Findings Of Fact Petitioner was incorporated on September 22, 1983. The initial directors were Ben E. Guzman and James E. Quinn. The corporation initially issued 40 shares. Mr. Guzman owned 10.2 shares, and Mr. Quinn owned 9.8 shares. Myrna Bortell owned 10.2 shares, and Edward T. Quinn, Jr. owned 9.8 shares. When expressed as percentages, the ownership shares have been rounded off so that Mr. Guzman and Ms. Bortell each owns 26%. Each of the shareholders made a real and substantial contribution to the capital of the corporation at its inception. This investment has not been returned in the form of return of capital or dividends, as such. At the organizational meeting of Petitioner, Mr. Guzman was elected to serve as president, Mr. James Quinn as vice-president, and Ms. Bortell as secretary and treasurer. Petitioner's bylaws provide that a quorum of shareholder requires the representation in person or by proxy of the majority of shares entitled to vote. Once a quorum is present, the vote of a majority of shares entitled to vote constitutes action taken by the shareholders. The shareholders elect the directors, who are to direct the management of the business and affairs of the company. Shareholders may remove any director at any time by a vote of the majority of the shares. Directors elect and remove the officers. The president is the chief executive officer of the company and has general and active management of the business and affairs of the company, subject to the directors. The ownership and management structure of Petitioner did not change until the annual shareholders' meeting on August 1, 1985. At that time, Ms. Bortell replaced Mr. Quinn as a director. The ownership and management structure did not change again until James Quinn's departure two years later, as set forth below. Petitioner promptly applied for certification as a what is now known as a Disadvantaged Business Enterprise (DBE). By Final Order dated June 20, 1984, Respondent granted certification to Petitioner. Petitioner continuously maintained its one-year certification thereafter, renewing it annually. During the one-year certification term due to expire on May 12, 1988, Respondent notified Petitioner, by letter dated October 19, 1987, that Petitioner's "application for certification as a [DBE] is hereby denied." The letter informed Petitioner that Respondent had determined that Mr. Guzman did not exercise control of the corporation, which did not appear to be an independent business entity. The letter cited and relied upon what is now Rule 14-78.005(7)(c) and (e), Florida Administrative Code. Petitioner was given 15 days within which to request a hearing. By letter dated October 28, 1987, Petitioner demanded a hearing. By letter to Petitioner dated November 19, 1987, the U.S. Department of Transportation announced as its final administrative determination that Petitioner was ineligible for federal DBE certification. The letter cited two bases for the denial. First, Mr. Guzman and Ms. Bortell had failed to demonstrate that they were members of the Hispanic minority group. Membership in such group required a showing that they were in fact part of the Hispanic community. This determination was based on the failure of Mr. Guzman and Ms. Bortell to respond to a request by Lee County, Florida, for evidence of their status as Hispanics. Second, Ms. Bortell lacked technical expertise in the construction industry. Although Mr. Guzman had such expertise, so did the two non-minority owners, Messrs. Quinn, so it was "highly unlikely" that the minority owners could independently control Petitioner. By letter dated January 11, 1988, the U.S. Department of Transportation informed Respondent of the action taken in the November 19 letter, a copy of which was enclosed. Respondent advised Petitioner by letter dated January 13, 1988, that, pursuant to the November 19 letter, Petitioner was ineligible for use as a DBE to meet federal goals on federal-aid projects. The letter noted that the November 19 letter did not affect Petitioner's eligibility for use as a DBE on projects not involving federal funding. By letter dated February 24, 1988, the U.S. Department of Transportation clarified a misunderstanding arising out of its November 19 letter. Although a decertified contractor could not be used to meet Respondent's annual federal DBE goal, the contractor's participation could not be prohibited until the administrative hearings were complete. Thus, the decertified contractor could be used to meet project goals "on an individual basis." Requesting clarification of the clarification, Respondent, by letter dated April 22, 1988, asked U.S. Department of Transportation whether the participation of Petitioner would thereby jeopardize Respondent's ability to meet its annual federal DBE goal. By letter to Respondent dated April 29, 1988, U. S. Department of Transportation stated that Petitioner should not be allowed to participate as a DBE on any federal-aid project and Petitioner could not be used to meet annual federal DBE goals. In addition, Petitioner could not be used to meet federal DBE goals on individual projects either. In the meantime, Respondent, by letter dated April 22, 1988, informed Petitioner that Ms. Bortell's lack of control and limited involvement with Petitioner, as well as Mr. Guzman's limited involvement, disqualified Petitioner as a DBE. Respondent requested whether Petitioner still wanted a hearing. The letter mentions a meeting with the U.S. Department of Transportation representative with whom the parties had been corresponding. Undeterred by what must have appeared to be a puzzling display of federalism, Petitioner repeated its desire for a hearing by letter dated May 12, 1988. The letter restated Petitioner's disagreement with Petitioner's allegations that the minority owners lacked control and the corporation was not an independent business entity. On the same date, Respondent transmitted the file to the Division of Administrative Hearings for a hearing on the issue whether Petitioner was entitled to "obtain" DBE certification in accordance with what is now Rule 14- 78.005(7)(c) and (e). Respondent subsequently notified the Division of Administrative Hearings of the receipt of the May 12 letter from Petitioner. Mr. Guzman and Ms. Bortell are Hispanic Americans, who are socially and economically disadvantaged individuals. The Quinns are not socially and economically disadvantaged individuals. Petitioner is engaged in the milling and recycling of asphalt. Mr. Guzman has substantial involvement with the day-to-day affairs of Petitioner's business. He is responsible for the supervision of all projects of Petitioner and supervises the foremen on these projects. He handles the preparation of bids for work based on estimating that he performs. He schedules labor and equipment for jobs. At one time he was one of the only operators of a milling machine, but now the company has 15 employees and he no longer is needed for this purpose. He also has been directly involved in securing of financing for