The Issue The issue for consideration herein is whether Respondents should be disciplined as proposed in the Cease and Desist Order And Complaint filed herein because of the alleged misconduct outlined therein.
Findings Of Fact At all times pertinent to the allegations contained in the Cease and Desist Order and Administrative Complaint, the Petitioner was the state agency responsible for the administration and enforcement of the Florida Consumer Finance Act, Chapter 516, Florida Statutes. Respondents Norman were licensed real estate professionals who also established and operated Bankers Acceptance of America, a credit "repair" agency. Sometime in February, 1989, Steven Fischer who, with his wife was, at the time, substantially in debt, contacted Respondent, Bankers Acceptance of America, (Bankers), because of its advertisement which he had seen in the Bradenton Herald. This ad offered assistance with "credit repair", and, by implication, with securing Visa and Master Card, auto loans and home loans. When he first called the number listed in the ad, Mr. Fischer spoke with Respondent, Dan Norman, and made an appointment to meet with him at Fischer's home, where they discussed his credit situation and how Respondents could help him. As a result of the representations made by Mr. Norman, Mr. Fischer signed a two page contract for Respondents' service. This contract, which bears the signature of Dan Norman for Bankers and that of Mr. and Mrs. Fischer as well, is entitled a "Service Contract Agreement", wherein Bankers is identified as the consultant and the Fischers as the clients. Review of the contract document indicates that it relates solely to the client's credit situation and makes no reference to the credit "repair" service being conditioned upon or related to the purchase or sale of real estate through Respondents, in any fashion whatever. Though the contract is silent on the issue of real estate, Mr. Fischer recalls that at the time of their interview, there was some mention of real estate, but at the time of hearing, he could not recall what it was. He does not recall Mr. Norman telling him that he or Bankers were real estate brokers or that they would be interested in working on credit only with those who would consider buying or selling real estate through them. He does recall, however, that his prime concern at the time was the repair of his credit and he had no interest in either purchasing or selling real estate. Neither the ad in the paper, the contract he signed, nor the "Client Questionnaire" filled out by Mr. Norman regarding him made any reference to real estate except as an asset of the client. Neither did they refer to Respondents as real estate brokers. On his initial visit to the Fischer home, Mr. Norman remained for several hours, talking about the Fischers' credit situation. Ultimately Mr. Fischer paid Mr. Norman $100.00 as a deposit and agreed to pay an additional $300.00 at $100.00 per month for three months, for a total credit repair fee of $400.00. Thereafter, Respondent Juanita Norman was the Fischers' primary contact with their creditors, with Mr. Norman coming in only when creditors had some objection to efforts to arrange some compromise or payment schedule. Whenever such a situation arose, either the Fischers would call her or she would call them. Several of the Fischers' creditors, notably American Express, refused to accept Respondents as a credit repair service. Mr. Fischer did not request a refund because of Respondents' inability to completely accomplish that which was to be done. He admits that he did not always follow Respondent's instructions. He did not file a complaint with the Petitioner herein, but after a complaint was filed by someone unknown, was contacted by Mr. Norman who offered a partial refund of fees paid. None was forthcoming, however. In his testimony at the hearing, Dan Norman claimed that notwithstanding the advertisement in the newspaper, and the terms of the service contract agreement involved herein, neither he, his wife, nor Bankers, agreed to "repair" credit for the Fischers but merely to assist them in their fixing their own credit by helping them to establish new credit over time. He admits his contract provides that with the Fischer's cooperation, he could help them set up a repayment schedule, could work with their creditors, and could set up a budget for them so that they could repair their own credit. He claims this was done. The success of Respondents in repairing the Fischer's credit is not, however, the issue involved in this case. Mr. Norman admits that the Fischers paid him $400.00, and further acknowledges that he signed similar contracts with between 60 and 70 other clients who paid a similar fee or less. Neither the $400.00 received from the Fischers, however, nor the fees paid by the other clients was placed in a trust account maintained by Norman or Bankers for the credit repair service. Mr. Norman claims that he is a real estate broker and that he and his wife operated a real estate brokerage agency under the name, Bankers Acceptance Real Estate Group, under which Bankers Acceptance of America, the credit repair firm, was operated as a part of the real estate operation. Mrs. Norman admits that it was their intention to use the credit repair service as a means to feed customers to the real estate business. Norman had a trust account in the name of the real estate business, but none of the fees received from the credit repair clients were placed into that trust account because they were not deposits placed in a real estate transaction. By the same token, since he did not consider himself to be operating a "credit repair" service, other than incident to his real estate business, he felt he did not need to obtain a surety bond and did not do so. After a complaint was filed with the Department of Banking and Finance by someone not further identified, Lynn D. Chang, a financial administrator with the Comptroller's office, issued a subpoena to Respondents on June 16, 1989, calling for them to provide information regarding the surety bonding company, the location and a copy of their surety bond, the location and account number of this escrow account, proof of said account, and a copy of the information statement and consumer contract. None of the requested information was provided by the Respondents. Instead, by letter to Ms. Chang dated July 7, 1989, Both Dan and Juanita Norman advised her that based on their prior telephone conversation, their evaluation of the law regarding credit repair, and a telephone discussion with Mr. Underwood, a representative of the Comptroller's office, they concluded that their operation fell within the exemption from bonding and escrow requirements afforded real estate brokers, and that no additional information would be provided. Respondents claim that their credit repair operation was incident to their operation of a real estate brokerage firm. It is their contention that by helping to repair their clients' credit, Respondents were getting those clients ready to buy houses and Respondents claim that as of the time the complaint herein was filed, 20 of their 60 to 70 clients were ready to purchase real estate and had qualified for financing. No evidence in support of this claim was presented, however. After the complaint was filed, and an article concerning them was published in the local newspaper, in effect, their business was wiped out and only one of their 20 qualified buyers actually went through with their deal. Mr. Norman claims that a client was never taken on in the credit repair business unless that client indicated that he or she was interested in buying real estate when their credit had been repaired. The Respondent indicates, however, that while in business as a credit repair agency, "incident" to the real estate operation for two years, Respondent's generated $16,000.00 in credit repair income, and only $5,000.00 in real estate commissions as the result of the one previously mentioned sale. Considering the evidence in its totality, it is clear that the Normans, through Bankers Acceptance of America, were operating a classical credit service organization. It may have been in conjunction with a real estate business, but the service was not rendered incident to that business. They failed to obtain the required surety bond; to establish a trust account for the repair service operation; and to submit the required disclosure forms as is called for in the Florida Statutes, and at no time during the operation of the repair service, were those requirements met. However, the Respondents' credit service organization operation was not large scale, and there is substantial evidence that since the complaint was filed in this case and the preliminary Cease and Desist Order entered, the Respondents' business has dried up and no further income has been earned as a result of it. The Normans claim, and there is no evidence to contradict it, that that operation has ceased.
