The Issue Whether the Respondent properly rejected the Petitioner's bid for Board of Regents (BOR) project 658 because it did not comply with the good faith effort requirements of the General and Special Conditions of the project's specifications?
Findings Of Fact Call for Bids was issued by the Respondent, Florida Board of Regents, for Board of Regents ("BOR") project numbered 658, Southeast Campus Building - Davie at Broward Community College Central Campus, in Florida Administrative Weekly. (Stipulated). The Project Manual is the volume assembled which includes the bidding requirements, sample forms, and Conditions of the Contract and Specifications (Jt. Ex. 1 at pp. 8 of 106 pages). The Call for Bids (Jt. Ex. 2) provided that at least fifteen (15) percent of the project contracted amount will be expended with minority business enterprises (MBE) certified by the Department of General Services as set forth under the Florida Small and Minority Business Act, Chapter 287, Florida Statutes. If fifteen percent were not obtainable, the State University System would recognize good faith efforts by the bidder (Jt. Ex. 2). The Call for Bids (Jt. Ex. 2) provided that the bidder be advised to review the Good Faith Efforts requirements in the Special Conditions section of the Project Manual immediately, in order to schedule the necessary tasks to accomplish Good Faith Efforts. The Call for Bids (Jt. Ex. 2) provided that all bidders must be qualified at the time of their bid proposal in accordance with the Instruction to Bidders, Article B-2. The Instructions to Bidders, Article B-2 at page 9 of the Project Manual, (Jt. Ex. 1) provides in pertinent part, that in order to be eligible to submit a Bid Proposal, a bidder must meet any special requirements set forth in the Special Conditions section of the Project Manual. The Project Manual, Instructions to Bidders, B-23 at page 16 (Jt. Ex. 1) provides that the contract will be awarded by the Respondent for projects of $500,000 or more, to the lowest qualified and responsible bidder, provided the bid is reasonable and it is in the best interest of the Respondent to accept it. The award of the contract is subject to the demonstration of "good faith effort" by any bidder whose Bid Proposal proposes less than fifteen (15) percent participation in the contract by MBEs (Minority Business Enterprise). Demonstrated "good faith effort" is set forth in the Special Conditions. The contract award will be made to that responsible bidder submitting the low responsive aggregate bid within the preestablished construction budget. The Project Manual, Instructions to Bidders, B-25 at page 17, (Jt. Ex. 1) provides that the Florida Small and Minority Business Act, Chapter 287, Florida Statutes requires the involvement of minority business enterprises in the construction program. The Respondent/Owner has adopted a program for the involvement of minority business enterprises in the construction program. The application of that program is set forth in the Special Conditions of the Project Manual. The Project Manual, Instructions to Bidders, B-26 at page 17 (Jt. Ex. 1) provides that bidders shall be thoroughly familiar with the Special Conditions and their requirements. The Project Manual, Instructions to Bidders, B-26, at page 15 provides that falsification of any entry made on a bidder's proposal will be deemed a material irregularity and will be grounds for rejection. The Project Manual, Special Conditions, Article 1, subparagraph 1.1.1, at page I-1 of I-26 pages, (Jt. Ex. 1), provides that the SUS has established a Construction Minority Business Enterprise Program in compliance with the Florida Small and Minority Business Assistance Act, Chapter 287, Florida Statutes. The expenditure of at least fifteen (15) percent of the Base Bid with certified MBEs is a requirement of this contract, unless Good Faith Effort, as identified in paragraph 1.7 can be demonstrated by the Bidder. MBEs not certified by Department of General Services will be deleted from the calculation of the required participation of MBEs, and evidence of Good Faith Effort in lieu thereof will be required as identified in subparagraph 1.1.2 and paragraph 1-7 of these Special Conditions. The Project Manual Special Conditions, Article I, subparagraph 1.1.2 at page I-2 of I-26 pages, (Jt. Ex. 1), provides that evidence of good faith efforts will be required as specified by the Respondent/Owner within two working days after the opening of bids. Incomplete evidence which does not fully support each of the eight requirements of paragraph 1.7 of the Special Conditions shall constitute cause for determining the bid to be unresponsive, except that the owner may, at its option but not as a duty, seek supplementary evidence not submitted by the Bidder. The Project Manual Special Conditions, Article 1, paragraph 1.6 at page I-3 of I-26 pages, (Jt. Ex. 1) states that MBE's participating in the State University System Minority Construction Program must be certified as a MBE by the Florida Department of General Services (hereinafter referred to as DGS) at the time of bid submittal. Certification identifies and limits the Specialty Area of business the MBE can perform and still qualify as a certified MBE. Therefore, the trade service listed on the Proposal for each of the MBEs must be within the scope of the Specialty Area. The bidder is required to ascertain that a listed MBE is certified by the DGS in the appropriate specialty area to perform the services for which it is listed. (Jt. Ex. 1, B-15, at p. 13). On January 17, 1992, Petitioner, Centex-Rooney Consturction Company, Intervenor, State Paving Corporation, and ten other bidders submitted bids on BOR Construction Project No. BR-658. After review of the bids and preparation of the bid tabulatio it was announced by FAU that Centex-Rooney was the apparent low bidder, but that Centex-Rooney had failed to meet the fifteen percent (15%) MBE participation requirement, and therefore, would be required to submit evidence of Good Faith Efforts within two days. The bid submitted by Centex-Rooney listed four (4) subcontractors which Centex-Rooney represented as DGS certified MBE firms, for a total of $867,000 which was 9.56% of the base bid of $9,067,000. (Stipulated). Since the bid submitted by Centex-Rooney was less than fifteen (15) percent required participation in the contract by MBEs, the University Planning Office requested that Centex-Rooney submit documentation to demonstrate "good faith effort" as set forth in the Special Conditions of the Project Manual. (Stipulated). Centex-Rooney timely submitted its good faith documentation on January 22, 1992. (Stipulated). The Board of Regents with representatives of Centex-Rooney on February 25, 1992 to give Petitioner an opportunity to clarity and submit any additional good faith evidence in support of its bid. After reviewing the additional evidence, the Respondent contended that Centex-Rooney was in non-compliance with paragraphs 1.1.1 and 1.6.1 of the Special Conditions of the Project Manual, requiring at least 15% participation by MBEs at the time of bid opening, and at least one good faith effort criteria, paragraph 1.7.4, Special Conditions of the Project Manual. (Stipulated). Centex-Rooney was informed of the Board of Regents decision to reject its bid for non-compliance with Respondent's MBE requirements, and on March 6, 1992, the Chancellor of the Florida Board of Regents awarded the contract to State Paving Corporation. (Stipulated). ^ The Board notified by letter dated March 6, 1992, all bidders of its award of contract for BR-658 project to the next lowest responsive bidder, State Paving