the corporation. When he is not at a project site, he is in the office daily by 6:30 a.m. He also has exclusive authority to hire and fire nonclerical personnel. Ms. Bortell visits the office perhaps once a week and speaks to someone at the office by telephone a few times a week. She has no experience in milling or construction generally. She works full-time as an account manager for a utility company. Her background includes seven years employment for an insurance company. Her only duties for Petitioner include the handling of insurance matters and supervision, including hiring and firing, of clerical personnel. In mid-1987, Edward Quinn bought all of the shares of stock owned by his brother, James Quinn. In August 1987, Edward Quinn became a salaried employee of Petitioner. Previously, James Quinn had worked as an operator in the field, although he quit when he sold his interest in the corporation. Edward Quinn handles sales and contract administration for Petitioner, although health problems have prevented him from doing much since joining Petitioner as an employee. In fact, Edward Quinn performs limited services for Petitioner and his income from Petitioner resembles in many respects a passive return on investment rather than earned income. Mr. Guzman controls the daily affairs of the business of Petitioner. Major business decisions are handled by the three shareholders. Although no major disputes have arisen among the shareholders, in the event of such a dispute, Ms. Bortell would side with Mr. Gtizman so that the socially and economically disadvantaged shareholders ultimately control the corporation. There is no evidence whatsoever that Petitioner is less than an independent business entity.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that a Final Order be entered granting Petitioner DBE certification for a period of three months, at which time Petitioner may reapply for certification, if it desires; provided, however, Petitioner may not participate, as a DBE, in any federal-aid project unless and until recertified as a DBE by the U.S. Department of Transportation. ENTERED this 21st day of September 1988, in Tallahassee, Florida. ROBERT E. MEALE Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 21st day of September 1988. APPENDIX Treatment Accorded Petitioner's Proposed Findings Adopted. Adopted in substance. First sentence adopted. Second sentence rejected as irrelevant, legal conclusion, and without proper predicate to the extent that it can be characterized as a fact. The reasons are set forth in the Conclusions of Law. Adopted. 5 and 7. Rejected as legal conclusion, although included in Conclusions of Law. 6. Rejected as legal conclusion. Adopted. Rejected as legal conclusion. Treatment Accorded Respondent's Proposed Findings 1-8. Adopted. Rejected as irrelevant. Adopted. First sentence rejected as recitation of testimony and legal argument. Remainder adopted in substance. 12-13. Rejected as legal argument. Adopted as to supervision of clerical personnel and handling of insurance. Remainder rejected as unnecessary. Rejected as unsupported by the greater weight of the evidence. Adopted in substance. Rejected as recitation of testimony. COPIES FURNISHED: James W. Anderson Chief Litigation Attorney Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32301-8064 George Spofford, Esquire Cummings, Lawrence & Vezina Post Office Box 589 Tallahassee, Florida 32302-0589 Mill-It Corporation 961 Sunshine Lane Altamonte Springs, Florida 32714 Kaye N. Henderson Secretary Department of Transportation Haydon Burns Building 605 Suwannee Street Tallahassee, Florida 32399-0450 Thomas H. Bateman, III General Counsel Department of Transportation Haydon Burns Building 562 Suwannee Street Tallahassee, Florida 32399-0450 =================================================================
Findings Of Fact The Petitioner, Earl L. Barnwell, is employed as a uniformed officer of the Florida Highway Patrol. He was sworn into the Highway Patrol in October of 1953, and remained in this employment until November 30, 1956. In November of 1956, because of the death of his father and resulting family hardships, the Petitioner requested emergency leave from his employer, which was refused by his supervisors. Petitioner Barnwell then tendered his resignation in November of 1956, but became re-employed March 1, 1957, after having exhausted his accumulated leave and having been off the state payroll for the months of January and February of 1957. After Petitioner's re-employment and the customary one year's probationary period, he again achieved permanent status and repaid the retirement contributions which had been refunded to him upon his resignation. His retirement credit was reinstated for the period he had worked prior to his resignation. In December of 1970, Petitioner Barnwell transferred from the Highway Patrol Retirement System under Chapter 321, Florida Statutes, to the Florida Retirement System under Chapter 121, Florida Statutes. On March 1, 1973, Petitioner was notified by the State Retirement Director that "no [retirement] credit was given for the two (2) months, January and February, 1957, when you were not on the payroll. There is no statute which would allow credit for these two (2) months. Therefore, since you were not on the payroll for these two (2) months, this would constitute a break in service, and your continuous service would begin March 1, 1957." On January 5, 1979, Petitioner Barnwell wrote to the Respondent Division requesting a hearing regarding the break in service in the retirement matter, stating "I am in total disagreement with the past information I have received and strongly feel an administrative resolution of my problem may well favorably be reached in its conclusion." The Respondent Division requested the assignment of a hearing officer to consider the case. The Respondent Division submitted a proposed recommended order, and Petitioner Barnwell submitted documentation relative to his statements made at the hearing. These instruments were considered in the writing of this order. To the extent the proposed findings of fact have not been adopted in, or are inconsistent with, factual findings in this order they have been specifically rejected as being irrelevant or not having been supported by the evidence.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, the Hearing Officer recommends that the Petition of Earl L. Barnwell to be eligible to retire after completion of twenty-five (25) continuous years of creditable service regardless of age be denied. DONE and ORDERED this 15th day of November, 1979, in Tallahassee, Leon County, Florida. DELPHENE C. STRICKLAND Hearing Officer Division of Administrative Hearings Room 101, Collins Building Tallahassee, Florida 32301 (904) 488-9675 COPIES FURNISHED: Stephen S. Mathues, Esquire Division of Retirement 2639 North Monroe Street Suite 207C - Box 81 Tallahassee, Florida 32303 Earl L. Barnwell 575 Seventh Street, South Safety Harbor, Florida 33572
