The Issue The issue in this case is whether, in making an award of a lease for office space, the Respondent acted according to the requirements of law.
Findings Of Fact In February, 1993, the Department of Labor and Employment Security ("Department") issued a Request for Proposal and Bid Submittal No. 540:0969 ("RFP") seeking to lease approximately 18,684 square feet of office space in Jacksonville, Florida, for a period of six years. The space was to house the Office of Disability Determinations ("ODD"), which processes disability claims and determines whether claimants are eligible for Social Security and Supplemental Income benefits. The office has minimal contact with the general public. The RFP provided that all bids were subject to conditions stated within the RFP. Bids not in compliance with RFP conditions were subject to rejection. RFP Article D, General Provisions, Paragraph 8 provides as follows: The Department reserves the right to reject any and all bid proposals for reasons which shall include but not be limited to the agency's budgetary constraints; waive any minor informality or technicality in bids' to accept that bid deemed to be the lowest and in the best interest of the state, and if necessary, to reinstate procedures for soliciting competitive proposals. A pre-bid conference was conducted by the Department on February 16, 1993. Representatives from the vendors involved in this proceeding attended the conference. Bids were opened on March 5, 1993. The Department received five responses, three of which were deemed to be responsive and which were evaluated. The remaining two responses were determined to be nonresponsive and were not evaluated. On or about March 10, 1993, based on the evaluations, the Department proposed to award the bid to Koger Properties, Inc. On or about March 17, 1993, the Department notified the vendors of the intended award. The Petitioners filed timely notices protesting the intended award. TOWNCENTRE PROPOSAL Paragraph 13 sets forth conditions to which a bidder must agree in order to be awarded a bid. Subsection "a" of the paragraph states, "[i]f successful, bidder agrees to enter into a lease agreement on the Department of General Services Standard Lease Agreement Form BCM 4054 (Attachment F - Do not complete)." The copy of the Department of General Services Standard Lease Agreement Form which was included in the RFP was a poorly reproduced copy. Article III of the Lease Agreement Form provides as follows: III HEATING, AIR CONDITIONING AND JANITOR SERVICES 1.a. The Lessor agrees to furnish to the Lessee heating and air conditioning equipment and maint(illegible) in satisfactory operating condition at all times for the leased premises during the term of the lease at the (illegible) of the Lessor. b. The Lessor agrees to maintain thermostats in the demised premises at 68 degrees Fahrenhe(illegible) the heating season and 78 degrees Fahrenheit during the cooling season; and certifies that boilers the(illegible) been calibrated to permit the most efficient operation. The Lessor agrees to furnish janitorial services and all necessary janitorial supplies for the leased (illegible) during the term of the lease at the expense of the Lessor. All services required above shall be provided during the Lessee's normal working hours, whic(illegible)marily from 7:30 a.m. to 5:30 p.m., Monday through Friday excluding state holidays. Also attached to the RFP was a copy of an addendum to the lease, also poorly reproduced. The addendum provides as follows: Article III, Paragraph III Addendum for Full Service Lease The lessor and lessee mutually agree that the described prem(illegible) leased in this lease agreement shall be available to the department (lessee) for its exclusive use twenty four (24) (illegible) per day, seven (7) days per week during the lease term. T(illegible) space to be leased by the department will be fully occupied during normal working hours from 7:30 a.m. to 5:30 p.m., Mo(illegible) through Friday, excluding holidays, Saturdays and Sundays, (illegible) may be fully or partially occupied during all other periods (illegible) time as necessary and required at the full discretion of th(illegible) department. Accordingly, services to be provided by the le(illegible) under the terms of the lease agreement, including electrici(illegible) other utilities, will be provided during all hours of occup(illegible) at no additional cost to the department (lessee). Although the copy of the lease agreement and addendum included in the RFP were poorly reproduced, it is clear that the addendum modifies the paragraph of the lease agreement related to provision of heating, air conditioning and janitorial services to require that HVAC services be provided throughout the premises during all hours of occupancy at no additional cost to the Department. The proposal submitted by Towncentre included an "Attachment Z" which states as follows: The following represent exceptions and/or clarifications to the terms of the Request for Proposal and Bid Submittal Form ("RFP") for the referenced Lease. Except as noted herein, Bidder shall comply fully with the terms of the RFP..." Item #7 of Attachment Z states as follows: The Building in which the space is offered is serviced by central heating, ventilating and air conditioning; therefore, no separate thermostats will be provided in the space other than in the computer room. However, the required temperature standards will be maintained and satisfied. The computer room HVAC shall be available 24 hours a day. Otherwise, after-hours HVAC is billed at $80 per hour. Attachment Z also included additional exceptions to the provisions of the RFP. Contrary to the requirements set forth in the addendum attached to the lease form included in the RFP, the Towncentre proposal included additional charges for after hours uses. The Department determined that the Towncentre proposal was nonresponsive and disqualified the proposal from further consideration. Because the Towncentre proposal includes HVAC charges which are specifically prohibited under the terms of the RFP, the Towncentre proposal is nonresponsive to the RFP. Towncentre asserts that other sections of the RFP indicate that, within the leased premises, only the computer room is required to be heated or cooled on a continuous basis. Vendors had an adequate opportunity to direct questions regarding the RFP to Department officials. There is no evidence that Towncentre sought clarification from the Department related to this matter prior to submitting the bid proposal. In the notification to Towncentre that the bid had been determined to be nonresponsive to the RFP, the Department identified the other exceptions as additional reasons for the determination of nonresponsiveness. At hearing Towncentre introduced no evidence related to the remaining items included within Attachment Z. BRYAN SIMPSON JR. FOR P.V. ASSOCIATES The Simpson bid was deemed to be responsive and was evaluated. The evaluations were performed by three Department employees, Dorea Sowinski, Albert Cherry, and Tom Mahar. On March 9, 1993, the evaluators visited the physical locations of the three responsive bids. (Although the bid had been declared nonresponsive, they also visited the Towncentre site, apparently as a courtesy.) The Simpson space is located in downtown Jacksonville. After completion of the site visits, the evaluators separately and independently completed their evaluation sheets. The evaluators awarded a total of 262 points to Koger Properties and 248 points to Simpson. Page 7 of the RFP sets forth the evaluation criteria which were considered in awarding evaluation points. The RFP stated as follows: The successful bid will be the one determined to be the lowest and best. All bids will be evaluated based on the award factors enumerated below: Rental, using Present Value methodology for basic term of lease (See D, General Provisions Items 3 and 4) applying the present value discount rate of 5.6 per cent. (Weighing: 35) Conformance of and susceptibility of the design of the space offered to efficient layout and good utilization and to the specific requirements contained in the Invitation to Bid. (Weighing: 20) The effect of environmental factors, including the physical characteristics of the building and the area surrounding it on the efficient and economical conduct of the Departmental operations planned for the requested space. (Weighing: 20) Offers providing contiguous space within preferred boundaries. (Weighing 5) Frequency and availability of satisfactory public transportation within one block of the offered space. (Weighing 15) Availability of adequate dining facilities within one mile of the offered space. (Weighing: 2) Proximity of offered space to the clients served by the Department at this facility. (Weighing: 3) Proximity of offered space to other Department activities as well as other public services. (Weighing: 0) TOTAL POINTS: 100 Simpson asserts that the evaluators acted improperly in awarding points in categories 3, 5, 6 and 7. Category 3 relates to the effect of environmental factors, including the physical characteristics of the building and the area surrounding it on the efficient and economical conduct of the Departmental operations planned for the requested space. Although Simpson asserts that category 3 is vague and ambiguous, there was no objection to the category prior to the submission of the bid responses and the announcement of the proposed lease award. Each evaluator could award up to 20 points in this category for a total of 60 available points. Koger was awarded 55 points. Simpson received 27 points. As to individual evaluators awards, Tom Mahar awarded Simpson five points, Albert Cherry awarded Simpson ten points, and Dorea Sowinski awarded Simpson 12 points. Based on the written memo dated March 10, 1993, identifying the reasons for the recommended bid award, two of the three evaluators considered the Koger space to be located in a safer area than the Simpson facility, and, at least in part, based their point awards on this factor. The two evaluators cite minimal anecdotal information in support of their opinions. The evaluators undertook no investigation related to safety issues and there are no facts to support their opinions. Their award of points for "environmental factors" is arbitrary. Category 5 relates to the frequency and availability of public transportation within one block of the offered space. Each evaluator could award up to 15 points in this category for a total of 45 available points. Both Koger and Simpson received the maximum 45 points. RFP Page Two, question 8 provides as follows: Public Transportation availability: BIDDER RESPONSE: (Check appropriate box) Taxi , Bus , Frequency of service closest bus stop . Both Koger and Simpson indicate service by taxi and bus. The Koger proposal indicates a frequency of service as "8 BUSES" and the closest bus stop as "IN FRONT OF BUILDING ON WOODCOCK DRIVE." Simpson indicates a frequency of service as "15 minutes" and the closest bus stop as "front of building." The Department asserts that the Koger level of transportation access, albeit less than that serving the Simpson site, is satisfactory and therefore entitled to an