Recommendation Based on the foregoing Findings of Fact and conclusions of Law, it is, therefore: RECOMMENDED that a Final Cease and Desist Order be issued against each of the Respondents, Dan Norman, Juanita Norman, and Bankers Acceptance of America, a Florida General Partnership, as to each of the allegations of misconduct outlined in the initial Cease and Desist Order and Complaint filed herein. RECOMMENDED this 20th day of June, 1990, in Tallahassee, Florida. ARNOLD H. POLLOCK Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 20th day of June, 1990. COPIES FURNISHED: Robert K. Good, Esquire Office of the Comptroller 400 West Robinson Street, Suite 501 Orlando, Florida 32801 Dan Norman Juanita Norman Bankers Acceptance of America 3505 34th Avenue Drive West Bradenton, Florida 34205 Hon. Gerald Lewis Comptroller, State of Florida The Capitol Tallahassee, Florida 32399-0350 William G. Reeves General Counsel Department of Banking and Finance The Capitol Plaza Level, Rm. 1302 Tallahassee, Florida 32399-0350
The Issue The issue in this case is whether Petitioner's request for license by endorsement as a professional engineer should be granted.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: Petitioner, James R. Eason (Petitioner), is the pavement management coordinator for the Hernando County Public Works Department. He is a registered professional engineer in the State of Georgia, having received Professional Engineering Registration Number 17320 in 1988. In March 1997, Petitioner filed an application with Respondent, Board of Professional Engineers (Board), seeking licensure by endorsement as a professional engineer in this state. On July 1, 1997, the Board issued its preliminary decision in the form of a letter advising Petitioner that his application had been denied. As grounds, the Board stated that Petitioner had received a raw score of 67 with five points awarded for Veterans Preference on the Principles and Practice portion of the examination. The letter further explained that a raw score of 70 or above was required in order for his score on the Georgia examination to be recognized in the State of Florida and that "Chapter 471, F.S. does not provide for awarding of points for Veterans Preference." The denial of the application prompted Petitioner to bring this action. Petitioner is a graduate of, and holds a bachelor's degree in civil engineering from, the Georgia Institute of Technology. He has a record of four years active engineering experience of a character indicating competence to be in responsible charge of engineering. The parties have also stipulated he is of good moral character, and he has never been under investigation in another state for any act which would constitute a violation of Chapters 455 or 471, Florida Statutes. Petitioner passed the Fundamentals portion of the professional engineering examination administered in 1973 by the State of Georgia. He obtained a score of more than 70. In April 1988, Petitioner took the Principles and Practice portion of the examination. A grade of 70 was required to pass the Georgia examination. Petitioner received a grade of 67 on the initial scoring of the Principles and Practice portion of the examination, plus a five-point Veterans Preference credit, for a total grade of 72. The Veterans Preference credit is provided by Georgia law to all candidates who are members or former members of the Armed Forces of the United States and meet certain service requirements. In Petitioner's case, he had served eight years on active duty as a member of the United States Naval Reserve, and he was honorably discharged as a Lieutenant on July 3, 1969, upon expiration of his active duty commitment. At least ninety days of his active duty military service was during wartime or at a time when military personnel were committed by the President of the United States. The examination administered by the State of Georgia in April 1988 was a national examination published by the National Council of Examiners for Engineering and Surveying, and it was identical to the examination administered by the State of Florida at that time. Florida, like Georgia, requires a grade of 70 to pass the examination, but it does not provide a Veterans Credit for service to candidates who are members or former members of the Armed Forces of the United States. Therefore, in the State of Georgia, a veteran can pass the examination with a raw score as low as 65. To this extent, the two examinations are not substantially equivalent. Among other things, Petitioner pointed out at hearing that he needed only three points to achieve a passing grade on the Principles and Practice portion of the examination. Therefore, he concluded that the awarding of that amount of extra points for being a veteran amounted to only a single standard deviation, and thus the extra points were immaterial in relation to the overall score. However, the Board does not construe this three-point deficiency as being "immaterial," and had Petitioner received the same score in Florida, he would not have passed the examination.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Board of Professional Engineers enter a Final Order denying Petitioner's request for licensure by endorsement as a professional engineer. DONE AND ORDERED this 25th day of November 1997, in Tallahassee, Leon County, Florida. DONALD R. ALEXANDER Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 25th day of November, 1997. COPIES FURNISHED: Joseph M. Mason, Jr., Esquire Post Office Box 1090 Brooksville, Florida 34605-1900 Edwin A. Bayo, Esquire Department of Legal Affairs The Capitol Tallahassee, Florida 32399-1050 Angel Gonzalez, Executive Director Board of Professional Engineers 1940 North Monroe Street Tallahassee, Florida 32399-0755
The Issue Whether employees of Production Credit Associations and the Federal Land Bank Associations of Florida may be licensed to sell insurance by the Florida Department of Insurance. (a) Whether the affidavit by C. W. S. Horne offered by Intervenors Production Credit Associations of Florida and Federal Land Bank Associations of Florida is relevant and material to the issues. Whether the Production Credit Associations of Florida and the Federal Land Bank Associations of Florida are financial institutions as defined in Section 636.9_8 of the Florida Statutes. Whether the Department of Insurance, in its licensing proceedings, should consider or must consider the Federal laws, rules and regulations.
Findings Of Fact Facts stipulated by the parties on the record: "The Petitioners, the Florida Association of Insurance Agents, representing the Association and its members individually and collectively, is a representative party in interest for these proceedings and any review thereof. And its members will be effected by any decision of the Department of Insurance in licensing insurance agents to be employed by, retained by, or associated with Production Credit Associations in the State of Florida. For the purposes of this proceeding, and any review thereof, no member of the Association may take a position contrary to or in opposition to that taken herein by the Petitioner. "The Production Credit Associations of Florida and the Federal Land Bank Associations of Florida and the Federal Land Bank Associations of Florida have an interest in the decisions of the Department of Insurance with respect to the licensing of insurance agents to sell insurance on their behalf. And the decisions of the Department in licensing of such insurance agents will substantially effect the interest of the Production Credit Associations and the Federal Land Bank Associations of Florida, and they are therefore proper parties to the Administrative Proceedings. "Florida Farm Bureau Federation, L.A.A., (Limited Agricultural Association) is a non-profit voluntary general farm membership organization comprised of approximately 65,000 member families. The Florida Farm Bureau offers comprehensive insurance services to their members, and if the Department licenses insurance agents to be employed by or associated with the Production Credit Associations of Florida, they will be offering similar services that are already offered by the Florida Farm Bureau. "The Department of Insurance has licensed two insurance agents with type 2-20 general lines insurance licenses, which licenses since their issuance have been utilized by the holders thereof. The Production Credit Associations of Florida and the Federal Land Bank Associations of Florida have retained such licensed agents and have entered into the insurance business through the process of having such agents solicit and sell insurance to persons, including those who borrow from either the Production Credit Associations or the Federal Land Bank Associations of Florida. "The Intervenors, Production Credit Associations of Florida, may offer into evidence an affidavit concerning the operations of the Associations and their affiliates in Florida. The other parties hereto will not object to the form of the evidence, but reserve the right to object to its introduction on the grounds that it is irrelevant and immaterial. ". . .there are Federal rules and regulations under the Farm Credit Administration Act. The Hearing Officer may take judicial knowledge of such rules and regulations and any amendments thereto. ". . .it is stipulated that Mr. Field has witnesses that would testify to these items, and the other parties waive cross examination of such witnesses and agree to these facts without necessarily stipulating that such facts are true. ". . .Mr. Bob Taylor, Vice President for Underwriting of Farm Bureau Insurance Companies, would testify that Farm Bureau, through its related insurance companies and other competitive companies are currently offering cost, qualitatively and availability, similar insurance services to those being sought in rural communities. ". . .Mr. Doug Oswald, President of Sun Bank, Ocala, would testify as to the availability of farm loans during the last 24 years in the Ocala, Marion County, Florida area. He would testify that such loans are currently available through current commercial sources and have been available, and such loans, including both mortgage and production type loans, are presently available in Marion County. And that insurance related services in connection with the farm type loans in his community have been available through the Farm Bureau and other companies during this period of time. ". . .Mr. Bob Taylor, Vice President of Underwriting, Farm Bureau Insurance Companies, would also testify that similar insurance services proposed to be offered to the Production Credit Association and the Land Bank are presently being and have been offered by the Farm Bureau Insurance Companies in the rural communities on a competitive form from both cost, qualitatively and availability. The Hearing Officer further finds: The Production Credit Associations of Florida and the Federal Land Bank Associations of Florida are chartered by the Farm Credit Administration [a federal agency in the executive branch of the government subject to regulation and supervision by the Farm Credit Administration, Title 12, Chapter IV, United States Code] upon application of local persons eligible to borrow money from the Farm Credit System. There are nine (9) Production Credit Associations and seven (7) Federal Land Bank Associations in Florida. Two licenses have been approved by the Respondent for two employees or associates of the Production Credit Association. The following affidavit of C. W. S. Horne, Executive Vice President of Federal Land Banks of Columbia and the Federal Land Bank of Columbia, is admissible for the purpose of describing the operations and functions of the associations and their affiliates in Florida: "PERSONALLY APPEARED BEFORE ME C. W. S. Horne, being duly sworn deposes and says that he is the Executive Vice President of the Federal Land Bank of Columbia, and the Federal Credit Bank of Columbia, and that if called upon to testify in the above captioned matter he would state that according to his knowledge and belief the Farm Credit Act of 1971 does in fact provide in Section 1.4(11) as follows: "Accept deposits of securities or of current funds"; and that neither the Federal Land Bank nor the Federal Intermediate Credit Bank accepts any deposits from members of the general public in any form such as is common with commercial banks and that it accepts no deposits either for time or checking accounts or issue certificates of deposit or other similar evidences of indebtedness; and that pursuant to Section 1.4(11) of the Farm Credit Act of 1971, the Federal Land Bank of Columbia does retain certain funds belonging to Federal land bank Associations and that it issues an advice of indebtedness to the associations and pays interest thereon based upon the cost of money to the Federal Land Bank of Columbia and that in practice these transactions amount to loans by certain associations to the Federal Land Bank of Columbia. Further the deponent sayeth not." The Florida Farm Bureau Federation, a limited agricultural association is a non-profit, voluntary general farm membership organization. Members may, and many do, borrow from the Production Credit Associations and the Federal Land Bank Associations, associations which are a part of the Farm credit Systems. The Florida Farm Bureau offers comprehensive insurance to its members through individual agents licensed by the Respondent Department of Insurance.