Corporation. (Stipulated). Petitioner timely filed a Notice of Intent to Protest on March 10, 1992. (Stipulated). On March 19, 1992, Petitioner timely filed its Petition for Formal Written Protest for BR-658. (Stipulated). A representative from Centex-Rooney attended the pre-bid/pre- solicitation meeting. (Jt. Ex. 10, R-115, 116). The minority business enterprise program was discussed and the Board of Regents' requirements for good faith efforts were reviewed. (R-116, 117, 131). Centex-Rooney submitted its bid proposal on January 17, 1992. (Jt. Ex. 13). On page 2, paragraph c., of the bid proposed form submitted by Centex- Rooney, it provides that expenditure with minority business enterprises shall be consistent with the requirements of Article 1. of the Special Conditions, Minority Business Enterprise Requirements. Centex-Rooney listed four subcontractors on its List of Subcontractors and MBE participation form as DGS certified MBEs for a total of 9.56% participation (Jt. Ex. 13, Jt. Ex. 31). The List of Subcontractors form is an integral part of the proposal (Jt. Ex. 13, List of Subcontractors Form page 1) and it is required of all bidders that MBEs must be certified at the time of bid opening for bona fide participation. (Jt. Ex. 1, page I-3 of I-26 pages, R-163, 174). Two of the four subcontractors listed by Centex-Rooney, Quality Concrete and S&S Roofing, were not DGS certified MBEs at the time of bid submittal. (R-19, 150, 163, 164, 174). Therefore, the two non-DGS certified subcontractors were deleted from the calculation of the required participation of MBEs, so that the total DGS certified MBE participation of Centex-Rooney at the time of bid submittal was 5%. (Jt. Ex. 1, Spec. Conditions 1.1.1, page I-1, Jt. Ex. 13, R-19, 150, 163-4, 174). Therefore, Centex-Rooney was required to show a good faith effort to engage MBE's. See Paragraph 16 above. Ms. Patricia Jackson, MBE Coordinator for Respondent, testified that requiring the DGS certified MBEs to be named at the time of bid opening makes the contract bidding procedures consistent, and eliminates any unfair price differentials between contractors. (R-151). Centex-Rooney was pressed for time in responding to the bid. It called a large number of the MBEs listed the documentation provided, and wrote letters to those subcontractors who expressed an interest and to other subcontractors. Mr. Charles Federico was chairman of the MBE advisory committee at Florida Atlantic University (Jt. Ex. 6, R-115). The committee reviewed the good faith efforts submitted by Petitioner (Jt. Ex. 6, 25, R-115, 140). The good faith effort submittal to FAU from Centex-Rooney contained nine sections (Jt. Ex. 25) with the following consecutive headings: Pre-Bid Meeting Attendance, Advertisements for MBE Participation, Solicitation Letter to Minority Businesses, Follow-Up Contacts to Minority Businesses, Selected Items (or portions) of Work for Minority Businesses, Specific Project Bidding Information made available to Minority Businesses, Utilization of Minority Businesses in Bid, Solicitation of Available Minority Organizations to Recruit Minority Businesses, and a Table of Contents. Under the third heading in Centex-Rooney's good faith efforts, Solicitation Letters to Minority Businesses, Petitioner provided 55 form letters in his submittal to FAU and a bulletin. The text of each form letter provided the following: Centex-Rooney is bidding as general contractor on the Southeast Campus Building for FAU and BCC, Central Campus, Davie, FL and invites your firm to submit a quotation for the materials and/or labor on any portion of said project which falls within your scope of work. Please review the attached notices with respect to pertinent information pertaining to the bid. If your firm will be unable to submit a bid on the project, please state your reasons on the enclosed unavailability certificate form, sign and return to the Office of C-R. By doing this, it will help maintain an active MBE directory at Centex-Rooney and continue to indulge you on our bid list. Centex-Rooney encourages that participation of MBE contractors will be more than happy to answer your questions regarding this project. Under the section heading, Follow-up Contracts to Minority Businesses, for Petitioner's good faith submittal to FAU Petitioner included a 14 page log gridded with subcontractor/ vendor names, telephone numbers, MBE designation, will bid, bid submitted, low bid, date contacted and remark sections. The FAU MBE advisory committee found Petitioner in non-compliance with 1.7.3, 1.7.4, 1.7.7 and 1.7.8 of the Special Conditions section of the Project Manual that contains the good faith efforts requirements of Respondent. (Jt. Ex. 6, Jt. Ex. 12). The committee based its findings on the Special Conditions section of the Project Manual. (R-119). The committee found non-compliance with 1.7.3 because the 55 form letters submitted by Petitioner were dated January 9, 1992. The committee determined that a letter dated January 9 was too late to give MBEs time to respond to the January 17 bid opening date. (R.121). In regard to 1.7.4, the committee found the Petitioner in non- compliance because no follow-up letters, telegrams, or meetings notes were provided in the good faith documentation. (R-122, 124). Mr. Federico testified that the committee found non-compliance with 1.7.7 of the Good Faith Effort requirements (R-125, 126) and 1.7.8. (R-126, 127). The advisory committee determination was sent to the Vice-President of Administration and Finance at FAU, Ms. Marie McDemmond. (R-128). The University President recommended award of the contract to Centex- Rooney. (Jt. Ex. 2, R-129). The University President is not authorized to award Board of Regents contracts. The Board of Regents awards contracts for projects of $500,000 or more. (Jt. Ex. 1, B-23, at page 16). Centex-Rooney could not utilize the two additional subcontractors, Kings Plumbing and Eagle Electric Distributors, because they were not listed on the Subcontractor/MBE form submitted by Centex-Rooney at the time of bid opening. (R-129, 130, 131). The University reconsidered its recommendation (Jt. Ex. 29), and subsequently recommended State Paving for award. (Jt. Ex. 32). The Handbook distributed by FAU at the pre-bid/pre-solicitation meeting contains a disclaimer which states that it is not intended to replace or supplement any information in the Project Manual or conditions for contract award (R-31, 132). State Paving met and exceeded the 15% MBE participation requirements for BR-65 (Jt. Ex. 14, R-20). Centex-Rooney's bid plus three alternatives was $9,590,000, and State Paving's bid plus three alternates was 9,592,500, so that the two bidders were $2,500 apart. (Jt. Ex. 7). At least seven of the twelve bidders on BR-658 met the 15% MBE participation goal (R-19). The FAU committee has reviewed many bids and has had several that met good faith efforts and several where the low bidders had met 15% MBE goal. (R- 117, 142). Ms. Jackson received a telephone call from Centex-Rooney regarding the FAU advisory committee's determination of non-compliance. (R-149). Ms. Jackson contacted Mr. Federico and reviewed the bid proposal and good faith efforts of Centex-Rooney on behalf of the Board of Regents. (R-148, 149). Ms. Jackson reviewed Centex-Rooney's good faith efforts as submitted to FAU and found non-compliance with 1.7.4 of the Special Conditions in the Project Manual for BR-658. (R-149). The Special Conditions of the Project Manual at page I-5 for 1.7.4, provide that the State University System requires that a bidder shall make no less than one written follow-up contact per initial contact. In the event a positive