Findings Of Fact On July 15, 1993, the School Board issued an invitation to bid for certain construction work on Bair Middle School, which was designated Project Number 2611-88-01. Responses to the invitation were due by 2:00 p.m. on August 26, 1993. Hewett-Kier, Pirtle, and six other contractors timely submitted bids for the project. The bids were opened on August 26, 1993, and Pirtle was the apparent low bidder with a bid of $1,150,000. Hewett-Kier was the second low bidder with a bid of $1,167,000. On September 2, 1993, the bids were posted. The Bid Tabulation Form indicated the intent of the School Board's Facilities Department to recommend that the School Board award the subject contract to Pirtle. Article 10 of the Special Conditions to the invitation pertains to MBE subcontractor participation goals and requirements. Article 10, Paragraph 1 sets forth the following MBE participation requirement for the subject bid: The School Board of Broward County, Florida is committed to affirmatively ensuring a substantial increase in the awarding of construction subcontracts to Minority Businesses. School Board Policy . . . requires all projects estimated to cost $1 million or more must have MBE subcontracting goals and that Contractors awarded work on such projects fully participate in the MBE Program. Compliance with the requirements of this article is mandatory. The total MBE Contract Goal for this project is 6 percent. This total MBE Goal will be comprised of the sum of the following categories: Black: 2 percent. Hispanic: 2 percent. Woman: 2 percent. Other: 0 percent. Article 10, Paragraph 3(A) of the Special Conditions provides, in pertinent part, as follows: Failure to Comply: Failure on the part of the Bidder to comply with the requirements of this Article shall be cause for finding the bidder Non-responsive, unless every reasonable effort to utilize MBE subcontractors is demonstrated to The School Board of Broward County, Florida. In the event a bid is deemed non-responsive, award may then be made to the next lowest bidder, or all remaining bids may be rejected and the project readvertised. Article 10, Paragraph 4(A) of the Special Conditions pertains to bidding requirements and procedures prior to contract award and provides, in pertinent part, as follows: Submittals Within seven (7) calendar days after bid opening, the low Bidder . . . as a condition of contract award, shall submit to the Owner the following documents . . . concerning MBE Contractor and Subcontractor participation in the contract: * * * 3. Unavailability Certification-MBE Subcontractor Participation: If the Low Bidder is unable to commit adequate MBE Subcontractor Participation to meet the Contract Goal, he/she should request execution of this document for each MBE Subcontractor he/she has solicited, but who cannot participate for reasons of their own. This is necessary to show good faith efforts on the Bidder's part to meet the Contract Goal. Failure to submit the requested Documents within the allotted time will render a bid non-responsive, unless it is determined that the contract goal cannot be met. Article 10, Paragraph 4(B) of the Special Conditions pertains to good faith efforts required of bidders to meet the MBE subcontracting goals and provides, in pertinent part, as follows: Good Faith Efforts: If the information submitted in response to the previous paragraph demonstrates a Bidder does not meet the MBE Subcontractor Goal, information sufficient to satisfy The School Board of Broward County, Florida that the bidder has made good faith efforts must be submitted. Efforts to obtain MBE Subcontractor participation are good faith efforts to meet the goal, if they are sincerely motivated, if, given all relevant circumstances, they could not reasonably be expected to produce a level of MBE Subcontractor participation sufficient to meet the goal. In order to award a contract to a Bidder that has failed to meet the MBE Subcontracting Goal, The School Board of Broward County, Florida must determine that the Bidder's efforts were those that a bidder actively and aggressively seeking the goal would make given all relevant circumstances. In making the required judgment, The School Board of Broward County, Florida may consider the kinds of efforts listed below. This is not a mandatory checklist. The School Board of Broward County, Florida does not insist the Bidder do any one or any particular combination of things on the list, nor is the list exclusive or exhaustive. Other factors or types of efforts may be relevant in appropriate cases. In determining whether or not a bidder has made good faith efforts, the School Board of Broward County, Florida will look not only at the different kinds of efforts that a Bidder has made, but also the quantity and intensity of these efforts. Good Faith Efforts are as follows: The Bidder attended pre-bid meetings if advertised and scheduled by The School Board of Broward County, Florida to inform MBE Subcontractors of subcontracting opportunities; The Bidder provided written notice to a reasonable number of specific MBE Subcontractors that their interest in the contract is being solicited in sufficient time to allow MBE Subcontractors to participate effectively; The Bidder, in order to increase the likelihood of meeting the goal, selected portions of the work to be performed by MBE Subcontractors that could be broken down into economically feasible units to facilitate MBE Subcontractor participation; The Bidder provided interested MBE Subcontractors with adequate information about the plans, specifications and requirements of the contract; The Bidder negotiated in good faith with interested MBE Subcontractors, not rejecting MBE Subcontractors as unqualified without sound reasons based on a thorough knowledge of their capabilities; The Bidder contacted the MBE Coordinator for direct referral of certified MBE Subcontractors; The Bidder maintained records listing name, address, type of trade, and describe (sic) results of contact of each MBE Subcontractor with regard to each prospective contract opportunity; The Bidder notified the MBE Coordinator whenever he cannot successfully locate qualified MBE Subcontractors; The Bidder actively maintains a file with the names and addresses of MBE subcontractors. (List may be obtained from MBE Coordinators Office) The Bidder engaged in specific and continuing personal recruitment efforts directed at Minority contractor's organizations, Minority recruitment organizations, and Minority Business Assistance Centers. Meeting the goal or making good faith efforts to do so is a condition of being awarded this contract. Claudia Williams is the MBE Contract Compliance Administrator for the School Board. Ms. Williams has the responsibility to assign minority goals to each project and to determine on behalf of the School Board whether bidders have complied with the School Board's policy pertaining to minority subcontractor participation. Ms. Williams has made this compliance determination on behalf of the School Board on over a 100 occasions. Ms. Williams is familiar with the good