Recommendation Deny applications for licensure from the Production credit Associations of Florida and for the federal Land Bank Associations of Florida and revoke any licenses that have been issued. DONE and ORDERED this 16th day of December, 1976 in Tallahassee, Florida. DELPHENE C. STRICKLAND Hearing Officer Division of Administrative Hearings Room 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 16th day of December, 1976. COPIES FURNISHED: Fred B. Karl, Esquire Post Office Drawer 229 Tallahassee, Florida 32302 Edward L. Kutter, Esquire Room 268 Larson Building Tallahassee, Florida 32304 E. Harper Field, Esquire Post Office Box 1879 Tallahassee, Florida Joseph C. Jacobs, Esquire Post Office Box 1170 Tallahassee, Florida 32302 J. R. Lowry, Esquire Bevin Ritch, Esquire Post Office Box 1025 Gainesville, Florida
Findings Of Fact The Department rules on the Proposed Findings of Facts submitted by the parties as follows: APPLICANT'S PROPOSED FINDINGS Applicant's proposed finding as to the net profit to asset ratio is accepted. Applicant's proposed finding as to the adjusted capital to asset ratio is accepted. Applicant's proposed finding as to the boundaries of the PSA are accepted. Applicant's proposed findings as to the population estimates of the PSA and the communities located within the PSA are accepted to the extent they are not inconsistent with the Department's findings adopted herein. Applicant's proposed finding as to net migration into Pinellas County and the age distribution characteristics of Pinellas County are accepted to the extent they are not inconsistent with the Department's findings adopted herein. Applicant's proposed finding that the Bank of Indian Rocks is the only full service bank with its main office operating in the PSA is accepted. Applicant's proposed finding that the Bank of Indian Rocks experienced a 23.3 percent rate of growth for loans and a relatively modest rate of growth for deposits during the last reporting year is accepted. Applicant's proposed findings as to the nature of the proposed branch site are accepted. Applicant's proposed finding as to the banks servicing the PSA is accepted to the extent that said banks have branch offices located in the PSA, but is rejected to the extent that said finding excludes other banks which may service customers in the PSA. Applicant's proposed finding that the PSA community is heavily dominated in terms of bank operations by the Bank of Indian Rocks is rejected as being unsupported by competent substantive evidence in the record. The record indicates that based on a telephone sample survey of 399 persons, 49 percent of the households in the PSA have their primary checking account at the Bank of Indian Rocks. The Applicant's proposed finding does not necessarily follow from the survey. Applicant's proposed finding as to the percentage of people located in the PSA that have a primary checking account in the PSA and bank with the Bank of Indian Rocks is rejected for the reasons previously stated in paragraph 10. Applicant's proposed finding as to the need for an additional full service bank based on the statistical data presented is rejected as constituting a conclusion of law. Applicant's proposed finding as to the savings and loan associations serving the PSA is accepted to the extent that said savings and loan associations have offices located in the PSA, but is rejected to the extent that said finding excludes other savings and loan association offices which may serve customers in the PSA. Applicant's proposed findings as to the nature of the primary service area is accepted, with the exception of the finding as to the amount of land available for future development which is rejected as being unsupported by competent substantial evidence in the record. Applicant's proposed findings that the Applicant's economic capacity will be enhanced by the branch; that the Applicant can support the proposed branch and statements with regard thereto, are rejected as constituting conclusions of law and legal argument, rather than findings of fact. Applicant's proposed findings as to the range of services that will be offered at the proposed branch are accepted. Applicant's proposed finding as to the need for additional banking facilities and the convenience of the proposed bank are rejected as constituting conclusions of law. Applicant's proposed findings as to the substantial experience of the bank staff, and significant assets are accepted; however, Applicant's proposed findings to the capability of the bank to support the branch facilities is rejected as constituting a conclusion of law. Applicant's proposed findings as to the Applicant's return on assets on 1977, 19978 and year to date are accepted. Applicant's proposed findings as to the liquid assets as a percent of total liabilities; condition of assets; classified assets and loan loss ratio are accepted. Applicant's proposed findings as to increased earnings, increased average balances and reduced chargeoffs are accepted. Applicant's proposed finding that there has been no cash operating loss of the Applicant is rejected as being unsupported by competent substantial evidence in the record. Applicant's other statements with regard thereto are rejected as constituting legal argument rather than findings of facts. Applicant's proposed finding that the review of the branch by management of the Applicant and the Atlantic Bancorporation is significant is accepted; however, Applicant's proposed finding as to the judgment of the management as to the success of the proposed branch constitutes a conclusion of law. Applicant's proposed finding that there was no insider transaction involved in the purchase of the land is rejected as being irrelevant and immaterial. Applicant's proposed finding that there was no showing that the lease transaction constitutes an insider transaction is rejected as being unsupported by competent substantial evidence in the record. Applicant's proposed finding that the lease sum represents approximately a 12 percent return on assets is accepted; however, the Applicant's proposed finding that the lease arrangement was not controverted as being unfair or unreasonable is rejected as being irrelevant and immaterial. Applicant's proposed finding that the depth of management is sufficient to operate the branch is rejected as constituting a conclusion of law. Applicant's proposed findings as to the number of years of experience of various officers of the bank is accepted. Applicant's proposed finding as to whether the name of the proposed branch was confusing is rejected as constituting a conclusion of law. Applicant's proposed finding that the Applicant does not have more than four pending branch applications is accepted. Applicant's proposed findings that there was no evidence presented which would indicate that the bank was not in compliance with federal and state regulations and statements of bank offices thereto are accepted. PROTESTANT'S PROPOSED FINDINGS Protestant's proposed findings in Section 1 are accepted, with the exception of the last sentence which is rejected as being a conclusory statement not supported by competent substantial evidence in the record. Protestant's proposed findings in Section 2 are accepted. Protestant's proposed findings in Section 3 are accepted, with the exception that the record reflects that the proposed site is located in the vicinity of the northwest quadrant of the intersection of Indian Rocks Road and Walsingham, and does not specify the number of fees west of the intersection. Protestant's proposed findings as to the PSA's boundaries as delineated by the Applicant in Section 4 are accepted. The second and third sentences in Section 4 are rejected as being unsupported by competent substantial evidence in the record. The first sentence in the second paragraph of Section 4 is accepted. The second sentence in the second paragraph of Section 4 is rejected as constituting legal argument rather than a finding of fact. The remaining proposed findings in Section 4 relating to the boundaries of the PSA of the First Bank of Treasure Island are irrelevant for the reason that said PSA is not necessarily applicable to subsequent applications. Protestant's proposed finding in Section 4 as to the population of the PSA is accepted and the proposed findings relating to the population of First Bank of Treasure Island's PSA is rejected as being irrelevant. Protestant's proposed finding in Section 4 as to the residential nature of the PSA is accepted. Protestant's proposed finding as to the limited nature of commercial activity is rejected as being unsupported by competent substantial evidence. The record reflects that although commercial activity in the PSA is in the form of small retail, professional, and service type establishments, these establishments are numerous in number. Protestant's proposed finding as to the considerable greenbelt lands which cannot be used for development is rejected as being unsupported by competent substantial evidence. The record reflects that there are greenbelt areas which cannot be used for development, but does not reflect that the amount of these lands is considerable. Protestant's proposed findings in the first and second sentences in Section 5 are accepted. The third sentence in Section 5 is accepted to the extent that traffic coming from west to east cannot enter the proposed site directly. The remaining findings in the first paragraph of Section 5 are accepted, with the exception of the last phrase of the last sentence which is rejected as speculation and not supported by competent substantial evidence in the record. Protestant's proposed finding in the second paragraph of Section 5 as to the number of Applicant's existing customers in the PSA is accepted, however, the remaining findings in that paragraph are rejected as unsupported by competent substantial evidence in the record. Protestant's proposed finding in the last paragraph of Section 5 is rejected as constituting a conclusion of law. Protestant's proposed finding in the first paragraph of Section 6 are accepted to the extent that said finding represents the number of offices of financial institutions serving the PSA and not the number of financial institutions. Protestant's proposed finding in the first sentence of the second paragraph of Section 6 is rejected as being unsupported by competent substantial evidence in the record. The record reflects that the Applicant offers automatic transfer from savings to checking and not that they contend this service is unique. Protestant's proposed finding in the second sentence of the second paragraph of Section 6 is accepted with the exception that the record does not support the finding that the Bank of Indian Rocks offers automatic transfer accounts. The finding in the last sentence of the second paragraph of Section 6 is rejected as being irrelevant. Protestant's proposed finding in the third paragraph of Section 6 is rejected as being unsupported by competent substantial evidence in the record. The record reflects that some of the questions asked in the Burke survey may have been based on the assumption that automatic transfer accounts were not presently offered in the PSA, however, the entire survey was not based on that assumption. Protestant's proposed finding in the fourth paragraph of Section 6 is accepted. Protestant's proposed finding in the fifth paragraph of Section 6 is rejected as being unsupported by competent substantial evidence in the record, said finding is based on hearsay evidence which is uncorroborated. Protestant's proposed finding in the sixth paragraph as to the number of businesses that the Applicant listed in its application which were not in its PSA is accepted, however, the remaining finding in that paragraph is rejected as irrelevant. Protestant's proposed finding in the last paragraph of Section 6 is rejected as constituting a conclusion of law. Protestant's proposed finding as to the provisions of Rule 3C- 13.041(2)(a), F.A.C. in the first paragraph of Section 7 are accepted. Protestant's proposed finding as to the Applicant's capital to asset ratio in the second paragraph of Section 7 is accepted. Protestant's remaining finding in that paragraph is rejected as constituting legal argument and opinion, rather than a finding of fact. Protestant's proposed