The Issue The issue before the Florida Land and Water Adjudicatory Commission (FLWAC) in this proceeding is whether the Petition to Establish the Myakka Ranch Community Development District (Petition) meets the criteria set forth in Chapter 190, Florida Statutes, and Chapter 42-1, Florida Administrative Code. The local public hearing was for the purpose of gathering information in anticipation of quasi-legislative rulemaking by FLWAC.
The Issue Whether Respondent's proposed award of a contract to Intervenor is contrary to statutes, rules, policies, or the bid specifications, pursuant to Section 120.57(3)(f), Florida Statutes.
Findings Of Fact On January 14, 2003, Respondent advertised for bids by way of an invitation to bid (ITB) for Contract Number E3C42, Maintenance Financial Project Number 40952917201. This would be a "Push Button" contract for the replacement of damaged guardrails along various roadways in Okaloosa and Walton Counties. Pursuant to this Contract, the successful bidder would respond upon notice, and repair or replace guardrails, or take other measures to ensure safety of the traveling public. The bid solicitation and contract were issued pursuant to Section 337.11, Florida Statutes. All bidders had to certify compliance with Florida Statutes and other applicable law, and all contractors were held to strict compliance with all legal requirements. There were no protests to the terms and conditions of the bid solicitation. The instant challenge does not allege non-compliance with the statutes or terms of the ITB generally. The challenge is whether award of the bid to Intervenor, as a non-profit corporation, is "contrary to competition." This maintenance contract does not require that the contractor be pre-qualified pursuant to Section 334.14, Florida Statutes, and Rule Chapter 14-22, Florida Administrative Code. Four bidders responded to the solicitation, with the apparent low bidder being Intervenor, and the apparent second low bidder being Petitioner. Respondent posted its intended award of the contract to Intervenor, and Petitioner timely filed a protest that initiated this proceeding. Intervenor is a not-for-profit corporation created under the provisions of Chapter 617, Florida Statutes. As such, pursuant to Sections 617.0301 and 617.2001, Florida Statutes, Intervenor can engage in any lawful purpose not for pecuniary profit. As a not-for-profit corporation, Intervenor may receive certain tax breaks and other economic advantages not enjoyed by a for-profit corporation. Petitioner is a for-profit corporation. No evidence exists that Intervenor is not capable and responsible to perform the work. Intervenor is qualified to contract with Respondent for the performance of work related to the construction and maintenance of transportation-related facilities by youths enrolled in youth work experience programs, pursuant to Section 334.351, Florida Statutes. Respondent spends appropriations under this section, and Intervenor is the recipient of such contracts. However, the instant contract will not be let under Section 334.351, Florida Statutes, but pursuant to Section 337.11, Florida Statutes.
Recommendation Based on the foregoing Findings of Facts and Conclusions of Law, it is RECOMMENDED: That the protest filed by Petitioner be dismissed and Respondent shall award the subject contract to Intervenor. DONE AND ENTERED this 24th day of July, 2003, in Tallahassee, Leon County, Florida. S STEPHEN F. DEAN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 24th day of July, 2003. COPIES FURNISHED: John C. Bottcher, Esquire Department of Transportation Haydon Burns Building, Mail Station 58 605 Suwannee Street Tallahassee, Florida 32399-0458 Brant Hargrove, Esquire Law Office of Brant Hargrove 2984 Wellington Circle, West Tallahassee, Florida 32308 Timothy Patrick Driscoll, Esquire Timothy Patrick Driscoll, P.A. 101 First Avenue South, Suite 340 St. Petersburg, Florida 33701 James C. Myers, Clerk of Agency Proceedings Department of Transportation Haydon Burns Building, Mail Station 58 605 Suwannee Street Tallahassee, Florida 32399-0450
The Issue The issue for determination is whether Petitioner is eligible for a consumer certificate of exemption as a charitable institution pursuant to subsection 212.08(7)(o), Florida Statutes.
Findings Of Fact Petitioner, Jewish Federation of Brevard, Inc. (Federation) is an umbrella organization comprised of numerous Jewish organizations from Brevard County, the purpose of which is to benefit the total Jewish population in the county and to assist the Jewish population worldwide. Its local programs also benefit the non-Jewish community to a certain degree. There are approximately 200 similar organizations all over the country. They collect contributions which benefit local programs and which are also passed on to the United Jewish Appeal, a separate worldwide organization which funds Jewish social welfare programs and the resettlement of Jewish people. The United Jewish Appeal is the single largest recipient of the Federation’s contributions. The United Jewish Appeal holds a Department of Revenue Consumer’s Certificate of Exemption. The Federation is exempt from federal income tax under section 509(a)(1) of the Internal Revenue Code, and has been so exempt since 1975. Internal Revenue Service Forms 990 (Return of Organization Exempt from Income Tax) for the years 1989-1995 accurately reflect the expenditures of the Federation for those years. At hearing, the Federation’s treasurer, Haim Bar-Navon, further explained the three categories of expenditures: administration of the organization, contributions to United Jewish Appeal and contributions or expenditures for local programs. The Federation’s administrative expenses include basic costs of operating the organization and raising funds: salaries, rent, office