faith effort requirements contained in the School Board's bid documents and she is familiar with the availability of black-owned MBE subcontractors to perform work on School Board construction projects. There are fewer black-owned MBE subcontractors certified by the School Board than there are female or Hispanic-owned MBE subcontractors. It is more difficult for a contractor to meet the black-owned MBE subcontractor goal of 2 percent than it is to meet the other MBE subcontractor goals. Pirtle's bid had a total of 24 percent MBE participation comprised of female or Hispanic-owned MBEs. Initially, there were no black-owned MBE subcontractors. The MBE goals are not intended to be rigid or inflexible requirements, but the general contractor is expected to make good faith efforts to secure the participation of MBE subcontractors. Pirtle met (and greatly exceeded) the MBE goals set forth in the bid documents for total MBE participation. Consequently, Pirtle is required to show nothing further in this proceeding as to the total goal. It is the second goal, pertaining to MBE distribution based on the gender or the ethnicity of the subcontractor, that was not met. Specifically, Pirtle did not meet the MBE goal of 2 percent for participation by black-owned MBE subcontractors. On September 2, 1993, Pirtle submitted minority business enterprise (MBE) participation documentation pursuant to Article 10 of the invitation, which established that Pirtle had received responses to bid solicitations from three black-owned MBE subcontractors and that it had received noncompetitive bids from two of those black-owned MBE subcontractors. Pirtle also provided the School Board with a copy of the solicitation letter it sent to black-owned MBE subcontractors. Ms. Williams reviewed this documentation, taking into consideration the nature of the project, her knowledge of the availability of black-owned subcontractors, and the criteria for judging good faith efforts contained in the bid documents. Ms. Williams was satisfied after reviewing the information furnished to her by Pirtle on September 2, 1993, that Pirtle had satisfied the good faith efforts requirement to secure the 2 percent black-owned MBE subcontractor participation. Petitioner failed to establish that the Ms. Williams, on behalf of the School Board, acted fraudulently, arbitrarily, illegally, or dishonestly in making the determination that Pirtle's efforts to secure black-owned MBE subcontractors met the good faith efforts requirements contained in Article 10 of the Special Conditions to the invitation. Ms. Williams was nevertheless concerned that Pirtle had secured the participation of no black-owned MBE subcontractor, and so informed Pirtle. On September 7, 1993, Pirtle informed Ms. Williams that it had secured the participation of a black-owned MBE subcontractor to perform work valued at $5,700.00, which represented 0.5 percent of the value of the contract. This additional information was provided pursuant to Article 10, Paragraph (4)(D)1 of the Special Conditions of the bid, which provides for a pre-conciliation conference process as follows: If the MBE Coordinator questions the acceptability of the Low Bidder's MBE Subcontractor submissions, the Bidder shall, upon at least three (3) calendar days notice given by the MBE Coordinator, meet with the MBE Coordinator to present information and arguments pertinent to his compliance with the applicable requirements. At the formal hearing, Pirtle established that it had made good faith efforts to secure black-owned MBE subcontractors to participate in the project. Pirtle solicited bids from 47 black-owned subcontractors, only three of which filed any response to the solicitation. Hewett-Kier argued that Pirtle should have given black-owned MBE subcontractors the opportunity to undercut the bid of other subcontractors after the bidding was closed in order to obtain the ethnic distribution goal. This contention is rejected because this questionable tactic was not shown to be necessary, reasonable, or appropriate.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the School Board of Broward County, Florida, enter a Final Order which denies the bid protest of Hewett-Kier and which awards the subject bid to Pirtle. DONE AND ENTERED this 28th day of February, 1994, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28th day of February, 1994. APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-6449BID The following rulings are made on the proposed findings of fact submitted by Petitioner. The proposed findings of fact contained in the section designated "General Factual Background" are adopted in material part by the Recommended Order. The proposed findings of fact contained in the section designated "Intervenor is a Non-Responsive Bidder" are adopted in part by the Recommended Order. The proposed findings that Hewett-Kier was a responsive bidder is rejected as being unnecessary to the conclusions reached. The conclusion that Pirtle is a non-responsive bidder is rejected as being contrary to the conclusions reached. The proposed findings of fact contained in the section designated "The School Board's Determination of Good Faith Efforts is Arbitrary and Capricious" are adopted in material part by the Recommended Order, but the conclusions intertwined with those proposed findings are rejected as being contrary to the conclusions reached. The following rulings are made on the proposed findings of fact submitted by Respondent. The proposed findings of fact in paragraphs 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, and 14 are adopted in material part by the Recommended Order. The proposed findings of fact in paragraphs 15, 16 and 17 are rejected as being unnecessary to the conclusions reached. The following rulings are made on the proposed findings of fact submitted by Intervenor. The proposed findings of fact contained in the section designated "Testimony of Claudia Williams" are adopted in material part or are subordinate to findings made. The proposed findings of fact contained in the section designated "Testimony of Francisco Flores" are subordinate to the findings made. The proposed findings of fact contained in the section designated "Testimony of James Hewett" are subordinate to the findings made. The proposed findings of fact contained in the section designated "Testimony of Michael Geary" are subordinate to the findings made. COPIES FURNISHED: Robert E. Ferencik, Esquire David Valdini, Esquire LIEBY, FERENCIK, LIBANOFF & BRANDT Penthouse 2, 290 Northwest 165 Street Miami, Florida 33169-6457 Edward J. Marko, Esquire MARKO & STEPHANY Post Office Box 4369 Fort Lauderdale, Florida 33338 John B. DiChiara, Esquire 507 South East 11th Court Fort Lauderdale, Florida 33316 Virgil L. Morgan, Superintendent School Board of Broward County 600 Southeast Third Avenue Fort Lauderdale, Florida 33301-3125
The Issue Whether Respondent, Department of Revenue's ("Department"), B03 assessment against Petitioner, GBR Enterprises, Inc. ("GBR"), for sales tax and interest is incorrect.