findings in the first paragraph of Section 7 are accepted. Protestant's proposed finding in the fourth paragraph of Section 7 is rejected as being unsupported by competent substantial evidence in the record. The record reflects that Mr. Maurer stated that the Applicant probably would not be able to add to capital through earnings based on the projected losses of the unopened branches. Protestant's proposed findings as to the projected deposits of the Applicant's branches in the fifth paragraph of Section 7 are accepted, however, Protestant's proposed finding as to the need for additional capital is rejected as constituting a conclusion of law, opinion and legal argument. The remaining findings in that paragraph and the first sentence of the sixth paragraph are rejected as being legal argument rather than findings of facts based on competent substantial evidence in the record. The finding in the second sentence of the sixth paragraph is accepted. Protestant's proposed finding in the seventh paragraph of Section 7 that the applicant does not have sufficient personnel to staff and manage its new branches is accepted. Protestant's proposed finding that no manager for the proposed branch has been selected is rejected as being unsupported by competent substantial evidence in the record. Although there appears to be conflicting testimony as to this fact, the application contained in the record states that James Arntz had been selected as the branch manager, in addition to testimony on direct examination that Mr. Arntz had been selected as the branch manager and the record supports said finding. Protestant's proposed finding as to the managerial capacity of the Applicant and its impact on the adequacy of capital to asset ratio is rejected as constituting a conclusion of law. Protestant's proposed findings contained in the first two sentences of the eighth paragraph of Section 7 are accepted. Protestant's proposed finding contained in the last sentence is rejected as constituting a conclusion of law. Protestant's proposed finding in the last paragraph of Section 7 is rejected as constituting a conclusion of law. Protestant's proposed finding in the first sentence of the first paragraph of Section 8 is accepted. The remaining findings in that paragraph are rejected as constituting conclusions of law. Protestant's proposed finding in the first sentence of the second paragraph of Section 8 is accepted, and the remaining finding in that paragraph is rejected as constituting a conclusion of law. Protestant's proposed findings in Section 9 are accepted. Protestant's proposed findings in Section 10 are accepted. Protestant's proposed findings in the first two paragraphs and the first, second and fourth sentence of the third paragraph of Section 11 are accepted. The proposed findings in the third and fifth sentences of the third paragraph are rejected as constituting conclusions of law. Protestant's proposed findings in the first two sentences of the fourth paragraph of Section 11 are accepted, the remaining sentence in that paragraph is rejected as constituting a conclusion of law. Protestant's proposed findings in Section 12 are accepted, with the exception that (1) 9 percent represents an average cost of time deposits and to a minimum and (2) the proposed finding in the last sentence constitutes a conclusion of law. Protestant's proposed findings in the first two paragraphs of Section 13 are accepted. The remaining findings of the last paragraph are rejected as constituting conclusions of law. Protestant's proposed findings in the first paragraph of Section 14 are accepted, with the exception that the record reflects that the purchase price of the proposed site was $240,000 and not $200,000. Protestant's proposed findings in the first two sentences of the second paragraph of Section 14 are rejected as being irrelevant. The proposed findings in the third sentence is accepted. The proposed findings in the remaining sentences of that paragraph are rejected as constituting legal argument and conclusions of law. Protestant's proposed findings in Section 15 as to the provisions of Rule 3C-13.041(3) are accepted. The remaining proposed findings are rejected as being irrelevant. Protestant's proposed findings in Section 16 as to the provisions of rule 3c-13.041(2)(c) are accepted. The proposed finding in the second sentence of that section is accepted. The proposed finding in the third sentence is rejected as being unsupported by competent substantial evidence in the record for the reasons stated above in paragraph 53 of this Order. The proposed finding in the last sentence is rejected as constituting a conclusion of law. DEPARTMENT'S PROPOSED FINDINGS The Department's proposed findings contained in paragraph 1, 3, 4 through 10, 12 through 19,22 and 23 are accepted. The Department's proposed findings contained in paragraph 2 are accepted with the exception of the third sentence which is rejected as being unsupported by competent substantial evidence in record for the reasons stated above in paragraph 53 of this Order. The Department's proposed findings contained in paragraph 11 are accepted, with the exception of the figure for the projected deposits for the first year based on 2.2 persons per household which is rejected as being unsupported by competent substantial evidence in the record. The record reflects that this figure is $2,487,000 and not $2,700,000. The Department's proposed findings contained in paragraph 20 are accepted, with the exception of the number of deposit and loan customers residing in the PSA which is rejected as being unsupported by competent substantial evidence. The record reflects that there was conflicting testimony as to the number of existing deposit customers, however, the hearing officer found the number to be 140, and 65 loan customers. The Department's proposed findings contained in paragraph 21 are accepted, with the exception of the amount of square feet of the building to house the proposed branch, which is rejected as being unsupported by competent substantial evidence. Although the application contained in the record stated that the building would contain 3,640 square feet (including the drive-in canopy), the hearing officer found that the building would contain 2,000 square feet. PROTESTANT'S EXCEPTIONS TO THE REPORT AND FINDINGS OF FACT OF HEARING OFFICER The Protestant's exception contained in Section 1, with regard to the Hearing Officer's ruling's on the proposed findings, is accepted to the extent that the better practice would be for the Hearing Officer to specify which proposed findings are rejected as not supported by the evidence, which are irrelevant and which constitute conclusions of law. However, it has been recognized that the hearing officer is not required to make explicit rulings on subordinate. commulative, immaterial or unnecessary proposed facts. Forrester v. Career Service Commission, 361 So.2d 220 (1st DCA Fla. 1978). Notwithstanding, the Department has expressly ruled on each proposed finding and stated the reasons therefore. Protestant's exception contained in Section 2 is rejected for the reason that some of the proposed findings contained in Protestant's Proposed Findings of Fact were not based on competent substantial evidence, were irrelevant or constituted conclusions of law, as more fully set forth above in paragraphs 31 through 70. Therefore, it would be improper for either the Hearing Officer or the Department to adopt each and every proposed finding contained in Protestant's Proposed Findings of Fact as requested in the exception. Protestant's exception contained in Section 3 is rejected for the reason that the Hearing Officer's finding that the proposed branch manager is James Arntz is supported by competent substantial evidence in the record. The testimony contained in pages 497 and 498 of the transcript, cited by Protestant in its exception, refers to the Applicant's application for a branch office in northeast St. Petersburg. Although there was conflicting testimony as to this fact (see TR-465 and TR-540), the application contained in the record also identified James Arntz as the proposed branch manager. As such, there was competent substantial evidence in the record to support the Hearing Officer's finding. Protestant's exception contained in Section 4 is accepted for the reason that the Hearing Officer found that the "the greater weight of the evidence indicates that average number of persons per household in Pinellas County is 2.2". As such, Applicant's revised figures based on 2.2 percent per household are accepted which indicate that the proposed branch will not show a profit until the fourth year. The Department's findings of fact have modified the Hearing Officer's findings accordingly. Protestant's exception contained in Section 5 is rejected for the reason that the Hearing Officer's finding is supported by competent substantial evidence in the record. The testimony contained on pages 511 and 512 of the transcript, which is cited by the Protestant, merely states that the Applicant probably would not be able to add to capital through earnings based on the assumption of the projected losses of the Applicant's new branches. As such, the Hearing Officer's finding is accurate. Protestant's exception contained in Section 6 is accepted for the reason that the record reflects that the Applicant's president stated that the branch will probably have Saturday banking hours, but that the exact hours had not been determined. The Department's Findings of Facts have modified the Hearing Officer's findings accordingly. Protestant's exception contained in Section 7 is rejected for the reason that the Hearing Officer's finding is supported by competent substantial evidence in the record. On pages 328 and 329 of the transcript, the witness for the Applicant testified that there was a stacking lane which functionally is in front of the site for traffic hearing west. Protestant's exception contained in Section 8 is rejected for the reasons that the Hearing Officer's finding based on the study was limited and for a limited purpose, and the questions asked in the survey and the procedure appear reasonable. In addition, the Hearing Officer's and Department's reliance on the study is minimal, if at all. Protestant's exception contained in Section 9 is rejected for the reason that the adverse impact of the establishment of a branch on other banks is irrelevant, because it is not a consideration under the statutory and regulatory criteria applicable to branch bank applications. Protestant's exceptions contained in Sections 10 and 19, 21 and 23 are rejected for the reasons that the requested findings are conclusions of law which are not properly included in the Hearing Officer's report pursuant to Section 120.60(3), Florida Statutes. Protestant's exception contained in Section 20 is rejected for the reason that the requested finding as to an appraisal of land and improvements is irrelevant where, as in this case, there is no insider transaction involved in the purchase of the land. Protestant's exception contained in Section 22 is rejected for the reason that the revisions referred to by the Protestant were updated figures based on data unavailable at the time of the application and figures relating to the lease arrangement. Although at the time of the application, the Applicant intended to purchase the proposed site, it later decided to lease the proposed site. The Department does not view this as a material change in the application and fails to see how the Protestant was prejudiced by this change. As to the updated figures, in McDonald v. Department of Banking and Finance, 346 So.2d 569, 584 (Fla. 1st DCA), the court stated that the hearing officer may freely consider relevant evidence of changing economic conditions and other current circumstances external to the application. It should also be noted that the revisions referred to by the Protestant were testified to at the hearing in June, thus giving the Protestant a month's notice to make any changes necessary in the preparation of its case which was later presented at the continuation of the hearing in July. Protestant's exception contained in Section 24 is rejected for the reason that the requested findings are not material to the statutory and regulatory criteria applicable to branch applications.