supplies, printing costs and the like. Without question, in all but two years of its operation the Federation spent less than 50 percent of its annual expenditures on administration. For two years, 1995 and 1996, administrative expenditures were higher than 50 percent. The Federation hoped that by hiring an executive director, rather than depending on its volunteers, it could generate more contributions to disburse to the United Jewish Appeal and to local programs. The hoped-for result was not attained, and after hiring one individual, then another, the Federation has given up that paid position. The resulting excessive administrative costs for 1995 and 1996 were wholly unintended and will not likely reoccur, as the Federation now hires only a single staff person, an office manager, for $18,300 annually. The adopted operating budget for 1997 more accurately reflects the past and future break-out of expenditures. This budget reflects total expenditures of $160,000, allocated as follows: EXPENSES National Programs UJA 50,000 Allocations (local [sic] & national) 5,000 Local Programs Community Relations 8,000 Cultural 8,000 Educational 2,000 Newsletter 14,000 Social Services (including Elderly) 5,000 Scholarships (youth) 10,000 Bar/Bat Mitzvah 3,000 Youth 2,000 Fund Raising 5,000 President’s Discretionary Fund 2,000 Contingency 1,100 Administrative Accountant 1,100 Federation Dues & Fees 1,500 Office Employees & Payroll Taxes 18,300 Office Expenses 14,000 Replenish Working Capital 10,000 TOTAL EXPENSES 160,000 (Joint exhibit no. 5) Even if “Fund Raising”, “President’s Discretionary Fund” and “Contingency” are all considered administrative costs, the total is still less than 50 percent of total expenditures, leaving the majority of the funds for “national programs” and “local programs”. The exact figures for 1996 were not available at the time of hearing and the Federation’s representative could only candidly estimate that administrative costs for that year, when compiled, would exceed 50 percent. Other accurate data from 1989-1995 are available from the Federation’s forms 900: Total Revenue Other UJA Contributions Local Programs Adm. Costs Fund- Raising Costs 1995 159,504 50,000 4,750 41,962 90,295 2,822 1994 297,700 140,009 8,000 40,314 77,813 13,734 1993 213,827 108,770 8,000 42,765 39,601 - 1992 173,269 90,429 11,650 21,971 30,530 - 1991 209,548 118,781 29,960 19,375 31,970 - 1990 152,023 81,400 10,065 18,261 22,127 - 1989 128,393 70,000 15,363 21,512 20,380 - (Joint exhibit no. 4) From this data it is evident that, prior to 1995, administrative costs, including a separate item for “fund raising costs” never approached or exceeded 50 percent of the Federations revenue. More significantly, it is evident that allocations to the United Jewish Appeal (UJA) did approach or exceed 50 percent of the Federation’s revenue prior to 1995. This is significant because, as found in paragraph 3, above, the United Jewish Appeal itself holds a certificate of exemption. In 1995, and thereafter, allocations to the United Jewish Appeal are substantially less than 50 percent of total revenue. This would not be a problem if the “other” allocations and expenditures for local programs could be determined eligible as “charitable” pursuant to statute and rule. However, they cannot be determined eligible. Organizations which received the contributions reflected in the “other” category above, and on forms 900, vary from year to year. These are primarily organizations like the United Appeal. Recipients in 1995 included Hillel of Florida, for maintenance of a site for Jewish students at universities in Florida; Hebrew Union College; the Holocaust Memorial Museum in Maitland, Florida; the U.S. Holocaust Museum; Yeshiva University; Sharing Centers of Brevard (North, Central and South); Serene Harbour; Space Coast Early Intervention Center; Ventures in Living; and the Women’s Center. No evidence was provided to establish that these organizations qualify as “charitable” pursuant to section 212.08, Florida Statutes. “Local programs” also benefit substantially from the Federation each year. The amounts and recipients vary according to the annual budgets, but the 1997 budget total of $52,000.00 is broken out as follows: Community relations - air time paid to a radio station to broadcast a program, “The World from the Jewish Perspective”; Cultural - a Holocaust memorial event, a Jewish community festival, a Jewish film festival and occasional lectures; Educational - workshops for teachers, convention expenses for teachers, and books and materials for a teachers’ resource center; Newsletter - a publication of news and events to everyone on the Federation’s mailing list, Jewish and non-Jewish; Social Services - includes services to the elderly; Scholarships - expenses for Jewish youngsters to attend Jewish camps based on financial statements of need provided by the parents, or for trips to Israel, not based on need; Bar/Bat Mitzvah - when youths reach age 13 and make their Bar or Bat Mitzvah, $500 each is set aside that they can use towards a trip to Israel; Youth - two or three social get-togethers per year for students from all of the various temples or congregations in the local area. There is no evidence that these activities or programs are services described as “charitable” in section 212.08(7), Florida Statutes.
The Issue Mary Harrison's charge of discrimination dated August 4, 1995, alleges that Jodan, Inc., doing business as Manpower (Jodan), discriminated on the basis of her race and for retaliation by constructively discharging her, giving her verbal and written reprimands and a poor performance rating, by denying her training and by intimidating her. The issues for disposition in this proceeding are whether the alleged discrimination occurred, and if so, what relief is appropriate.
