the rules as proposed and as adopted impose very nearly the same criteria, but the criteria are more easily identified under the rules as adopted. While the goals are nearly equivalent, they are not identical. The rules as adopted do impose a slightly more stringent requirement. As to the City of Gainesville, specifically, the requirement is more stringent, but not to the extent that the City cannot meet the goals with reasonable efforts. Under the rules as originally proposed, a goal was specified for reducing annual peak demand loads for summer or winter. Under the rules as adopted, goals are set for summer and winter peak demands. While this is a substantively different goal which imposes different responsibilities upon utilities, the evidence does not reveal that the goal is more onerous or stringent that provided in the rules as proposed. The rules as proposed set the same percentage oil reduction goal as in the rules as adopted. The rules require however, that the goals be met by 1989 rather than by 1990 as in the proposed rules. It would appear that this is a more stringent requirement; however, the rules do not require any actual oil reduction during the period 1981-85. The emergency rules adopted by the Commission (Rules 25 ER 80-9 through 25 ER 80-14) are substantively identical to the permanent rules as originally proposed by the Commission. All of the differences between the rules as adopted and the rules as originally proposed discussed in the foregoing paragraph pertain equally to differences between the emergency rules and the permanent rules. Through its Order No. 9923 issued April 2, 1981, the Public Service Commission proposed to adopt amendments to its Rule 25-17.02 and a new Rule 25- 17.041. With modifications not here pertinent, the rules were adopted through Commission Order No. 10069 issued June 17, 1981. The rules were not properly filed with the office of the Secretary of State, and they were accordingly withdrawn and reproposed under commission Order No. 10234 issued August 26, 1981. These proposed rules are the subject of the Petitioner's challenge in Case No. 81-2161RP before the Division of Administrative Hearings. The proposed revision to Commission Rule 25-17.02 modifies the goals for reduction of growth rates of end use weather-sensitive peak kilowatt demand and of kilowatt-hour consumption to relate to the average annual growth rate in the number of residential customers for the 1981-89 period rather than for the 1980-89 period. The percentage growth rates remain the same as originally provided. Other dates are modified to reflect the passing of another year. Proposed Rule 25-17.041 sets transitional goals for utilities that have not yet had plans and programs approved by the Commission. It appears that these proposed rules impose slightly more stringent goals upon electrical utilities. It does not appear that the changes are so onerous, however, as to be unreasonable. The Public Service Commission has interpreted both the emergency rules and the permanent rules as requiring that electric utilities adopt "end use" plans and programs to meet the specific goals set out in the rules, rather than "supply side" plans and programs. "End use" refers to power uses on the customer side of the meter which lies between the utility's lines and the customer's home or business. Thus, "end use programs" would be designed to reduce consumption of electrical power by ultimate consumers. "supply side" refers to things that occur on the utility's side of the meter. "Supply side programs" would be programs designed to eliminate inefficiencies in the utility's generating system. The Public Service Commission consistently interpreted the emergency rules as requiring that utilities propose end use programs to meet the specific goals. While this interpretation is not readily obvious from a reading of the rules, it is neither inconsistent with them, nor a strained interpretation. General goals set out in the emergency rules include goals which would encourage electric utilities to improve supply side efficiencies. For example, Rules 25 ER 80-9 (2)(a), and (c), which relate to electric generating utilities, all require increased supply side efficiencies. The specific goals, however, relate to reduction of the growth rates of weather- sensitive peak demand and of total electric consumption. While "total electric consumption" could be interpreted as including supply side efficiencies, it would be inappropriate to interpret it in that manner because the goals are to reduce growth rates. Since generating utilities are specifically mandated under the general goals to improve supply side efficiencies, it would be inconsistent to interpret the specific goals as encouraging the same programs. Whatever ambiguity there is in the emergency rules as to whether supply side programs could be used to meet the specific goals, there is no ambiguity under the permanent rules adopted by the Commission. Rule 25-17.02 sets specific goals for "end use KW [kilowatt] demand" and "KWH [kilowatt-hour] consumption." End use solutions are clearly required under the permanent rules. The City of Gainesville operates an electric utility. The City submitted a plan to the Public Service Commission to meet the energy efficiency goals. The Commission disapproved the City's proposal and directed that a revised conservation plan be submitted. The City's plan was rejected because it proposed primarily supply side programs to meet the Commission's specific conservation goals. The Commission found in its Order No. 9906 issued March 31, 1981, that if the supply side programs proposed by the City were excluded, the City's plan would not fleet the specific goals. The City appears to concede that such end use programs as it has proposed would not meet the specific goals. Meeting the Commission's goals through end use programs would involve some additional expense by the City over what it would need to have expended to meet the goals through supply side programs. Whether the additional expense would ultimately prove cost effective because it would result in the City needing to spend less for new facilities in the future is a matter of conjecture, and cannot be determined from the evidence.
The Issue The issue in this matter is whether Respondent’s proposed Florida Administrative Code Rule 59A-36.001 constitutes an invalid exercise of delegated legislative authority. Before that issue may be reached, however, it is necessary to determine whether Petitioner has standing to challenge the proposed rule.
Findings Of Fact AHCA is the state agency responsible for the licensure of assisted living facilities (“ALFs”) in the State of Florida. See Ch. 429, Part I; and Ch. 408, Part II, Fla. Stat. As part of its responsibilities, AHCA serves as the enforcement arm for the licensed activity and operation of ALFs. See gen., Chs. 408 and 429, Fla. Stat.; Fla. Admin. Code R. 58A-5 and 59A-35. Petitioner is currently licensed by AHCA to operate an ALF in Hilliard, Florida. Accordingly, Petitioner falls under AHCA’s jurisdiction and is required to adhere to all rules promulgated by AHCA, as well as the Department of Elder Affairs, pertaining to ALFs. See §§ 408.802(13) and 429.01(2), Fla. Stat. Section 429.28, Florida Statutes, is the “resident bill of rights” for ALFs. The resident bill of rights provides that no resident of an ALF “shall be deprived of any civil or legal rights, benefits, or privileges guaranteed by law, the Constitution of the State of Florida, or the Constitution of the United States as a resident of a facility.” Section 429.28 enumerates 12 specific rights for ALF residents. In its 2015 legislative session, the Florida Legislature amended section 429.28(3)(a), which states (as amended): [AHCA] shall conduct a survey to determine general compliance with facility standards and compliance with residents’ rights as a prerequisite to initial licensure or licensure renewal. [AHCA] shall adopt rules for uniform standards and criteria that will be used to determine compliance with facility standards and compliance with residents’ rights. Thereafter, AHCA drafted rule 59A-36.001 entitled, “Standards and Criteria for Determining Resident Rights.”4/ AHCA published the proposed rule in Volume 42, No. 50, March 14, 2016, of the Florida Administrative Register. On June 8, 2016, AHCA published a Notice of Change/Withdrawal amending several sections of the proposed rule. AHCA’s stated purpose and effect of rule 59A-36.001 is to “create a new rule chapter regarding residents’ rights in assisted living facilities licensed by the Agency. Section directs the Agency to adopt rules for uniform standards and compliance with residents’ rights.” Rule 59A-36.001 specifically provides, in pertinent part5/: 59A-36.001, Standards and Criteria for Determining Compliance with Facility Standards and Resident Rights DEFINITIONS. In addition to the terms defined in Section 429.02, F.S., and Rule 58A-5.0131, F.A.C., the following definitions are applicable in this rule chapter. “Core Survey Task” means tasks conducted by Agency survey staff that focus on core areas of regulations. “Timely Manner” means as soon as possible, but not to exceed 24 hours of Agency staff having requested materials. Rule 59A-36.001(2) is entitled “SURVEY PROCESS FOR RESIDENT RIGHTS” and provides, in pertinent part: The following core survey tasks shall be utilized during survey activities in order to determine the facility’s compliance with resident rights pursuant to 429.28, F.S. and 58A-5.0182, F.A.C. The surveyor(s) conducts a tour of the facility to determine if the residents’ health, safety, and welfare are maintained. The tour includes observations and assessments of the following: . . . . Thereafter, rule 59A-36.001(2), in subsections 1 and 2, lists approximately 35 “standards and criteria” a surveyor is to use to determine whether the “residents’ health, safety, and welfare” are maintained by the ALF. In addition to the general reference to section 429.28 and Florida Administrative Code Rule 58A- 5.0182, approximately 18 of the enumerated “standards and criteria” refer to section 429.14(6) or a specific provision from chapter 58A-5. Catherine Anne Avery testified on AHCA’s behalf. Ms. Avery is the manager for the Assisted Living Unit at AHCA. She was the lead developer and drafter of rule 59A-36.001. Ms. Avery explained that, as a prerequisite to initial licensure or licensure renewal of ALFs, AHCA is responsible for surveying (inspecting) ALFs to determine compliance with facility standards and residents’ rights. Pursuant to the Legislature’s directive in section 429.28(3)(a), AHCA created rule 59A-36.001 to standardize the survey process for all AHCA surveyors across the state. Ms. Avery drafted the proposed rule to ensure that surveyors use uniform criteria when determining whether an ALF has generally complied with required facility standards and resident care standards and