Findings Of Fact The Applicant, Protestant, and Department submitted Proposed Findings of Fact pursuant to Rule 3C-9.11, Florida Administrative Code. The Applicant's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings stated in the Hearing Officer's Report or where they may constitute conclusions of law, with the following exceptions: The last sentence of Proposed Finding Number 8 is rejected to the extent that it constitutes a legal argument as opposed to a finding of ultimate fact. Proposed Finding Number 11 is rejected in that it constitutes legal argument as opposed to a finding of ultimate fact. Proposed Finding Number 15 is rejected in that it constitutes a conclusion of law. The Protestant's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings stated in the Hearing Officer's Report or where they may constitute conclusions of law, with the following exceptions: The first sentence of Proposed Finding Number 6 is rejected in that it is speculative, constitutes legal argument, and is not supported by competent substantial evidence. The last sentence of Proposed Finding Number 6 is rejected in that it constitutes a conclusion of law as to the reason why the Protestant's bank charter was granted. The first, third, fourth and fifth sentences of Proposed Finding Number 10 are rejected, as they constitute legal arguments based upon restatement of testimony, as opposed to findings of ultimate fact. The second sentence of Proposed Finding Number 11 is rejected in that it constitutes a conclusion of law. Proposed Finding Number 14 is rejected in that it consists of argumentative references to testimony and not findings of ultimate fact. Proposed Finding Number 24 is rejected in that it constitutes legal argument and conclusions of law rather than findings of ultimate fact. The first sentence of Proposed Finding Number 26 is rejected in that it constitutes a conclusion of law. The second sentence of Proposed Finding Number 26 is rejected in that it is repetitious and constitutes a conclusion of law. The Fourth sentence of Proposed Finding Number 26 is rejected in that it constitutes a conclusion of law. Proposed Finding Number 27 is rejected in that it constitutes a conclusion of law. Proposed Finding Number 28 is rejected in that it constitutes legal argument rather than a finding of ultimate fact. The last sentence of Proposed Finding Number 31 is rejected in that it constitutes legal argument and a conclusion of law. The Department's Proposed Findings of Fact are accepted except where they might specifically conflict with the Findings of the Hearing Officer's Report or where they may constitute conclusions of law.
Findings Of Fact On May 29, 1985, The Columbus Company submitted a bid to construct a rest area along I-95 in accordance with the specifications for State Job No. 70225-3410. The bid documents required the bidders to have 10 percent subcontractors from DBEs or submit documentation with the bid to show good faith efforts to meet this 10 percent requirement were made if the 10 percent goal is not met. Respondent maintains a list of businesses qualifying as DBEs and periodically publishes a directory of those firms so qualifying. This latest directory published by DOT prior to the bid opening on the contract at issue here was April 15, 1985. Respondent's Bureau of Minority Affairs maintains a current register and will advise any bidder so requesting whether of not a firm qualifies as a DBE or WBE. The invitation to bid provides the contractor's bid submission shall include the following information: The names and addresses of certified DBE and WBE firms that will participate in the contract. Only DBEs and WBEs certified by the Department at the time the bid is submitted may be counted towards DBE and WBE goals. A description of the work each named DBE or WBE firm will perform. The dollar amount of participation by each named DBE and WBE firm. If the DBE or WBE goal is not met, sufficient information to demonstrate that the contractor made good faith efforts to meet the goals. Oscar Pope was Petitioner's estimator on this bid and prepared the bid which was submitted. Pope sent letters to various DBE firms soliciting their participation as subcontractors in the project and put ads in the newspaper. Prior to submitting the bid Pope realized that he did not have the required 10 percent DBE participation and he contacted another company to inquire where he could get additional minority participation from truckers and was referred to UPF Trucking. Pope contacted UPF Trucking and Billy Montgomery of UPF told Pope that UPF could qualify as a MBE. Pope did not check the directory or call DOT to verify UPF Trucking's status as a MBE. In his bid submitted, which included DBE/WBE utilization form No. 1, Pope listed UPF Trucking as being certified by Florida DOT as a MBE. Including the subcontract Petitioner entered into with UPF Trucking brought the MBE participation to the 10 percent goal required by the contract and no documentation was submitted to demonstrate Petitioner had made good faith efforts to reach the required DBE goals but could not do so. Upon the opening of the bids for this project, Petitioner was the low bidder. When the MBE participation listed in the bid was checked, UPF Trucking was found to be not qualified as a MBE firm. UPF Trucking was not listed in the April 15, 1985, directory of qualified minority businesses or on any approved list maintained by DOT. Had Pope called DOT before submitting Petitioner's bid, he could have learned UPF Trucking was not a qualified MBE. Petitioner's bid was forwarded to DOT's technical review committee and good faith efforts committee and both of these committees recommended the bid be found non-responsive because of the failure to meet the DBE goal. The bid was declared non-responsive and the contract was awarded to the next lowest bidder.
The Issue The issue in this proceeding is whether Petitioner is entitled to retirement service credit for the time period in which he was not employed with the State of Florida.