response is obtained, the Bidder shall request, in writing, a meeting between the MBE and Bidder's staff. The documentation required in the Special Conditions for 1.7.4 are copies of letters, telegrams and/or meeting rates. Ms. Jackson testified that the telephone log submitted by Centex-Rooney to document compliance with 1.7.4 did not meet the Special Conditions requirements because it was not a letter nor a telegram or a meeting note. (R-149). Nor did the telephone log reflect one written follow-up per initial contact as required by the University implementation of 1.7.4 in the Special Conditions (R-149, 157). Ms. Jackson contacted Centex-Rooney by phone and informed it of her finding that Centex-Rooney's reversal of the telephone calls and letters did not conform to the requirements of 1.7.4. (R-152). Thereafter, a meeting was arranged between Ms. Jackson and other BOR staff to provide Centex-Rooney an opportunity to provide supplemental evidence of good faith effort. (R-152). The Special Conditions section, at I-2, paragraph 1.1.2 provides that incomplete evidence which does not fully support each of the eight requirements of Paragraph 1.7 (good faith requirements) shall constitute cause for determining the bid to be unresponsive, except that the Owner may, at its option but not as a duty, seek supplementary evidence not submitted by the bidder. (R- 152). Centex-Rooney supplemented its submittal with 55 form letters dated January 24, 1992. These form letters were not considered satisfactory by Respondent as a written follow-up to each initial contact or to meet any other requirements in 1.7.4 because the letters were dated after the date of the bid opening. (Jt. Ex. 27, R-157, 158). Pursuant to Centex-Rooney's request at the February 25, 1992 meeting, Ms. Jackson again reviewed the company's documentation of its good faith efforts, evaluating the January 9, 1992 letters originally submitted as documentation for 1.7.4, as documentation for 1.7.3, and evaluating the telephone log, originally submitted as documentation of follow-up contact for 1.7.4 as initial solicitation documentation for 1.7.3. (R-153, 154). Considering Centex-Rooney's efforts in their best light, it was still determined by BOR that Centex-Rooney was not in compliance with 1.7.4. because there was no initial written contact and no written follow-up for each positive response. The telephone log is deemed to be analogous to meeting notes; however, the documentation viewed most favorably for Petitioner does not meet the written requirements of the Special Conditions which cannot be waived. (R- 157, 160, 161, 162, 163, 171). Two spread sheets were provided to BOR as supplemental documentation (Jt. Ex. 26). The Summary (Jt. Ex. 37) and other spread sheets (Jt. Ex. 36) were not provided to FAU by Centex-Rooney nor to Respondent in its subsequent review or as part of its option to permit supplementary documentation for good faith compliance. (R-55, 70, 71). Petitioner did not obtain the 15% MBE participation for BR 658. Petitioner did not meet the MBE requirements contained in 1.1.1 of the Special Conditions. (Jt. Ex. 1, page I-1). Two of the MBEs listed by Petitioner with its bid proposal were not certified by DGS at the time of bid submittal. Petitioner did not meet the MBE requirements contained in 1.6.1. (Jt. Ex. 2, I-3). The telephone log submitted by Petitioner was insufficient as required documentation. Petitioner did not meet the good faith efforts requirement set out in 1.7.4 of the Special Conditions (Jt. Ex. 2, page I-4). (R-175, Jt. Ex. 28, 29). The telephone log, as presented by Centex-Rooney was not a copy of a letter, a telegram or a meeting note. The telephone contact did not constitute a written follow-up contact per initial contact as required by the Special Conditions, nor did it suffice as a request in writing for a meeting between the MBE and bidder's staff if a positive response was obtained from an MBE. (R-149, 157). Conversely, as proposed by Petitioner, the telephone contact was not acceptable under the terms of the Special Conditions as an initial notice under 1.7.3 because the contact was not by letter as required. Also, there was not a letter for each initial telephone contact, and the January 9 letters did not request meetings with those MBEs who responded positively, nor did the letters provide evidence of any meeting notes. (R-157, 160, 161, 162, 163, 171).
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is, RECOMMENDED: That Centex-Rooney's bid for project BR-658 was properly rejected by the Respondent, and that the Board of Regents may proceed with its award of the contract to the Intervenor, State Paving. DONE and ENTERED this day of May, 1992, in Tallahassee, Florida. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this day of May, 1992. APPENDIX CASE NO. 92-2272BID Board of Regent's proposed findings were read and considered. The findings of the BOR were adopted except for Paragraph 22 which was deemed a conclusion of law. State Pavings' proposed findings were read and considered. The following list indicated which findings were adopted, and which were rejected and why: 1 through 3. Adopted. Was not specifically adopted, but is correct and is subsumed in other findings. Subsumed in other findings. Rejected that Centex-Rooney "freely admits" their bid failed to meet 15% requirement, a contrary to the evidence. Subsumed Paragraphs 32, 33 and 34. Subsumed Paragraphs 44, 45, 46 and 47. Subsumed Paragraph 50. Subsumed Paragraph 29 re documentation. Comments re Mr. Hamlin are argument and rejected. Rejected in part a restatement of statutes and law, and subsumed in other findings. Adopted that Centex-Rooney complied with 1.7.1, 1.7.2, and failed to comply with 1.7.3 and 1.7.4. Centex-Rooney did comply with 1.7.5 and 1.7.6 and 1.7.8. To the extent that the evidence in this case did not show Centex-Rooney's good faith efforts, 1.7.7 was not proven. Rejected as argument. Subsumed Paragraph 35. Subsumed Paragraphs 39 and 41. Rejected as argument. Subsumed in Paragraphs 55, 56 and 57. Rejected as conclusion of law. The Petitioner's proposed findings were read and considered. The following list which of the findings were adopted, and which were rejected and why. Paragraphs 1 through 11. Adopted. Adopted, Paragraph 23. True; adopted in part in Paragraph and in Paragraphs 23 and 28. 14 and 15. Rejected as irrelevant. True, subsumed in Paragraph 28. Subsumed in Paragraphs 32 and 46. True, but irrelevant. There was no allegation that Centex-Rooney failed to advertise. Subsumed in Paragraphs 28 and 33. Subsumed in Paragraphs 32, 48 and 52. True but irrelevant because Centex-Rooney had fewer than 15%. True but irrelevant. Subsumed in various paragraphs. Subsumed in Paragraphs 28, 32, 33, 34 and 35. True subsumed in Paragraphs 36 and 37. Subsumed in Paragraphs 44, 46, 47, 50 and 51. Irrelevant because it does not establish compliance with 1.7.3 and 1.7.4. BOR properly rejected this evidence which was presented after the bid opening. Copies furnished: Charles B. Reed, Chancellor Florida Board of Regents State University System 325 West Gaines Street Tallahassee, FL 32399-1950 James E. Glass, Esquire 6161 Blue Lagoon Dr., Suite 350 Miami, FL 33126 Jane Mostoller, Esquire 325 W. Gaines St., Suite 1522 Tallahassee, FL 32399-1950 J. Victor Barrios, Esquire 1026 Ease Park Avenue Tallahassee, FL 32301
The Issue Whether the Petitioner is entitled to certification as a minority business enterprise by the Florida Department of Labor and Employment Security, Minority Business Advocacy and Assistance Office (formerly known as the Commission on Minority Economic and Business Development).