rights. According to Ms. Avery, AHCA created rule 59A-36.001 solely and exclusively to educate AHCA surveyors on how to conduct ALF surveys. Rule 59A-36.001 is not intended to be used by ALFs or providers. Rule 59A-36.001 essentially creates a checklist of the “core” statutory and administrative rule standards. AHCA intends for every surveyor to use the standards and criteria outlined in rule 59A-36.001 during each survey. Ms. Avery relayed that a survey requires a surveyor to tour the ALF facility; observe ALF operations and services; interact with ALF staff and residents; and interview ALF employees and residents. During the survey, the surveyor is attentive for any possible violations of Florida law. If the surveyor finds evidence of a violation, the surveyor is to refer to the pertinent statutory authority and related administrative rules. After reviewing the applicable statutes and rules, if the surveyor determines that the ALF has committed a violation, the surveyor may issue a Statement of Deficiency to the ALF. Ms. Avery testified that each “standard and criteria” listed in rule 59A-36.001 is based on existing statutory and rule authority. Ms. Avery explained that rule 59A-36.001 does not impose any requirements on an ALF or include any criteria that is not already set forth in Florida statutes or other agency rules. Similarly, the proposed rule does not create new standards or criteria with which Petitioner is required to comply. Therefore, because ALFs must comply with the existing statutes and administrative rules listed in rule 59A-36.001, Ms. Avery testified that the proposed rule will not affect Petitioner. Ms. Avery expressed that AHCA will not cite rule 59A-36.001 to impose administrative penalties on Petitioner (or any other ALF). Any deficiency a surveyor might identify during a survey is encompassed within other applicable rules or statutory authority.6/ Accordingly, Petitioner cannot be sanctioned by AHCA under rule 59A-36.001 for failure to comply with “facility standards” or “residents’ rights.” Ms. Avery conceded that rule 59A-36.001 does not record every statute or rule provision pertaining to “facility standards” and “residents’ rights.” She explained that, in compiling one list of uniform standards and criteria, AHCA could not practically include every factor that might impact an ALF resident’s safety and well-being. Ms. Avery did not believe it was possible to delineate every area of concern or condition that affects the “legal rights, benefits, or privileges” of ALF residents. Instead, AHCA fashioned rule 59A-36.001 to reference only the “core survey tasks.” These tasks focus on the core area of regulations that are designed to protect the health, safety, and welfare of ALF residents. In setting down uniform standards into one rule, AHCA wanted to focus its surveyors on those areas that are most important and have the highest impact on residents’ rights. At the final hearing, Petitioner elicited testimony from Ms. Avery that AHCA surveyors may utilize other resources during surveys that are not incorporated into rule 59A-36.001. These resources include the Aspen Regulation Set (“Aspen Reg Set”) and the Assisted Living Resource Manual (“Resource Manual”). These two documents provide a surveyor with lists of AHCA protocols, statutory references, and various investigative forms that offer guidance on how a surveyor is to conduct a survey or gather evidence to assess an ALF’s compliance with governing law. The Aspen Reg Set contains a list of pertinent statutes and administrative rules a surveyor may use to assign deficiencies. The Resource Manual contains an interview worksheet that a surveyor may use while questioning facility staff, residents, or residents’ family members. Ms. Avery explained that rule 59A-36.001 was not designed to directly replace the Aspen Reg Set or the Resource Manual. Instead, all these resources combine to provide a “toolbox” for the surveyor to use to determine compliance. The Aspen Reg Set and the Resource Manual are merely tools the surveyor may employ at his or her discretion. No surveyor is required to use the documents during a survey. In addition, Ms. Avery explained that the statutes and administrative rules cited in the Aspen Reg Set or the Resource Manual consist of the same law that AHCA listed in rule 59A-36.001. Ms. Avery also testified that section 429.28 authorizes AHCA surveyors to refer to recognized “community standards” during ALF surveys. Section 429.28(1)(j) specifically states: Every resident of a facility shall have the right to: * * * (j) Access to adequate and appropriate health care consistent with established and recognized standards within the community. AHCA, however, did not incorporate into rule 59A-36.001 all the various Florida “community standards” that a surveyor may encounter to determine an ALFs’ compliance with residents’ rights. Ms. Avery explained that “community standards” are not codified in statute. In addition, AHCA does not have authority to define “community standards.” Instead, AHCA surveyors consider community standards on a case-by-case basis depending upon facts and circumstances that are particular to the specific community. Ms. Avery also addressed a specific provision AHCA included in rule 59A-36.001 regarding the time period in which an ALF must produce documents following a surveyor’s request. Rule 59A-36.001(2)(4) states that, “The facility must provide agency staff with requested documents in a timely manner and allow the agency staff to obtain copies.” (Emphasis added). Rule 59A-36.001(1)(b) defines “timely manner” to mean “as soon as possible, but not to exceed 24 hours of Agency staff having requested materials.” Ms. Avery explained that the time period for an ALF to produce documents is already addressed in existing Florida law. Specifically, rule 58A-5.024 provides that an ALF “must maintain required records in a manner that makes such records readily available at the licensee’s physical address for review by a legally authorized entity . . . ‘readily available’ means the ability to immediately produce documents, records, or other such data, either in electronic or paper format, upon request.” (Emphasis added). AHCA decided to use “24 hours” in rule 59A- 36.001(1)(b) instead of the term “immediately” as a way to provide the surveyor a workable frame of reference when requesting documents from ALFs. Instead of demanding that an ALF produce documents “immediately,” the surveyor will have the discretion to grant an ALF a more practical time period to produce the records (i.e., within 24 hours). Essentially, AHCA intended surveyors to use the 24-hour time period as a rule of thumb. Ms. Avery opined that Petitioner will not be affected by a surveyor’s use of the term “timely manner” in rule 59A- 36.001(1)(b). AHCA can sanction an ALF for failing to produce records “immediately” under existing statutes and administrative rules. See, e.g., §§ 408.811(3), 429.14, and 429.34(2), Fla. Stat. AHCA will not cite to rule 59A-36.001 for an ALF’s failure to produce records in a “timely manner.” Finally, Ms. Avery pointed out that AHCA does not have rulemaking authority regarding facility standards or residents’ rights. Instead, the Department of Elder Affairs has sole authority under Florida law to promulgate rules for residents’ rights in chapter 429. See § 429.41, Fla. Stat. Facility standards for ALFs are set forth in chapter 429, part I, and chapter 58A-5. Therefore, AHCA cannot, and did not, include any “uniform standards and criteria” in rule 59A-36.001 that expand, interpret, reduce, or otherwise modify the rules for facility standards and residents’ rights promulgated by the Department of Elder Affairs. Petitioner’s owner and executive director, Douglas Adkins, testified on Petitioner’s behalf. Mr. Adkins has administered Petitioner for over 29 years. Petitioner asserts that rule 59A-36.001 is vague in that the proposed rule lacks adequate specificity. Because of its vagueness, Petitioner argues that rule 59A-36.001 fails to establish adequate standards for AHCA decisions and provides AHCA surveyors too much discretion during the survey process. Mr. Adkins expressed that the “uniform standards and criteria” listed in rule 59A-36.001 do not contain sufficient detail to fairly and reasonably inform ALFs how AHCA surveyors will determine compliance with applicable statutes and rules. Mr. Adkins expounded that AHCA must enunciate more clearly what regulations surveyors might cite to sanction ALFs, and how they will determine compliance. Mr. Adkins explained that Petitioner initiated this rule challenge to ensure that it is fully aware of AHCA’s expectations prior to its licensure renewal surveys. To make sure that its ALF services comply with all legal requirements, Petitioner seeks a comprehensive understanding of how AHCA surveyors will determine compliance with applicable facility standards and residents’ rights. Mr. Adkins testified that he keenly reviews all materials and resources to which AHCA surveyors may refer during their surveys. He also studies AHCA postings and informational releases to ascertain pertinent Florida law. Having AHCA set forth in rule 59A-36.001 the exact standards its surveyors will use to determine ALF compliance will greatly assist him achieve his goal of administrating his ALF in full compliance with Florida statutes and administrative rules, as well as be fully prepared for Petitioner’s licensure renewal surveys. Despite his claim, however, Mr. Adkins did not point to any distinct example (or prospective AHCA survey) where an AHCA surveyor could cite rule 59A-36.001 as a basis for a legal deficiency or violation while surveying his facility. Neither did Mr. Adkins identify any standard or criteria set forth in rule 59A-36.001 with which Petitioner might fail to comply. Further, Mr. Adkins did not present evidence of any imminent or pending adverse administrative action Petitioner might or will confront based on AHCA’s promulgation of rule 59A-36.001. The competent substantial evidence presented at the final hearing fails to prove that Petitioner is substantially affected by rule 59A-36.001. Petitioner did not show that the proposed rule will cause a real or immediate injury in fact. In addition, Petitioner failed to establish, by a preponderance of the evidence in the record, a factual basis that the proposed rule is vague. Conversely, AHCA demonstrated that rule 59A- 36.001 is not an invalid exercise of delegated legislative authority as to Petitioner’s objection that the proposed rule is vague.
The Issue The issue in this case is whether Robert L. Packer (Respondent) violated Emerald Coast Utilities Authority (ECUA or Petitioner) personnel policies as set forth in subsections B-13 A (4), (22), (32) and (33) of ECUA’s Human Resources Manual and Employee Handbook, as charged in the letter dated January 13, 2020, from Petitioner’s sanitation collections manager.