award of all points available. Simpson asserts that the greater availability of public transportation to the Simpson site should result, under the terms of the evaluation criteria, in Simpson receiving more points than the Koger site for this category. The evaluation criteria clearly requires consideration of both the frequency and availability of satisfactory public transportation. Simpson asserts that in considering the transportation category, the evaluators should have reviewed local public transportation schedules. Review of such schedules establishes that the Simpson site is served more frequently by public bus transportation than is the Koger site, and further establishes that the number of bus routes directly serving the Simpson property far exceeds the routes serving the Koger site. Simpson did not include the schedules in the RFP response. The Simpson site is also located nearby the downtown public transportation transfer station at which point many, perhaps all, local bus routes connect. Simpson did not denote the location of the transfer station in the RFP response While the evaluation committee is not required to consider the bus schedules in reviewing bid proposals, the evaluation committee failed to consider the substantially greater frequency and availability of public transportation to the Simpson site relative to the Koger site, as set forth in the respective RFPs. The Department's position is contrary to the specific criteria identified in the RFP. The award of equivalent points for transportation access to both Simpson and Koger is unsupported by fact or logic and is arbitrary. Category 6 relates to the availability of adequate dining facilities within one mile of the offered space. Each evaluator could award up to two points in this category for a total of six available. Koger was awarded six points. Simpson received one point. When the evaluators rated the adequacy of dining facilities, they considered only those dining facilities which were located within two blocks of the offered space. Such is contrary to the clear terms of the RFP. The Department offered no rationale for the decision to amend the RFP criteria after submission of the proposals. The Simpson RFP response states only that there are adequate dining facilities within walking distance of the offered facility. The Koger response states that there are "three (3) sandwich shops within walking distance in the Koger center and other numerous restaurants within one (1) mile." As to individual evaluators awards, Tom Mahar awarded Simpson one point, while both Albert Cherry and Dorea Sowinski awarded Simpson zero points. Mahar's award was based on his opinion, again based on alleged safety concerns, that employees would be hesitant to walk to nearby restaurants and that driving and parking presented a problem in the downtown location. Cherry voiced a similar opinion. As to alleged safety concerns, Mahar and Cherry again based their opinions on minimal anecdotal information, supported by neither fact nor logic. Neither evaluator undertook any factual analysis of the safety issues relative to the proposed site. Their award of points for this category is arbitrary. On the other hand, Sowinski did not see any restaurants close to the Simpson site during the site visit. In excess of 40 restaurants are located within one mile of the Simpson site. The restaurants provide a variety of dining options both as to expense and fare. Sowinski's failure to observe restaurants located across the street from the Simpson site is, although difficult to understand, apparently a simple mistake on her part. Category 7 relates to the proximity of offered space to the clients served by the Department at this facility. Each evaluator could award up to three points in this category for a total of nine available. Simpson offered no evidence that the determination of points awarded for category 7 was inappropriate.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that the Department of Labor and Employment Security enter a Final Order DISMISSING the protest filed by Towncentre Venture, and WITHDRAWING the proposed award of lease contract based on the Request for Proposal and Bid Submittal No. 540:0969. DONE and RECOMMENDED this 28th day of June, 1993, in Tallahassee, Florida. WILLIAM F. QUATTLEBAUM 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 June, 1993. APPENDIX TO CASES NO. 93-2015BID and 93-2106BID The following constitute rulings on proposed findings of facts submitted by the parties. Petitioner Towncentre Venture Towncentre Venture's proposed findings of fact are accepted as modified and incorporated in the Recommended Order except as follows: 4. Rejected, second sentence is irrelevant. 5-7. Rejected, irrelevant. Taken as a whole, the RFP indicates that HVAC services are to be provided throughout the leased premises during all hours of occupancy at no additional cost to the Department. The evidence fails to establish that the vendors were confused about the terms of the RFP. There were apparently no related questions addressed to Department personnel during the pre-bid conference or at any time subsequent to the conference and prior to the bid opening. 10. Rejected. Not supported by the document cited which does not identify the attachment by letter. 13. Rejected, irrelevant. The standard form lease included in the RFP was a sample document. None of the blank spaces were completed. 16. Rejected, irrelevant. The attendees at the conference were provided an opportunity to inquire as to all matters. There were apparently no questions asked related to the RFP's requirement that HVAC services be provided throughout the facility during all hours of occupancy at no additional cost to the Department. 17-18, 20-21. Rejected, irrelevant. The terms of the RFP are clear. 19. Rejected, irrelevant. The terms of the addendum for full service lease clearly indicate that such HVAC services were to be provided at no additional charge, not just in the computer room, but throughout the entire leased facility. 22. Rejected. The Towncentre bid was nonresponsive to the terms of the RFP. Petitioner Bryan Simpson, Jr., for P. V. Associates P. V. Associates' proposed findings of fact are accepted as modified and incorporated in the Recommended Order except as follows: 3. Rejected, not supported by the greater weight of the evidence which establishes that the RFP was issued seeking space for the Jacksonville Office of Disability Determinations. 4, 23, 24. Rejected, unnecessary. Respondent Department of Labor and Employment Security The Respondent's proposed findings of fact are accepted as modified and incorporated in the Recommended Order except as follows: 17. Rejected. The decision to award equivalent points for public transportation access fails to reflect the substantially greater access provided to the Simpson site and is arbitrary. 20-21. Rejected, not supported by greater weight of evidence which establishes no evidence that safety concerns were based on a reasonable evaluation of facts. There are no facts to support the conclusion that the Simpson location if less safe than the Koger site. COPIES FURNISHED: Shirley Gooding, Acting Secretary Suite 303, Hartman Building 2012 Capital Circle S.E. Tallahassee, Florida 32399-2152 Cecilia Renn Chief Legal Counsel Suite 307, Hartman Building 2012 Capital Circle, S.E. Tallahassee, Florida 32399-2152 Thomas M. Jenks, Esquire Pappas and Metcalf, P.A. 1 Independent Drive, Suite 3301 Jacksonville, Florida 32202 Nathan D. Goldman, Esquire Marcia Maria Morales, Esquire 200 Laura Street Post Office Box 240 Jacksonville, Florida 33202 Edward Dion, Esquire Assistant General Counsel Suite 307, Hartman Building 2012 Capital Circle S.E. Tallahassee, Florida 32399-2189
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: The petitioner is a dentist and is also engaged in the business of leasing real property in Florida for commercial purposes. A tax auditor for the respondent, Mr. Eugene A. Soinski, notified petitioner that an audit of his books and records would be conducted to determine whether petitioner was remitting the appropriate amount of rental taxes to the respondent. At the time of the initial audit, Mr. Soinski was supplied with only bank deposit receipts and certain leases. The auditor had difficulty in determining which were mortgage payments and which were rental payments. Based upon the auditor's review of petitioner's deposit slips, lease agreements, a three-year audit prepared by petitioner and discussions with some of petitioner's tenants, as assessment for delinquent taxes was made. The initial assessment was reduced and the present dispute lies with the revised assessment dated October 2, 1978, in the amount of $5,316.35. In his amended petition for a hearing and at the hearing, petitioner alleged that no rent tax was due on three specific leases. Petitioner offered no evidence to refute the respondent's assessment on any other lease. All testimony and evidence adduced at the hearing was confined to the lease agreements between petitioner and three other businesses -- Suncoast Amusement, Product Movement Systems, Inc., and Staid, Inc. One of the three disputed items in the assessment concerned an agreement between petitioner and Suncoast Amusement, also referred to as Hot Foots. The lease agreement between Suncoast and petitioner was not made available at the hearing. According to the testimony of the petitioner, the tenant removed carpeting from the premises and installed new red carpeting in its stead. Certain other improvements were also made to the property. The petitioner testified that he received no actual benefit to the property from these improvements, and that the red carpet actually decreased the value of the property. The auditor, Mr. Soinski, remembered seeing the lease agreement and matching the rental payment amounts with the deposit receipts to arrive at the assessment. A copy of the first two pages of the "business lease" between petitioner and Product Movement Systems, Inc., was received into evidence as respondent's Exhibit 3. This agreement contains the stipulation that TWENTY-SECOND: Minimum of two room office, with air, will be built at tenant's expense and remain as part of the first years rent. According to petitioner, the tenant actually built eight to ten offices and this did not improve the real estate. It was, instead, a deterrent to future tenants, according to petitioner. A copy of the "business lease" between petitioner and Staid, Inc., was received into evidence as the respondent's Exhibit 2. The consideration for the agreement was a total rental of sixty thousand dollars, payable as follows: One thousand dollars per month in advance, plus 4 percent State tax. Two thousand dollars security deposit, receipt acknowledged. Also on the first of each month an amount equal to 1/60th of the total cost of all improvements of any kind, as approved by both parties, will be paid plus the above basic rent of $1,040. - per month. Also, the twenty-fourth stipulation and condition in said lease provides as follows . . . TWENTY-FOURTH: If during the life of this lease tenant has need of more space every effort will be made to provide some adjacent. If it is desirable to both parties a new building is necessary then such buildings will be to tenants specifications, the rent will be the total cost of such land and improvements including architect fee, cost of mortgage, paving, landscaping or any expense of any nature x 15 percent net, net. According to the petitioner, he made a loan to Staid, Inc., in the amount of $48,000.00 to enable Staid to pay for certain improvements to the property. This loan was to be repaid in installments of $800.00 per month for sixty months. It was petitioner's testimony that regardless of the wording contained in the lease agreement, the improvements were not considered a part of the rent, he derived no benefits from the improvements to the property, and part of the payment made by the tenant each month was for repayments of a loan, rather than rental on the property. It was the testimony of Mr. Soinski, the auditor, that the assessment of the three disputed leases was based on the total amount of rent paid by the tenants to the petitioner, which rent included any improvements to the property. Where lease documents were available, he utilized the amount of rent due from the face of the lease document. Where possible, he compared the lease documents with the petitioner's bank deposit slips. The revised notice of proposed assessment dated October 2, 1978, was received into evidence as the respondent's Exhibit 1. This document assesses a tax on rentals of real property in the amount of $4,215.40, a delinquent penalty in the amount of $210.79 and interest through October 2, 1978, in the amount of $890.16, for a total amount of $5,316.35.