Findings Of Fact The Department of Management Services (DMS) is responsible for the administration of the Florida Retirement System (FRS) under Chapter 121, Florida Statutes. The Department of Transportation (DOT) is an agency of the State of Florida whose employees qualify for membership in FRS. Petitioner Richard L. Duley is an honorably discharged veteran. He began employment with DOT in 1991. At the same time, he became a member of FRS. Prior to 2001, then-Governor Jeb Bush directed state agencies to reduce their workforce by 25 percent over a five- year period beginning in 2001. The directive was known as the "Service First Initiative." In response to the Governor’s directive, DOT developed an Agency Organizational Efficiency Plan. On January 18, 2005, Petitioner was notified that his position was designated to be deleted under the Agency’s Organizational Efficiency Plan; his position was abolished on June 30, 2005. As a result, Petitioner was dismissed from state employment and was no longer receiving retirement service credit for FRS. However, Petitioner did not receive a clear point of entry to challenge either his termination or whether he was entitled to a veteran's preference by DOT. After his dismissal, Petitioner was hired by a private firm who had contracted with the State to perform the functions that Mr. Duley had previously provided as an employee of the state. The contract terminated in June or July of 2007, and was not renewed. As such, Mr. Duley became unemployed. On July 30, 2007, Petitioner filed a complaint with the Department of Veterans’ Affairs (DVA) alleging that DOT had denied him veteran’s preference in retention during the 2005 layoff. The DVA found that Petitioner's complaint had merit. On November 19, 2007, Petitioner filed a complaint with the Public Employees Relations Commission (PERC), which held an evidentiary hearing on the complaint. PERC is the administrative body that has jurisdiction to determine issues and remedies under the veteran's preference statute. In its Final Order issued April 8, 2007, PERC found that Petitioner was an honorably discharged veteran and was entitled to preferential treatment in employment. PERC also found that DOT violated the veteran’s preference law by not affording Petitioner special consideration in finding alternative employment after the layoff. As a remedy for its violation of the veteran's preference law, PERC ordered DOT to make Petitioner an offer of employment to an existing position comparable to that which he held prior to his layoff. PERC also awarded Petitioner attorneys’ fees and costs. However, and most importantly, PERC did not reinstate Petitioner to his former position because it had been abolished. Similarly, PERC did not rescind Petitioner's termination. Finally, PERC did not award back pay or benefits to Petitioner. As a consequence of the Final Order, neither Petitioner nor DOT paid contributions towards the Retirement Systems Trust Fund for the period that Petitioner was not employed with the State. Additionally, Petitioner was offered and hired into a new position by DOT and again began to accrue retirement service credit in FRS when he was hired by DOT in May of 2008. The PERC Final Order was not appealed and became res judicata on the issues litigated therein. Therefore, since Petitioner's termination was not rescinded and Petitioner was not reinstated by PERC and did not pay contributions into FRS, he is not entitled to receive credit for the time he was not employed by the State and this action should be dismissed.
Recommendation Based upon the foregoing, Finding of Fact and Conclusions of Law set forth herein, it is RECOMMENDED: That the Department of Management Services, Division of Retirement, enter a Final Order dismissing this action. DONE AND ENTERED this 23rd day of December, 2010, in Tallahassee, Leon County, Florida. S DIANE CLEAVINGER 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 23rd day of December, 2010. COPIES FURNISHED: Richard L. Duley 5432 Pinderton Way Tallahassee, Florida 32317 Larry D. Scott, Esquire Department of Management Services Division of Retirement 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399 Kristin M. Klein, Esquire Department of Management Services 4050 Esplanade Way, Suite 160 Tallahassee, Florida 32399 Sarabeth Snuggs, Director Division of Retirement Department of Management Services Post Office Box 9000 Tallahassee, Florida 32315-9000 John Brenneis, General Counsel Department of Management Services 4050 Esplanade Way Tallahassee, Florida 32399-0950
Findings Of Fact The Petitioners have filed an application with the Respondent to organize a new bank in Ocala, Marion County, Florida. The name of the proposed bank would be the Citizens First Bank of Ocala. The Petitioners are the organizers and proposed directors of the bank. Each of the Petitioners is of good moral character, and each enjoys an outstanding reputation. None of the Petitioners have been convicted of any crimes involving breach of trust, and none have filed for bankruptcy, or have any history of being bad credit risks. Together the Petitioners constitute a diverse group with very broad and successful business experiences. The Petitioner William R. Kidd is a registered professional engineer and realtor who has lived and worked in Ocala since 1950. Mr. Kidd has broad experience in evaluating various aspects of real estate transactions, and he has extensive experience in arranging financing of construction projects. Mr. Kidd owns a pollution control company which has a net worth of approximately $25,000 and a real estate business with sales since 1975 in excess of $10,000,000. He also manages and operates a successful consulting engineering firm. Mr. Kidd plans to invest $40,000 in the new bank, and he has sufficient funds readily availably to make that investment. Mr. Kidd is willing to invest more money in the enterprise if additional capitalization is required. Mr. Kidd is interested in working with the bank, particularly in relation to financing of real estate transactions, and construction projects. The Petitioner Ralph Murphy was born in Marion County and has spent most of his life there. Mr. Murphy owns a linen service company which does approximately $18,500 to $19,000 in business weekly. The linen service, which Mr. Murphy has managed since it was a small entity doing less than $2,500 in business weekly, has a net worth of approximately $900,000. Mr. Murphy serves on the Boards of Directors of several other corporations. Mr. Murphy intends to purchase $40,000 of stock in the proposed new bank, and he has funds readily available with which he can do that. Mr. Murphy is willing to devote as much time as is necessary to organize the bank. The Petitioner Milton L. Copeland manages an insurance firm which writes commercial insurance policies for businesses in Florida and in Georgia. His company has offices in Ocala and Jacksonville. The Ocala office writes approximately $2,000,000 in insurance policies annually. The Jacksonville office writes approximately $15,000 in policies weekly. Mr. Copeland has a personal net worth of approximately $800,000. Mr. Copeland intends to buy $40,000 worth of stock in the proposed new bank, and he has funds readily available for that purpose. Mr. Copeland wishes to take an active part in soliciting new accounts for the bank, and he could devote as much as two full days per week to bank activities. If further capitalization of the proposed bank were considered necessary, Mr. Copeland is willing to increase his investment in the bank. The Petitioner James Cunningham owns and operates a funeral home business in Ocala. He has lived in Ocala most of his life. The dollar volume of Mr. Cunningham's business during 1976 was approximately $250,000. Mr. Cunningham is a City Councilman in Ocala. He is a black man. It has only been in recent years that blacks have even been employed at local banks, and no blacks presently serve on the Boards of Directors of any banks operating in Ocala or Marion County. Mr. Cunningham intends to purchase $40,000 worth of stock in the new bank. He will need to borrow no more than 25 percent of that amount in order to make the investment. Mr. Cunningham desires to take an active part in soliciting accounts and customers for the new bank, and he is willing to devote whatever time would be required for that purpose. The Petitioner Marjorie Renfroe owns and operates a boat, motor and trailer sales and service business in Marion County. Her business had gross sales during 1976 of approximately $350,000. Ms. Renfroe serves on the Board of Directors of the United Way in Marion County, and on the Board of Directors of the Central Florida Community College. Ms. Renfroe plans to buy $40,000 worth of stock in the new bank, and if further capitalization were found necessary, she is willing to increase her investment, and is able to do so. Ms. Renfroe is willing to devote as much time as necessary to managing the new bank, and she is particularly interested in providing services to employees and students of the local community college, especially instructional sorts of courses for students. No women presently serve on the Boards of Directors of any banks in Marion County. One woman serves on the Board of Directors of a savings and loan institution in Marion County. The Petitioner Van G. Staton manages a Belk-Lindsey Department Store in Ocala, Florida. He has lived in Ocala and managed the department store since 1956. The store employs 48 persons and had gross sales during 1976 of approximately $3,000,000. The annual payroll of the store is $400,000 to $500,000. The Petitioner serves on the Board of Directors of a local automobile sales and service corporation, and from 1970 through 1975 he served on the Marion County School Board. Mr. Staton plans to purchase $40,000 of stock in the new bank, and he would not need to borrow more than 50 percent of that amount. Mr. Staton would favor additional capitalization, and would be willing to increase his investment. Mr. Staton is particularly interested in having extended business hours in the new bank beyond the hours presently served by banks operating in Marion County, and Saturday openings. He is willing to spend as much time as is necessary with banking activities. The Petitioner Owen C. Shelton owns and manages two corporations which operate fifteen convenience stores. The total sales for the two corporations was approximately $17,000,000 during 1976. Mr. Shelton has lived in Ocala for 15 years. His personal net worth is in excess of $1,000,000. Mr. Shelton has been in the grocery business for twenty-five years. He started with one small store. His corporations employ approximately 185 persons. Mr. Shelton plans to purchase $40,000 worth of stock in the new bank, and he is willing to increase his investment if further capitalization is required. The Petitioner Terry Trexler is President and Chairman of the Board of Nobility Homes, a mobile home manufacturing business. The company does business in 29 states, and does from 5.1 to 5.2 million dollars worth of business on a quarterly basis. Mr. Trexler has lived in Ocala for 15 years. Mr. Trexler plans to invest $40,000 in purchasing stock in the new bank, and he intends to be