Findings Of Fact Escambia County Utilities Authority was declared an independent special district with transferred assets and enumerated powers by chapter 2001-324, Laws of Florida. Escambia County Utilities Authority’s name was changed to ECUA by chapter 2004-398. By law, ECUA provides utility services throughout Escambia County, Florida, and has the power to appoint, remove, and suspend its employees, and fix their compensation within the guidelines of Escambia County Civil Service Rules. Id. Respondent was hired by Petitioner as a sanitation equipment operator in April 2009, with a start date of April 14, 2009. Respondent was promoted with a salary increase to a sanitation equipment operator II (step 2) on April 14, 2010, and received another raise on December 7, 2019, when he was transferred to ECUA’s commercial division. On the first day of his employment, Respondent acknowledged receipt of a copy of ECUA’s Employee Handbook, which is a summary of ECUA’s benefits, policies, procedures, and rules, and was advised that a copy of ECUA’s Human Resources Manual is available for review by all employees. On December 10, 2019, while covering another driver’s route, Respondent was operating ECUA vehicle number 26B, a Half Pack Dura- Pack garbage truck designed to pick up and empty large garbage containers (dumpsters or cans). Although Respondent had driven the route several times before, it was not his regular route. One of the customers on the route was Eddie Craig Express Automotive, an automotive body shop located at 6345 North Palafox Street in Pensacola. Respondent serviced the Eddie Craig Express Automotive location between 4:00 and 5:00 a.m., the morning of December 10, 2019. When he arrived at the location, it was dark and there were a lot of cars in the lot where the dumpster was located. There was a truck parked at an angle to the dumpster that Respondent had to maneuver around. Prior to dumping, which involved lifting the can over the garbage truck with the truck’s front forks, Respondent got out of his truck and surveyed the site to make sure that the arms of the truck and the dumpster would not make contact with the building next to the dumpster. Respondent then got back into the truck and dumped the can. Respondent did not notice any contact with the roof or damage to the building. Although the mirrors on the left side of the garbage truck were sufficient to see the left side of the dumpster while overhead, the mirrors on the right side (where the building was located) were insufficient to view that side of the can during the dumping process. In addition, because of the noise of the garbage truck, especially during the dumping process with hydraulic noises and additional engine acceleration, it is unlikely that Respondent would have been able to hear any contact that the dumpster or truck forks may have made with the adjacent building. Respondent did not notice any contact with or damage to the adjacent building. After dumping the can, Respondent backed out, returning to the roadway, carefully avoiding the cars parked in the lot. According to the ECUA Vehicle Claim Report of the incident, Eddie Craig, the owner of Eddie Craig Express Automotive, contacted ECUA risk management staff and reported damage to the left front roof eave on the corner of his building that he believed was done by an ECUA sanitation truck on the morning of December 10, 2019. Upon investigation at the scene on December 12, 2019, investigating ECUA employees observed wood fragments and debris below the corner of the building’s damaged roof which had paint smudges matching the paint of both the dumpster and ECUA’s sanitation trucks. The dumpster on the site had scratches consistent with the theory that the damage to the roof eave was caused by contact with the dumpster. In addition, the ECUA employees who investigated the scene observed a tire track adjacent to the building matching the tread on tires used on ECUA vehicle number 26B, and other ECUA sanitation vehicles. The location of the tire track was close enough to the building to support the conclusion that the damage to the roof was caused by an ECUA truck while dumping a can. Respondent confirmed that he was the one that serviced the can at Eddie Craig Express Automotive on the morning of December 10, 2019. There were no other dump services scheduled between the time Respondent dumped the can and the investigation on December 12, 2019. The preponderance of the evidence demonstrates that, despite Respondent’s precaution of getting out of the truck and looking around prior to dumping the can, unfortunately, the dumpster or the green arms of the garbage truck, or both, bumped the corner of the roof of the adjacent building, bending away the flashing and knocking off pieces of wood. Given the obstacles in the lot, it is quite apparent that Respondent went out of his way to service the customer that morning. However, especially in hindsight, it is equally obvious that it would have been better not to service the dumpster that day. ECUA’s sanitation collection manager, Keith Kyles, testified that, although not a written rule, he tells the sanitation truck drivers all the time, including Respondent, that in order to avoid accidents, they should not attempt to service cans in precarious locations. Rather, according to the advice given by Mr. Kyles, the drivers should leave the containers in place and call in the problem so that the cans can be relocated. Prior to this accident, although written up on May 3, 2017, for an unrelated incident involving failure to properly report the poor condition of a vehicle’s tires, and on October 16, 2017, for failure to pick up bulk waste items, Respondent had not had an accident with an ECUA vehicle since 2013. ECUA’s commercial services supervisor, Ricky Fretwell, testified that Respondent is a good employee. Mr. Fretwell said that he felt bad for Respondent because of the accident. According to Mr. Fretwell, Respondent “went out of his way, but it cost him.” Mr. Fretwell confirmed that, because of the noise during dumping, it was quite possible that Respondent did not notice that an accident had occurred. Mr. Fretwell, as one of the ECUA employees who investigated the accident scene on December 12, 2019, however, also confirmed that the angle of the tire track, the wood shards, paint scrapes, and other evidence was consistent with the conclusion that the damage occurred that morning of December 10, 2019, when Respondent serviced the site. Mr. Fretwell further confirmed that, consistent with Mr. Kyles’s testimony, according to unwritten protocol, instead of servicing the site that morning, Respondent should have left the dumpster in place and called it in.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is Recommended that the Executive Director of the Emerald Coast Utilities Authority find that Respondent violated ECUA Human Resources Manual and Employee Handbook sections B-13 A (22) and (32), but not sections B-13 A (4) or (33), as concluded above, and impose such discipline on Respondent as determined appropriate under the provisions of said Manual. DONE AND ENTERED this 19th day of August, 2020, in Tallahassee, Leon County, Florida. S JAMES H. PETERSON, III 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 19th day of August, 2020. COPIES FURNISHED: Robert L. Packer 2329 Silverside Loop Pensacola, Florida 32526 Jessica L. Scholl, Esquire Moore, Hill & Westmoreland, P.A. Post Office Box 13290 Pensacola, Florida 32591 (eServed) Stephen E. Sorrell, Executive Director Emerald Coast Utilities Authority 9255 Sturdevant Street Pensacola, Florida 32514 Cynthia Sutherland, Director Human Resources and Administrative Services Emerald Coast Utilities Authority 9255 Sturdevant Street Pensacola, Florida 32514
The Issue Whether the Department of Corrections? action to withdraw its Intent to Award and to reject all replies to ITN 12-DC-8396 is illegal, arbitrary, dishonest, or fraudulent, and if so, whether its Intent to Award is contrary to governing statutes, rules, policies, or the solicitation specifications.
Findings Of Fact The DOC is an agency of the State of Florida that is responsible for the supervisory and protective care, custody, and control of Florida?s inmate population. In carrying out this statutory responsibility, the Department provides access to inmate telephone services. On April 15, 2013, the DOC issued the ITN, entitled “Statewide Inmate Telephone Services, ITN 12-DC-8396,” seeking vendors to provide managed-access inmate telephone service to the DOC. Responses to the ITN were due to be opened on May 21, 2013. The DOC issued Addendum #1 to the ITN on April 23, 2013, revising one page of the ITN. The DOC issued Addendum #2 to the ITN on May 14, 2013, revising a number of pages of the ITN, and including answers to a number of vendor questions. EPSI, GTL, and Securus are providers of inmate telephone systems and services. Securus is the incumbent contractor, and has been providing the Department with services substantially similar to those solicited for over five years. No party filed a notice of protest to the terms, conditions, or specifications contained in the ITN or the Addenda within 72 hours of their posting or a formal written protest within 10 days thereafter. Replies to the ITN were received from EPSI, GTL, Securus, and Telmate, LLC. Telmate?s reply was determined to be not responsive to the ITN. Two-Part ITN As amended by Addendum #2, section 2.4 of the ITN, entitled “ITN Process,” provided that the Invitation to Negotiate process to select qualified vendors would consist of two distinct parts. In Part 1, an interested vendor was to submit a response that described certain Mandatory Responsiveness Requirement elements, as well as a Statement of Qualifications, Technical Response, and Financial Documentation. These responses would then be scored using established evaluation criteria and the scores would be combined with cost points assigned from submitted Cost Proposals. In Part 2, the Department was to select one or more qualified vendors for negotiations. After negotiations, the Department would request a Best and Final Offer from each vendor for final consideration prior to final award decision. The ITN provided that the Department could reject any and all responses at any time. High Commissions and Low Rates Section 2.5 of the ITN, entitled “Initial Cost Response,” provided in part: It is the Department?s intention, through the ITN process, to generate the highest percentage of revenue for the State, while ensuring a quality telephone service with reasonable and justifiable telephone call rate charges for inmate?s family and friends similar to those available to the public-at- large. Section 2.6 of the ITN, entitled “Revenue to be Paid to the Department,” provided in part that the Department intended to enter into a contract to provide inmate telephone service at no cost to the Department. It provided that, “[t]he successful Contractor shall pay to the Department a commission calculated as a percentage of gross revenues.”1/ The commission paid by a vendor is the single largest expense in the industry and is an important aspect of any bid. Contract Term Section 2.8 of the ITN was entitled “Contract Term” and provided: It is anticipated that the initial term of any Contract resulting from this ITN shall be for a five (5) year period. At its sole discretion, the Department may renew the Contract in accordance with Form PUR 1000 #26. The renewal shall be contingent, at a minimum, on satisfactory performance of the Contract by the Contractor as determined by the Department, and subject to the availability of funds. If the Department desires to renew the Contracts resulting from this ITN, it will provide written notice to the Contractor no later than thirty days prior to the Contract expiration date. Own Technology System Section 3.4 of the ITN provided in part: The successful Contractor is required to implement its own technology system to facilitate inmate telephone service. Due to the size and complexity of the anticipated system, the successful Contractor will be allowed a period of transition beginning on the date the contract is executed in which to install and implement the utilization of its own technology system. Transition, implementation and installation are limited to eighty (80) days. The Department realizes that some "down time" will occur during this transition, and Respondents shall propose an implementation plan that reduces this "down time" and allows for a smooth progression to the proposed ITS. GTL emphasizes the language stating that the successful contractor must implement “its own” technology system, and asserts that the technology system which EPSI offers to install is not owned by it, but by Inmate Calling Solutions, LLC (ICS), its subcontractor. However, EPSI demonstrated