Recommendation Based upon the findings of fact and conclusions of law recited above, it is RECOMMENDED that the proposed assessment dated October 2, 1978, in the amount of $5,316.35 be upheld and that the relief requested by petitioner be denied. DONE AND ENTERED this 3rd day of January 1980 in Tallahassee, Florida. DIANE D. TREMOR Hearing Officer Division of Administrative Hearings 101 Collins Building Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 3rd day of January 1980. COPIES FURNISHED: James W. Hickman 203 River Bend Longwood, Florida Linda Procta Assistant Attorney General Department of Legal Affairs The Capitol LL04 Tallahassee, Florida 32301 =================================================================
The Issue Whether or not the actions of the petitioner in amending its lease agreement resulted in increased costs which are reimbursable by the Department of Health and Rehabilitative Services through an interim rate request.
Findings Of Fact Hallandale is a licensed nursing home facility located in Hallandale, Florida, and at all times material hereto, Hallandale was certified to and was participating in the Florida Medicaid Program. The participation was subject to a standard nursing home provider agreement entered into by the parties. Pursuant to the agreement, Hallandale provides nursing care for Medicaid recipients and receives as payment the recognized rate of Medicaid reimbursement established for Hallandale by HRS in accordance with the applicable state and federal laws, regulations, and guidelines. The agreement may be cancelled by either party after giving thirty (30) days notice. In 1971, Hallandale entered into a lease agreement with the owners of the nursing home facility and began operating the nursing home. The lease called for a payment of $84.00 per month, per bed, had no escalation clause, and would not expire until 1986. At the time the lease was negotiated, the owners had been operating the nursing home themselves at a loss. To avoid bankruptcy or having to sell the property at a loss, the owners leased the property to Hallandale. However, within seven or eight years the owners began to put pressure on Hallandale to renegotiate the lease because the owners did not think they were getting a fair return on their investment. In 1981, the owners and Hallandale entered into negotiations to amend the terms of the lease to provide an increased rental rate and an extension of the lease term. The negotiations were not successful, and finally, by letter dated July 6, 1983, the owners issued the following ultimatum: "Although the lease has a renegotiation clause six months prior to expiration, we must renegotiate the terms and conditions of this lease immediately. The partnership has made a decision that we will definitely not renew or extend your lease unless we can come to some satisfactory arrangement regarding terms and conditions, effective immediately." On December 13, 1983, Hallandale and the owners entered into an amendment to the original lease. The amendment increased the lease payments and extended the lease until August of 1998. The amended lease provided for a minimum rental of $110 per month, per bed, as of September 1, 1983, with increases in the rental every year thereafter. Saul Lerner has been president of Hallandale since 1975 and has been associated with the facility since it was first leased in 1971. Mr. Lerner is an astute businessman who has been involved in a variety of businesses for forty years. He was chiefly responsible for renegotiating the lease with the owners. Although the lease was renegotiated due to the owners' threats to sell the facility, 1/ Mr. Lerner did not merely accede to the owners' demands. There were several offers and counteroffers made before the final agreement was reached, and the renegotiated lease provided for a considerably lower rental rate than that demanded by the owners. Prior to entering into the lease amendment Mr. Lerner consulted with people in the industry, had a MAI appraisal performed, discussed the situation with James Beymer, a real estate broker specializing in nursing home and health related facilities, consulted with his accountants who had been in the health care field for 13 years, and talked with Sebastian Gomez of the Department of Health and Rehabilitative Services. Mr. Lerner consulted with his business associates, and the pros and cons of renegotiating the lease were carefully considered. Hallandale's determination to renegotiate the lease in 1983 was a reasonable and prudent business decision. By agreeing to increased rental payments for the three years that remained on the original lease, Hallandale gained an additional 12 years to operate the facility. This permitted Hallandale to project its costs and plan for the future. It could make additions and improvements to the building, buy new equipment, and provide for stability in staffing. On the other hand, had Hallandale refused to renegotiate the lease, it faced an uncertain future. There was a strong possibility that the owners would not be willing to renew the lease when it expired, which would result in Hallandale's losing the equipment and improvements it had put into the building. In addition, the owners were threatening to sell the property, and even though Hallandale had the right of first refusal, it would have had difficulty in obtaining the money required to purchase the property. Further, Hallandale realized that even if the owners would be willing to negotiate a new lease in 1986, Hallandale would not have the same leverage or bargaining power in 1986 as it had in 1983. Hallandale has participated in the Medicaid program continuously since 1971. At the time of the hearing the facility had 142 patients, of which 45 were Medicaid patients. 2/ Hallandale has never refused a Medicaid patient, and some of the patients have been there 8 or 9 years. The Medicaid patients are treated the same as the private patients, to such a degree that no one knows which patients are Medicaid patients. Although the agreement with HRS allows a provider to leave the Medicaid program with 30 days notice, Hallandale has no intention to ever discontinue participation in the Medicaid program. The extended term of the renegotiated lease is not only advantageous to Hallandale, it is also beneficial to Hallandale's patients, including Medicaid patients. It secures continuity of care for the patients and ensures that the patients will not have to be moved to a new facility in 1986. The transfer from one facility to another can be a very traumatic event for an elderly person; some patients have died within weeks of a transfer. Further, the patients benefit immediately because the extended term of the lease allows Hallandale to make improvements to the facility and buy equipment that it would not have been able to do without the security of a long term lease. The lease payments called for by the new lease are not out of line with lease payments made by similar institutions. Mr. Lerner looked at other lease payments being made in the community and found that $110 per bed per month was not an exorbitant amount. James Beymer leased nursing home facilities that were not as nice as the Hallandale facility for $138 per bed per month $166 per bed per month, and $225 per bed per month. Had Hallandale purchased the facility for $3 million, the price asked by the owners, the cost per month per bed would have been over twice the amount of the lease payment. 3/ Lease payments are included in a facility's "fixed costs." The fixed costs also include depreciation, real estate taxes and insurance. The state places a cap on reimbursement rates for fixed costs. In June 1983, prior to the renegotiation of the lease, Hallandale's fixed costs were $4.61 per patient day; under the renegotiated lease, the fixed costs would be $5.16 per patient day. Thus, even with the higher lease payment, the fixed costs are considerably under the state cap of $12.50 per patient day. A provider's reimbursement rate is determined by HRS from a cost report submitted by a provider. The rate is a prospective per diem rate. If, during the prospective period, the provider incurs an increase in costs, the provider has a right to submit an interim rate request to HRS. The Department uses the same principles to determine whether costs submitted in an interim rate request should be allowed as in determining whether costs submitted in a cost report should be allowed. Lease payments are allowable expenses under the Medicaid program subject to the Medicaid cost reimbursement principles. In calculating Hallandale's per diem rate, HRS allowed Hallandale $84 per month lease cost for each Medicaid patient in the facility based on the 1971 lease. Prior to executing the new lease, Hallandale contacted HRS to inquire if the new lease cost would be allowable and was informed that the new costs would probably not be allowable. On November 9, 1983, Hallandale submitted an interim rate request to cover the increased cost of the new lease payments. The interim rate request was procedurally correct. By letter dated May 30, 1984, HRS denied the interim rate request because "...the lease cost was negotiated for investment related reasons and is not related to patient care." On June 25, 1984, Hallandale filed its petition for a formal administrative hearing.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the interim rate increase requested by Hallandale be granted. DONE and ORDERED this 26th day of April, 1985, in Tallahassee, Leon County, Florida. DIANE A. GRUBBS Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 26th day of April, 1985.