Findings Of Fact Jodan, Inc., is a family owned franchise of Manpower Temporary Services. Jodan provides temporary staff to its clients. It has six offices in Central Florida: two in north Orlando; one in south Orlando; and one each in Deland, Daytona, and Melbourne. Dan Gavin, president, is responsible for the day to day operations; John Gavin, his brother, is a co-owner. In March 1994, Margaret Jones was Jodan's district manager for the north Orlando (Maitland) and south Orlando (Sand Lake Road) offices. She recruited and hired Ms. Harrison to work as a service representative in the Maitland office. Shortly before that time John Gavin had asked her to recruit specifically for a minority employee as it would be helpful for the office to have a more diverse staff to serve its clients. Ms. Harrison is an African-American woman. At the time that she was hired by Ms. Jones in March 1994, her substantial work experience was in real estate and property management. Service representatives at Jodan perform the intake process with temporary employees (application, interview and testing); they take orders from clients and place temporary employees with those clients. Jodan provides a detailed training program for its employees, including its service representatives. Upon the commencement of her employment with Jodan, Ms. Harrison began a training program known as Professional Service 1 (PS-1) under the supervision of Margaret Jones. PS-1 is a self study course where the employee learns the policies and procedures of a Manpower franchise through tapes and other training materials. It is the responsibility of the employee to keep track of and complete PS-1. Normally it takes between three and six months for an employee to complete PS-1; however, it can take longer, depending on the employee's office work load at the time. Disgruntled and upset by what she perceived as criticism of her management and hiring decisions, Ms. Jones left the employ of Jodan on or about August 1, 1994. Prior to that time, Ms. Harrison had completed all but three or four minor details in the PS-1 training. Ms. Harrison was satisfied by her training under Ms. Jones and she admits that no one at Jodan attempted to prevent her from completing PS-1. In September 1994, Ms. Harrison reported to Dan Gavin that her PS-1 materials were lost. He was surprised that one of his employees would lose her training materials and he assisted Ms. Harrison in looking for the materials by, among other things, looking in an off-site storage facility for them. Ms. Harrison's materials were never found and she includes the disappearance of her training materials as one of the basis for her charge of discrimination. There is no evidence that anyone took the materials but neither is there any explanation for their disappearance. Normally, when an employee completes PS-1, a checklist is sent to Manpower headquarters in Milwaukee, Wisconsin, indicating the employee has completed the training. On the checklist, the employee is required to record the dates that she completed each aspect of PS-1. Mr. Gavin contacted Manpower headquarters and obtained a new checklist. He also set up a schedule to meet with Ms. Harrison to go over the items on the checklist and verify that all of PS-1 had been completed. At their first meeting, Ms. Harrison assured Mr. Gavin that she had completed all of PS-1. Based on their conversation, he called Manpower headquarters and verbally confirmed that Ms. Harrison had completed PS-1. Manpower records indicate that she officially completed PS-1 as of December 1, 1994. Ms. Harrison's testimony at hearing with regard to whether she actually had an opportunity to finish the training was confused and unclear as she seemed to contend that there were materials that she was supposed to send to the home office, but could not, due to the lapse of time and loss of her training package. After an employee completes PS-1, the next step is to attend PS-2, which is a week-long training seminar at Manpower headquarters in Milwaukee. PS-2 reinforces what is learned in PS-1 and teaches additional marketing skills. Employees are given a list of dates during which PS-2 will be offered and, because the training requires them to be away from home for a week, they can schedule it at their convenience. Employees can schedule PS-2 before actually completing PS-1 but must have completed PS-1 before they actually attend PS-2. Ms. Harrison could have attended PS-2 any time after December 1, 1994. In January 1995, Mr. Gavin directed the area manager, Kathy Stanford, to ensure that all eligible employees, including Ms. Harrison, sign up for and attend PS-2. The PS-2 classes fill up quickly and it was a priority for Mr. Gavin to have his employees enroll. On more than one occasion, Ms. Stanford gave Ms. Harrison a list of available classes and the opportunity to attend PS-2. However, Ms. Harrison failed to sign up for PS-2. Jodan evaluates employees' performance and salaries on an annual basis. On January 30, 1995, Ms. Harrison was given her annual evaluation. Although the "Appraisal Period" on her evaluation is listed as March 21, 1994, to September 1994, the uncontradicted evidence was that this was a scrivener's error and the appraisal period was March 21, 1994, (Harrison's date of hire) through December 31, 1994. Her review was performed by Mr. Gavin, who was familiar with her performance, with input from Ms. Harrison's immediate supervisor, Gloria Michael. Ms. Stanford sat in on all evaluations done at that time, including Ms. Harrison's, because she was the new area manager and sitting in on the reviews was one way for her to become familiar with the staff and their performances. Ms. Harrison's overall score on the evaluation was a 2.66 on a scale of 1 to 5. A score of 2 means "Below Expectations" and a score of 3 means "Consistently Meets Expectations." A service representative learns all performance areas covered by the evaluation through PS-1. Although she claims that she was evaluated in areas in which she was not trained, Ms. Harrison did not raise this issue with Mr. Gavin and she did not write in any comments on the evaluation in the space provided for employee comments. Further, the uncontradicted testimony, including that of Margaret Jones, established that Ms. Harrison did receive training in all areas of her job in which she was evaluated. Ms. Harrison did not suffer any job detriment as the result of this evaluation or the unusual circumstances surrounding her PS-1 training. She received a pay increase following the evaluation and was then the highest paid service representative. On March 29, 1995, Ms. Harrison was presented with a memorandum by Ms. Michael that addressed concerns she had with Ms. Harrison's job performance. Specifically, the memorandum addressed the following areas: Failure to be responsive to customer needs; The high number of personal calls Ms. Harrison was receiving at the office; Failure to properly match an employee's skills with a client's needs; Failure to consistently enter and update employee information in the computer system each time she spoke with an employee; Failure to open the office on time in the morning; Failure to set up computer training for applicants when she opened the office in the morning. Neither Mr. Gavin nor Ms. Stanford played any role in the preparation or presentation of this memorandum. Ms. Harrison did not suffer any adverse employment action as the result of the March 29, 1995, memorandum. Ms. Michael followed up the March 29, 1995, memorandum with a memorandum on May 3, 1995, detailing Ms. Harrison's improvement in all of the areas discussed in the March 29, 1995, memorandum. On May 15-16, 1995, Ms. Harrison and Ms. Michael (who is white) failed to provide an important client with prompt and appropriate service. As a result, Ms. Stanford counseled both women and placed them both on 90 days probation. Ms. Harrison does not contend that this action was discriminatory. On July 17, 1995, Ms. Harrison submitted a letter of resignation. In the letter she stated that she enjoyed her position as service representative. She also stated that she felt she had been subjected to discriminatory treatment. Ms. Harrison's resignation and the allegations of discriminatory treatment came as a surprise to Ms. Stanford and Mr. Gavin as Ms. Harrison had never before told them she was unhappy or felt discriminated against. In her letter of resignation, Ms. Harrison offered to meet with Mr. Gavin and Ms. Stanford to discuss her resignation, but during her exit interview she refused to discuss her allegations. Although many of Jodan's temporary employees were minorities, Ms. Harrison was the only African-American service representative. There were, however, other minorities, including Hispanic-Americans. Ms. Harrison presented her case in an articulate organized professional manner. It is clear that she felt the work environment was stressful and uncomfortable. However, she did not prove that she was discriminated against or was the object of hostile or adverse employment actions. The temporary employment agency business is highly competitive. Jodan had several large corporate clients and it had to work hard to meet the needs of those clients, sometimes on short notice. This created pressure on Jordan's regular staff that was experienced by white or non-minority employees as well as Ms. Harrison.