that while the inmate telephone platform, dubbed the “Enforcer System,” is owned by ICS now, that EPSI has a Master User Agreement with ICS and that an agreement has already been reached that before the contract would be entered into, a Statement of Work would be executed to create actual ownership in EPSI for purposes of the Florida contract. GTL alleges that in EPSI?s reply, EPSI relied upon the experience, qualifications, and resources of its affiliated entities in other areas as well. For example, GTL asserts that EPSI?s claim that it would be providing 83 percent of the manpower is false, since EPSI has acknowledged that EPSI is only a contracting subsidiary of CenturyLink, Inc., and that EPSI has no employees of its own. While it is clear that EPSI?s reply to the ITN relies upon the resources of its parent to carry out the terms of the contract with respect to experience, presence in the state, and personnel, EPSI demonstrated that this arrangement was common, and well understood by the Department. EPSI demonstrated that all required capabilities would be available to it through the resources of its parent and subcontractors at the time the contract was entered into, and that its reply was in conformance with the provisions of the ITN in all material respects. EPSI has the integrity and reliability to assure good faith performance of the contract. Call Recording Section 3.6 of the ITN, entitled “Inmate Telephone System Functionality (General),” provided in part: The system shall provide the capability to flag any individual telephone number in the inmate?s „Approved Number List? as „Do Not Record.? The default setting for each telephone number will be to record until flagged by Department personnel to the contrary. Securus alleges that section 3.6 of the ITN implements Department regulations2/ and that EPSI?s reply was non-responsive because it stated that recording of calls to specific telephone numbers would be deactivated regardless of who called that number. Securus alleges that this creates a security risk because other inmates calling the same number should still have their calls recorded. EPSI indicated in its reply to the ITN that it read, agreed, and would comply with section 3.6. While EPSI went on to say that this capability was not connected to an inmate?s PIN, the language of section 3.6 does not mention an inmate?s PIN either. Read literally, this section requires only the ability to “flag” any individual telephone number that appears in an inmate?s number list as “do not record” and requires that, by default, calls to a telephone number will be recorded until it is flagged. EPSI?s reply indicated it could meet this requirement. This provision says nothing about continuing to record calls to that same number from other inmates. Whether or not this creates a security risk or is what the Department actually desired are issues which might well be discussed as part of the negotiations, but this does not affect the responsiveness of EPSI?s reply to section 3.6. Furthermore, Mr. Cooper testified at hearing that EPSI does have the capability to mark a number as “do not record” only with respect to an individual inmate, at the option of the Department. EPSI?s reply conformed to the call-recording provisions of section 3.6 of the ITN in all material respects. Call Forwarding Section 3.6.8 of the ITN, entitled “System Restriction, Fraud Control and Notification Requirements,” provided that the provided inmate telephone services have the following security capability: Ability to immediately terminate a call if it detects that a called party?s telephone number is call forwarded to another telephone number. The system shall make a “notation” in the database on the inmate?s call. The system shall make this information available, in a report format, to designated department personnel. In response to an inquiry noting that, as worded, the ITN did not technically require a vendor to have the capability to detect call-forwarded calls in the first place, the Department responded that this functionality was required. Securus alleges that EPSI is unable to comply with this requirement, citing as evidence EPSI?s admission, made some months before in connection with an RFP being conducted by the Kansas Department of Corrections, that it did not yet have this capability. EPSI indicated in its reply to the ITN that it read, agreed, and would comply with this requirement. As for the Kansas solicitation, EPSI showed that it now possesses this capability, and has in fact installed it before. EPSI?s reply conformed to the call-forwarding provisions of section 3.6.8 of the ITN in all material respects. Keefe Commissary Network Section 5.2.1 of the ITN, entitled “Respondents? Business/Corporate Experience,” at paragraph e. directed each vendor to: [P]rovide and identify all entities of or related to the Respondent (including parent company and subsidiaries of the parent company; divisions or subdivisions of parent company or of Respondent), that have ever been convicted of fraud or of deceit or unlawful business dealings whether related to the services contemplated by this ITN or not, or entered into any type of settlement agreement concerning a business practice, including services contemplated by this ITN, in response to a civil or criminal action, or have been the subject of any complaint, action, investigation or suit involving any other type of dealings contrary to federal, state, or other regulatory agency regulations. The Respondent shall identify the amount of any payments made as part of any settlement agreement, consent order or conviction. Attachment 6 to the ITN, setting forth Evaluation Criteria, similarly provided guidance regarding the assessment of points for Business/Corporate Experience. Paragraph 1.(f) provided: “If any entities of, or related to, the Respondent were convicted of fraud or of deceit or unlawful business dealings, what were the circumstances that led to the conviction and how was it resolved by the Respondent?” Addendum #2. to the ITN, which included questions and answers, also contained the following: Question 57: In Attachment 6, Article 1.f. regarding respondents “convicted of fraud, deceit, or unlawful business dealing . . .” does this include associated subcontractors proposed in this ITN? Answer 57: Yes, any subcontractors you intend to utilize on this project, would be considered an entity of and related to your firm. As a proposed subcontractor, ICS is an entity of, or related to, EPSI. There is no evidence to indicate that ICS has ever been convicted of fraud or of deceit or unlawful business dealings. There is no evidence to indicate that ICS has entered into any type of settlement agreement concerning a business practice in response to a civil or criminal action. There is no evidence to indicate that ICS has been the subject of any complaint, action, investigation, or suit involving any other type of dealings contrary to federal, state, or other regulatory agency regulations. The only evidence at hearing as to convictions involved “two individuals from the Florida DOC” and “two individuals from a company called AIS, I think that?s American Institutional Services.” No evidence was presented that AIS was “an entity of or related to” EPSI. Conversely, there was no evidence that Keefe Commissary Network (KCN) or anyone employed by it was ever convicted of any crime. There was similarly no evidence that KCN entered into any type of settlement agreement concerning a business practice in response to civil or criminal action. It was shown that KCN “cooperated with the federal government in an investigation” that resulted in criminal convictions, and it is concluded that KCN was therefore itself a subject of an investigation involving any other type of dealings contrary to federal, state, or other regulatory agency regulations. However, KCN is not an entity of, or related to, EPSI. KCN is not a parent company of EPSI, it is not a division, subdivision, or subsidiary of EPSI, and it is not a division, subdivision, or subsidiary of EPSI?s parent company, CenturyLink, Inc. EPSI?s reply conformed to the disclosure requirements of section 5.2.1, Attachment 6, and Addendum #2 of the ITN in all material respects. Phases of the ITN Section 6 describes nine phases of the ITN: Phase 1 – Public Opening and Review of Mandatory Responsiveness Requirements Phase 2 – Review of References and Other Bid Requirements Phase 3 – Evaluations of Statement of Qualifications, Technical Responses, and Managed Access Solutions3/ Phase 4 – CPA Review of Financial Documentation Phase 5 – Review of Initial Cost Sheets Phase 6 – Determination of Final Scores Phase 7 – Negotiations Phase 8 – Best and Final Offers from Respondents Phase 9 – Notice of Intended Decision Evaluation Criteria in the ITN As amended by Addendum #2, the ITN established scoring criteria to evaluate replies in three main categories: Statement of Qualifications (500 points); Technical Response (400 points); and Initial Cost Sheets (100 points). It also provided specific guidance for consideration of the commissions and rates shown on the Initial Cost Sheet that made up the pricing category. Section 6.1.5 of the ITN, entitled “Phase 5 – Review of Initial Cost Sheet,” provided in part: The Initial Cost Proposal with the highest commission (percentage of gross revenue) to be paid to the Department will be awarded 50 points. The price submitted in Table 1 for the Original Contract Term, and the subsequent renewal price pages for Table 1 will be averaged to determine the highest commission submitted. All other commission percentages will receive points according to the following formula: (X/N) x 50 = Z Where: X = Respondents proposed Commission Percentage to be Paid. N = highest Commission Percentage to be Paid of all responses submitted. Z = points awarded. * * * The Initial Cost Proposal with the lowest telephone rate charge will be awarded 50 points. The price submitted in Table 1 for the Original Contract Term, and the subsequent renewal price pages for Table 1 will be averaged to determine the highest commission submitted. All other cost responses will receive points according to the following formula: (N/X) x 50 = Z Where: N = lowest verified telephone rate charge of all responses submitted. X = Respondent?s proposed lowest telephone rate charge. Z = points awarded. The ITN as amended by Addendum #2 provided instructions that initial costs should be submitted with the most favorable terms the Respondent could offer and that final percentages and rates would be determined through the negotiation process. It included the following chart:4/ COST PROPOSAL INITIAL Contract Term 5 years ONE Year Renewal TWO Year Renewal THREE Year Renewal FOUR Year Renewal FIVE Year Renewal Initial Department Commission % Rate Proposed Initial Blended Telephone Rate for All Calls* (inclusive of surcharges) The ITN, including its Addenda, did not specify selection criteria upon which the determination of best value to the state would be based. Allegation that EPSI Reply was Misleading On the Certification/Attestation Page, each vendor was required to certify that the information contained in its reply was true and sufficiently complete so as not to be misleading. While portions of its reply might have provided more detail, EPSI did not mislead the Department regarding its legal structure, affiliations, and subcontractors, or misrepresent what entity would be providing technology or services if EPSI was awarded the contract. EPSI?s reply explained that EPSI was a wholly owned corporate subsidiary of CenturyLink, Inc., and described many aspects of the contract that would be performed using resources of its parent, as well as aspects that would be performed through ICS as its subcontractor. Department Evaluation of Initial Replies The information on the Cost Proposal table was reviewed and scored by Ms. Hussey, who had been appointed as the procurement manager for the ITN. Attempting to follow the instructions provided in section 6.1.5, she added together the six numbers found in the boxes indicating commission percentages on the Cost Proposal sheets. One of these boxes contained the commission percentage for the original five-year contract term and each of the other five boxes contained the commission percentage for one of the five renewal years. She then divided this sum by six, the number of boxes in the computation chart (“divide by six”). In other words, she calculated the arithmetic mean of the six numbers provided in each proposal. The Department had not intended for the commission percentages to be averaged in this manner. Instead, they had intended that a weighted mean would be calculated. That is, they intended that five times the commission percentage shown for the initial contract term would be added to the commission percentages