The Issue The issue for disposition in this case is whether Respondent has implemented an agency statement that meets the definition of a rule, but which has not been adopted pursuant to section 120.54, Florida Statutes.
Findings Of Fact The Board of Trustees of the Internal Improvement Trust Fund (Board) is charged with the management of state lands, including sovereign submerged lands. § 253.03(1), Fla. Stat. The Department of Environmental Protection (Department) is charged with the duty to “perform all staff duties and functions related to the acquisition, administration, and disposition of state lands, title to which is or will be vested in the Board of Trustees of the Internal Improvement Trust Fund.” § 253.002(1), Fla. Stat. The City of Titusville operates a municipal marina, which includes a 205-slip docking facility for mooring of commercial and recreational vessels (Marina), on sovereignty submerged lands leased from the Board. Petitioner owns a Florida-registered vessel which he keeps at the Marina pursuant to an annual mooring/dockage agreement. On June 9, 2009, the City of Titusville and the Board entered into a “fee waived” lease renewal and modification for a parcel of sovereignty submerged land in the Indian River (Lease). The Lease allows the Marina to operate “with liveaboards as defined in paragraph 26, as shown and conditioned in Attachment A, and the State of Florida Department of Environmental Protection, Consolidated Environmental Resource Permit No. 05-287409-001, dated December 31, 2008, incorporated herein and made a part of this lease by reference.” Paragraph 26 of the Lease provides that: 26. LIVEABOARDS: The term “liveaboard” is defined as a vessel docked at the facility and inhabited by a person or persons for any five (5) consecutive days or a total of ten (10) days within a thirty (30) day period. If liveaboards are authorized by paragraph one (1) of this lease, in no event shall such “liveaboard” status exceed six (6) months within any twelve (12) month period, nor shall any such vessel constitute a legal or primary residence. On or about July 31, 2015, Petitioner and the City of Titusville entered into the annual contractual mooring/dockage agreement, paragraph 4 of which provides that: 4. LIVEABOARDS: For the purposes of this Agreement, the term “liveaboard” is defined herein as a vessel docked at the facility and inhabited by a person or persons for any five (5) consecutive days or a total of ten (10) days within a thirty (30) day period. Pursuant to requirements of the City’s Submerged Land Lease with the State of Florida, no vessel shall occupy the Marina in this “1iveaboard” status for more than six (6) months within any twelve (l2) month period, nor shall the Marina Facility constitute a legal or primary residence of the OWNER. Petitioner asserts that the alleged agency statement regarding “liveaboard” vessels “unreasonably and arbitrarily denies me the unrestricted right to stay on my vessel by limiting the number of consecutive days during which I may occupy the vessel,” and that “[t]he Board’s non-rule policy denies me the unrestricted freedom to enjoy my vessel as a second home.”
Findings Of Fact At all times pertinent to the allegations contained herein, Petitioner, Division of Real Estate, was the state agency in Florida responsible for the regulation of the real estate profession and for the licensing of real estate professionals. Respondent was, at all times material to the issues herein, a licensed real estate salesman in this state. He was issued salesman's license 0419038 and from August 27, 1990 through September 2, 1991, was an active salesman with Scarlett Faulic & Associates located in Indian Shores, Florida. From September 3, 1991 through September 30, 1991, he was a salesman with Arn Realty Group, Inc., also in Indian Shores. Effective October 1, 1991, his license became inactive due to non-renewal and remained in that status until he renewed it on April 16, 1992 when he affiliated as a salesman with First Gulf Beach Realty, Inc. in Indian Rocks Beach, Florida. From July 28, 1992 to the date of the hearing, he was an active salesman with Bobby Byrd Real Estate, Inc. in Clearwater. Sometime prior to June 13, 1991, Ted Plihcik, presently a resident of Coram, New York and formerly the owner/occupant of the property in issue which is located in Pinellas County, Florida, met the Respondent at a garage sale at Respondent's home. Because Mr. Plihcik intended to move out of the area, he entered into a listing agreement with Respondent on behalf of Arn Realty's predecessor, under which the firm was either to rent or sell the property. This agreement was to expire on December 31, 1991, and there is no evidence it was cancelled prior to expiration. Sometime after Mr. Plihcik moved to New York, he received a telephone call from Respondent in which Respondent said he had a couple to rent the property for the rental amount previously stipulated, $650.00 per month, from which Respondent was to get a commission of 10%. Respondent indicated he would take a deposit from the tenants and that he had a signed lease. Prior to his departure, Mr. Plihcik had started to make some renovations to the property's garage. He had redone the bathroom area and was planning to make another room out of the garage. However, he never got around to completing the job or to putting in the windows. He had decided to change it back into a garage, and in fact the prospective tenants wanted a garage rather than another bedroom, so he directed Respondent to hire someone to finish the reconversion. At Plihcik's request, Respondent got several estimates for the work which Plihcik felt were too high. At that point, Respondent offered to do the work himself. Plihcik agreed and gave Respondent authorization to use the deposit money to pay for necessary materials and consistent with that agreement, on September 14, 1991, by letter, Plihcik authorized Arn Realty Group to release money to Danley for the "alterations and repairs he is doing to my property...." Because the Isabelles did not pay the full two month deposit, Mr. Plihcik later revised the authorization to allow Respondent to use rent money as well, but he did not relieve Respondent from the requirement to turn any money received as rent over to Arn Realty upon receipt and thereafter get payment from the company. It is obvious that Plihcik was under the opinion that the deposit money Danley had received from the tenants had been turned over to the broker, Arn Realty. Mr. Plihcik tried unsuccessfully repeatedly to contact the Respondent requesting a copy of the lease agreement, copies of receipts for materials purchased for the garage work, or anything else pertinent, even sending at least one letter by certified mail, the receipt for which bore what Plihcik recognized as Respondent's signature. He received no responses. Sometime in early August, 1991, Deborah Isabelle and her husband rented Mr. Plihcik's house through Respondent and put up a [portion of the 1st and last month rent. They also signed a lease which called for rent at $525.00 per month but, notwithstanding many requests for one, never received a copy. Each time they asked, Respondent would say he would get them one but he never did. At the time they rented the property, the garage was under repair and, after some negotiation, it was orally agreed upon that the work would be completed by move-in time, September 1, 1991. At one point, Respondent asked the Isabelles to pay the rent in cash because it would be easier for him to buy the things needed for the repair work he was to do. They acceded to this request for a while, writing some checks to the supermarket for cash to pay Respondent, but got only one receipt. Because they were uncomfortable with this cash arrangement, they asked Respondent for the name of the owner of the property and he replied, merely, "Ted." On one occasion, mail for Mr. Plihcik from a real estate agency came to the house. Ms. Isabelle thereafter got Mr. Plihcik's New York address from the County records, contacted him, and asked him if he had received his rent. She received a negative reply. She also asked him about the lease they had signed and he related he had not received one of those, either. In fact, when she called, Mr. Plihcik didn't know who she was he had never heard their name. During that conversation, Ms. Isabelle advised Mr. Plihcik that they had not received any of the things Respondent had promised; that he was also asking them for cash; and was frequently at the house. Mr. Plihcik said he'd take care of it but no more was done. In November, 1991, Ms. Isabelle set up a three way telephone call between the Isabelles, Mr. Plihcik and the Respondent. During that call, Respondent claimed he was doing the work promised; that he had mailed Mr. Plihcik some money in cash several weeks previously and could not understand why it had not been received. The lease agreement, at paragraph 6, dealing with maintenance and grounds upkeep, purports to require the Isabelles "... to help convert 3rd bedroom back to garage in lieu of $650.00 rent." Though Respondent contends the rent was reduced from $650.00 per month, as was called for in the listing agreement, to $525.00, conditioned upon the tenants' help with the work on the garage conversion, there is no evidence that Mr. Plihcik ever agreed to accept less than the $650.00 per month rent. In addition, Ms. Isabelle claims they did not agree to do any work and the lease did not contain that provision at the time they signed it some 2 or 3 weeks after they moved in. It is found that Respondent's contention is without merit even though Mr. Isabelle did take down some 2x4's so he could install his tool bench. Over the period of their occupancy, the Isabelles paid Mr. Danley a total of $1,531.50 by check directly or by check written for cash and turned over, as well as an additional $400.00 in cash. Six hundred dollars of the checks were made payable to Arn Realty, and it appears they were deposited to that company's