active in soliciting new accounts and customers for the bank. The Petitioner Sam Kinlaw is a resident of Orlando, Florida. He has a Bachelor's Degree in Business Administration from the University of Florida, and attended the Banking School of the South at Louisiana State University. Mr. Kinlaw has been active in the banking business, or in similar financial businesses since approximately 1958. He has served as the head of installment loan departments and commercial lending departments of banks in Florida. Beginning in 1972, he became the Chief Executive Officer of the Semoran Bank, which was a new Federally chartered bank. He was responsible for setting up the bank, hiring personnel, establishing policies, and carrying on the day-to-day operations of the bank. He served in that capacity from near the end of 1972 until September, 1975. He has not been involved in the banking business since then. Mr. Kinlaw intends to purchase a "qualifying share" of stock in the bank. He intends to serve on the Board of Directors during the time that the bank is being organized, until other persons with direct banking experience are named to the Board of Directors. The Petitioner Braxton Jones owns and operates several convenience stores and two supermarkets. He has lived in Ocala nearly all of his life. He is prepared to purchase between $20,000 and $30,000 of stock in the new bank, and he is willing to devote whatever time would be necessary to organize and operate the bank. The Petitioner Clarence Woodrow Hicks has lived in Marion County for approximately 30 years. He formerly owned and operated Hicks News Agency, which was involved in the wholesale distribution of magazines, books, postcards and sundry items. He also owned two retail book stores. Mr. Hicks has sold his business and is now semi-retired. He serves as a consultant to the new owners of his business. During the time that he operated the businesses, they did approximately three million dollars of business per year. Mr. Hicks' net worth is in excess of one million dollars. Mr. Hicks has time available to devote to the new bank. The proposed Citizens First Bank of Ocala would, if the instant application were granted, be located at the northwest corner of the intersection of State Road 200 and Southwest 16th Avenue in Ocala. The location is approximately one mile west of Pine Street (Federal Highways 441, 27, and 301), which is the primary north/south artery through Ocala. The proposed bank would be located just over three miles east of Interstate Highway 75. State Road 200 is presently a four lane highway which serves as one of the primary routes from the Interstate Highway into Ocala. Southwest 16th Avenue is presently two- laned, but all right of ways have been acquired and construction will shortly commence to four-lane the road. All of the banks and the savings and loans associations which presently operate in the Ocala area are located east of Pine Street. There are no banking facilities in the Ocala area which are located to the west of Pine Street. Location of a banking facility to the west of Pine Street would serve the convenience of persons in Ocala who live or work on the west side of Pine Street. Pine Street is a very busy highway, which has not been properly designed so that it can be easily crossed. Furthermore, a railroad track runs parallel to Pine Street to the West, and presents an additional barrier. While it is not impossible for persons who live or work on the west side of Pine Street to bank on the east side, the testimony is unrebutted that it is inconvenient to do so due to traffic congestion, and the railroad. There are many persons who reside on the west side, of Pine Street. The area to the north of the proposed bank site is a residential area. There are many low income residences, and trailer park type residential facilities in that area. There are also many moderate income residences to the south and the west of the proposed site all on the west side of Pine Street. The total population of the primary service area, which is designated to be west of Pine Street, is estimated to be 14,300, as of July, 1977. This represents more than a 35 percent increase from 1970 population figures. Many more residences are planned in the area. Over 1,200 new homes have recently been completed, and more than 500 are under construction. Larger residential developments are in the planning stages. There is considerable commercial activity in the areas surrounding the proposed site. The Ocala Industrial Park is located immediately across State Road 200 from the proposed site, and the South 40 Industrial Park is also nearby. Thirty-eight firms presently occupy space in the Ocala Industrial Park, employing more than 1,500 persons and occupying more than one million square feet of building space. Fourteen firms are presently located at the South 40 Industrial Park, employing nearly 350 persons and utilizing more than 300,000 square feet of building space. Both Industrial Parks have experienced steady growth. Many businesses, including several automobile sales and service businesses, have located on State Road 200. Construction is scheduled to begin on a major shopping mall in January, 1978, by the Edward J. DeBartolo Corporation. The mall will be located on State Road 200 just east of Interstate Highway 75. Construction will take approximately 12 months. More than 900 persons will be employed at the mall. In addition, most of the horse farms which surround the Ocala area are located west of Pine Street. There are six banking institutions located in Marion County. The two banks located out of the Ocala area have no particular relevance to this matter. Four banks are located in Ocala. Only one of these banks is an independent bank. The others are parts of larger bank holding companies which are not centered in Ocala. Total bank deposits in Marion County have increased steadily from a total of $176,586,000 in 1973 to $236,336,000 in June, 1977. Although estimates vary, it is evident that the population of Marion County has increased from a 1970 total of approximately 69,000 to a 1977 total of from 104,000 to 127,000. It appears that existing banks in Marion County are in a healthy financial position and are experiencing steady growth. There are many interlocking relationships on the Boards of Directors of the existing banks. None of the Petitioners presently serve on the Boards of any of the existing banks, and this can only promote more lively competition among the banks. Petitioners have proposed to keep their bank open for longer hours than existing banks, and for additional banking days. Petitioners propose to provide specialized counselling for new business people, and education courses for students who attend the nearby Central Florida Community College. It appears that local banks have frequently acted adversely on loan applications from local developers, who have been able to borrow money at favorable rates outside of Marion County. The presently existing banks have not adequately served the very large and active horse farming industry that is located in Ocala, and several horse farmers have needed to go to Gainesville to obtain adequate farm businesses. Banks in Marion County have shown a deposit gain of nearly sixteen percent during the year 1976, as compared to a State of Florida average of approximately 7.4 percent. Of the sixteen counties in which new bank charters were granted in the period from January, 1975, through March, 1977, only two counties had a total deposit growth greater than was experienced in Marion County. A savings and loan association was chartered and opened in Marion County in January, 1975. The association has achieved very good success, and has not proved harmful to other financial institutions, which have also shown steady growth during this same period. Petitioners have projected a net profit at the end of the third year of their operation of $163,300 based on deposits of $10,000,000. A more conservative estimate of a net profit of $61,350, based on $8,000,000 in deposits after three years was estimated by Examiner Howze, a bank examiner who conducted an investigation of the instant application for the Respondent. George Lewis, II, the former Director of the Division of Banking, prepared a proposed budget which showed that the bank would be operating at a loss after three years. George Lewis' estimates are not credible. He estimated that the return on commercial loans would be at a rate of from 7 and 1/4 to 8 percent during the first, second and third years. Nine percent is a more realistic figure, and is itself conservative. The Respondent approved the charter of the Shores Bank of Lake Wier in Marion County which indicated a nine percent return on loans. George Lewis furthermore showed a three percent cost on all demand deposits. This cost is not justified by any factors currently accepted in the banking business. George Lewis apparently based the additional cost on his feeling that the legislature may pass a law requiring banks to pay such a return on all demand deposits. Such speculation has not been shown to be justifiable, and cannot serve as a reasonable factor to be used in predicting a proposed bank's profits. Petitioners propose to issue capital stock in the amount of $1,000,000, and thus to capitalize the new bank in that amount. This is adequate capital to serve the needs of the proposed bank during the first three years of its operation. George Lewis, II, testified that additional, capitalization would be required, but he gave no reason for his opinion. To the extent that additional capital is required, the Petitioners are in a position to raise it, and are willing to do so. Only one of the Petitioners who would serve on the first Board of Directors of the proposed bank has any direct banking experience. All of the Petitioners have engaged in considerable banking activities, but only Sam Kinlaw has served in an active capacity with a bank. The Petitioners propose to hire experienced persons to serve as the bank's Chief Executive Officer and Chief Operations Officer. These persons would also serve on the Board of Directors. The Petitioners do represent a good cross-section of successful business people. Their varied business experiences within Marion County would be very helpful to the new bank. In order to properly operate the bank, however, they will require experienced officers. Consistent with the Respondent's policy, the Petitioners have not yet named their officers. To do so, the Petitioners would place the persons they propose to hire in an untenable position in their present capacities. The Respondent has, in the past, approved bank charter applications for further processing under similar circumstances, so as to allow applicants an opportunity to recruit acceptable, experienced individuals to serve as officers. The Board of the proposed bank, as presently constituted, does not have adequate banking experience so as to assure a reasonable prospect of success. If, however, experienced, competent officers, who will also serve on the Board, are hired, the Board would be such as to assure a reasonable promise of success. The parties have stipulated that the name of the proposed bank, the Citizens First Bank of Ocala, is not so similar to any existing bank as to cause confusion with the name of the existing bank. The property which the Petitioners have obtained for the proposed bank is an excellent location. Petitioners plan to utilize a structure which is already on the land to commence operations. The structure has approximately 3,000 square feet of floor space, is aesthetically appropriate, and can be fairly easily modified to serve as a banking facility. The structure, when modified to increase the size of the lobby and to provide appropriate security measures, should prove adequate during the first three years of the bank's operation. There is sufficient land for additions to be made, and the structure is physically sound so that a second floor could be added. The Petitioners are prepared to increase the size of the facility as required.