for the five renewal years, with that sum then being divided by ten, the total number of years (“divide by ten”). The Department did not clearly express this intent in section 6.1.5. Mr. Viefhaus testified that based upon the language, Securus believed that in Phase 5 the Department would compute the average commission rate the way that Ms. Hussey actually did it, taking the arithmetic mean of the six commission percentages provided by each vendor, and that therefore Securus prepared its submission with that calculation in mind.5/ Mr. Montanaro testified that based upon the language, GTL believed that in Phase 5 the Department would “divide by ten,” that is, compute the weighted mean covering the ten-year period of the contract, and that GTL filled out its Cost Proposal table based upon that understanding. The DOC posted a notice of its intent to negotiate with GTL, Securus, and EPSI on June 3, 2013. Telmate, LLC, was not chosen for negotiations.6/ Following the Notice of Intent to Negotiate was this statement in bold print: Failure to file a protest within the time prescribed in Section 120.57(3), Florida Statutes, or failure to post the bond or other security required by law within the time allowed for filing a bond shall constitute a waiver of proceedings under Chapter 120, Florida Statutes. On June 14, 2013, the DOC issued a Request for Best and Final Offers (RBAFO), directing that Best and Final Offers (BAFO) be provided to the DOC by June 18, 2013. Location-Based Services The RBAFO included location-based services of called cell phones as an additional negotiated service, requesting a narrative description of the service that could be provided. The capability to provide location-based services had not been part of the original ITN, but discussions took place as part of the negotiations. Securus contends that EPSI was not a responsible vendor because it misrepresented its ability to provide such location-based services through 3Cinteractive, Inc. (3Ci). EPSI demonstrated that it had indicated to the Department during negotiations that it did not have the capability at that time, but that the capability could easily be added. EPSI showed that due to an earlier call it received from 3Ci, it believed that 3Ci would be able to provide location- based services to it. EPSI was also talking at this time to another company, CTI, which could also provide it that capability. In its BAFO, EPSI indicated it could provide these services, explained that they would require payments to a third- party provider, and showed a corresponding financial change to their offer. No competent evidence showed whether or not 3Ci was actually able to provide that service on behalf of EPSI, either at the time the BAFO was submitted, or earlier. EPSI showed that it believed 3Ci was available to provide that service, however, and there is no basis to conclude that EPSI in any way misrepresented its ability to provide location-based services during negotiations or in its BAFO. Language of the RBAFO The RBAFO provided in part: This RBAFO contains Pricing, Additional Negotiated Services, and Value Added Services as discussed during negotiation and outlined below. The other specifications of the original ITN, unless modified in the RBAFO, remain in effect. Respondents are cautioned to clearly read the entire RBAFO for all revisions and changes to the original ITN and any addenda to specifications, which are incorporated herein and made a part of this RBAFO document. Unless otherwise modified in this Request for Best and Final Offer, the initial requirements as set forth in the Department?s Invitation to Negotiate document and any addenda issued thereto have not been revised and remain as previously indicated. Additionally, to the extent that portions of the ITN have not been revised or changed, the previous reply/initial reply provided to the Department will remain in effect. These two introductory paragraphs of the RBAFO were confusing. It was not clear on the face of the RBAFO whether “other specifications” excluded only the pricing information to be supplied or also the specifications indicating how that pricing information would be calculated or evaluated. It was not clear whether “other specifications” were the same thing as “initial requirements” which had not been revised. It was not clear whether scoring procedures constituted “specifications.” While it was clear that, to the extent not revised or changed by the RBAFO, initial replies that had been submitted -- including Statements of Qualifications, Technical Response, Financial Documentation, and Cost Proposals -- would “remain in effect,” it was not clear how, if at all, these would be considered in determining the best value to the State. In the RBAFO under the heading “PRICING,” vendors were instructed to provide their BAFO for rates on a provided Cost Proposal table which was virtually identical to the table that had been provided earlier in the ITN for the evaluation stage, including a single square within which to indicate a commission rate for the initial five-year contract term, and five squares within which to indicate commission rates for each of five renewal years. The RBAFO stated that the Department was seeking pricing that would provide the “best value to the state.” It included a list of 11 additional services that had been addressed in negotiations and stated that, “in order to provide the best value to the state,” the Department reserved the right to accept or reject any or all of these additional services. It provided that after BAFOs were received, the Negotiation Team would prepare a summary of the negotiations and make a recommendation as to which vendor would provide the “best value to the state.” The RBAFO did not specify selection criteria upon which the determination of best value to the State would be based. In considering commission percentages as part of their determination as to which vendor would receive the contract, the Negotiation Team decided not to consider commissions that had been listed by vendors for the renewal years, concluding that the original five-year contract term was all that was assured, since renewals might or might not occur. On June 25, 2013, the DOC posted its Notice of Agency Decision stating its intent to award a contract to EPSI. Protests and the Decision to Reject All Replies Subsequent to timely filing notices of intent to protest the intended award, Securus and GTL filed Formal Written Protests with the DOC on July 5 and 8, 2013, respectively. The Department considered and compared the protests. It determined that language in the ITN directing that in Phase 5 the highest commission would be determined by averaging the price for the original contract term with the prices for the renewal years was ambiguous and flawed. It determined that use of a table with six squares as the initial cost sheet was a mistake. The Department determined that the language and structure of the RBAFO could be read one way to say that the Department would use the same methodology to evaluate the pricing in the negotiation stage as had been used to evaluate the Initial Cost sheets in Phase 5, or could be read another way to mean that BAFO pricing would not be evaluated that way. It determined that the inclusion in the RBAFO of a table virtually identical to the one used as the initial cost sheet was a mistake. The Department determined that the language and the structure of the RBAFO could be read one way to require further consideration of such factors as the Statement of Qualifications and Technical Response in determining best value to the State, or could be read another way to require no further consideration of these factors. The Department prepared some spreadsheets demonstrating the varying results that would be obtained using “divide by six” and “divide by ten” and also considered a spreadsheet that had been prepared by Securus. The Department considered that its own Contract Manager had interpreted the Phase 5 instructions to mean “divide by six,” while the Department had actually intended the instructions to mean “divide by ten.” The Department had intended that the Negotiation Team give some weight to the renewal-year pricing, and had included the pricing table in the RBAFO for that reason, not simply to comply with statutory requirements regarding renewal pricing. The Department determined that the way the RBAFO was written and the inclusion of the chart required at least some consideration of ten-year pricing, and that vendors had therefore been misled when the Negotiation Team gave no consideration to the commission percentages for the renewal years. Specifically, based upon the Securus protest, the Department determined that the RBAFO language had been interpreted by Securus to require that the Phase 5 calculation of average commission percentage be carried over to evaluation of the pricing in the BAFOs, which Securus had concluded meant “divide by six.” The Department further determined that based upon the GTL protest, the RBAFO language had been interpreted by GTL to require the Department to consider the renewal years in pricing, as well as such things as the Statement of Qualifications and Technical Response in the BAFO stage. The Department determined that had “divide by six” been used in evaluating the BAFOs, Securus would have a computed percentage of 70 percent, higher than any other vendor. The Department concluded that the wording and structure of the ITN and RBAFO did not create a level playing field to evaluate replies because they were confusing and ambiguous and were not understood by everyone in the same way. Vendors naturally had structured their replies to maximize their chances of being awarded the contract based upon their understanding of how the replies would be evaluated. The Department concluded that vendor pricing might have been different but for the misleading language and structure of the ITN and RBAFO. The Department did not compute what the final award would have been had it applied the scoring procedures for the initial cost sheets set forth in section 6.1.5 to the cost elements of the BAFOs. The Department did not compute what the final award would have been had it applied the scoring procedures for the Statement of Qualifications and Technical Response set forth in section 6.1.3 to the BAFOs. Ms. Bailey testified that while she had originally approved the ITN, she was unaware of any problems, and that it was only later, after the protests to the Notice of Intended Award had been filed and she had reviewed the specifications again, that she had come to the conclusion that the ITN and RBAFO were flawed. Following the protests of the intended award by GTL and Securus, on July 23, 2013, the DOC posted to the Vendor Bid System a Notice of Revised Agency Decision stating the DOC?s intent to reject all replies and reissue the ITN. On August 5, 2013, EPSI, GTL, and Securus filed formal written protests challenging DOC?s intended decision to reject all replies. Securus subsequently withdrew its protest to DOC?s rejection of all replies. As the vendor initially notified that it would receive the contract, EPSI?s substantial interests were affected by the Department's subsequent decision to reject all replies. GTL alleged the contract had wrongly been awarded to EPSI and that it should have received the award, and its substantial interests were affected by the Department's subsequent decision to reject all replies. The Department did not act arbitrarily in its decision to reject all replies. The Department did not act illegally, dishonestly, or fraudulently in its decision to reject all replies. EPSI would likely be harmed in any re-solicitation of bids relative to its position in the first ITN, because potential competitors would have detailed information about EPSI?s earlier reply that was unavailable to them during the first ITN. An ITN requires a great deal of work by the Department and creates a big demand on Department resources. The decision to reject all replies was not undertaken lightly. The State of Florida would likely benefit in any new competitive solicitation7/ because all vendors would be aware of the replies that had been submitted earlier in response to the ITN, and bidders would likely try to improve upon those proposals to improve their chances of being awarded the contract.
Recommendation Upon consideration of the above findings of fact and conclusions of law, it is RECOMMENDED: That the Department of Corrections issue a final order finding that the rejection of all replies submitted in response to ITN 12-DC-8396 was not illegal, arbitrary, dishonest, or fraudulent, and dismissing all four protests. DONE AND ENTERED this 1st day of November, 2013, in Tallahassee, Leon County, Florida. S F. SCOTT BOYD 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 November, 2013.