Findings Of Fact The Parties and Audit Period GBR is a Florida corporation with its principal place of business in Miami, Florida. Gilda Rosenberg is the owner of GBR and a related entity, Gilly Vending, Inc. ("Gilly"). GBR and Gilly are in the vending machine business. At all times material hereto, Amit Biegun served as the chief financial officer of the two entities. The Department is the state agency responsible for administering Florida's sales tax laws pursuant to chapter 212, Florida Statutes. This case concerns the audit period of January 1, 2012, to December 31, 2014. GBR's Provision of Vending Machine Services Prior to the audit period, the school boards of Broward and Palm Beach County issued written solicitations through competitive invitations to bid ("ITB"), seeking vendors to furnish, install, stock, and maintain vending machines on school property. The bids required a "full turn-key operation." The stated objectives were to obtain the best vending service and percentage commission rates that will be most advantageous to the school boards, and to provide a contract that will be most profitable to the awarded vendor. The stated goal was that student choices from beverage and snack vending machines closely align with federal dietary guidelines. GBR operates approximately 700 snack and beverage vending machines situated at 65 schools in Broward, Palm Beach, and Miami-Dade Counties. Of these 65 schools, 43 are in Broward County, 21 are in Palm Beach County, and one is in Miami-Dade County. The snack vending machines are all owned by GBR. Beverage vending machines are owned by bottling companies, such as Coca-Cola and Pepsi. Of the 700 vending machines, approximately 60 percent of the machines are for beverages and the remaining 40 percent are for snacks. GBR has written vending agreements with some schools. In these agreements, GBR is designated as a licensee, the school is designated as the licensor, and GBR is granted a license to install vending machines on school property in exchange for a commission. Furthermore, GBR is solely responsible to pay all federal, state, and local taxes in connection with the operation of the vending machines. Ownership of the vending machines does not transfer to the schools. However, in some cases the schools have keys to the machines. In addition, designated school board employees have access to the inside of the machines in order to review the meter, monitor all transactions, and reconcile the revenue from the machines. GBR places the vending machines on school property. However, the schools control the locations of the vending machines. The schools also require timers on the machines so that the schools can control the times during the day when the machines are operational and accessible to students. The schools also control the types of products to be placed in the machines to ensure that the products closely align with the federal dietary guidelines. The schools also control pricing strategies. GBR stocks, maintains, and services the vending machines. However, Coca-Cola and Pepsi may repair the beverage machines they own. GBR is solely responsible for repairing the machines it owns. The schools require that any vendor service workers seeking access to the vending machines during school hours pass background checks. GBR route drivers collect the revenue from all of the vending machines and the revenues are deposited into GBR's bank accounts. In exchange for GBR's services, the schools receive from GBR, as a commission, a percentage of the gross receipts. However, neither GBR nor the schools are guaranteed any revenue unless sales occur from the machines. On its federal income tax returns, GBR reports all sales revenue from the vending machines. For the tax year 2012, GBR's federal income tax return reflects gross receipts or sales of $5,952,270. Of this amount, GBR paid the schools $1,363,207, a percentage of the gross receipts which GBR characterized on the tax return and its general ledger as a commission and equipment space fee and cost of goods sold. For the tax year 2013, GBR's federal income tax return reflects gross receipts or sales of $6,535,362. Of this amount, GBR paid directly to the schools $1,122,211, a percentage of the gross receipts which GBR characterized on the tax return and its general ledger as a commission and equipment space fee and cost of goods sold. For the tax year 2014, GBR's federal income tax return reflects gross receipts or sales of $6,076,255. Of this amount, GBR paid directly to the schools $1,279,682, a percentage of the gross receipts which GBR characterized on the tax return and its general ledger as a commission and equipment space fee and cost of goods sold. Thus, for the audit period, and according to the federal tax returns and general ledgers, GBR's gross receipts or sales were $18,563,887. Of this amount, GBR paid directly to the schools $3,765,100, as a commission and equipment space fee and cost of goods sold. The Department's Audit and Assessment On January 27, 2015, the Department, through its tax auditor, Mary Gray, sent written notice to GBR of its intent to conduct the audit. This was Ms. Gray's first audit involving vending machines at schools. Thereafter, GBR provided Ms. Gray with its general ledger, federal returns, and bid documents. On October 28, 2015, Ms. Gray issued a draft assessment to GBR. The email transmittal by Ms. Gray to GBR's representative states that "[t]he case is being forwarded for supervisory review." In the draft, Ms. Gray determined that GBR owed additional tax in the amount of $28,589.65, but there was no mention of any purported tax on the monies paid by GBR to the schools as a license fee to use real property. However, very close to the end of the audit, within one week after issuing the draft, and after Ms. Gray did further research and conferred with her supervisor, Ms. Gray's supervisor advised her to issue the B03 assessment pursuant to section 212.031 and rule 12A-1.044, and tax the monies paid by GBR to the schools as a license fee to use real property. Thus, according to the Department, GBR was now responsible for tax in the amount of $246,230.93, plus applicable interest. Of this alleged amount, $1,218.48 was for additional sales tax (A01), $4,181.41 was for purchase