Recommendation Based on the above, it is RECOMMENDED: that the Florida Commission on Human Relations dismiss Ms. Harrison's charge of discrimination. DONE AND ENTERED this 1st day of December, 1998, in Tallahassee, Leon County, Florida. MARY CLARK 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 1st day of December, 1998. COPIES FURNISHED: Mary A. Harrison 2356 Carborn Street Orlando, Florida 32839 Kelly T. Blystone, Esquire Moran & Shams, P.A. Post Office Box 472 Orlando, Florida 32802-0472 Sharon Moultry, Clerk Commission on Human Relations Building F, Suite 240 325 John Knox Road Tallahassee, Florida 32303-4149 Dana Baird, General Counsel Commission on Human Relations Building F, Suite 240 325 John Knox Road Tallahassee, Florida 32303-4149
The Issue The issue in this case is whether Respondent, the Department of Revenue, should grant Petitioner's application for a consumer's certificate of exemption from sales and use tax.
Findings Of Fact Petitioner is a nonprofit organization incorporated under the laws of the State of Florida on or about August 27, 1997. Petitioner applied to Respondent for a consumer's certificate of exemption from sales and use tax. While the application indicates that it is based on exemption status as an "enterprise zone," Petitioner clarified at final hearing that it actually was basing its application on exemption status as a "charitable institution." ("Enterprise zone" is not an exemption category under the applicable statutes. See Conclusions of Law, infra.) The IRS has determined that Petitioner is exempt from federal income tax under IRC Section 501(a) as an organization described in IRC Section 501(c)(3). A letter dated February 2, 1999, stated that Petitioner: was formed in 1997 to plan and implement redevelopment efforts in the Greater Newtown Community which lead to overall improvement in the quality of life of its residents. In the short time since our inception, we have responded to community needs by implementing a broad range of programs that will have a positive impact on our community. But from the evidence presented (which included no testimony from either party), it is difficult to ascertain factual detail about Petitioner, its activities, or its finances. In addition to grant application and fund-raising activities, it appears that Petitioner has been involved in informational and participation-recruitment meetings and information-gathering surveys for planning purposes (called the Business Retention and Expansion Survey). Petitioner also appears to have been involved in a Storefront Renovation Program and several community celebrations. Petitioner has plans for other economic and community redevelopment activities. But it cannot be ascertained from the evidence which of the other economic development activities have taken place and which are still in grant application or planning stages. For example, documentation regarding Petitioner's involvement in one activity refers to the activity as the "proposed WAGES Employment Challenge." Petitioner obtained $128,000 of funding from the City of Sarasota for seed money for its economic redevelopment and other activities. Petitioner budgeted to spend the $128,000 in 1998. The entire budget consists of salaries, fringe benefits, and overhead expenses. According to a "Profit and Loss" statement for January through October 1998, Petitioner spent $30,581.49 during that time period. All of those expenditures were in the category of payroll and overhead expenses. One activity referenced in Petitioner's documentation is Petitioner's "partnering" with financial institutions and mortgage brokers to process mortgage loans for affordable housing. In that case, the expenditures would be by the other institutions, not by Petitioner. There is no information as to any other expenditures made by Petitioner.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order denying Petitioner's application for a consumer's certificate of exemption from sales and use tax. DONE AND ENTERED this 5th day of November, 1999, in Tallahassee, Leon County, Florida. J. LAWRENCE JOHNSTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 5th day of November, 1999. COPIES FURNISHED: Bill Nickell, Esquire Department of Revenue Post Office Box 6668 Tallahassee, Florida 32314-6668 Cynthia E. Porter, Executive Director Greater Newtown Community Redevelopment Corporation 1751 Dr. Martin Luther King, Jr., Way Sarasota, Florida 34234 Joseph C. Mellichamp, III, Esquire Office of Attorney General The Capitol, Plaza Level 01 Tallahassee, Florida 32399-1050 Linda Lettera, General Counsel Department of Revenue 204 Carlton Building Tallahassee, Florida 32399-0100 Larry Fuchs, Executive Director Department of Revenue 104 Carlton Building Tallahassee, Florida 32399-0100
The Issue The issue for determination is whether Petitioner is eligible for a consumer certificate of exemption pursuant to Subsection 212.08(7)(o), Florida Statutes.