The Issue Whether the petitioner is entitled to credit for the answers given to the challenged questions in the General Contractor’s examination administered October 18, 1995.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: The Department of Business and Professional Regulation, Construction Industry Licensing Board, is the state agency with jurisdiction over the examination and regulation of general contractors in the State of Florida. Sections 489.107(4) and .113(1), Florida Statutes. Mr. Simmons sat for the General Contractor examination on October 18, 1995, and received a failing grade of 68.75 percent on the business and financial administration portion of the examination. Even though he passed the other two portions of the examination, Mr. Simmons failed the examination as a result of the failing grade on this portion of the examination. Mr. Simmons subsequently filed a timely challenge to unspecified test questions on the business and financial administration portion of the examination. He presented evidence at the hearing concerning the sufficiency of his answers to questions 13 and 22 of the financial administration section of the examination and claimed that he would have presented evidence relating to questions 18 and 39 of the business administration section but could not because he was not certain that the questions included in the review materials provided to him by the respondent were the same as the questions included in the test booklet he used on October 18, 1995. Question 13 of the financial administration section of the examination is an objective, multiple choice question. The applicant is to choose the correct answer from among four choices. The correct answer to question 13 is “C," but Mr. Simmons incorrectly chose “B.” Question 22 of the financial administration section of the examination is an objective, multiple choice question. The applicant is required to choose the correct answer to the question from among four answers provided and is to choose the correct answer based only on the information included in the question. The correct answer to question 22 is “C," but Mr. Simmons incorrectly chose “A.” Mr. Simmons failed to prove that questions 18 and 39 of the business administration section of the examination included in the review manual provided to him by the respondent were not the same questions included in the test booklet he used on October 18, 1995. Because he failed to present any evidence regarding the sufficiency of his answers to these questions, he is deemed to have abandoned any substantive challenge to them. Question 13 of the business administration section of the examination is clear and unambiguous, and only one correct answer was included among the answer choices. The correct answer is found in the reference material which Mr. Simmons was permitted to use while he was taking the examination. The respondent correctly gave no credit to Mr. Simmons for his answer to this question because it was the wrong answer. Question 22 of the business administration section of the examination is clear and unambiguous, and only one correct answer was included among the answer choices. The method for determining the correct answer from the information provided in the question is contained in the reference materials Mr. Simmons was permitted to use while he was taking the examination. The respondent correctly gave no credit to Mr. Simmons for his answer to this question because it was the wrong answer.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Department of Business and Professional Regulation, Construction Industry Licensing Board, issue a final order dismissing Alfred Simmons’s challenge to the subject examination and that the examination questions and answers provided at the hearing be sealed and not open to public inspection. DONE AND ENTERED this 3rd day of January, 1997, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO 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 3rd day of January, 1997. COPIES FURNISHED: Alfred Simmons 7755 West Kismet Street Miramar, Florida 33023 R. Beth Atchison, Assistant General Counsel Department of Business and Professional Regulation Construction Industry Licensing Board Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0750 Lynda L. Goodgame General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792 Richard Hickok, Executive Director Construction Industry Licensing Board 7960 Arlington Expressway, Suite 300 Jacksonville, Florida 32211-7467
Findings Of Fact Pursuant to its authority to regulate water and sewer rates, charges and rate structures embodied in Chapters 367, Florida Statutes, and 25-30, Florida Administrative Code, the Public Service Commission entered Orders numbered 16971 and 17058, which adopted specific guidelines and conditions for utilities to implement certain income tax impact charges for contributions-in-aid- of-construction ("CIAC gross-up charges"). (See Orders numbered 20409, p.3; 16971, p.2-4; and 17058). One of these conditions requires that utilities submit appropriate tariff sheets (rates and charges sheets) for the Commission's approval prior to implementation of the CIAC gross-up charge. CIAC is the payment or contribution of cash or property to a utility from a customer or entity seeking service from that utility in order to secure the provision of such services or to reserve it for a future time. The Internal Revenue Code of 1986 changed the treatment of CIAC from being non-taxable to being taxable as income. A CIAC gross-up charge is a method by which a utility can recover that tax expense, represented by the income tax assessed against collected CIAC, through approved rates and charges to customers. The amount of CIAC tax impact funds collected by a utility is not itself treated as CIAC for rate-making purposes. The Respondent, St. Johns North Utility Corp., collected gross-up charges which were not authorized by its filed and approved tariff schedules (rate schedules), and without securing the requisite approval from the Commission. (See Orders numbered 20409 and 20762). The Commission was made aware of the charging of unauthorized CIAC gross-up charges by the Utility Respondent when a developer, Fruit Cove Limited, communicated with the Commission concerning its doubts about utility service being available for one of its subdivisions, when required, from the Respondent. Fruit Cove Limited had paid CIAC gross-up charges to St. Johns. On June 3, 1988, the Commission, through its staff, contacted Mr. Joseph E. Warren, the General Manager for the Respondent, and explained the Commission's requirements regarding the requisite pre-approval of the charging of CIAC gross-up charges. Mr. Warren agreed to file a written request for authorization to implement such charges. No request was filed, despite repeated admonitions and solicitations by the Commission and its staff and a lengthy opportunity to comply. Finally, Order No. 20409 was issued by the Commission on December 5, 1988, requiring the Utility to file a written request for authorization to implement CIAC gross-up charges within thirty (30) days of that Order. A written request was not timely filed, however. The Utility finally filed its written request for approval of these charges on September 5, 1989. The accompanying tariff sheets representing such charges were ultimately filed in response to Orders numbered 16971 and 20409, and Show Cause Order No. 20762. They became effective on September 15, 1989. The Commission, through its staff, also made repeated inquiries to the Utility regarding certain service availability charges and practices, initially by letter of July 29, 1988. The Utility was allowed until August 19, 1988 to make the requested responses. The letter was addressed to Mr. Joseph Warren at the Utility's mailing address of record. The Utility, however, did not provide written responses to the comments and questions by the Commission, despite repeated assurances that it would do so. Order No. 20409, issued on December 5, 1988, required the Utility to provide the full written responses to the July 29, 1988 letter within thirty (30) days of the date of that Order. The responses were not timely made. Order No. 20762 was issued on February 17, 1989, requiring the Utility to show cause in writing on or before March 13, 1989 why it should not be fined up to $5,000.00 per day, in accordance with the Commission's penalty authority, for failure to comply with the provisions of Order No. 20409, regarding the necessity for written responses to the Commission's specified questions and the submission of a written request to implement the CIAC gross-up charges referenced above. The first item in the Commission's July 29, 1988 letter to the Utility had requested the Utility to seek approval, including submission of proposed rate tariff sheets for authorization to implement the CIAC tax impact charge referenced above. That item was responded to on September 5, 1989, more than eight months after the deadline set by Order No. 20409. The second item in the Commission's July 29, 1988 letter to the Utility had requested the Utility to provide the names and addresses of financial institutions in which gross-up charge funds were being retained. That item was responded to as requested. The third item in the Commission's July 29, 1988 letter to the Utility had requested the Utility to provide a listing of all gross-up monies received from each contributor. No response was ever provided by the Respondent. The significance of the information requested by the Commission is that it would provide identity of the individuals who were entitled to a refund of the unauthorized CIAC gross-up charges collected by the Utility, as provided in Order No. 20762. The fourth item in the Commission's July 29, 1988 letter to the Utility had requested the Utility to provide a copy of all current developer agreements. That item was responded to within the deadline set by Order No. 20409. The fifth item in the Commission's July 29, 1988 letter to the Utility had requested the Utility to file revised tariff sheets indicating the actual legal description of the Utility's certificated service territory. No response was ever provided. Order No. 20762 was ultimately issued on February 17, 1989 imposing a $5,000.00 fine on the Utility for serving outside of its authorized service area. Order No. 20409 requested the Utility to indicate to the Commission whether, with regard to the developer agreement between the Respondent and Fruit Cove Limited, the charges listed in the various paragraphs of that agreement would, upon completion of the real estate development involved, be adjusted to reflect actual utility service costs incurred. No response to that request was ever provided by the Utility. Additionally, in that Order, the Commission requested information concerning a so- called "step tank", which was referenced in paragraphs 12C and 13D of the developer agreement with Fruit Cove Limited. That request, in Order No. 20409, was never responded to. A certain fee was charged for installation of the step tank by the Utility to Fruit Cove Limited, and no response was given to the Commission's inquiry as to why that fee was omitted from the Utility's approved tariff on file with the Commission. The significance of the requested information was that the omission of the step tank installation fee from the Utility's tariff of rates and charges could cause the developer agreement to constitute a "special service availability agreement", which can only be approved in advance by the Commission. It is not a matter, approval of which has been delegated by the Commission to its staff members. The Order referenced last above also requested an explanation for why a meter installation fee, referred to in that same developer agreement, does not include a "curb stop" or a meter box. This information is significant because it is necessary in order for the Commission to determine whether the charge involved is reasonable. A cost breakdown for the meter installation, including the various hardware components and other charges, was necessary and was not provided by the Utility. Additional information concerning the area of service availability, required to be provided to the commission by Order No. 20409, included the requirement that approval be obtained from the Commission for the CIAC gross-up charge in the developer agreement with Fruit Cove Limited. As stated above, that approval was not requested in writing, as required by the Order, for more than eight months after the deadline set by that Order. By Order No. 20762, St. Johns was fined $5,000.00 for three separate violations of the statutes and rules, and the Orders enumerating them, for a total of $15,000.00. The Utility was fined for serving outside of its authorized service territory, for collecting unauthorized CIAC gross- up charges, and for failing to file its developer agreements with the Commission as required by law. The developer agreements were only submitted after repeated efforts by the Commission's staff which culminated in Order No. 20409 and which were either unresponded to or not properly responded to by the Utility. Additionally, by Order No. 21559, issued on July 17, 1989, St. Johns was fined $5,000.00 for failure to file an application for an extension of its territory as required by Order No. 20409. In the meantime, by Order No. 22342, issued on December 26, 1989, the Commission approved a transfer of the Utility's assets from St. Johns to Jacksonville Suburban Utilities Corporation ("Jacksonville Suburban"). That Order did not authorize transfer of the liabilities of the Respondent to Jacksonville Suburban. The Order specifies that St. Johns, and not Jacksonville Suburban, will remain liable for the previously imposed refund obligations and fines. Only in the event that there remained sales proceeds in excess of the certain debt of St. Johns owed to its institutional lender would funds from the Jacksonville Suburban sale be applied toward payment of the refund and fines found to be due and owing by the above-cited Orders, by way of escrow or otherwise. Any excess proceeds, absent Order No. 22342, were to be paid to St. Johns. Order No. 22342 does not make Jacksonville Suburban liable for the refund and fines at issue. It is speculative whether there will be any sales proceeds available from the sale, after payment of the debt, to be applied toward the refund and fines. The sales price was made dependent upon establishment of the Utility's "rate base" amount, to be established in that transfer proceeding at a point in time after entry of Order No. 22342. That Order, however, specifically preserves the liability of St. Johns for the refund and fines and does not provide for the extinguishment of such liability in the event that the sales proceeds prove to be insufficient to pay them.