Findings Of Fact Aqua Terra, Inc., is a corporation that was organized under the laws of Florida. Aqua Terra is a small business as that term is defined by Section 288.703(1), Florida Statutes. 1/ The work of the corporation requires expertise in geology and in environmental science. The work of the corporation also requires the services of an engineer for certain projects. Isidro Duque owns 51 percent of the stock of Aqua Terra. Mr. Duque is of Hispanic-American descent and is, consequently, a member of a recognized minority group. Richard Meyers owns 49 percent of the stock of Aqua Terra. Mr. Meyers is not a member of a minority group. Mr. Duque founded Aqua Terra on April 23, 1993. Mr. Duque and Mr. Meyers were coworkers at another company before Mr. Duque founded Aqua Terra. Mr. Duque was the sole shareholder and only officer of the corporation until March, 1994, when Mr. Meyers formally joined the company. When Mr. Meyers joined Aqua Terra in March, 1994, the parties negotiated the structure of the corporation. They agreed that Mr. Duque would retain 51 percent of the authorized stock of the corporation and that Mr. Meyers would be issued the remaining 49 percent. Mr. Duque was named the President, Treasurer, and a Director of the corporation. Mr. Meyers was named the Vice- President, Secretary, and a Director of the corporation. The Board of Directors consists of only these two directors. According to the bylaws of the corporation, all corporate powers are to be exercised under the authority of, and the business and affairs of the corporation shall be managed under the direction of, its board of directors. A majority vote of the board of directors is required. Mr. Duque is a professional geologist while Mr. Meyers is an environmental scientist. They both direct projects undertaken by the corporation and share the overall responsibility for such projects. Mr. Duque is primarily responsible for those aspects of a project that require expertise in geology. Mr. Meyers is primarily responsible for those aspects of a project that require expertise in environmental science. The corporation retains the services of a consulting engineer for projects that require certification by an engineer. The engineer the corporation uses for this purpose is not a member of a minority group. Both Mr. Duque and Mr. Meyers have the authority to transact any and all business on behalf of the corporation, including the signing of checks and bank drafts. Mr. Meyers and Mr. Duque actively participate in the daily operation of the corporation. Mr. Duque manages the business development activities of the corporation. Mr. Meyers manages the financial concerns of the corporation and is primarily responsible for purchasing. Mr. Meyers and Mr. Duque assert that Mr. Duque, as the 51 percent shareholder, retains the right to overturn any decision made by Mr. Meyers and that he retains ultimate authority to control the corporation. That right was not established since the existing authority to manage the corporation is, pursuant to the bylaws, vested in the Board of Directors. The managerial functions actually performed by both stockholders are essential to the operation of the company, and one was not established to be more important than the other. Petitioner failed to establish that Mr. Duque exercises dominate control of the affairs of the business.
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 certification as a minority business enterprise. DONE AND ENTERED this 27th day of August, 1996, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of August, 1996.
The Issue The issue presented is whether Petitioner's application for certification as a minority business enterprise should be granted.
Findings Of Fact Petitioner Omni Outdoors, Inc., a for-profit corporation located in Coral Springs, Florida, is engaged in the business of commercial landscaping and irrigation. It was incorporated on September 19, 1995, by Bruce Reeb. When incorporated, Petitioner issued its 100 shares of stock as follows: 24 shares to Bruce, 26 shares to his wife Terry, 24 shares to Kevin McMahon, and 26 shares to Kevin's wife Michele. Accordingly, the Reebs and the McMahons each own 50 percent of the business. Both Reebs and both McMahons became the 4-member Board of Directors. Bruce became the president and the secretary of the corporation, and Kevin became the vice-president and the treasurer. According to the corporation's By-laws, the President is the chief executive officer of the corporation, responsible for the general supervision of its business. Bruce is a certified general contractor in the State of Florida and is the qualifier for Petitioner. Kevin holds an irrigation license and is the qualifier for Petitioner in that area. Bruce handles estimating, pricing, and proposal preparation and presentation. Kevin runs the field operations and purchasing of materials. In October 1996 Terry quit her job as a flight attendant to begin working for Petitioner, handling accounting and personnel matters. Her name was added to the corporation's bank accounts as an authorized signature. Bruce and Kevin remain as authorized signatures on the accounts, and only one signature is required for the corporation's checks. She was given the title "chief executive officer" of the corporation in January 1997, a position authorized by an amendment to the By-laws in March 1997. She was given a smaller salary than Bruce or Kevin, who were paid the same amount. Kevin's wife Michele has never been involved in the day- to-day activities of the corporation. She has never received a salary from the business. In January 1997 Terry filed an application with Respondent for the corporation to be certified as a minority business enterprise, under the status of "American Woman." Around the time the corporation filed its application, Terry's salary was increased to $600 per week so she would be making the same as Kevin, and Bruce's salary was decreased to $400 per week. Even after Terry's full-time employment by the corporation, the signatures of her husband or of Kevin continue to appear on corporate obligations, such as an indemnity agreement and corporate promissory notes.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered denying Petitioner's application for certification as a minority business enterprise. DONE AND ENTERED this 8th day of April, 1998, in Tallahassee, Leon County, Florida. LINDA M. RIGOT 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 8th day of April, 1998. COPIES FURNISHED: Terry M. Reeb, Chief Executive Officer Omni Outdoors, Inc. 1742 Northwest 112 Terrace Coral Springs, Florida 33071 Joseph L. Shields, Esquire Department of Labor and Employment Security 2012 Capital Circle, Southeast The Hartman Building, Suite 307 Tallahassee, Florida 32399-2189 Edward A. Dion, General Counsel Department of Labor and Employment Security 2012 Capital Circle, Southeast The Hartman Building, Suite 307 Tallahassee, Florida 32399-2189 Douglas L. Jamerson, Secretary Department of Labor and Employment Security 2012 Capital Circle, Southeast The Hartman Building, Suite 303 Tallahassee, Florida 32399-2189
The Issue Whether Florida Moving Systems, Inc. should be certified as a minority business enterprise by the Respondent, pursuant to Section 288.703(1) and (2), Florida Statutes and the applicable rules implementing the statute.
Findings Of Fact Claudia Deneen and Thomas B. Deneen, husband and wife, and another partner purchased the applicant company with joint funds in 1988. Subsequently, the business was incorporated and the name changed to Florida Moving Systems, Inc. Prior to the time of the incorporation of the business, David P. Astolfi bought out the original partner and obtained a 25 percent share in the incorporated business. Claudia Deneen, Thomas B. Deneen and David P. Astolfi presently serve as the Directors of the applicant corporation. Neither Thomas B. Deneen nor David P. Astolfi qualify for classification as a "minority." In 1992, Claudia Deneen obtained her husband's stock in the corporation without consideration, but for prior services rendered. Claudia Deneen now holds 75 percent of the outstanding stock in her name. While Claudia Deneen was out on maternity leave in 1992, Thomas Deneen ran the business. Claudia and Thomas Deneen, as well as David Astolfi each have authority to individually sign business checks. Astolfi who serves as Vice President for Sales, is paid $1100 weekly, Thomas Deneen who serves as President, is paid $1500 weekly. Claudia Deneen who serves as Vice President, Secretary/Treasurer, and chief purchasing agent, is paid $1000 weekly when money is available. Both Claudia and Thomas Deneen signed and guaranteed the business leases. All three Directors, Claudia and Thomas Deneen and Astolfi, share common ownership in a similar business called Florida Distribution Systems, Inc. which is housed adjacent to the applicant. Thomas Deneen signs 90 percent of applicant's payroll checks. Business decisions are made jointly by all directors. Claudia Deneen is the chief purchasing agent for the corporation and maintains control over the purchase of goods, equipment and services. She also participates in the hiring and firing of personnel and the setting of all employment policies. Petitioner's offer of proof, consisting of business letters or recommendation, all recommended both Claudia and Thomas Deneen as a team, not individually.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the application for Minority Business Certification filed by Florida Moving Systems, Inc. on January 17, 1994, be DENIED. DONE and ENTERED this 1st day of September, 1995, in Tallahassee, Florida. DANIEL M. KILBRIDE 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 September, 1995. APPENDIX The following constitutes my specific rulings, in accordance with section 120.59, Florida Statutes, on proposed findings of fact submitted by the parties. Proposed findings of fact submitted by Petitioner. Petitioner did not submit proposed findings of fact. Proposed findings of fact submitted by Respondent. Accepted in substance: paragraphs 1-13. COPIES FURNISHED: Claudia Deneen Vice President and Secretary/Treasurer 4317 Fortune Place West Melbourne, Florida 32904 Joseph L. Shields, Esquire Senior Attorney 107 West Gaines Street 201 Collins Building Tallahassee, Florida 32399-2005 Crandall Jones Executive Administrator Collins Building, Suite 201 107 W. Gaines Street Tallahassee, Florida 32399-2000
The Issue The issue is whether the Petitioner is qualified for designation and certification as a minority business enterprise.