Findings Of Fact On January 31, 1994, the National Council of La Raza (Petitioner) filed an application with the Department of Revenue (Respondent) for a consumer certificate of exemption as a charitable organization. Petitioner indicated, among other things, on its application that it was a social welfare organization. Petitioner filed the application in anticipation of bringing its annual conference to Miami Beach, Florida in July 1994. 1/ Petitioner is a private, nonprofit organization which was incorporated in 1968 in Arizona. Petitioner's national headquarters is in Washington, D.C. and it has offices in Arizona, California, Illinois, and Texas. Article III of Petitioner's second amended articles of incorporation provides in pertinent part that one of its purposes is to "operate exclusively for charitable and educational purposes, including, but not limited to improvement of the condition of the Mexican American poor, and the under privileged." Article III of the amended articles of incorporation further provides in pertinent part that in carrying-out its purpose it would "conduct research and inquiry of the problems and issues that confront, with local variations and particular effects, the Chicano communities"; "promote meetings, conferences, seminars, discussions and other forms of group communication and analysis of the same among those engaged in organizational activity"; "provide technical assistance to affiliated barrio/community development organizations and to encourage, promote and facilitate mutual aid and assistance among them in order to strengthen each of them through the moral, technical and material resources of all"; "encourage and assist the development of the moral, technical and material resources of the barrios and colonias"; and "organize, exist and function as a charitable, non-profit, non-political 501(c)(3) tax-exempt organization." Also, Article III of the amended articles of incorporation provides in pertinent part that its priorities are to "serve as the national advocate and mobilizer of resources and support for barrio/community development programs"; and "deliver program support and technical assistance services to barrio/community development programs in [named] priority areas." Consistent with the purposes in Petitioner's amended articles of incorporation, Petitioner provides in its publicly disseminated literature that it provides its services through four major types of initiatives: (a) "capacity-building assistance to support and strengthen Hispanic community-based organizations"; (b) "applied research, public policy analysis, and advocacy on behalf of the entire Hispanic community, designed to influence public policies and programs"; (c) "public information efforts to provide accurate information and positive images of Hispanics in the mainstream and Hispanic media"; and (d) "special catalytic efforts which use the [Petitioner] structure and reputation to create other entities or projects important to the Hispanic community". On or about May 1, 1968, Petitioner received a federal income tax exemption from the Internal Revenue Service as an organization described in Section 501(c)(3) of the Internal Revenue Code. Petitioner's organizational classifications under Section 501(c)(3) were charitable, educational and scientific. Petitioner's Section 501(c)(3) federal income tax exemption was effective at the time of its application with Respondent for a consumer certificate of exemption. Petitioner has been granted sales tax exemption by Washington, D.C., Michigan, Texas, and the city of Los Angeles, California. Petitioner's organizational structure consists of a Board of Directors, Office of the President, Office of Finance, Office of Administration, Office of Research Advocacy and Legislation, Office of Technical Assistance and Constituency Support, Office of Institutional Development, and Office of Development and Special Events. As to the Office of Research Advocacy and Legislation (ORAL), it is responsible for conducting research and analysis of issues which have been identified by Petitioner's Board of Directors and affiliates as having a primary importance to the Hispanic community. ORAL, through its Policy Analysis Center, conducts studies and research on immigration, education, housing, poverty, welfare, census, and national farm workers issues. Also, ORAL engages in a limited amount of lobbying on behalf of the Hispanic community. ORAL's services are mainly educational. The services include providing information and pamphlets on immigration and civil rights and producing a national radio program on immigration issues. The services are delivered primarily through brochures and pamphlets which are distributed without charge to Petitioner's affiliates and certain groups and organizations. Other groups and organizations are charged a fee depending upon what the group or organization is. ORAL's services are provided to a disadvantaged Hispanic population. As to the Office of Technical Assistance and Constituency Support (TACS), it is responsible for interfacing with both Petitioner's affiliates and its branch offices to directly provide services to the disadvantaged Hispanic community. Most of TACS' assistance focuses on resource development, program operations, and management or governance needs, in addition to addressing critical community needs through national emphasis programs operated in cooperation with Petitioner's affiliates. Also, TACS provides capacity-building assistance to the staff and board members of Hispanic community-based organizations through staff and board training and on-site assistance. As to the Office of Institutional Development (OID), it is responsible for conducting research on issues new to Petitioner and directing Petitioner's services to the Hispanic community. OID coordinates, on the national level, Petitioner's new programs (program models) in education, health education, the elderly and leadership development, as well as projects involving Europe. OID implements the new programs through Petitioner's affiliates. For example, in the 1980's AIDS became a new concern for the Hispanic community and was assigned to OID. A national toll-free AIDS hot line was established by OID and maintained in its office. The hot line is advertised through various media communications, Petitioner's affiliates, and community- based organizations. Additionally, funding has been provided through OID to two (2) Florida affiliates, Centro Campesino Farmworkers Center, Inc., and the Hispanic Alliance. The funding was provided through OID's leadership initiatives to a coordinating council for the purpose of distributing post-hurricane relief to farmworkers in Florida. The offices of ORAL, TACS, and OID have under their responsibility mission activities and core activities. Core activities involve issues which are identified by Petitioner's board and its affiliate organizations as being at the core of Petitioner's existence, such as civil rights enforcement and immigration issues. These activities are not necessarily funded by a particular government contract or grant from a private foundation or corporation. Mission activities consist of activities which are important in supporting the mission of Petitioner, but are not currently funded by a particular government contract or grant from a private foundation or corporation. These activities relate to administrative functions engaged in by ORAL, TACS, and OID to support Petitioner's operations and are funded with internal funds. The offices of ORAL, TACS and OID work interdependently. A problem is identified in the Hispanic community by Petitioner and/or its affiliates and assigned to ORAL or OID; ORAL or OID conducts research and develops programs to address the problem; and TACS delivers the program services to the disadvantaged Hispanic community, working with affiliates and community-based organizations to implement the programs. A program called Project EXCEL (Excellence in Community Educational Leadership) is an educational program developed by Petitioner. The problem of illiteracy and low