Recommendation Having considered the foregoing Findings of Fact, Conclusions of Law, the evidence of record, the candor and demeanor of the witnesses, and the pleadings and arguments of the parties, it is therefore, RECOMMENDED that St. Johns be assessed a penalty of $5,000.00 for knowingly and willfully failing to comply with Order No. 20409. DONE AND ENTERED this 13th day of June, 1990, in Tallahassee, Leon County, Florida. Hearings Hearings 1990. P. MICHAEL RUFF Hearing Officer Division of Administrative The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative this 14th day of June, APPENDIX TO RECOMMENDED ORDER Petitioner's Proposed Findings of Fact 1.-24. Accepted. Respondent's Proposed Findings of Fact. (Respondent filed no proposed Findings of Fact) Copies furnished to: David Schwartz, Esq. Florida Public Service Commission Legal Division 101 E. Gaines Street Tallahassee, FL 32399-0850 Joseph E. Warren, Esq. 1930 San Marco Boulevard Suite 200 Jacksonville, FL 32207 Mr. Steve Tribble Director of Records and Recording Florida Public Service Commission 101 E. Gaines Street Tallahassee, FL 32399-0850 Mr. David Swafford Executive Director Florida Public Service Commission 101 E. Gaines Street, Room 116 Tallahassee, FL 32399-0850 Susan Clark, Esq. General Counsel Florida Public Service Commission 101 E. Gaines Street, Room 212 Tallahassee, FL 32399-0850
The Issue The issues are whether the Florida Commission on Ethics (Ethics Commission) has jurisdiction over Counts I and IV of the Advocate's Amended Recommendation, pursuant to section 122.322(1), Florida Statutes; if jurisdiction exists over Count IV, whether Respondent, while a commissioner and vice mayor of the City of Margate (City), violated section 112.313(7), Florida Statutes, by appearing before the City commission on behalf of his employer, which was seeking a beer and wine license for consumption on the premises (2COP); and whether Respondent is entitled to an award of attorneys' fees and costs, pursuant to section 57.105(5), Florida Statutes.
Findings Of Fact The Complaint is on a Ethics Commission form (Form 50) that asks the complainant for a full explanation of the complaint. The complaint form refers twice to documents. The complaint form asks the complainant not to attach copies of lengthy documents; the form assures that, "if they are relevant, your description of them will suffice." The oath printed on the complaint form states: "I . . . do depose on oath or affirmation . . . that the facts set forth in the foregoing complaint and attachments thereto are true and correct to the best of my knowledge and belief." The Complaint, which is signed and notarized, contains no explanation or narrative, but Complainant attached 11 pages of copies of documents, which are marked as pages 3 through 13. Page three of the Complaint is an article dated March 8, 2012, and posted on MargateNews.net.5/ This article reports that, by a 3-2 vote, the City commission reprimanded Respondent for abusing City credit card privileges, even though Respondent claimed to have repaid any unauthorized charges. The article reports that one commissioner expressed a belief that Respondent misused a City credit card and committed a "few other abuses." At page four of the Complaint is a copy of the City credit card agreement signed by Respondent. Handwritten notations add: "This (i.e., the credit card agreement) states that he (Respondent) cannot use card for personal use in which he did[.] [H]e bought beer and wine for his bar with cash advance. Says he paid it back in cash be has no repcit (sic) for it." All handwritten notes on documents attached to the Complaint and Amended Complaint were made by Complainant.6/ At page five, a MargateNews.net article dated August 16, 2010, reports alleged tax and purchasing violations by McLean's Bar & Grill, which was located at 2160 Mears Parkway. This article mentions other matters, including Respondent's voting a pay raise for City commissioners and a property-tax hike, Respondent's "history of financial instability . . . and fiduciary irresponsibility," and Respondent's two residential evictions from 1996-2006 for lease defaults. At page six is an unsigned, typewritten letter about Respondent. This letter twice charges that Respondent misused a City credit card and also alleges that he failed to repay $15,000 from "a Margate taxpayer"--Complainant--and violated unspecified tax and purchasing laws as to alcoholic beverages. A handwritten note adds: "I read this at the commissioner meeting." Below this note is printed Complainant's name. At pages seven and eight, a MargateNews.net article dated October 30, 2011, states that Complainant had lent Respondent $15,000 for a kitchen addition at McLean's Bar & Grill, but Respondent had failed to repay the loan after the business closed. This article alludes to some bad debts and judgments against Respondent or his businesses, but portions of the article are illegible, and the meaning of these portions of the article is unclear. The same article reports that Respondent was now operating Dave's Tiki Bar, which was located at 238 North State Road 7. Part of this portion of the article is also illegible, but seems to report that Jean LeBlanc, a co-owner with Respondent of a "former Tiki Bar," cancelled the bar's 2COP beer and wine license, effectively closing the bar. To reopen the Tiki Bar, according to the article, Respondent convinced his fellow City commissioners to hold a special meeting of the City commission in August 2011 to grant a 2COP license to "Tiki bar petitioner, Kenneth Suhandron," whom the article describes as Respondent's "partner." The article notes that Respondent abstained from voting due to a conflict of interest. The article states that Respondent acquired the corporate owner of the bar days after the special meeting, so Respondent now holds the temporary 2COP license, even though he had not paid for it. An online update indicates that Respondent paid for the 2COP license on November 1, 2011. At page nine, a MargateNews.net article dated August 20, 2011, describes a special meeting of the City commission on August 15. This article states that Respondent had been managing the Tiki Bar when a disagreement between him and his partner, Mr. LeBlanc, resulted in the cancellation of the bar's 2COP beer and wine license. According to the article, Respondent found a new investor, Mr. Suhandron, to apply for a new 2COP license and called for a special meeting of the City commission to provide the necessary City approval for the applicant to obtain a 2COP license. The article notes that Respondent appeared at the meeting to represent the listed applicant, Mr. Suhandron, but abstained from voting due to a conflict of interest. At pages 10 through 12 are a final summary judgment against Respondent and McLean's Bar & Grill, Inc., for $29,638.60 and a final judgment against Respondent for $20,073.63. At page 13 is an email from Complainant that pertains to the charge of Respondent's misuse of a City credit card. Redacted from the email is reportedly an email that another City commissioner had sent to Complainant, who added a handwritten note to this effect. The Amended Complaint is on the same form as the Complaint and is also notarized.7/ Like the Complaint, the Amended Complaint contains no explanation or narration of the charges, but it contains 41 pages of copies of documents, which are attached as pages A-3 through A-43. At pages A-3 through A-4, a letter dated May 16, 2012, from the Ethics Commission to Complainant focuses on Respondent's alleged failure to repay the $15,000 loan from Complainant and Respondent's misuse of a City credit card. To this letter, Complainant added a handwritten note stating: I cannot prove he use[d] [a City credit card for cash advances] for alcohol. . . for bar but just the cash advance alone is breaking the law over [sentence abruptly ends]. Just last week he got fined again for selling illigiel [sic] beer that he bought from a gas station in his bar[.] It will be in margate news.net next week[. I]f you want I can email you a copy. This man is a con artist. Pages A-5 through A-8 comprise a promissory note evidencing the $15,000 loan from Complainant. Complainant handwrote on the note: "He never gave me 1 payment or any interest payments." Pages A-9 through A-14 are the minutes of a meeting of the City commission on March 7, 2012. The sole handwritten addition to these minutes is at the top of the first page: "Each one of the following [commissioners?] has info on it[. A]ll are highlighted or outlined for your use." According to the minutes, one commissioner stated that she believed that Respondent had misused a City credit card and wanted him to resign, but he refused to respond to her statement or, clearly, to resign. This commissioner asked the City attorney to identify the options available to the City commission. The City attorney informed the commission that there had not been a determination that Respondent had violated the standards of conduct or code of ethics in his use of a City credit card and advised that the City commission could order an investigation, prospectively clarify the restrictions on the use of City credit cards and provide for forfeiture of office for a violation of these restrictions, publicly censure or reprimand a City commissioner, or prohibit a City commissioner from using a City credit card. According to the minutes, another commissioner--the mayor--then stated that what Respondent had done was wrong. The commissioner who had called for Respondent's resignation then asked for an investigation to be conducted by the county Board of Ethics or the Ethics Commission. The mayor responded that either this commissioner or a resident would need to file such a request because the City commission was not in a position to do so itself. A motion to censure Respondent, revoke his City credit card, and order an investigation then failed for the lack of a second. A motion followed to censure Respondent and revoke his City credit card. This motion was amended to add a directive to the City attorney to add restrictions to the use of City credit cards and provide for forfeiture of office for their violation. Prior to a vote on this amended motion, someone made a motion to table the amended motion, but the motion to table failed by a 2-3 vote. The commission then considered the amended motion, which passed 3-2. Respondent voted to table the amended motion and against the amended motion. At pages A-15 through A-21, the minutes of a meeting of the City commission on March 21, 2012, state that Respondent asked the City manager to cancel his City credit card "in light of the recent inquiries on his use of the card." (It appears, though, that the adoption of the March 7 amended motion should already have resulted in the cancellation of Respondent's City credit card.) According to the minutes, Respondent then "apologized for the mistrust the matter had caused" and added that "he did not intentionally misuse his position to mistrust anyone." Reverting to more conventional syntax, Respondent concluded: "He could not change what happened, but he had made it right and said it would not happen again." Complainant drew a box around this paragraph of the minutes, and he drew an arrow pointing to a corner of the box. Later in the meeting, the City commission unanimously agreed to advertise an ordinance restricting the use of City credit cards and providing for the dismissal of any employee violating these restrictions. A handwritten note states that Respondent should nonetheless be removed from office for his misuse of a City credit card because "[h]e used card for cash advances and said he paid city back in cash, but no one has a record of him doing that." Pages A-22 through A-37 are the minutes of a meeting of the City commission on April 18, 2012, and four executed memoranda of voting conflict that appear to have been attached to the minutes. These minutes describe City commission votes on alcoholic beverage licenses as to which Respondent abstained from voting due to his employment, but the establishments seeking City commission approvals appear to have been unrelated to Respondent. As indicated in the joint factual stipulation, at all material times, Respondent served as a commissioner and vice mayor of the City commission, and, as such, Respondent was subject to part III, chapter 112, Florida Statutes. As indicated in the joint factual stipulation, Respondent misused a City credit card. As indicated in the joint factual stipulation, while serving as a commissioner and vice mayor of the City, Respondent represented his employer before the City commission in the employer's application for a license from the City commission. Respondent timely disclosed his employment relationship to the City commission, abstained from voting on the issue, and timely filed a Memorandum of Voting Conflict. Under the circumstances, the appearance of Respondent, as an employee of the Tiki Bar, at the August 15, 2011, special meeting of the City commission did not constitute, or serve as a precursor to, a continuing or frequently recurring conflict between Respondent's private interests and public duties, nor did this appearance impede the full and faithful discharge of Respondent's public duties. The key facts are the lack of significant regulatory jurisdiction of the City commission over the issuance and use of 2COP licenses, the one-time nature of the Tiki Bar's need for City commission approval for its request for a 2COP license, the employment relationship that existed between Respondent and the Tiki Bar, and the absence of any responsibilities imposed on Respondent due to his employment with the Tiki Bar to represent other parties in requests before the City commission.