account. The balance of the checks and the cash were either payable to Respondent directly or, in the case of the Kash & Karry checks, written for cash to give to him. Of the $400.00 Arn Realty check, $300.00 was paid over by company check to Respondent for repairs to the instant property on the same day as the Isabelles' check was deposited to the company account. Respondent admits he received a total of $1,355.00 from the Isabelle's, either directly or indirectly, but claims all of it was used for work on the house. He also claims he is still owed $1,001.00 from Mr. Plihcik which includes $630.00 in real estate commission owed the broker. Nonetheless, Mr. Plihcik claims he received none of the money paid to Respondent, nor has Respondent presented any evidence to show the money was spent on either materials or labor for the garage reconversion. Mr. Arn, the broker supervising Respondent during the time is issue here claims he had no knowledge Respondent had obtained a tenant for Mr. Plihcik before he got Plihcik's letter. His records show a listing agreement for the property which calls for a rental commission in the event the property were leased by the company. In this case, the commission would be paid to the company, not the salesman, and would be deposited to the company's escrow account for later split with the associate involved. At no time would it be appropriate for the sales associate to collect and disburse funds without going through the broker and he would not do it that way. He did not authorize it here. Mr. Arn admits to having written at least one check to Respondent from money's received from the tenant for work to be done on the Plihcik property. He released that money only after he received a letter from Mr. Plihcik authorizing the release of funds to Respondent. All the money he received from the checks he received in August, 1991, in the amount of $600.00, was paid out to Respondent for repair costs. When he subsequently received a letter from Mr. Plihcik regarding cash which Respondent claimed he had mailed directly but which was not received, Mr. Arn replied in writing that he had not authorized Respondent to either receive or disburse funds directly. The Isabelles moved out of the house in either December, 1991 or January, 1992. By that time, Respondent had done very little work on the property. Some building materials were still on the property which Mr. Plihcik said he had left there. They are sure Respondent had not provided it. Mr. Carl Carpenter, a registered contractor and home inspector examined the property in question in March, 1992 for a potential purchaser. At that time, he found the garage in the process of being converted to a room. The framing had been installed as had the windows, and the sheet rock was partially installed. There was also a small bathroom which was not operating properly. It was his opinion that the construction was progressing from garage to room, and not the opposite. Mr. Carpenter was also of the opinion that to convert the room back to a garage would cost somewhere in the range of $600.00 and should take about 2 days. It would about double that to reinstall the bath. The bath he saw on the property was old. Respondent offered an estimate to reconvert the garage from a contractor obtained in August, 1991 which showed a total price of $1,606.00. While this is substantially more than the price cited by Mr. Carpenter, whose estimate seems rather out of line, cost is not the issue. The important part of Carpenter's testimony relates to his belief that the work in progress seemed more of conversion to a room rather than return to a garage and tends to indicate Respondent had done little if any work on the property. Ms. Sutton, the Division's investigator, interviewed Respondent 3 times regarding this matter and found his statements to be inconsistent. While he claimed he had done some work on the property and had not finished it, he could not give her the exact amount he had received from the Isabelles. He also gave her a list of what he had spent the money he had received on, but had no receipts from workers or suppliers to back it up. Mr. Danly claimed he had sent cash to Mr. Plihcik but denied receiving any cash payments from the Isabelles. He claimed he gave them receipts for what they gave him, but they have no memory of receiving any. Mr. Danley takes no issue with the facts as outlined by Ms. Isabelle except as to the remodeling of the garage which he claims is not covered by the restrictions contained in Chapter 475, Florida Statutes. He claims that the payments made by the Isabelles were authorized by Mr. Plihcik to be kept by him as compensation for the repair work on the garage and not to be transmitted to Plihcik as owner because the work needed to be done and Plihcik did not have the money to pay to have it done. He also asserts that the lease was signed by the Isabelles with the requirement in it that they would help with the work as a condition of reducing the rent. He delayed starting on the remodeling until he got the money from Mr. Arn, which, at least in part, was as early as August 29, 1991. When he got that check, he started work. Originally, he states, he hired 2 young men to do the dry-wall, but the bathroom had to be framed before the dry wall could be installed. Then the water heater was installed and the power line installed for that, all of which he claims he did himself. The framing and closing up of the old door to the kitchen was done by Respondent with the assistance of a contractor. All of this, he asserts, was done in September and October, 1991, contrary to the Isabelle's claim that the only work done prior to their departure was the installation of some dry wall. Some materials were already in place but some of that had been damaged and had to be replaced. He claims he had 3 helpers to do all this work and paid them in cash. The sink was put back into its original position and he got the material to reinstall the toilet which he was unable to do because of back problems. Mr. Danley denies ever asking the Isabelles for cash or loans. He claims the only payments he received were in the form of checks payable to him or to Arn, and all money received from them was used for the work. He also admits to collecting the rent due in October which, he claims, was used for the restoration project. The only checks introduced into evidence not payable to Arn or Danley are 3 payable to Kash & Karry and of these, two are endorsed by Daniel Isabelle and one bears no endorsement at all. These are the checks which Ms. Isabelle claims were made to provide cash for Respondent at his request. Taken together, the evidence as presented by both sides tends to support Ms. Isabelle's story. Mr. Danley claims he did not finish the work because he could not find a door for the garage. He claims to have called many places but was unable to find a single garage door. A call to a Scotty's building supply store in that area revealed a single garage door was readily available, though by special order. Finally, he bought one from a builder in St. Petersburg for $235.00 which was paid in cash. The price included installation the following morning, and the site was already prepared. However, the builder never showed up with the door and he lost the payment. On balance, Respondent's account of the matter, unsupported as it is by any direct evidence beyond his own testimony, is found to be less than credible.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore, recommended that a Final Order be issued by the Florida Real Estate Commission suspending Respondent, Paul Andrew Danley's license as a real estate salesman in Florida for a period of 3 years under such terms and conditions as are considered appropriate by the Commission; imposing a total administrative fine of $2,000.00; and imposing a reprimand. RECOMMENDED this 1st day of March, 1993, 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 1st day of March, 1993. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 92-5598 The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statutes, on all of the Proposed Findings of Fact submitted by the parties to this case. FOR THE PETITIONER: 1. & 2. Accepted and incorporated herein. 3. & 4. Accepted and incorporated herein. 5. Accepted. 6. - 8. Accepted and incorporated herein. 9. Accepted and incorporated. 10. & 11. Accepted and incorporated herein. 12. & 13. Accepted and incorporated herein. 14. Accepted and incorporated herein. 15. & 16. Accepted and incorporated herein. 17. Accepted but redundant with 4. 18. Accepted and incorporated herein. 19. - 22. Accepted and incorporated herein. 23. Accepted. 24. & 25. Accepted. 26. Accepted but not material to any issue. 27. Accepted and incorporated herein. 28. - 30. Accepted and incorporated herein. 31. - 33. Accepted and incorporated herein. 34. Accepted and incorporated herein. 35. Accepted but mot material to any issue. 36. & 37. Accepted and incorporated herein. 38. - 40. Accepted. 41. Accepted and incorporated herein. 42. Accepted and incorporated herein. 43. - 46. Accepted and incorporated herein. 47. Accepted. 48. - 53. Accepted and incorporated herein. 54. - 56. Accepted and incorporated herein. 57. Accepted. FOR THE RESPONDENT: 1. A - E. Considered more to be either argumnent on the state of the evidence or conclusions of law. Not accepted as a statement of fact as finally found. COPIES FURNISHED: Janine B. Myrick, Esquire DPR - Division of Real Estate 400 West Robinson Street, Suite N-308 P.O. Box 1900 Orlando, Florida 32802-1900 Gilbert P. McPherson, Esquire 1822 Drew Street, Suite 8 Clearwater, Florida 34625 Jack McRay General Counsel Department of Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Darlene F. Keller Division Director Division of Real Estate 400 West Robinson Street P.O. Box 1900 Orlando, Florida 32802-1900
The Issue Whether the Department of Transportation's intended action to reject all quotes and re-advertise Lease No. 550:0318 was illegal, arbitrary, fraudulent, or dishonest.