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is: RECOMMENDED: That the Petitioners' application for authority to organize and operate the Citizens First Bank of Ocala be approved for further processing, and that the application be finally approved when the Petitioners have satisfied the Respondent that they have retained appropriate individuals to serve as the bank's principal officers, and that these persons will also serve on the Board of Directors. RECOMMENDED this 30th day of December, 1977, in Tallahassee, Florida. G. STEVEN PFEIFFER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of December, 1977. COPIES FURNISHED: C. Gary Williams, Esquire AUSLEY, McMULLEN, McGEHEE, CAROTHERS & PROCTOR Post Office Box 391 Tallahassee, Florida 32302 S. Craig Kiser, Esquire Assistant General Counsel Office of the Comptroller Legal Annex Tallahassee, Florida 32304 Joseph C. Jacobs, Esquire Post Office Box 1170 Tallahassee, Florida 32302 Willard Ayres, Esquire Post Office Box 1148 Ocala, Florida 32670 Appendix
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: The applicant Metropolitan Bank and Trust Company is located at 4600 West Cypress Street, Tampa, Florida, and was established on May 31, 1974. Excluding its Chief Executive Officer and Executive Vice-President, the applicant has 25 officers with a combined total of 352 years of banking experience. The average age of the officers is 41, with an average of 15 years of banking experience. Six of the management team are past bank presidents. The applicant presently has two existing branch banking facilities. One is located 0.9 miles Southeast from the main office and one is located 8.6 miles Northwest of the main office. A third facility, acquired by merger, located 19.4 miles Southeast of the main facility, has been approved and was expected to open in April, 1979. As a result of the merger between Metropolitan and the American Guarantee Bank, the applicant now has 160 employees, The applicant has paid regular cash dividends to its stockholders since opening. As of December 31, 1978, the applicant had total assets of over $187,000,000.00. Its loans to loanable funds ratio has been maintained at about 80 percent. That ratio was 76.7 percent as of February 14, 1979. The protestant stipulated at the hearing that the applicant had no problem meeting its liquidity needs. As of December 31, 1978, the applicant had an adjusted capital to assets ratio of 8.2 percent. Its net profit to asset ratio was .836 percent as of December 31, 1978. The establishment of the proposed branch is expected to have no significant effect upon future earnings of the applicant. It is anticipated that the slight loss after the first year of operation will not exceed two cents per share and that the branch will contribute significantly to earnings of the applicant after the first year. The applicant presently has approximately $1.4 million in deposits and $2.8 million invested in loans from residents and business people in the primary service area of the proposed branch bank. The name of the proposed facility is to be Metropolitan Bank and Trust Company, Carrollwood Branch Office. It is to be located on the southwest corner of Dale Mabry Highway and Ehrlich Road, an unincorporated area of Hillsborough County, approximately 8.8 air miles from the main office. The property is presently owned by the applicant. No officer or employee of the applicant has an interest in the land purchased. The total cost of the land, building, furniture and fixtures and other fees is expected to amount to approximately $409,500.00. As of December 31, 1978, the applicant had an amount in excess of $1,391,500.00 to invest in bank premises. The proposed facility will offer full services, including checking and savings services, certificates of deposits, installment and commercial loans, VISA cards, safe deposit boxes, a 24-hour teller machine and Saturday banking. Additionally, the applicant intends to extend its main office services of international banking and trust services to the proposed branch. The building is to contain some 4,300 square feet and the drive-in area will contain some 1,050 square feet. Forty-three parking spaces will be provided. There will be five interior teller windows and four drive-in teller stations. The facility will also have a community room available for local citizens. The lending authority of the proposed branch manager will be $25,000.00 on an unsecured basis and $50,000.00 on a secured basis. Larger loans can be made available through consultation and approval of the parent bank. Long-term mortgage loans and acquisition and development loans will be available through the proposed branch. The proposed facility will have a branch manager and six staff (non- officer) members. The designated proposed branch manager is A. H. Vermeulen who has 22 years of experience in the banking industry and is currently a vice- president of the applicant. Mr. Vermuelen suffered a heart attack several weeks before the administrative hearing in this cause. It is expected that he will be able to resume his duties with the applicant. However, if he is unable to do so, the applicant has designated Charles Overholt as the proposed branch manager. Mr. Overholt has had 12 years of banking experience, has been an assistant branch manager of the Flagship Bank in St. Petersburg and is currently the applicant's vice-president in charge of the bookkeeping department. The applicant projects that total deposits at the proposed branch bank will be $5,000,00.00 at the end of the first year of operation, and $11,000,000.00 and $17,000,000.00 respectively at the end of the second and third years of operation. At the end of the first year of operation, the applicant anticipates a net loss of $22,100.00. Net profits of $211,300.00 and $459,500.00 are estimated for the end of the second and third years of operation. The site for the proposed branch banking facility is located on a main north/south traffic artery (North Dale Mabry Highway) and fronts on a major east/west traffic artery (Ehrlich Road). In selecting this site and designating the primary service area, the factors of residential development, population growth, traffic activity and flow, and existing financial institutions and services in the area were considered. Within the applicant's primary service area, there are presently two existing banks. The protestant Carrollwood is located 2.8 miles south of the applicant's site and the Exchange Bank of Temple Terrace branch is located 2.9 miles south of the proposed site. By an Order dated February 20, 1979, the Office of the Comptroller granted authority to the Sun Bank of Tampa Bay to open a branch bank to be located approximately 1.5 miles south of the site. Other applications for branch banks in the area are pending and there are several savings and loan institutions in the area. While the population of Tampa has declined in recent years, there have been considerable increases in population in the unincorporated areas of Hillsborough County, including the applicant's primary service area. The largest part (76.63 percent) of the increase in the unincorporated areas have resulted from net migration, as opposed to natural increase. There has been a good balance of growth in both the working or labor age group and the group aged 65 and above. The per capita personal income figures for Hillsborough County are below the State average and are increasing somewhat slower that the State average. The comparative figures report for June 30, 1977, through June 30, 1978, show that the protestant increased its total deposits by a little over 30 percent, the Exchange Bank of Temple Terrace increased its total deposits by almost 25 percent, and the Sun Bank of Tampa Bay likewise increased deposits by a little over 21 percent. The average for increases in deposits for the County was 16.6 percent. Official state estimates of population for the primary service area are not available. The applicant estimates the 1978 population of the primary service area to be 20,800. A population of 25,000 is projected for 1980 and a population of 33,000 is projected for 1985. The population of this area has grown approximately 105 percent since the year 1970. The two existing banks in the area result in a population per bank of 10,400 persons. The Sun Bank's branch brings this down to 6,933 persons per banking facility. The national average population per banking office is 4,715 and the Florida average is 8,086. The figures above for the primary service area do not take into account savings and loan institutions in the area nor customers served by banks outside the primary service area. The primary service area is mainly a "bedroom," residential community at the present time, with little commercial or industrial development. There is no significant concentration of employment in the area. The makeup of the populace is primarily upper middle class. Most of the residential development has occurred West of North Dale Mabry Highway. There are between 8,600 and 10,500 new residential units planned in the subdivisions located within the primary service area and, as of the date of the subject application, some 1,900 had been completed. Developers and landowners feel that commercial development in the area will naturally follow the residents development. At least two land developers in the primary service area have had difficulty obtaining financing in the form of large acquisition and development loans and construction loans from existing banks within the primary service area. The applicant is in substantial compliance with all state and federal laws affecting its operations. In accordance with the provisions of Florida Statutes Section 120.57(1)(a)(12), conclusions of law and a recommendation are not included in this Report. Respectfully submitted and entered this 29th day of March, 1979, in Tallahassee, Florida. DIANE D. TREMOR Hearing Officer Division of Administrative Hearings 530 Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: J. Riley Davis William S. Lyman Taylor, Brion, Buker and Green Assistant General Counsel P. O. Box 1796 Office of the Comptroller Tallahassee, Florida 32302 The Capitol Tallahassee, Florida 32304 Robert W. Perkins and Richard B. Collins Comptroller Gerald A. Lewis Michaels, Sheffield, Perkins, The Capitol Collins and Vickers Tallahassee, Florida 32304 Post Office Box 10069 Tallahassee, Florida 32302