Recommendation It is RECOMMENDED that the Ethics Commission enter a final order dismissing Counts II and IV, determining that Respondent violated section 112.313(6) as alleged in Count I, and imposing an administrative fine of $3000, censure, and a reprimand against Respondent. DONE AND ENTERED this 28th day of August, 2014, in Tallahassee, Leon County, Florida. S ROBERT E. MEALE 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 28th day of August, 2014. 1/ Available at
The Issue The issues are whether the intended contract awarded to Intervenor, The Henry and Rilla White Foundation, Inc. (Intervenor or White), pursuant to Request for Proposals #P2062 (RFP) for an Intensive Delinquency Diversion Services (IDDS) program in Palm Beach County, Florida (Circuit 15), is contrary to Respondent’s governing statutes, policies and rules, and the RFP. Petitioner, Juvenile Services Program, Inc. (Petitioner or JSP), timely challenged the intended award, and alleged that the award to Intervenor was clearly erroneous, contrary to competition, arbitrary, or capricious.
Findings Of Fact Respondent is an agency of the State of Florida and is the procuring agency for this proceeding. Petitioner is a not-for-profit corporation duly organized under the laws of the State of Florida. Intervenor is a not-for-profit corporation duly organized under the laws of the State of Florida. On November 23, 2009, Respondent issued the RFP to select a provider to operate IDDS programs in multiple counties, multiple circuits, within Florida. Petitioner did not protest the specifications of the RFP within 72 hours of the issuance of the RFP. Petitioner and White submitted timely responses to the RFP. Both sought the award for Circuit 15. On or about March 5, 2010, the Department posted its NOAA and informed all parties of its intent to award the contract at issue to Intervenor. The NOAA ranked White, first, with 1549.78 points; JSP, second, with 1451.34 points; and Urban League of Palm Beach, Inc., third, with 862.58 points. Petitioner filed a formal protest of the intended award to White on March 15, 2010. Thereafter, representatives from Petitioner and Respondent met to attempt resolution of the protest, but were unsuccessful. As the case moved forward to trial, White petitioned to intervene as the first ranked proposer. It is uncontested that White and JSP have standing in this matter. Throughout these proceedings, Petitioner maintained that Respondent scored the proposals contrary to the specifications of the RFP. Additionally, Petitioner claimed that the persons appointed to evaluate the proposals for the award did not have the requisite experience and knowledge in the program areas, and service requirements sufficient to score the proposals. Under the RFP, three components were to be scored by the evaluators: a technical section; a financial section; and a past performance section. A team of three evaluators independently scored the proposals submitted. Department program area managers selected the evaluators, who were then approved by the Department’s Deputy Secretary. All evaluators were trained in the evaluation process. In order to assure that appropriate employees are selected to serve as evaluators, Amy Johnson, Respondent’s chief of contracts, created a spreadsheet to identify those employees who are qualified to evaluate different types of procurements. The spreadsheet notes which program service area each employee is approved to serve. All of the evaluators in this case were chosen and deemed credentialed by Respondent to evaluate the subject RFP. In this case Karen McNeal, Jeffrey Balliet, and Cheryl Surls were selected and approved to evaluate the responses to the RFP. Ms. Johnson insured that the evaluators were trained to perform their duties. In this regard, Ms. Johnson reviewed the rules of the evaluation process and a generic evaluation with each of the evaluators. Training for the evaluators included how to score, along with sample scoring sheets. Although Ms. McNeal had not served as an evaluator prior to this case, she was appropriately trained and instructed in the methodology and guidelines for scoring proposals. Further, her job training and experience assured that she was familiar with IDDS program services. Mr. Balliet has served as an evaluator for proposals for approximately ten years. Mr. Balliet was appropriately trained and instructed in the scoring process. Additionally, Mr. Balliet’s work experience also qualified him to evaluate the IDDS proposals encompassed within the RFP responses. Finally, Ms. Surls has been familiar with the programs and services of IDDS for several years. She also completed RFP evaluation training prior to being placed on the spreadsheet list of potential evaluators. On January 11, 2010, Elaine Atwood, the procurement officer for the instant RFP, conducted a conference call with the evaluators for this case. All of the evaluators were familiar with the IDDS program and were provided an opportunity to ask Paul Hatcher, the author of the scope of services for this RFP, any program question regarding IDDS and/or the RFP. The Evaluation Team Ground Rules and Instruction specified that the evaluators were to read, evaluate, and score the proposals based upon the scoring sheet matrix. The evaluators were directed not to speak to other evaluators, nor to consider any information from any source other than the information provided within the proposal itself. If any evaluators were to require assistance, he or she was instructed to contact Ms. Atwood. All scoring was to be done based upon the solicitation document and the proposal submitted. The matrix for scoring assigned a score from 0 to 5 depending upon how well the proposal addressed the specification requirement. A score of 5 constituted the highest rating, and only those proposals that exceeded all technical specifications and requirements for the service component specified, with innovative, comprehensive, and complete detail were to receive that score. A score of 0 would be assigned when the proposal did not address the service component specified, or the evaluator could not locate the information in the proposal necessary to use another rating number. Petitioner maintained that one evaluator, Ms. McNeal, failed to follow the directions related to changes to scoring. It is concluded that Ms. McNeal adequately marked the score sheet, such that there was no confusion as to the score awarded, or the time of its entry. Contemporaneous with an initial score of “5” for the category “Management Capability,” Ms. McNeal re-marked the JSP score to a “4.” Similarly, Ms. McNeal re-marked the JSP score for the category “Consideration 1" from “5” to “4.” Any “change” occurred in the matter of moments that it took for Ms. McNeal to re-mark the score sheet, and did not indicate a reflection or after-thought of “change.” If anything, the “change” was to correct an error of marking. Ms. McNeal’s testimony as to the marking of the score sheet and her rationale for re-marking it has been deemed credible. Any deviation from the instructions as to a requirement that “change” must be documented is deemed minor or insignificant. Documenting a “change” is deemed minor and insignificant in this case, because the notation for the score of “4” was contemporaneous with the initial mark and not a later after- thought. Petitioner also challenged Ms. Surls’ award of the score “3” to all of JSP’s categories. Petitioner maintained that such an award demonstrated a lack of understanding regarding the subject matter addressed. To the contrary, Ms. Surls also awarded the score of “3” to White. The only category that exceeded “3” on Ms. Surls scoring of White was "Behavioral Management," for which Intervenor received a “4.” Ms. Surls was consistent and thorough in her review of the proposals and commented appropriately as to the basis for each score. The Technical Proposal narrative submitted by White did not exceed sixty pages. Petitioner did not contest scoring where an evaluator increased JSP’s score without comment. None of the alleged “changes” to scoring gave any proposal an unfair advantage. All proposals were given the same consideration and thoughtful review. The Department has used RFPs to cover multiple circuits in numerous instances. Petitioner did not timely challenge the process of providing for proposals for multiple circuits. Moreover, no evidence supports a finding that the process of covering multiple circuits within one RFP is inherently flawed or contrary to law.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered dismissing the Petition filed by Juvenile Service Program. DONE AND ENTERED this 14th day of March, 2011, in Tallahassee, Leon County, Florida. S J. D. PARRISH 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 14th day of March, 2011. COPIES FURNISHED: Tonja White Mathews, Esquire Department of Juvenile Justice The Knight Building 2737 Centerview Drive Tallahassee, Florida 32399-3100 Andrea V. Nelson, Esquire Walter Kelly, Esquire The Nelson Law Firm, PLC 1020 East Lafayette Street, Suite 214 Tallahassee, Florida 32301 Maureen McCarthy Daughton, Esquire Broad and Cassel 215 South Monroe Street, Suite 400 Post Office Drawer 11300 Tallahassee, Florida 32302 Secretary Department of Juvenile Justice The Knight Building 2737 Centerview Drive Tallahassee, Florida 32399-1300 Jennifer Parker, General Counsel Department of Juvenile Justice The Knight Building 2737 Centerview Drive Tallahassee, Florida 32399-1300
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that Petitioner's Final Determination be approved and that Respondent be required to repay $1,753 in grant funds expended in a manner inconsistent with Department regulations. DONE and ENTERED this 16th day of February, 1982, in Tallahassee, Florida. DONALD R. ALEXANDER 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 16th day of February, 1982. COPIES FURNISHED: Sonja P. Mathews, Esquire Suite 117-Montgomery Building 2562 Executive Center Circle, East Tallahassee, Florida 32301 Robert L. Davis Post Office Box 350 Apalachicola, Florida 32320