Findings Of Fact At the hearing, it became apparent that the reasons for denial were principally lack of independence and affiliation with a non-qualifying company. The parties stipulated to the following: Ms. Wendy Stephens, President and Secretary of WPS and sole stockholder WPS, possess the authority to, and does in fact, exercise complete control over the management, daily operations and corporate affairs of WPS. Ms. Stephens possesses the technical capability, managerial qualifications and expertise to operate WPS. The following facts were proven at hearing: Ms. Stephens is a white, female and is qualified as a minority person under the statute. In 1991, Charles Perry, Ms. Stephen's father and a white male, provided $7,000 for start up capital and a lease of 3 acres on his farm to house Alachua Greenery, a wholesale/retail nursery which Wendy Stephens began with assistance from Perry. Ms. Stephens has never made payments on the aforementioned lease. Charles Perry and Wendy Stephens were the sole stockholders in Alachua Greenery, each holding 50 percent of the shares in the corporation. Perry has contributed nothing more to the operation of the corporation, and has never exercised any control over the corporation, although he was initially a director. WPS is a Florida corporation, domiciled and doing business in the state. WPS is worth less than $3,000,000 and has three employees. Ms. Stephens is and always has been the sole stockholder of WPS, and has served as its President and Secretary since its incorporation. Ms. Stephens husband, Gary Stephens, was once a director of WPS upon the advice of counsel; however, he exercised no control over the corporation and resigned as a director on April 12, 1996. Gary Stephens sold a Bobcat tractor to Wendy Stephens upon which he has deferred payments. This Bobcat is used by WPS and Alachua Greenery. Gary Stephens has no other financial or other interest in WPS or Alachua Greenery. WPS was formed for the purpose of engaging in the retail landscaping business, which is a logical business expansion from the wholesale nursery business. WPS has engaged in the retail landscaping business for several customers. WPS shares equipment, land, vehicles, and employees with Alachua Greenery. There is no evidence that WPS, which has performed a number of contracts, has been a conduit of money to Alachua Greenery. On May 13, 1996, Perry gifted his share of Alachua Greenery to Wendy Stephens.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Petitioner's application for minority business status be denied. DONE AND ENTERED this 27th day of June, 1996, in Tallahassee, Florida. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 SunCom 278-9675 Filed with the Clerk of the Division of Administrative Hearings this 27th day of June, 1996. APPENDIX TO RECOMMENDED ORDER CASE NO. 96-0023 Both parties submitted proposed findings which were read and considered. The following states which of those findings were adopted, and which were rejected and why. References to numbered paragraphs in Petitioner's findings includes all letter subparagraphs unless otherwise noted. PETITIONER'S RECOMMENDED ORDER Paragraphs 1,2 Statement of Case Paragraph 3 Irrelevant Paragraphs 4-6 Statement of Case Paragraph 7a Paragraph 9 Paragraph 7b Subsumed in Paragraph 6 Paragraph 7c Subsumed in Paragraphs 6 & 8 Paragraph 7d Contrary to best evidence Paragraph 7e Irrelevant Paragraph 7f Subsumed in Paragraph 9 Paragraph 7g Irrelevant Paragraphs 7h,i Paragraph 7 Paragraphs 7j,k,l Subsumed in Paragraph 8 Paragraphs 7m,n,o,p Paragraph 4 Paragraph 7q Subsumed in Paragraph 12 Paragraph 7r Paragraph 11 Paragraphs 7s,t Irrelevant RESPONDENT'S RECOMMENDED ORDER Paragraph 1,2 Subsumed in Paragraph 8 Paragraph 3 Subsumed in Paragraph 10 Paragraph 4 Paragraph 4 Paragraph 5 Subsumed in Paragraph 10 Paragraph 6 Not necessary Paragraph 7,8 Paragraph 12 Paragraph 9 Not necessary COPIES FURNISHED: David L. Worthy, Esquire Peter A. Robertson and Associates 4128 Northwest 13th Street Gainesville, Florida 32609 Joseph L. Shields, Esquire Commission on Minority Economic and Business Development 107 West Gaines Street, Suite 201 Tallahassee, Florida 32399-2005 Veronica Anderson, Executive Administrator Commission on Minority Economic and Business Development Collins Building, Suite 201 107 West Gaines Street Tallahassee, Florida 32399-2000
The Issue The issue is whether Petitioner is entitled to certification as a minority business enterprise.
Findings Of Fact By undated application, Petitioner filed an Application for Minority Business Enterprise Certification. Stating that the applicant was established in November 1991, the application lists as the sole shareholders Hui Schaefer (a/k/a Gina Schaefer), who is a Korean-American minority, and her husband, Reid, who is a nonminority. The application was filed in July 1995. The application states that Ms. Schaefer is an Asian female owning 81 percent of the shares. The application lists Ms. Schaefer as the chief executive officer, secretary, and treasurer, Mr. Schaefer as the president, and Gordon Holfelder as the vice-president. The application lists these three persons as directors, plus DuWayne Boudin and Lenny LaRose. Except for Ms. Schaefer, the directors are nonminorities. Petitioner's bylaws provide for management of the business and property by a majority of the directors. The articles of incorporation provide similarly. Petitioner claimed at the final hearing that she had fired all of the directors except herself, but she produced no documentary proof of this action. Mr. and Ms. Schaefer purchased all of the stock of Petitioner in 1991. At the time of purchase, Ms. Schaefer received 500 shares and Mr. Schaefer received 400 shares. The sole purpose of this allocation was to enable the corporation to qualify as a minority business enterprise. The sole consideration for the shares was the forgiveness of about $6000 in debt. Mr. and Ms. Schaefer had lent this sum to Petitioner or its parent corporation, Unidyn Corp., so it could pay operating expenses, such as a telephone bill. Upon acquiring the shares, Mr. and Ms. Schaefer contributed capital to Petitioner in the form of furniture and equipment, which they value at $100,000. The evidence does not indicate that Mr. or Ms. Schaefer possessed any disproportionate interest in the $6000 loan, equipment, or furniture. To the contrary, it appears that their interests were equal in the money and assets. Petitioner is in the computer software business. Specifically, at the time of the application, Petitioner was a value-added retailer of computer programs. Petitioner purchased software programs from developers, customized the programs for end users, and resold the program to the end user with a commitment to provide technical support and training. Mr. Holfelder is a computer programmer. Mr. Schaefer is a sales representative. Ms. Schaefer is an office manager. At the time of the application, Petitioner employed nine fulltime permanent employees and earned over $800,000 in the fiscal year ending in 1993. At all material times, the compensation of Mr. Schaefer or Mr. Holfelder at least doubled the compensation of Ms. Schaefer. For calendar year 1995, their salaries were set at $60,000, while Ms. Schaefer's was set at $30,000, which was the same paid to Mr. LaRose. The other director listed on the application, Mr. Boudin, was set to earn $48,000 for 1995. The malleability of salaries in response to the requirements of government programs is reflected by Petitioner's explanation why Mr. Schaefer's salary is greater than Ms. Schaefer's salary. In a latter to Respondent dated August 30, 1995, Petitioner explained that the Schaefers were trying to refinance a home mortgage and "[s]everal of the mortgage companies suggested that it would be much easier to approve a VA mortgage if the husband and veteran, Reid Schaefer, had the highest salary." Ms. Schaefer has little technical experience in software programming. She could provide some technical support to customers for programs with which she was familiar as an end user, but she generally was not involved with the technical end of Petitioner's business. Ms. Schaefer's actual authority over corporation management was quite limited in practice. Hiring and firing authority is divided into departments with persons other than Ms. Schaefer responsible for such personnel decisions in the crucial areas of programming and marketing. Mr. Schaefer is responsible for purchasing. Even Ms. Schaefer's involvement in internal bookkeeping is subordinated to Mr. LaRose, who is Petitioner's in-house accountant. Mr. Boudin handles customer training and assists in sales. Ms. Schaefer signed most of the checks, but appeared to do so at the direction of others. She was not the sole person authorized to sign checks drawn on any of Petitioner's accounts, all of which authorized checks to be signed by a single authorized signer. At the end of 1994, shares were redistributed, leaving Ms. Schaefer with 500 shares, Mr. Schaefer with 100 shares, and Mr. LaRose, Mr. Holfelder, and Mr. Boudin with five shares each. Later, Petitioner issues one share to Brian Risley, a systems installer. These transactions left Ms. Schaefer with 81 percent of the issued shares of Petitioner. Later transactions left her with an even greater percentage of the stock; Petitioner repurchased the shares owned by Mr. Schaefer and Mr. Holfelder, and Ms. Schaefer acquired an additional 89 shares. Petitioner repurchased Mr. Holfelder's shares in connection with her termination in January 1996. By that time, Petitioner had transformed from a value-added retailer to custom applications, designing software programs from scratch. Ms. Schaefer does not control Petitioner either in ownership or operation.