Findings Of Fact In October of 1999, the Department advertised for office space for use as the Toll Data Center - Audit Section, Office of Toll Operations (Toll Office) located in Broward County. The lease was clearly advertised as a negotiated lease. It was not advertised as a competitive bid lease. Under the negotiated lease process before letting any lease, the Department must submit to the Department of Management Services (DMS) a Request for Space Need (RSN) and Letter of Agency Staffing (LAS). From DMS the Department receives the authority to directly negotiate a lease for space under 5,000 square feet with prospective lessors. 1/ Consistent with procedure, the Department received approval of the RSN on October 18, 1999. Pursuant to statute, DMS has strongly suggested that prior to selection of the apparent successful lessor, the Department should obtain a minimum of three documented quotes for a lease that has not been competitively bid. The Department has consistently followed that suggestion in negotiated leases. Under special circumstances, where it is clear it is improbable that three quotes cannot be obtained, the Department may waive its requirement that three documented quotes be received. However, the agency must certify to DMS that attempts to receive the required number of documented quotes were unsuccessful and/or special circumstances exist to negotiate the lease with less than three quotes. In this case, no special circumstances exist. In an effort to obtain more than the minimum three documented quotes, the Department opted to advertise for lease space on the Internet. The Internet is utilized by the DMS, among other state agencies, to disseminate information provided in the RSN to the private sector. Additionally, the Internet site may also be used by the private sector to provide notice of space they have available for review by the agency seeking space. A total of three submittal packages were distributed for Lease No. 550:0318. Despite the Department's advertisement over the Internet, only two requests for quote submittal packages were received. Of the three quote submittal packages distributed, the Department received only one documented quote in response to the advertisement for the Toll Office. Atlantic Investment submitted a Quote Submittal Form to the Department in late October for office space in North Fort Lauderdale. Atlantic Investment became aware of the Department's advertisement for lease space from Sheldon M. Schermer, employed by Atlantic Investment as its real estate agent. Mr. Schermer learned of the Department's need for lease space from an advertisement placed on the Internet. On November 8, 1999, the Department informed Atlantic Investment via Sheldon M. Schermer, Real Estate Agent for Atlantic Investment, of the Department's intent to reject all quotes and re-advertise for Lease No. 550:0318. This decision was not arbitrary, capricious, fraudulent, or dishonest and well within the Department's discretion and procedures for negotiated leases. The basis for the decision was the Department's modification of the lease specifications pursuant to a recommendation by DMS to modify the lease space terms to hopefully generate more interest and more quotes. In a competitive negotiation, DMS was aware of agencies who modified leases and advertised as many as five times before three documented quotes were received. Moreover, the evidence showed that the Broward County commercial real estate market could easily generate three quotes for the space required by the Toll Office.
Recommendation Based upon the findings of fact and conclusions of law, it is RECOMMENDED: That a final order be entered dismissing the Petitioner's protest. DONE AND ENTERED this 14th day of April, 2000, in Tallahassee, Leon County, Florida. DIANE CLEAVINGER 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 14th day of April, 2000.
The Issue Has Respondent failed to secure that payment of workers' compensation for his employees, Section 440.107(2), Florida Statutes (2004), justifying the entry of a stop-work order, Section 440.107(7)(a), Florida Statutes (2004), and the entry of a financial penalty against Respondent, Section 440.107(7)(d), Florida Statutes (2004)?
Findings Of Fact William Pangrass is a workers' compensation investigator for Petitioner. On July 27, 2004, following a public complaint, Mr. Pangrass went to a work site location in Gainesville, Florida. This visit was made to ascertain whether Respondent had secured workers' compensation for persons employed at the work site. He observed several persons doing framing and related activities that constituted construction. Respondent was at the work site supervising activities. Mr. Pangrass asked Respondent to provide proof of workers' compensation insurance for persons employed at the work site. Respondent told Mr. Pangrass that Respondent had a leasing arrangement with Modern Business Associates, Inc. (MBA) to provide lease employees for the job, which would make the leasing company responsible for workers' compensation coverage. The personnel leasing company (MBA) takes employees that would ordinarily work for an employer, hires them and leases them back, making the leasing company the employer for purposes of providing workers' compensation insurance. Petitioner's Exhibit numbered 8 is a certificate of liability insurance for MBA in relation to Respondent. However, on the date in question, July 27, 2004, there was a dispute concerning coverage for the employees Travis Guarino and Thomas Hunter. On that subject, Respondent first told Mr. Pangrass that those two employees had just walked on the job that morning and that Respondent had not had time to inform MBA, so that the leased employees could be covered for workers' compensation insurance. Later Respondent told Mr. Pangrass that the employee names had been called into MBA so that workers' compensation insurance could be provided. Mr. Pangrass received a written communication from MBA concerning workers' compensation coverage for the employees at the work site, to include Messrs. Guarino and Hunter. This document is dated July 28, 2004. It is Petitioner's Exhibit numbered 9. It says "the two new employees were covered from the time they began work for Mr. Marston." It refers to them by name with the date of hire/coverage reflected as 7/27/04. When Mr. Pangrass received Petitioner's Exhibit numbered 9, he called MBA and someone, who is not identified in the record, told Mr. Pangrass that they had received his application, taken to mean Respondent's application and that the subject employees were covered as of 5:30 that day. This is taken to mean 5:30 p.m. July 27, 2004. As part of the investigation Mr. Pangrass utilized the Coverage and Compliance Automated System (CCAS). The CCAS printout, Petitioner's Exhibit numbered 1, shows that Respondent and Marston Builders did not have separate workers' compensation insurance coverage apart from that provided by MBA. On July 27, 2004, at 3:27 p.m., Mr. Pangrass served Respondent with a written request for production of business records for penalty assessment calculation, Petitioner's Exhibit numbered 4, requesting various categories of records maintained by Respondent. The next day Mr. Pangrass received from Respondent copies of cancelled checks drawn on the account of Ronnie W. Marston, Jr., d/b/a Marston Builders, Petitioner's Exhibit numbered 5. Some checks were paid to the order of Respondent. Some were paid to Lisa Marston for child support, day care, insurance and registration. One check was written to an auto sales company for the purpose "Nissan Sentra." Some checks were written to named individuals reflected in the list of employees on the work site July 27, 2004. Other checks were written to named individuals not at the work site on that date. The other persons referred to were in addition to Respondent and Lisa Marston. Some checks written to the third-party individuals noted the purposes, such as "sub-work" or "contracting labor." Other checks written to named individuals did not identify the purpose. Concerning payments made to Respondent in the checking account, all checks that were written to Respondent had dates in 2004. Prior to 2004, Respondent personally had been exempt from receiving workers' compensation coverage as a sole proprietor, notwithstanding his status as an employee. He is no longer entitled to elect exemption from coverage under terms set forth in Section 440.05, Florida Statutes, effective December 31, 2003. This is further reflected in the employer exemptions report pertaining to Respondent maintained by Petitioner, Petitioner's Exhibit numbered 2. When the law changed, corporate officers could still elect exemption, sole proprietors could not. At all times relevant to the inquiry, Respondent was a sole proprietor. Based upon his belief that Messers. Guarino and Hunter were employed at the work site without workers' compensation coverage, Mr. Pangrass issued a stop-work order on July 27, 2004, at 3:27 p.m., Petitioner's Exhibit numbered 6. This decision was supported by the field interview worksheet completed by Mr. Pangrass, Petitioner's Exhibit numbered 3. Based upon information discovered in the cancelled checks showing the payments that have been referred to, Mr. Pangrass entered an Amended Order of Penalty Assessment on August 4, 2004, calling for $106,135.46 in penalties under authority set forth in Section 440.107(7)(d), Florida Statutes (2004). The Amended of Order of Penalty Assessment is Petitioner's Exhibit numbered 7. It has attached a worksheet setting forth calculations pertaining to the persons who received the checks described. These calculations include class codes, the period of non-compliance, the gross payroll, the payroll column divided by 100, approved manual rate, premium calculations and penalty calculations the product of the proper premium multiplied by 1.5. The class codes were derived from the Scopes Manual, a listing published by NCCI that includes all occupations with job descriptions and classification numbers assigned to them. The Scopes Manual is used in the insurance industry and has been adopted by Petitioner in Florida Administrative Code Rule 69L-6.021. The classification code selected to perform penalty calculations was that of "Carpentry- Detached One or Two Family Dwellings." This classification is Number 5645. The calculation of an assessed penalty included workers found at the work site on July 27, 2004, who were paid by MBA. As reflected in the cancelled checks, Petitioner's Exhibit numbered 5, those workers were also paid by Respondent. For this reason, they were considered to be dually employed and payments not received from the lease company entitled the employees to workers' compensation coverage from Respondent. Calculations in the penalty worksheet supporting the assessment included payments to Respondent and Lisa Marston. The portion of the check payments received in the name of Respondent were outside the December 21, 2003 date, when the right to select to exemption from workers' compensation coverage as an employee who was a sole proprietor had expired. The calculations and the worksheet include checks written to Lisa Marston upon the theory that the payments benefit Respondent no less so had they been paid to Respondent directly, who in turn paid Lisa Marston. Calculations in the worksheet leading to the assessed penalty included checks written to individuals regardless of the stated purpose for the check, as well as those for whom the purpose of the payments was not made known.