graduation rates was identified. Research was conducted on the problem and the program, Project EXCEL, was developed. Petitioner implemented the program through its on-site staff who had oversight responsibility and who evaluated the program and actually worked with the clients to assist in the program's evaluation; whereas, the actual direct educational services were delivered to the clients by persons working for the organizations. Project EXCEL was implemented at public schools, day care centers, and churches. Petitioner secured and provided the funding for the community-based organizations to run demonstration sites for Project EXCEL. Two Florida organizations received assistance from Petitioner regarding Project EXCEL. Centro Campesino Farmworkers Center, Inc., which holds a sales tax exemption from Respondent, utilized the Project EXCEL curriculum developed by Petitioner in providing after-school services to children of migrant farmworkers. Also, the Coalition of Florida Farmworkers Organizations, Inc., which holds a sales tax exemption from Respondent, received a grant to implement Project EXCEL and Petitioner provided a curriculum and some of its staff to assist the Coalition of Florida Farmworkers in working with the children. Both the Centro Campesino Farmworkers and the Coalition of Florida Farmworkers pay annual dues to Petitioner as affiliates. They have received from Petitioner pass-through funds as subgrants. Petitioner does not engage in direct fund raising to support the organizations. Pass-through funding is funding distributed through Petitioner to its affiliates or other outside organizations through subgrants. The funds are received by Petitioner from grants for which Petitioner applies. For both the Centro Campesino Farmworkers and the Coalition of Florida Farmworkers, Petitioner has not provided volunteers to run any of the organizations' programs or provide the organizations' services at the local level. Furthermore, Petitioner does not control, govern, or administer any of the Centro Compesino Farmworkers' or the Coalition of Florida Farmworkers' services or activities at the local level. In another instance, Petitioner identified housing problems for the Hispanic community regarding ownership, quality and availability. Research showed that, for Hispanics, there existed a low rate of home ownership, substandard housing, and discrimination. Petitioner secured funding to build low income housing and commercial developments in low income neighborhoods; at times, providing pre-development costs or professional services such as engineers and architects. As with Centro Campensino Farmworkers and the Coalition of Florida Farmworkers, Petitioner does not provide volunteers to work for its affiliate organizations at the local level (Petitioner's staff are paid employees), Petitioner does not engage in direct fund raising to support its affiliate organizations, and Petitioner does not control, govern, or administer any of the services at the local level. Also, ORAL, TACS, and OID have worked interdependently in developing programs in the health field. AIDS public service announcements have been produced by Petitioner. An AIDS national toll-free hot line is operated by Petitioner, with professional staff manning the phones to provide information to AIDS patients and others and with the costs being borne by Petitioner. As to the Office of Development and Special Effects (ODSE), it is responsible for fund raising, proposal writing, receipt of grants, Petitioner's future endowment or capital campaign. ODSE's primary responsibility is the operation of Petitioner's annual conference and Congressional awards dinner. The annual conference is held in different locations and the awards dinner is held in Washington, D.C. The annual conference is attended by thousands of participants from across the United States to discuss topics and issues relevant to the Hispanic community. Affiliates which attend pay a registration fee. Usually offered at the conference are workshops, seminars, an art show, job fair, silent auction, and an exhibit hall where corporations and governmental agencies can promote themselves. Except for the meal events, all the other activities are open to the public at no charge. As part of the conference, Petitioner sponsors a Youth Leadership Program in which the expenses are paid for 25 to 30 youths (tenth to twelfth graders), who are disadvantaged and at-risk and from various parts of the country, to attend the conference. A similar program is sponsored by Petitioner for college students. Additionally, Petitioner sponsors a one day event for area disadvantaged district school students. Petitioner's 1994 annual conference was held at Miami Beach, Florida on July 17 - 20, 1994. Petitioner provided or sponsored all of its usual activities or programs, except for a job fair. In addition, Petitioner sponsored a senior citizens day for the disadvantaged elderly. The registration fee for affiliates was $150. Petitioner's Office of Finance is responsible for the fiscal management of all internal matters and the financial practices of Petitioner. Petitioner reflects its fiscal financial picture on two documents. As a Section 501(c)(3) organization, Petitioner files federal tax returns, known as Forms 990, on a yearly basis. Additionally, Petitioner has audited financial statements prepared annually. Among other things, Form 990 reflects Petitioner's expenses found on its audited financial statements, but in greater detail. Petitioner's fiscal year is from October 1st to September 30th of each year. Expenditures associated with Petitioner's Board of Directors, Office of the President, Office of Finance, and Office of Administration are general administrative expenses. These expenditures fall within the category of supporting activities on Petitioner's audited financial statements. For the fiscal year October 1, 1992 to September 30, 1993, Petitioner's total expenditures were $5,581,316. Of this total of expenditures, $4,407,194 represented expenses for program services, per the category on Form 990, of which $126,250 represented pass-through funds to subgrantees; of which over $2.6 million represented compensation of officers and directors, etc., other salaries and wages, pension plan contributions, other employee benefits, payroll taxes, and conferences, conventions and meetings 2/ ; and of which $57,421 represented legislative advocacy. Also, of the total expenditures, $1,174,122 represented expenses for supporting activities, of which $976,044 represented general administration; and of which $198,078 represented fund raising which is money expended in writing proposals to fund Petitioner's programs. For the fiscal year October 1, 1991, through September 30, 1992, Petitioner's total expenditures were $5,150,084.00. Of this total of expenditures, $3,982,552 represented expenses for program services, including $172,620 for pass-through funds to subgrantees, over $2.3 million for compensation of officers and directors, other salaries and wages, pension plan contributions, other employee benefits, payroll taxes, and conferences, conventions and meetings, and $54,410 for legislative advocacy. Also, of the total expenditures, $1,167,532 represented expenses for supporting services, including $978,557 for general administration, and $188,975 for fund raising. Even though Petitioner claims to have 182 affiliates, only 162 affiliates were identified. Petitioner actively works with 120 of the 162 identified affiliates. Nine of the affiliates hold certificates of exemption issued by Respondent. Because of the minimal descriptions provided by Petitioner of the affiliates, only a small minority could be determined to provide services for free or at a substantially reduced cost.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order DENYING the National Council of La Raza a consumer certificate of exemption. DONE AND ENTERED this 8th day of February, 1996, in Tallahassee, Leon County, Florida. ERROL H. POWELL, 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 8th day of February, 1996.