Recommendation It is RECOMMENDED that the Commission on Minority Economic and Business Development enter a final order denying Petitioner's application for certification. DONE and ENTERED on April 29, 1996, in Tallahassee, Florida. ROBERT E. MEALE 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 on April 29, 1996. APPENDIX Rulings on Petitioner's Proposed Findings 1: rejected as unsupported by the appropriate weight of the evidence. 2-3 and 6: rejected as legal argument. 4: rejected as unsupported by the appropriate weight of the evidence and subordinate. 5: adopted or adopted in substance except as to implication that Ms. Schaefer controls the business. 7: rejected as not finding of fact. 8-9: rejected as recitation of evidence. 10 (first sentence): rejected as unsupported by the appropriate weight of the evidence. 10 (remainder): rejected as recitation of evidence and unsupported by the appropriate weight of the evidence. 11: rejected as speculative and unsupported by the appropriate weight of the evidence. 12: rejected as speculative. 13: rejected as subordinate. 14 (first sentence): adopted or adopted in substance. 14 (remainder): rejected as irrelevant. 15: rejected as subordinate. 16: rejected as unsupported by the appropriate weight of the evidence, recitation of evidence, and subordinate. 17: rejected as unsupported by the appropriate weight of the evidence and recitation of evidence. 18-19: rejected as unsupported by the appropriate weight of the evidence. 20: rejected as unsupported by the appropriate weight of the evidence. 21 (first sentence): adopted or adopted in substance. 21 (remainder): rejected as unsupported by the appropriate weight of the evidence. 22: rejected as unsupported by the appropriate weight of the evidence and subordinate. 23: rejected as legal argument. 24: rejected as unsupported by the appropriate weight of the evidence, subordinate, and legal argument. 25-26: rejected as unsupported by the appropriate weight of the evidence. Rulings on Respondent's Proposed Findings 1: adopted or adopted in substance except for subsequent transaction, which does not alter findings. 2: adopted or adopted in substance. 3: adopted or adopted in substance except for presence of additional nonminorities. 4-8: adopted or adopted in substance. 9-10: rejected as subordinate and recitation of evidence. 11-14: adopted or adopted in substance. 15: adopted or adopted in substance except that such personnel decisions are divided into three areas with different persons in charge of each area. 16-17: adopted or adopted in substance except that the illustrations are rejected as subordinate and recitation of evidence. COPIES FURNISHED: Veronica Anderson, Executive Administrator Commission on Minority Economic and Business Development Collins Building, Suite 201 107 West Gaines Street Tallahassee, Florida 32399-2000 Joseph Shields, General Counsel Commission on Minority Economic and Business Development Collins Building, Suite 201 107 West Gaines Street Tallahassee, Florida 32399-2000 Kurt A. Streyffeler Kurt A. Streyffeler, P.A. 3440 Marinatown Lane, Northwest Suite 205 North Fort Myers, Florida 33903
Findings Of Fact Petitioner was incorporated in July 1992. Petitioner is a graphic design firm specializing in strategic, market-driven design. Petitioner conducts market analysis of a client and, only after defining the corporate identity of the client, engages in the development of suitable graphic design. Mary Francis Weathington is the president and chief executive officer of Petitioner. Her experience in communications began in 1980 as a technical writer and editor. From 1989-92, Ms. Weathington served as an account supervisor for an advertising firm. In this role, Ms. Weathington supervised all junior account executives, developed marketing plans, presented proposals to clients, and communicated client needs to agency staff. Ms. Weathington started Petitioner with John LoCastro, who had worked with her at the advertising agency during the same period of time. Mr. LoCastro was responsible for concept development, management, and design direction at the advertising agency. A third person, David Miller, was also involved with the formation of Petitioner. Mr. Miller served as secretary and treasurer, Mr. LoCastro as vice president, and Ms. Weathington as president. Until December 31, 1993, when Mr. Miller resigned from Petitioner, the three principals each owned 50 shares of the 150 issued shares of Petitioner. The capital contribution of each principal was valued at $4500. When he left the company, Mr. Miller transferred his stock to Petitioner in a transaction that required him to pay money to the company due to its thin capitalization and performance. At the same time, Ms. Weathington purchased two more shares. In the summer of 1994, Ms. Weathington bought three more shares and Mr. LoCastro's wife bought two shares. Presently, Ms. Weathington owns 55 shares, Mr. LoCastro owns 50 shares, and Mrs. LoCastro owns two shares. Petitioner has not issued other shares. Petitioner's board of directors consists of Ms. Weathington, her husband, Mr. LoCastro, and his wife. However, Mr. Weathington is a nonvoting director. Besides the two principals, Petitioner employs only one other fulltime employee, an office manager who is responsible for answering the phone, bookkeeping, proofreading, and handling miscellaneous clerical duties. Petitioner also employs, as needed, freelance graphic designers. Petitioner has recently employed a freelance copywriter. In a small company like Petitioner, there is necessarily some sharing of responsibilities in order to secure and produce design work and ensure that payables and receivables are properly managed. However, there are clear areas of responsibility for Ms. Weathington and Mr. LoCastro. As his resume states, Mr. LoCastro is "[r]esponsible for overall creative management, with an emphasis on creative development, planning and design." He is in charge of visual graphics and does nearly all of the computer graphics work, unless it is assigned to a freelancer. Ms. Weathington is responsible for marketing in two respects. First, she markets for Petitioner. She has brought a large majority of the clients to Petitioner and continues to remain responsible for their use of the company. Second, Ms. Weathington assists the clients in developing advertising and design programs that will effectively market the products and services of the clients. Ms. Weathington conducts market research of a client's needs and prepares advertising and design strategies to maintain and enhance the client's business. Ms. Weathington also is chiefly responsible for the management and administration of Petitioner. The office manager's bookkeeping duties are performed under the supervision of Ms. Weathington, who handles personnel, purchasing, planning, and accounting. Although the signatures of both principals are required on checks over $500, this requirement reflects security concerns and does not have a bearing on the division of responsibilities between Ms. Weathington and Mr. LoCastro. Although Mr. LoCastro is responsible for the in-house visuals, Ms. Weathington is responsible for copywriting, which is performed in-house nearly in its entirety. Each principal has been required to guarantee personally the debt of Petitioner. But, given the greater assets of Ms. Weathington, the financial risk is actually borne by her, not Mr. LoCastro. Petitioner's lender would not have made the loan on Mr. LoCastro's guarantee alone, but would have on Ms. Weathington's guarantee alone. Ms. Weathington's control of Petitioner is evidenced in other respects. Petitioner pays for a cellular telephone for her, but not Mr. LoCastro. The marketing brochure prepared by Petitioner features Ms. Weathington in a superior role to the subordinate roles of Mr. LoCastro and Mr. Miller. Ms. Weathington's indispensable contribution to Petitioner is documented by gross sales figures for 1993, during which, for personal reasons, she was unable to work in the spring and fall. When she returned to work in the summer, gross sales increased from less than $10,000 per month to over $50,000 per month. When she left work again in the fall, gross monthly sales fell again to the $20,000 level. Profits have also increased by 16 percent since Ms. Weathington's return.