expenses (B02), $13,790 was for untaxed rent (B02), and $227,041.04 was for the purported license to use real property (B03). Ms. Gray then prepared a Standard Audit Report detailing her position of the audit and forwarded the report to the Department's dispute resolution division. On January 19, 2016, the Department issued the Notice of Proposed Assessment ("NOPA") against GBR for additional tax and interest due of $288,993.31. The Department does not seek a penalty against GBR. At hearing, Ms. Gray acknowledged that she and her supervisor "struggled" with understanding GBR's reference to commissions and equipment expense fees in the tax returns and general ledgers and the Department's decision to ultimately issue the B03 assessment. At hearing, the Department's representative, Mr. Zych, acknowledged that a proper analysis as to whether a particular arrangement constitutes a license to use real property involves a consideration of issues of control, such as control over access to and placement of the machines, products, and money. In the instant case, the schools controlled significant aspects of the parties' arrangement, including placement of and access to the machines, pricing strategies, and the type of products that could be placed and sold from the machines. The vending machines were placed at the schools and under significant control by the schools so that the schools would be in compliance with federal dietary guidelines. GBR provided an important service to the schools in order that the schools meet federal dietary guidelines. GBR was able to provide the service only because of a competitive ITB process. The goal of the bids was to obtain a vendor service for the sale of products to students in conformity with federal dietary guidelines, not to enter into a license for the use of real property. Although GBR characterized the payouts to the schools on its tax returns and general ledgers as "commissions" and "equivalent space fees," and GBR controls some aspects of the arrangements, the facts adduced at hearing demonstrate that the substance of the arrangement is in the nature of a service contract. In sum, given the totality of the circumstances and under the unique facts of this case, the undersigned concludes as an issue of fact, that the arrangement between GBR and the schools boards and schools is in the nature of a service, and not a license to use real property.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order rescinding the B03 assessment in its entirety. DONE AND ENTERED this 14th day of January, 2019, in Tallahassee, Leon County, Florida. S DARREN A. SCHWARTZ 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 January, 2019.
Findings Of Fact Petitioner is A graduate of the University of the East in Manila, Philippines. Petitioner is the holder of the state of Illinois C.P.A. Certificate No. 18012. On July 11, 1979, Petitioner filed an application to obtain a reciprocal certified public accountant certificate in Florida (licensure by endorsement) based upon his certificate issued by the State of Illinois. On December 14, 1979, the Board denied Petitioner's application for a reciprocal certificate for the reason that Petitioner had not graduated from an accredited four-year college or university and, accordingly, failed to satisfy the requirements set forth in Section 7(3)(b), Chapter 79-202, Laws of Florida, now codified as Section 473.308(3)(b), Florida Statutes (1979) The University of the East in Manila, Philippines, is not recognized by the Board as an accredited university in Florida and was not so recognized at the time that Petitioner received his certificate as a certified public accountant in the State of Illinois. The University of the East is not listed among the institutions of post secondary education by the Council on Postsecondary Accreditation, the official listing of accredited colleges and universities adopted by the Board to ensure the minimum competence of public accounting practitioners. Additionally, the University of the East in Manila, Philippines, has not been accredited by any of the regional accrediting agencies recognized by the Board. Douglas H. Thompson, Jr., the Respondent's Executive Director since 1968, is the Board's chief executive officer and, as such, carries out the Board's functions respecting applications for licensure. Mr. Thompson examined Petitioner's application pursuant to Petitioner's Illinois certificate to ascertain whether Petitioner's certificate was issued under criteria substantially equivalent to Florida's licensing criteria and determined that the criteria were not substantially equivalent. Petitioner's application was considered by the Board on two occasions and was rejected.
Recommendation Based upon the foregoing findings of fact and conclusions of law, it is RECOMMENDED THAT: Petitioner's application for a reciprocal certified public accountant certificate be denied. RECOMMENDED this 10th day of June, 1980, in Tallahassee, Florida. LINDA M. RIGOT Hearing Officer Division of Administrative Hearings Collins Building Room 101 Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 10th day of June, 1980. COPIES FURNISHED: Samuel Hankin, Esquire Commerce Building 226 South Main Street Gainesville, Florida 32602 Mr. Marianito Manalo Ilagan 9020 S.W. 56th Street Cooper City, Florida 33328 Ms. Nancy Kelley Wittenberg Secretary Department of Professional Regulation The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301
The Issue The issues are (1) whether Florida Housing Finance Corporation's (Florida Housing) intended decision to award low- income housing tax credits for an affordable housing development in medium-size counties to Grove Manor Phase I, LTD (Grove Manor), JIC Grand Palms, LLC (Grand Palms), Madison Palms, Ltd. (Madison Palms), and RST The Pines, LP (The Pines), was contrary to solicitation specifications, and if so, whether that determination was clearly erroneous, arbitrary, capricious, or contrary to competition; and (2) whether Florida Housing's determination that Brownsville Manor, LP (Brownsville), achieved the maximum available score of 28 points was contrary to solicitation specifications, and if so, whether that determination was clearly erroneous, arbitrary, capricious, or contrary to competition.