Findings Of Fact Based upon the testimony of the witnesses, the documentary evidence received at the hearing, and the record in DOAH case no. 88-6257, the following findings of fact are made: On October 24, 1988, the Department notified Sophie DeRuiter and Ann & Jan Retirement Villa that the license to operate an adult congregate living facility expired on October 23, 1988, and that the application for renewal was denied. The specific reasons listed as the grounds for such denial were a determination of confirmed medical neglect of residents and the inappropriate retention of residents. Thereafter, Petitioner timely sought an administrative review of the denial by filing a petition for administrative hearing with the Department which was subsequently forwarded to the Division of Administrative Hearings for formal proceedings on December 16, 1988. That matter was assigned DOAH case no. 88- 6257. Hearing of case no. 88-6257 was originally scheduled for March 17, 1989, by notice of hearing dated January 18, 1989. Thereafter, Petitioner scheduled a number of depositions and requested a continuance in the case to accommodate Sophie DeRuiter. That motion was unopposed by the Department and was granted by order entered February 27, 1989. That order also rescheduled the hearing for April 14, 1989, and required the parties to file a prehearing statement no later than March 24, 1989. Neither party timely filed a prehearing statement. In fact, the parties were unable to agree on a statement due to their disagreement as to the issues of the case. The unilateral statements filed by the parties established that Petitioner sought review of all grounds for the denial of the license renewal. On the other hand, the Department took the position that since Sophie DeRuiter was listed on the Florida Abuse Registry for confirmed medical neglect of residents, that such listing precluded renewal of the license. The Department alleged that Petitioner had not timely challenged the abuse report, and that such record could not be challenged in the instant case. The Department's letter denying amendment or expungement of the medical neglect had been issued December 7, 1988. Given the confusion of the parties and their failure to file prehearing statements as required, the hearing scheduled for April 14, 1989, was cancelled. Subsequently, the Department moved to limit the issue to whether there was a confirmed record of an abuse report (and thereby presume the underlying report correct). Such motion was denied on June 1, 1989. On June 9, 1989, the hearing of this matter was convened. At that time, the Department moved to continue the case due to illness of counsel and her inability to review an amended witness list filed by Petitioner. The motion was granted after it was apparent counsel for the Department was unprepared to go forward on all issues of the case (she represented she had just received the order requiring her to go forward on all issues on June 8, 1989). The case was rescheduled for August 10, 1989. Subsequently, the matter was continued again at Petitioner's request. The case was finally scheduled for hearing for September 8, 1989. The Petitioner filed a motion for summary judgment on August 14, 1989. On September 7, 1989, the Department filed a notice of dismissal which was construed as an assent, in whole or in part, to the relief requested by the Petitioner. Consequently, the hearing was cancelled and jurisdiction was relinquished to the Department for such further action as would be appropriate. It was presumed that the abuse record would be expunged which would result in the reinstatement of the license. The Petitioner in the instant case has not, however, established the final resolution of DOAH case no. 88-6257. Petitioner did not comply with Rule 22I-6.035, Florida Administrative Code by attaching the documents on which the claim that the small business party prevailed was predicated nor was proof of such document offered at the hearing of this matter. Sophie DeRuiter is the administrator and owner of Ann & Jan Retirement Villa which is located at 3486 Rostan Lane, Lake Worth, Florida. According to the style of the initial pleading filed by Petitioner in the instant case, Ann & Jan Retirement Villa has been incorporated. The proof offered at hearing suggested that Sophie DeRuiter is the sole proprietor of a business known as "Ann & Jan Retirement Villa." In August, 1988, Ms. DeRuiter employed approximately four full-time employees. In the three years she has owned and operated the facility, Ms. DeRuiter has never employed more than twenty-five full-time employees. The net worth of Ann & Jan Retirement Villa is less than two million dollars. Ms. DeRuiter's personal net worth is less than two million dollars. The combined worth of Ann & Jan Retirement Villa and Ms. DeRuiter is less than two million dollars. Ms. DeRuiter employed the law firm of Weissman and Chernay, P.A. to represent her in connection with the allegations in DOAH case no. 88-6257. In connection with that case, Ms. DeRuiter incurred legal fees in the amount of $8587.50 together with costs in the amount of $897.59. The reasonableness of those amounts was not disputed.