Recommendation It is hereby RECOMMENDED that the Department of Management Services enter a final order granting Petitioner's application for minority business enterprise certification. ENTERED on January 24, 1995, in Tallahassee, Florida. ROBERT E. MEALE 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 on January 24, 1995. APPENDIX Rulings on Petitioner's Proposed Findings 8, 9, and 12: adopted, although based on the facts and not a claimed concession or absence of dispute. 22: adopted, except that the evidence showed only that gross revenues went down during Ms. Weathington's absences. Nothing in the record addressed net earnings or profits during these periods. Remaining proposed findings: adopted or adopted in substance. Rulings on Respondent's Proposed Findings 1 (first sentence): adopted. 1 (remainder)-4 (except for last sentence): rejected as subordinate. 4 (last sentence): adopted. 5-6: rejected as subordinate. 7-8: adopted or adopted in substance. 9: rejected as recitation of evidence and subordinate. 10: to the extent not subordinate, adopted or adopted in substance. 11-12: adopted or adopted in substance. 13 (first sentence): adopted or adopted in substance. 13 (remainder): rejected as unsupported by the appropriate weight of the evidence. 14-15: adopted or adopted in substance. 16-19: rejected as unsupported by the appropriate weight of the evidence, subordinate, and recitation of evidence. 20 (first sentence): adopted or adopted in substance. 20 (second sentence): rejected as legal argument. 21: adopted or adopted in substance, except for the implication that, as a practical matter, Mr. LoCastro's guarantee represents as real a financial risk as Ms. Weathington's guarantee. 22 (first sentence): adopted. 22 (second sentence): rejected as unsupported by the appropriate weight of the evidence. Increased sales does not mean increased profits, and nothing in the record indicates increased profits. 22 (remainder): rejected as unsupported by the appropriate weight of the evidence. COPIES FURNISHED: William H. Lindner, Secretary Department of Management Services Knight Building, Suite 307 2737 Centerview Drive Tallahassee, FL 32399-0950 Paul A. Rowell, General Counsel Department of Management Services Knight Building, Suite 312 2737 Centerview Drive Tallahassee, FL 32399-0950 John S. Derr Bush & Derr, P.A. 2874-A Remington Green Circle Tallahassee, FL 32308 Attorney Cindy Horne Office of the General Counsel Department of Management Services Knight Building, Suite 312 2737 Centerview Drive Tallahassee, FL 32399-0950
The Issue Is Petitioner entitled to certification as a Minority Business Enterprise pursuant to Rule 38A-20.005, Florida Administrative Code?
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant findings of fact are made: On February 12, 1998, Teddy L. Serdynski and Janice A. Serdynski entered into a Partnership Agreement which in pertinent part provides as follows: NAME: The name of the partnership shall be known as "Ted's Auto Parts." PURPOSE: The purpose of the partnership shall be the operation of an automobile parts business and related enterprises. * * * COMMENCEMENT: The partnership shall officially commence upon execution of this agreement. DURATION: The partnership shall continue until dissolved, either by the parties or by legal proceedings, or by liquidation. CAPITAL: The capital of the partnership shall be contributed in amounts equalling 51% by JANICE A. SERDYNSKI and 49% by TEDDY L. SERDYNSKI, thereby granting to the said JANICE A. SERDYNSKI the controlling interest of said partnership. WITHDRAWAL: No partner shall withdraw any invested capital without the consent of the other partner. CAPITAL GAINS AND LOSSES: Capital gains and losses shall be shared in a proportionate amount of their investment and ownership interest. * * * MANAGEMENT: Although JANICE A. SERDYNSKI is the owner of a controlling interest in the partnership, each shall have equal voice in the management of the affairs of the partnership. Both parties shall administer to the general affairs of the partnership and shall carry out and put into effect the general policies and specific instructions of their decision on any given matter. BANK ACCOUNTS: The partnership shall maintain checking and other accounts in such bank or banks as the partners shall agree upon. Withdrawals and writing of checks on the partnership account may be done jointly and/or singly. PROFITS AND LOSSES: The partners shall share in accordance with their ownership interest in the profits and losses. . . . LIMITATIONS ON PARTNER: No partner, without the consent of the other partner, shall borrow money in the partnership name for partnership purposes or utilize collateral owned by the partnership as security for such loans, assign, transfer, pledge, compromise or release any of the claims or debts due to the partnership except on payment in full; consent to the arbitration of any dispute or controversy of the partnership; transfer firm assets; make, execute or deliver any assignment for the benefit of creditors; maker, execute or deliver any bond, confession of judgment, guaranty bond, indemnity bond, or surety bond or any contract to sell, bill of sale, deed, mortgage, lease relating to any substantial part of the partnership assets or his/her interest therein; or engage in any business or occupation without the consent of the other partner. * * * 17. DISPUTES: That the parties agree that all disputes and differences, if any, which shall arise between the parties, shall be referred to and decided by two indifferent, competent persons in or well acquainted with the trade, one person to be chosen by each party, or to submit to arbitration by a recognized arbitration service, and his/her or their decisions shall, in all respect, be final and conclusive on all parties. Ted's Auto Parts was a sole proprietorship from May 1, 1985 until February 11, 1998. From May 1, 1985, until February 11, 1998, Janice A. Serdynski shared ownership in Ted's Auto Parts equally with her husband, Teddy L. Serdynski, a non- minority. Janice A. Serdynski does not share income from Ted's Auto Parts commensurate with her 51 percent ownership. Decision-making, withdrawal of funds, borrowing of money, and the day-to-day management of Ted's Auto Parts are shared equally between Janice A. Serdynski and Teddy L. Serdynski. Ted's Auto Parts is a family operated business with duties, responsibilities, and decision-making occurring jointly, and, at time, mutually among family members. Both Janice A. Serdynski and Teddy L. Serdynski are authorized to sign checks on the account of Ted's Auto Parts.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it recommended that the Department enter a final order finding that Petitioner has failed to meet the requirements for Minority Business Enterprise certification and dismiss the petition filed by Petitioner. DONE AND ENTERED this 22nd day of March, 1999, in Tallahassee, Leon County, Florida. WILLIAM R. CAVE 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) 921-6947 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 22nd of March, 1999. COPIES FURNISHED: Douglas I. Jamerson. Secretary Department of Labor and Employment Security 303 Hartman Building 2012 Capital Circle, Southeast Tallahassee, Florida 32399-2152 Edward A. Dion General Counsel Department of Labor and Employment Security 307 Hartman Building 2012 Capital Circle, Southeast Tallahassee, Florida 32399-2152 Janice A. Serdynski Ted's Auto Parts 190 Second Avenue, South Bartow, Florida 33830 Joseph L. Shields, Senior Attorney Department of Labor and Employment Security 307 Hartman Building 2012 Capital Circle, Southeast Tallahassee, Florida 32399-2189
The Issue Whether Petitioner should be certified by Respondent as a minority business enterprise.