Findings Of Fact Florida Housing is a public corporation created pursuant to section 420.504. One of its responsibilities is to award low-income housing tax credits, which developers use to finance the construction of affordable housing. Tax credits are made available to states annually by the United States Treasury Department and are then awarded pursuant to a competitive cycle that starts with Florida Housing's issuance of an RFA. On September 3, 2015, Florida Housing issued an RFA in which it expected to award up to an estimated $10,763,426.00 of tax credits for affordable housing developments in medium counties. The RFA also requested proposals for housing developments in small counties, but that portion of the RFA is not at issue. All applicants in this proceeding proposed developments in medium counties. They include Redding (Seminole County), HTG (Hernando County), Brownsville (Escambia), Grove Manor (Polk County), Grand Palms (Manatee County), Madison Palms (Brevard County), and The Pines (Volusia County). Florida Housing retained the right to "waive Minor Irregularities in an otherwise valid Application" filed pursuant to the RFA. Fla. Admin. Code R. 67-60.008. A "minor irregularity" is defined as "a variation or condition of the Application pursuant to this rule chapter that does not provide a competitive advantage or benefit not enjoyed by other Applicants, and does not adversely impact the interests of the Corporation or the public." Fla. Admin. Code R. 67-60.002(6). These rules are particularly relevant in this case, as during the scoring process Florida Housing waived minor irregularities for several applicants. Florida Housing's Executive Director appointed a review committee comprised of Florida Housing staff to evaluate the applications for eligibility and scoring. Ninety-eight applications were received, processed, deemed eligible or ineligible, scored, and ranked pursuant to the terms of the RFA, administrative rules, and applicable federal regulations. Applications are considered for funding only if they are deemed "eligible," based on whether the application complies with various content requirements. Of the 98 applications filed in response to the RFA, 88 were found to be eligible, and ten were found ineligible. All applicants in this case were preliminarily deemed to have eligible applications and received a maximum score of 28 points. The RFA specifies a sorting order for funding eligible applicants. Recognizing that there would be more applications than available credits, Florida Housing established an order for funding for applicants with tied scores using a sequence of five tie breakers, with the last being a lottery number assigned by the luck of the draw. Applications with lower lottery numbers (closer to zero) are selected before those with higher lottery numbers. On January 29, 2016, Florida Housing posted a notice informing the participants that it intended to award funding to eight developments in medium counties, including those of Grove Manor, Grand Palms, Madison Palms, and The Pines. While the applications of HTG, Brownsville, and Redding were deemed to be eligible, they were not entitled to a preliminary award of funding because of their lottery number ranking. The randomly assigned lottery numbers of those applicants are as follows: HTG (14), Brownsville (16), and Redding (17). HTG and Redding timely filed formal written protests. HTG's protest is directed only at Grove Manor's application. Because Grove Manor agreed that its score should be adjusted downward, HTG is the next applicant in the funding range and should be awarded tax credits, assuming it successfully emerges from the credit underwriting process. No party has challenged the scoring of HTG's application. Redding's protest is directed at the applications of The Pines, Madison Palms, Grand Palms, and Grove Manor, who were selected for funding. Redding also contends that Brownsville, which has a lower lottery number, should have been deemed ineligible or assigned a lower score so that it would no longer be in the funding range. In an unusual twist of events that occurred after the posting of the notice on January 29, 2016, Madison Palms and Grove Manor agreed that they are either ineligible or out of the funding range. Therefore, assuming that adequate funds are available, in order for Redding to be awarded credits, it must establish that at least one of its remaining targets (Grand Palms, Brownsville, and The Pines) is ineligible or should be assigned fewer points. No party has challenged the scoring of Redding's application. Under the RFA, applicants are awarded points in three categories: general development experience, local government contributions, and proximity to services. Depending on whether family or elderly units are being proposed, to obtain proximity to service points, an applicant may select among several types of community services, including transit, a grocery store, a medical facility, a pharmacy, or a public school. Redding has challenged the number of proximity points awarded to The Pines for proximity to a medical facility and public school, Grand Palms for proximity to a pharmacy, and Brownsville for proximity to a public bus transfer stop. Based on Florida Housing's preliminary review of the applications, all three achieved a total proximity score of 18 points. The RFA requires that an applicant submit a Surveyor Certification Form with its application. The form identifies a Development Location Point (DLP), which is representative of where the development is located and must be on or within 100 feet of an existing residential building or a building to be constructed. The DLP is represented by a latitude and longitude coordinate. The distance from the DLP to the selected service is how the proximity points are awarded. The services on which an applicant intends to rely must also be identified on the form, along with the location of the service, as well as the latitude and longitude coordinates for each service. The RFA requires that the coordinates "represent a point that is on the doorway threshold of an exterior entrance that provides direct public access to the building where the service is located." Jt. Ex. 1, p. 25. Redding contends that the coordinates for certain services selected by The Pines, Grand Palms, and Brownsville are not on the "doorway threshold of an exterior entrance that provides direct public access to the building where the service is located." Accordingly, it argues that the number of proximity points awarded to each applicant must be lowered. The Pines selected a public school that has no doors allowing direct public access to the facility. Instead, the school is a series of buildings and classrooms connected by sidewalks and covered breezeways, making a primary "doorway threshold" problematic. The office is interior to the school. Given this unusual configuration, The Pines placed the coordinates at a student drop-off area in front of the school, where students then walk under the covered breezeways to their classrooms, and members of the public walk to offices and/or classrooms. Even if Redding's desired point for the coordinates was used, there would be no difference in the awarded proximity points, as the change in distance would be minimal. The coordinates for The