Recommendation Upon the consideration of the facts found and the conclusions of law reached, it is RECOMMENDED: That a Final Order be entered keeping the stop-work order in effect pending payment of the modified penalty assessed for failure to secure payment of workers' compensation. DONE AND ENTERED this 23rd day of March, 2005, in Tallahassee, Leon County, Florida. S CHARLES C. ADAMS 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 23rd day of March, 2005. COPIES FURNISHED: Colin M. Roopnarine, Esquire Department of Financial Services Division of Legal Services 200 East Gaines Street Tallahassee, Florida 32399-4229 Ronnie W. Marston d/b/a Marston Builders 25506 North West County Road 241 Alachua, Florida 32615 Honorable Tom Gallagher Chief Financial Officer Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300 Mark Casteel, General Counsel Department of Financial Services The Capitol, Plaza Level 11 Tallahassee, Florida 32399-0300
The Issue The issue in this case is whether the Board of Trustees of the Internal Improvement Trust Fund (BOT) should charge Respondent with lease payments and fine him for unauthorized use of sovereignty submerged lands under the Halifax River in Daytona Beach.
Findings Of Fact Respondent owns residential property on the Halifax River in Daytona Beach. In 2004, he entered into a Sovereignty Submerged Lands Lease with BOT to allow him to construct a single-family dock structure into the Halifax River from his property. In 2007, he entered into a Modification to Increase Square Footage (Modified Lease). The Modified Lease covered 2,714 square feet, required an annual lease fee of $423.89, and expired on November 16, 2008. The Modified Lease provided for a late charge equal to interest at the rate of 12 percent per annum from the due date until paid on any lease fees not paid within 30 days from their due dates. There was no evidence that any lease fee under the Modified Lease was not paid or paid late. In August 2008, BOT attempted to have Respondent enter into a Lease Renewal. He did not renew his lease, and the Modified Lease expired on November 16, 2008. Respondent paid no lease fees for 2008/2009. In September 2009, BOT again attempted to have Respondent enter into an updated Lease Renewal at an annual lease fee of $436.78 and pay current and past due lease fees. BOT placed Respondent on notice that his failure to do so could be considered a willful violation of Chapter 253, Florida Statutes, which could subject Respondent to administrative fines of up to $10,000 a day. Respondent did not renew his lease or pay any lease fees. Instead, he complained (as he claims to have since 2005) that a stormwater outfall structure installed by the Florida Department of Transportation (DOT) in 1998 approximately 100 feet to the north (upriver) of his dock structure, at the end of Ora Street, was not functioning properly and was allowing silt to enter the river, shoaling the water in the area of Respondent’s dock structure (and elsewhere in the vicinity) and eventually making it impossible for Respondent to moor his boat at his dock structure and navigate to the Intracoastal Waterway (ICW). The DOT outfall structure at Ora Street has been in existence since the 1950’s. In 1998, DOT added a silt box, which is not functioning properly and is allowing silt to enter the river. The evidence is not clear whether silt from the DOT outfall structure was entering the river before 1998. In 2010, BOT informed Respondent by certified mail that it had contacted the DOT at Respondent’s request and determined that DOT was planning to clean and monitor the outfall structure after August 2010 but had no plans to dredge sediment from the river. BOT also placed Respondent on notice that he was in violation for not renewing his lease and paying all current and past due fees, and that he would be fined and required to remove his dock structure if he did not come into compliance. This certified letter was designated an NOV. The evidence was not clear when the letter was sent to Respondent, but it is clear that Respondent has continued to refuse to renew the lease, or pay any fees, and has not removed his dock structure. BOT takes the position in this case that Respondent must pay: the Lease Renewal annual lease fee of $436.78 for 2008/2009, plus the Lease Renewal late charge equal to interest at the rate of 12 percent per annum from November 30, 2010; and an annual lease fee of $448.49 for 2009/2010, plus a late charge equal to interest at the rate of 12 percent per annum on the $448.49 from November 29, 2009. The evidence did not explain how the annual lease fees for the years 2008/2009 and 2009/2010 were determined. (But see Florida Administrative Code Rule2 18- 21.011(1)(b)10.b., set out in Conclusion of Law 24, which may explain how the annual lease fees were determined.) Invoices in evidence charge Respondent a total of $1,283.22 through July 30, 2010: $436.78, plus tax, for a total of $465.17 for the year 2008/2009; $448.49, plus tax for a total of $477.64 for the year 2009/2010; and $36.18 of interest on the $448.49. BOT also takes the position that Respondent must either: enter into a lease for the year 2010/2011 and beyond; remove part of his dock structure so that he will preempt only 1,150 square feet of sovereignty submerged land (so as not to require a lease, but only a cost-free consent of use); or remove the entire dock structure. BOT also seeks the imposition of an administrative fine under Rules 18-14.002 and 18-14.005(5). In its First Amended NOV, BOT sought a fine in the amount of $2,500; in its PRO, BOT seeks a fine in the amount of $2,500 for the first offense and $10,000 per day from the issuance of the NOV for repeat offenses. Respondent believes he should not be required to pay any lease fees or fines because of his inability to use his dock structure due to the shoaling of the river caused by the malfunctioning DOT outfall structure. Respondent believes it is DEP’s responsibility to require DOT to remove the silt from the river and make the outfall structure work properly. He believes this is required by the state and federal constitutions, statutes, and rules, and by an unspecified “federal bond issue” or “federal bond agency.” DEP takes the position that the silting from the outfall structure and its adverse impact on Respondent’s ability to use his dock structure is irrelevant because the requirement of a lease is based on preemption of sovereignty submerged land, not on the lessee’s use of the land. DEP also believes that, under an operating agreement among governmental agencies, the St. Johns River Water Management District (SJRWMD), not DEP, is the agency responsible for enforcing the applicable environmental laws and permit conditions against DOT. DOT has indicated to the parties that it is in the process of modifying the outfall structure so that it functions properly but that it does not have the money to remove silt from the river. DEP personnel visited the site at approximately 11:00 a.m. on July 16, 2010, and measured the water in the vicinity of the terminal platform and slips of Respondent’s dock structure to be approximately 36 inches deep, which is deep enough for navigation. DEP did not take measurements in the slips of the dock structure, between the terminal platform and Respondent’s property, or between the vicinity of the terminal platform and the ICW. The evidence was not clear what the tide stage was at the Respondent’s dock structure when DEP measured the water depth. DEP called the tide stage low, or near low, based in part on tidal charts for Ormond Beach and the Halifax River indicating that the tide was low at 11:21 a.m. and high at 4:10 p.m. on July 16, 2010. However, the persuasive evidence was that the tidal chart applied to locations at the beach, and there is a difference in the tides at Respondent’s dock structure and at the beach. It does not appear that the tide was dead low or near dead low at Respondent’s dock structure at 11:00 a.m. on July 16, 2010; it probably was between low and slack, possibly a half foot higher than dead low. Regardless of the measurements taken by DEP on July 16, 2010, Respondent testified that he is not able to operate his boat from his dock structure consistently due to shoaling from the silt. He testified that, as a result, he kept his boat at a marina for a year at a cost of $7,000 but cannot afford to continue to do so.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that BOT enter a final order: (1) that, within 10 days, Respondent sign the appropriate lease renewal and send it, along with $1,283.22 in past due lease fees and interest owed BOT, plus the lease payment for 2010/2011, by cashier’s check or money order made payable to the “Internal Improvement Trust Fund,” with a notation of OGC Case No. 10-1948, sent to 3319 Maguire Boulevard, Suite 232, Submerged Lands and Environmental Resource Program; or (2) that, within 20 days, Respondent remove his dock structure or at least enough of it to preempt no more than 1,150 square feet of sovereignty submerged; and (3) that, within 30 days, Respondent pay BOT a fine in the amount of $2,000, by cashier’s check or money order made payable to the “Internal Improvement Trust Fund,” with a notation of OGC Case No. 10-1948, sent to 3319 Maguire Boulevard, Suite 232, Attention David Herbster, Program Administrator, Submerged Lands and Environmental Resource Program. DONE AND ENTERED this 3rd day of November, 2010, in Tallahassee, Leon County, Florida. S J. LAWRENCE JOHNSTON 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 3rd day of November, 2010.