The Issue Whether Petitioner is entitled to a consumer's certificate of exemption from sales tax as a "charitable institution" as that term is defined by Section 212.08(7)(o)2b., Florida Statutes.
Findings Of Fact Petitioner is a nonprofit organization incorporated under the laws of the State of Florida as a corporation. Petitioner has applied to Respondent for a certificate of exemption from sales and use tax based on its claim that it is a "charitable institution" within the meaning of, and pursuant to the provisions of, Section 212.08(7)(o)2.b., Florida Statutes. 2/ The Internal Revenue Service has determined that Petitioner is exempt from federal income tax under Section 501(a) of the Internal Revenue Code as an organization described in Section 501(c)(3). Edy Sanon, Petitioner's executive director, testified in general terms as to the services performed by Petitioner to persons of Haitian descent. Based on that general testimony, it cannot be determined with any degree of certainty the precise services performed by Petitioner. Mr. Sanon testified that his organization provides translation services and referral services that assist Haitian immigrants in adjusting to life in the United States, becoming employable, and obtaining services from various government agencies. Petitioner engages in fund raising and searches for governmental grants for a center where people can come for help. The extent of its resources expended on fund raising was not established. Mr. Sanon testified that Petitioner provides its services free of charge and that it served approximately 800 clients last year. Chapter 212, Florida Statutes, imposes a tax on sales, use and other transactions. Respondent is the agency of the State of Florida charged with administering Chapter 212, Florida Statutes, and its duties include the issuance of certificates of exemption from tax pursuant to Section 212.08(7)(o), Florida Statutes. Pursuant to its rule-making authority, Respondent has adopted Rule 12A-1.001, Florida Administrative Code, to implement the provisions of Section 212.08(7)(o), Florida Statutes. Although Petitioner has been recognized as a nonprofit organization by the Internal Revenue Service, Petitioner must receive a certificate of exemption from Respondent to be exempt from Florida's tax on sales, use, and other transactions imposed by Chapter 212, Florida Statutes. The provisions of Section 212.08(7)(o), Florida Statutes, and Rule 12A-1.001, Florida Administrative Code, provide the criteria for the exemption sought by Petitioner. Section 212.08(7)(o), Florida Statutes, provides, in pertinent part, an exemption from sales tax as follows: (o) Religious, charitable, scientific, educational, and veterans' institutions and organizations. There are exempt from the tax imposed by this chapter transactions involving: * * * b. Sales or leases to nonprofit religious, nonprofit charitable, nonprofit scientific, or nonprofit educational institutions when used in carrying on their customary nonprofit religious, nonprofit charitable, nonprofit scientific, or nonprofit educational activities . . . * * * The provisions of this section authorizing exemptions from tax shall be strictly defined, limited, and applied in each category as follows: * * * b. "Charitable institutions" means only nonprofit corporations qualified as nonprofit pursuant to s. 501(c)(3), Internal Revenue Code of 1954, as amended, and other nonprofit entities, the sole or primary function of which is to provide, or to raise funds for organizations which provide, one or more of the following services if a reasonable percentage of such service is provided free of charge, or at a substantially reduced cost, to persons, animals, or organizations that are unable to pay for such service: * * * (IV) Social welfare services including adoption placement, child care, community care for the elderly, and other social welfare services which clearly and substantially benefit a client population which is disadvantaged or suffers a hardship . . . 3/ Rule 12A-1.001(3)(g), Florida Administrative Code, implements the provisions of Section 212.08(7)(o), Florida Statutes, and provides, in pertinent part, as follows: (g)1. "Charitable institutions" means only nonprofit corporations qualified as nonprofit pursuant to s. 501(c)(3), United States Internal Revenue Code, 1954, as amended, and other nonprofit entities that meet the following requirements: the sole or primary function is providing a "qualified charitable service" as defined in this subsection; and a reasonable percentage of such service is provided free of charge, or at a substantially reduced cost, to persons, animals, or organizations that are unable to pay for such service. * * * 3.a. For the purpose of this subsection the following terms and phrases shall have the meaning ascribed to them except when the context clearly indicates a different meaning: I. "Persons unable to pay" means persons whose annual income is 150 percent or less of the current Federal Poverty Guidelines . . . * * * "Substantially reduced cost" means the normal charge, market price, or fair market value to a purchaser or recipient, diminished in an amount of considerable quantity. "Sole or primary function" means that a charitable institution, excluding hospitals, must establish and support its function as providing or raising funds for services as outlined in subparagraphs 1. and 2. above, by expending in excess of 50.0 percent of the charitable institution's operational expenditures towards "qualified charitable services", as defined in subparagraph 2.a. - g. within the charitable institution's most recent fiscal year. Petitioner established that it is a nonprofit organization. Petitioner did not present any financial data at the formal hearing. In the absence of that financial information, it cannot be found that Petitioner disburses more than fifty percent of its expenditures to provide or raise funds for a provider of a statutorily listed service. The absence of that information is fatal to Petitioner's application. 4/ The unchallenged testimony of Mr. Sanon was sufficient to establish for the purposes of this proceeding that Petitioner does not charge for its services. Petitioner did not establish at the formal hearing the ability of any of its client to pay a reasonable fee for the services provided by Petitioner. The general testimony of Mr. Sanon failed to establish that the translation, referral, and other services provided by Petitioner are "social welfare services" within the meaning of Section 212.08(7)(o)2.b., Florida Statutes. 5/
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a final order that denies Petitioner's application for a certificate of exemption. DONE AND ENTERED this 1st day of December, 1998, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON 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 1st day of December, 1998.