Findings Of Fact Petitioner, Jupiter Environmental Laboratories, Inc. (Jupiter), is an environmental testing laboratory established in October 1995. The services performed by Jupiter include testing samples of water, oil, soil, and waste water in accordance with the Environmental Protection Agency standards. Jupiter also tests for inorganic and organic compounds by mass spectrography and gas chromatography. Jupiter is owned 70 percent by Glynda Russell, a female, and 30 percent by her husband, Edward Dabrea, who is a non- minority. Prior to forming Jupiter, Ms. Russell had not worked in a laboratory such as Jupiter. Her work experience had been in real estate and selling women's apparel. According to Ms. Russell she did gain some knowledge and experience in environmental testing because she was a customer of testing laboratories while she was in the real estate business. She became familiar with the Environmental Protection Agency's requirements while she was investigating environmental impacts when she was a realtor. Mr. Dubrea has a degree in earth science (geology) and has done post graduate studies in geoscience (organic geochemistry). He has extensive work experience in environmental testing laboratories. Both Ms. Russell and Mr. Dabrea are jointly liable for a $50,000 loan from the Small Business Administration and a $15,000 line of credit. Ms. Russell has also incurred debt of over $100,000 on her personal credit card for Jupiter's expenses. The company has three equipment leases which Ms. Russell signed and indicated she was personally liable. Ms. Russell also signed the lease for the space occupied by the business. Ms. Russell is the president of the corporation. Her duties include directing all marketing, sales, and financial operations. She is responsible for recruiting and hiring personnel, maintaining state certifications, prioritization of work flow (sample pick-up, sample log-in and report generation), bid pricing, selection of subcontracting laboratories, customer service and purchasing of supplies. Mr. Dabrea is the Technical Director for the company. In addition to working for Jupiter, he does freelance research. His resume states that his work at Jupiter includes the following: Planned and organized all technical details for new laboratory, including equipment requirements and analytical supplies. Received and setup instrumentation, performs necessary calibrations. Coordinates information with Laboratory Director and QA/QC Officer. Develops new methods and provides research assistance to clients with unusual assessments. Coordinates between laboratory and governmental agency to ensure compliance. Submits performance evaluation studies to E. P. A. for certification on quarterly basis. Responsible for ensuring adequate instrument capacity for continued growth of the company. Cliff Ross, a non-minority, is the Laboratory Director and works part-time for Jupiter. Start-up funds for Jupiter were contributed by Ms. Russell and Mr. Dabrea. Ms. Russell contributed $25,000 in cash, and computer equipment worth approximately $8,000. Mr. Dabrea contributed an $11,000 truck and $5,000 in computer equipment. Ms. Russell contributed 67 percent and Mr. Dabrea contributed 32 percent. Jupiter is certified in certain categories of environmental water testing by the State of Florida, Department of Health, pursuant to Chapter 403, Florida Statutes. In order to acquire such certification, tests must be performed in the laboratory by qualified technical personnel with the proper educational credentials. In order to acquire the certification for Jupiter, the tests were performed by Mr. Dabrea and Mr. Ross. Ms. Russell is not technically or educationally qualified to perform the tests required for certification. It is not necessary to have the certification to operate an environmental laboratory, but many companies acquire the certification as a marketing tool. Ms. Russell indicated in her response to the denial of her certification that "current market conditions make it all but impossible to get work without it." (Petitioner's Exhibit No. 1.) Ms. Russell can perform the extractions. Once the extractions are done for certain types of testing, the testing is automated. She cannot do chromatography. The Quality Assurance Director for Jupiter is Pamela Shore-Loeb. Her duties include responsibilities for all quality assurance and quality control requirements to ensure continued State of Florida laboratory certifications and project management to a growing client list. She, along with Ms. Russell, developed the quality assurance manual used by the business.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered finding that Petitioner, Jupiter Environmental Laboratories, Inc., meets the requirements of Rule 38A-20.005(2)(c), Florida Administrative Code, but does not meet the requirements of Rules 38A- 20.005(3)(c), (d)1, 4 and (6) and (4)(a), Florida Administrative Code. Consequently, the final order should deny Jupiter Environmental Laboratories, Inc.'s application for certification as a minority business enterprise. DONE AND ENTERED this 1st day of December, 1997, in Tallahassee, Leon County, Florida. SUSAN B. KIRKLAND Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (904) 488-9675 SUNCOM 278-9675 Fax Filing (904) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 1st day of December, 1997. COPIES FURNISHED: Joseph L. Shields, Esquire Department of Labor and Employment Security Hartman Building, Suite 307 2012 Capital Circle, Southeast Tallahassee, Florida 32399-2189 Glynda E. Russell, President Jupiter Environmental Laboratories, Inc. 220 Venus Street, Suite 16 Jupiter, Florida 33458 Douglas L. Jamerson, Secretary Department of Labor and Employment Security 303 Hartman Building 2012 Capital Circle, Southeast Tallahassee, Florida 32399-2152 Edward A. Dion, General Counsel Department of Labor and Employment Security 307 Hartman Building 2012 Capital Circle, Southeast Tallahassee, Florida 32399-2152
Findings Of Fact On or about March 17, 1994, Petitioner, T-B Services, Inc., filed an application for certification as a minority business enterprise with the Florida Department of Management Services. The Respondent, the State of Florida Commission on Minority Economic and Business Development, has subsequently been assigned responsibility for this matter. On May 3, 1994, Petitioner's application was denied. Petitioner's application was denied based upon Respondent's conclusion that Petitioner did not satisfy Sections 288.703(2) and 287.0942(1), Florida Statues, and rules governing minority business enterprises of the Department of Management Services. Mr. Anthony D. Nelson is the minority, 100 percent, owner of Petitioner. Mr. Nelson is an African-American. The business of Petitioner, fire protection consulting, and fabrication and installation services, requires the association of an individual holding a professional license to perform those services. There are two professional license holders associated with Petitioner. Neither of the professional license holders are members of any minority. Mr. Nelson does not hold a professional license necessary for the Petitioner to provide fire protection consulting, or fabrication and installation services.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by Respondent dismissing the Petition for Formal Hearing filed by T-B Services Group, Inc., and denying Petitioner's application for minority business enterprise certification. DONE AND ENTERED this 26th day of May, 1995, in Tallahassee Florida. LARRY J. SARTIN, 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 26th day of May, 1995. COPIES FURNISHED: Cindy A. Laquidara, Esquire Suite 1629, Riverplace Tower 1301 Riverplace Boulevard Jacksonville, Florida 32207 Kenneth W. Williams Assistant Attorney General Office of the Attorney General PL-01, The Capitol Tallahassee, Florida 32399-1050 Crandall Jones Commission on Minority Economic and Business Development Executive Administrator Knight Building 272 Centerview Drive Tallahassee, Florida 32399-0950