Pines' medical facility are approximately 90 feet from the door that provides direct public access. This was due to an error by the surveyor, who used the back of the facility, rather than the front doorway threshold. Even if the front door had been used for the threshold, The Pines would still be entitled to the same amount of proximity points, as the change in distance would be minimal and not change the scoring. The slight error in the form is a waivable minor irregularity. Brownsville selected a public bus transfer stop for its transit service. Due more than likely to a digital error in one of the satellites used to pinpoint the spot, the coordinates were approximately 150 feet from the canopy where passengers load and unload. Even if the correct point had been used, it would not change the amount of proximity points awarded to Brownsville. The slight error in the form is a waivable minor irregularity. Finally, Grand Palms selected a pharmacy for one of its services. During the process of locating the doorway threshold at the pharmacy, a traverse point was established 70 feet east of the doorway threshold. This was necessary because of an overhang above the doorway threshold. A measurement was then made from the traverse point to the doorway threshold. By mistake, the coordinates on the form represented the location of the traverse point, instead of the doorway threshold of the pharmacy. However, this 70-foot error did not affect the distance from the pharmacy to the DLP or the points awarded to Grand Palms for proximity to a pharmacy. The slight error in the form is a waivable minor irregularity. Florida Housing determined that the coordinates used by The Pines, Brownsville, and Grand Palms yielded the same proximity point score had they been located at the "doorway threshold" and/or "embark/disembark location" as defined in the RFA. Because there is no language in the RFA that provides direction on how to treat these types of minor errors, or mandates that Florida Housing treat them as a non-waivable item, Florida Housing considers them to be a minor irregularity that can be waived. In sum, the deviations were immaterial, no competitive advantage was realized by the applicants, and they were entitled to the proximity points awarded during the preliminary review. Redding also contends that Brownsville is ineligible for funding because it failed to comply with a material requirement in the RFA. In its application, Brownsville stated that it intends to place an 87-unit development on a "scattered site" consisting of two parcels (Site I and Site II) with an intervening roadway (North X Street) between them. The RFA defines a development which consists of a scattered site "to mean a single point on the site with the most units that is located within 100 feet of a residential building existing or to be constructed as part of the required Development." Jt. Ex. 1, p. 25. Stated another way, if multiple parcels are used for the development, the DLP must be located on the site which contains the majority of the residential units. Florida Housing considers this to be a material, non-waivable requirement of the RFA. In Brownsville's Surveyor Certification Form, the DLP is located on Site I, a 1.49-acre parcel that is zoned Commercial and lies west of Site II. In making its preliminary decision to award funding to Brownsville, Florida Housing relied upon the validity of the DLP as of the application deadline and assumed that Site I would have the majority of the units. It had no way to verify the accuracy of that information during the initial scoring process. The RFA requires an applicant to attach to its application a form entitled, "Local Government Verification that Development is Consistent with Zoning and Land Use Regulations." Brownsville's verification form was signed by Horace L. Jones, Director of Development Services for Escambia County, who confirmed that the intended use of the property was consistent with local zoning regulations. The verification forms do not include any information regarding the number of units on each parcel of the site. Florida Housing defers to the local government in determining whether local zoning requirements will be met. Mr. Jones later testified by deposition that Escambia County zoning regulations allow only "25 dwelling units per acre" on Site I. Therefore, on a 1.49-acre parcel, the maximum number of units allowed is 36, or less than a majority of the 87 units. Because Brownsville did not comply with a material requirement of the RFA for a scattered site, Florida Housing now considers the DLP for proximity purposes to be invalid. Had it concluded otherwise, Brownsville would be given a competitive advantage over the other applicants. Brownsville contends, however, that during the County site review process, it will utilize a procedure by which the County can consider the two parcels as a "Single Unified Development" and "cluster" the dwelling units. Although the County has a process to allow the transfer of density from one parcel to another, Brownsville had not started this process as of October 15, 2015, the due date for all applications and the cutoff date for any changes. Also, this process would entail a public hearing before the Board of County Commissioners (Board), and there is no guarantee that the Board would approve the density transfer. In fact, Mr. Jones testified that he was not sure if the density transfer was even a viable option. Therefore, the application of Brownsville contains a material deviation from the RFA and is not eligible for funding.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Housing Finance Corporation enter a final order rescinding the preliminary award to Grove Manor Phase I, Ltd. and Madison Palms, Ltd.; determining that Brownsville Manor, LP, is ineligible for funding; and designating HTG Hammock Ridge, LLC, and Redding Development Partners, LLC, as the recipients of tax credits being made available for developments in RFA 1015-106. DONE AND ENTERED this 19th day of April, 2016, in Tallahassee, Leon County, Florida. S D. R. ALEXANDER 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 April, 2016. COPIES FURNISHED: Kate Fleming, Corporation Clerk Florida Housing Finance Corporation 227 North Bronough Street, Suite 5000 Tallahassee, Florida 32301-1329 (eServed) Michael P. Donaldson, Esquire Carlton Fields Jorden Burt, P.A. Post Office Box 190 Tallahassee, Florida 32302-0190 (eServed) Hugh R. Brown, General Counsel Florida Housing Finance Corporation 227 North Bronough Street, Suite 5000 Tallahassee, Florida 32301-1329 (eServed) Betty C. Zachem, Esquire Florida Housing Finance Corporation 227 North Bronough Street, Suite 5000 Tallahassee, Florida 32301-1329 (eServed) M. Christopher Bryant, Esquire Oertel, Fernandez, Bryant & Atkinson, P.A. Post Office Box 1110 Tallahassee, Florida 32302-1110 (eServed) Maureen McCarthy Daughton, Esquire Maureen McCarthy Daughton, LLC Suite 340 1725 Capital Circle Northeast Tallahassee, Florida 32308-1591 (eServed) Donna Elizabeth Blanton, Esquire Radey Law Firm, P.A. Suite 200 301 South Bronough Street Tallahassee, Florida 32301-1706 (eServed) Douglas P. Manson, Esquire Manson Bolves Donaldson, P.A. 1101 West Swann Avenue Tampa, Florida 33606-2637 (eServed)
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.