The Issue Whether Respondent committed the violations alleged in the Administrative Complaint (as amended at the final hearing)? If so, what disciplinary action should be taken against him?
Findings Of Fact Based upon the evidence adduced at hearing, and the record as a whole, the following findings of fact are made: Respondent is a Florida-licensed real estate salesperson. He holds license number 0186760. Respondent passed the salesperson examination on November 6, 1995. From November 13, 1995, through February 26, 1997, Respondent was an active salesperson in association with Nicholas Chillemi, an individual broker trading as ReMax 100 (ReMax) and located at 10205 Southern Boulevard in Royal Palm Beach, Florida. From February 27, 1997, through June 24, 1998, Respondent was an active salesperson in association with Bowen Realty, Inc., a broker corporation trading as Bowen Realty and located in Jupiter, Florida. From June 25, 1998, through September 30, 1999, Respondent was an active salesperson in association with Forum Realty, Inc., a broker corporation trading as Realty Executives of the Palm Beaches and located in Lake Worth, Florida. On October 1, 1999, Respondent's salesperson license became involuntary inactive (which is its current status) due to non-renewal. At no time material to the instant case did Respondent hold a real estate broker license At all times material to the instant case, Javier and Maria Velilla owned residential property located at 1290 McDermott Lane in Royal Palm Beach, Florida (McDermott Lane Property). Respondent and Ms. Velilla have known each other for 16 or 17 years. They first met in Chicago, Illinois. Some time prior to September 1, 1996, not very long after he had moved from Chicago to Florida and had begun working as a real estate salesperson for Mr. Chillemi, Respondent returned to Chicago and visited Ms. Velilla. During his visit, Respondent agreed, as a representative of ReMax, 2/ to help the Velillas find a tenant for the McDermott Lane Property. Through the efforts of Respondent, a tenant was ultimately found for the property. The tenant was Belinda Vosatka. On or about August 28, 1996, the Velillas (as lessors) and Ms. Vosatka (as lessee) entered into a Residential Lease for Single Family Home and Duplex (McDermott Lane Property Lease). The McDermott Lane Property Lease covered the one-year period from September 1, 1996, to August 31, 1997, and required Ms. Vosatka to make a security deposit of $850.00 and lease payments of $850.00 a month. Paragraph VI of the McDermott Lane Property Lease provided as follows: NOTICES. Henry Saldana is Landlord's Agent. All notices to Landlord and all Lease Payments must be sent to Landlord's Agent at 10205 Southern BLVD, R.P.B., Fl 33411 unless Landlord gives Tenant written notice of a change. Landlord's Agent may perform inspections on behalf of Landlord. All notices to Landlord shall be given by certified mail, return receipt requested, or by hand delivery to Landlord or Landlord's Agent. Any notice to Tenant shall be given by certified mail, return receipt requested, or delivered to Tenant at the Premises. If Tenant is absent from the Premises, a notice to Tenant may be given by leaving a copy of the notice at the Premises. The Velillas agreed to pay Respondent $50.00 a month for acting as their "agent" under the McDermott Lane Property Lease ("Agent" Fee Arrangement). Respondent entered into this agreement with the Velillas in his individual capacity, not as a ReMax salesperson on behalf of Mr. Chillemi. (As Respondent was aware at the time he entered into the "Agent" Fee Arrangement, collecting lease payments from tenants and providing related property management functions were not among the services that ReMax provided its clients.) Respondent made Mr. Chillemi aware of the McDermott Lane Property Lease, but at no time did he inform Mr. Chillemi about the "Agent" Fee Arrangement, much less share with Mr. Chillemi the $50.00 payments he received from the Velillas for acting as their "agent." On September 1, 1996, Respondent received from Mr. Chillemi a $425.00 commission for his role in the leasing of the McDermott Lane Property. For approximately the first half of the lease period, the Velillas received from Respondent, within five days of the beginning of each month, money orders in the amount of the monthly lease payments Ms. Vosatka was required to make under the McDermott Lane Property Lease, and the Velillas, in turn, paid Respondent (by check payable to Respondent) $50.00 a month in accordance with the "Agent" Fee Arrangement." Thereafter, however, to the dissatisfaction of the Velillas, the money orders began arriving later in the month. Upon looking into the matter, Ms. Velilla discovered that, pursuant to Respondent's instructions (which he had given without the Velillas' express authorization), Ms. Vosatka had been making her monthly lease payments by sending Respondent personal checks payable to Respondent. Displeased with this arrangement, Ms. Velilla had Respondent draft the following Amendment to Lease, which she and her husband (as lessors) and Ms Vosatka (as lessee) signed: It is mutually agreed and understood by the parties [who] entered into a leasing agreement on August 26, 1996 for the property located at 1290 McDermott Ln. Royal Palm Beach, Fl 33411 and herein referred to as, Javier & Maria Victoria Velilla, as the Landlord, and Belinda Vosatka, as the Tenant, that the rent for the above named property shall be due and payable by way of Cashier's Check or Money Order and to the name of the above mentioned Landlord on the same dates as agreed on the original lease. In consideration to the rent being paid by Cashier's Check or Money Order, the Landlord agrees to allow Four D[o]ll[a]rs ($4.00) allowance to the Tenant for expenses incurred for issuance of the payment. Therefore, the actual rent due by the Tenant shall be in the amount of $846 per month. The rest of the terms of the lease stand as originally agreed. Ms. Vosatka paid her rent for two or three months following the execution of this Amendment to Lease with cashier's checks payable to the Velillas. She then stopped making payments. When Ms. Velilla contacted Respondent and inquired about the situation, Respondent told her that Ms. Vosatka had health problems and was not able to work. After not receiving any lease payments for approximately three months, the Velillas, at the urging of a friend, traveled to Florida to inspect the McDermott Lane Property. Upon arriving at the property, they found that Ms. Vosatka had vacated the premises, leaving it in deplorable condition.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is hereby RECOMMENDED that the Commission issue a final order dismissing the Administrative Complaint (as amended at the final hearing) in its entirety. DONE AND ENTERED this 10th day of October, 2000, in Tallahassee, Florida. STUART M. LERNER 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 10th day of October, 2000.
