Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, documentary evidence received, post- hearing memoranda and briefs, and the entire record compiled herein, thereby make the following relevant factual findings. At all times material to the allegations and charges in this proceeding, Respondent, Riviera Resort Hotel Associates, Ltd., was the holder of a valid alcoholic beverage license No. 16-615-S, Series 4-COP, located at 2080 South Ocean Drive, Hallandale, Broward County, Florida. On May 8, 1984, at about 9:30 p.m., Officer D'Ambrosia entered the licensed premises in an undercover capacity with a confidential source (CI). Based on a telephone complaint, Officer D'Ambrosia was requested by his supervisors to conduct an investigation to determine if the complaint was meritorious. The main lounge in the licensed premises has a front and back entrance. The front entrance is through the main lobby and the back door leads to a parking lot. Upon entering the premises, Officer D'Ambrosia and CI approached the main bar. Sergeant Pat Roberts was at the main bar area as a backup officer. There were approximately four other patrons at the bar. Officer D'Ambrosia and CI made contact with the on-duty bartender, Tommy Brownyard. After Brownyard served them drinks and the three of them engaged in general conversation, CI asked Brownyard if he had the "stuff" and if the price of $80.00 was still the same. Brownyard affirmed, stating that it would be in three bags, a one-gram and two half gram bags. CI then turned to Officer D'Ambrosia and stated the price of two grams would be $160.00. Officer D'Ambrosia counted out eight $20.00 bills and laid them on top of the bar counter. Brownyard left the bar area and entered the men's bathroom. After two or three minutes, Brownyard left the restroom, walked back to the bar and approached Officer D'Ambrosia and CI. Brownyard placed what looked like a pack of Marlboro cigarettes on top of the counter. Officer D'Ambrosia spread out the eight $20.00 bills on top of the counter in a manner that Brownyard could see it and Brownyard picked up the money while facing Officer D'Ambrosia and counted it behind the bar. Brownyard placed the currency in his pants pocket. Officer D'Ambrosia picked up the Marlboro box, opened it, and pulled out three clear plastic zip-lock-bags containing a white powdery substance. After looking at the bags, Officer D'Ambrosia placed them back into the box and placed a box in his shirt pocket. Sergeant pat Roberts observed the transaction. The three plastic bags which Officer D'Ambrosia purchased from Brownyard contained cocaine, a controlled substance under Chapter 893, Florida Statutes. As stated, the lounge only had, at most, four patrons besides Officer D'Ambrosia, CI and Roberts. The conversation with Brownyard about drugs occurred in a normal tone of voice. Officer D'Ambrosia did not attempt to conceal the purchase of drugs at the bar. Before Officer D'Ambrosia and CI left the bar, they spoke to Brownyard about the best time to buy more cocaine. Brownyard stated that Thursday (May 10, 1984) would be good but that Officer D'Ambrosia or CI should first call. Brownyard said that if Officer D'Ambrosia or CI wanted one gram of coke, to call and say "Is the one girl in there tonight?" and if Officer D'Ambrosia or the CI wanted two grams of cocaine, to call and ask "If the two girls are tonight." Brownyard would respond yes or no to the questions. After Officer D'Ambrosia and CI left, Sergeant Roberts had a conversation with Brownyard. Brownyard told Sergeant Roberts that he worked "directly for the owners" and that he "ran the placed" apparently referring to the lounge. On May 10, 1984, at about 9:20 p.m., Officer D'Ambrosia and CI went to the licensed premises and took seats at the bar. Officer Olive had arrived about 15 minutes earlier to be the backup officer. Officer Oliva was seated at the bar across from Officer D'Ambrosia and CI with a clear view of both D'Ambrosia and CI. There were at most five unidentified patrons at the bar on that evening. Brownyard was attending the bar. Officer D'Ambrosia and CI greeted at bar and, after approximately ten minutes, Brownyard approached Office D'Ambrosia and CI and stated "Those two girls are here if you are interested." Officer D'Ambrosia affirmed and Brownyard told Officer D'Ambrosia and CI that the cocaine would be in 2 one-gram bags. Brownyard then left the bar and walked to the area of the men's restroom. After approximately one minute, Brownyard left the area of the restroom and walked back to the bar. Brownyard approached Officer D'Ambrosia and CI. Brownyard placed a matchbox on the top of the bar and looked at Officer D'Ambrosia. Officer D'Ambrosia placed $160.00 on the bar counter and picked up the matchbox. Brownyard picked up the money and, after counting it, placed it in his pocket. Officer D'Ambrosia opened the matchbox and noticed two clear plastic zip-lock bags containing a white powdery substance. Office Olive observed the transaction. The two plastic bags bought and received from Brownyard contained cocaine. The conversation with Brownyard about drugs occurred in a normal tone of voice and Officer D'Ambrosia made no effort to conceal the sale on the premises. On May 14, 1984, at approximately 9:15 p.m. Officer D'Ambrosia entered the Riviera Resort Motel. Officer D'Ambrosia walked to the bar and sat down. Officer Wheeler had arrived before Officer D'Ambrosia as the backup officer. Officer D'Ambrosia entered into a conversation with the on-duty bartender named Janette about Brownyard. Janette stated that Brownyard had been fired. Janette told Officer D'Ambrosia that Brownyard had been fired by Chi Che, the bar manager (Arturo Muniz). At approximately 9:45 p.m., a patron later identified as Benee Scola entered the bar. Approximately 15 minutes later, Janette received a phone call from Brownyard. Janette advised Brownyard that Officer D'Ambrosia was at the bar looking for him. Brownyard told Janette that he would be at the bar in approximately 45 minutes. Janette relayed this information to Officer D'Ambrosia and at approximately 10:45 p.m., Brownyard entered the bar and sat down. D'Ambrosia and Janette approached and greeted Brownyard. Office D'Ambrosia asked Brownyard if "The two girls were around." Brownyard affirmed and stated that the price would be $80.00 per gram. Janette was in a position to hear this conversation. Officer Wheeler moved to a different part of the bar to get a better view of D'Ambrosia, Brownyard and Janette and to talk to Benne Scola. Brownyard asked D'Ambrosia if he was still interested in the "two girls" and Officer D'Ambrosia affirmed. Brownyard then obtained two matchboxes from Janette, who asked him (Brownyard) if one of the matchboxes was for her. Brownyard said yes. Brownyard left the bar and walked toward the men's restroom. Approximately two minutes, Brownyard returned and sat next to D'Ambrosia, placing a matchbox on top of the bar counter. The two clear plastic zip-lock bags containing cocaine were inside the matchbook cover. Officer D'Ambrosia pulled some currency from his pocket, counted out eight $20.00 bills and handed Brownyard the money below the bar counter. Officer D'Ambrosia picked up the matchbook, examined the contents, and placed it in his shirt pocket. Officer Wheeler did not see the exchange of money but observed the remaining portion of the transaction. On that evening, Chi Che entered the premises and set down two bar stools from Brownyard. Brownyard told D'Ambrosia that he had an argument with Chi Che about the liquor to carry at the bar and about accepting bad traveler's checks. After five or ten minutes, Chi Che left the bar. Janette asked Brownyard to watch the bar while she used the restroom. Brownyard agreed. Brownyard left the bar area after Janette returned from the restroom. D'Ambrosia states that Scola asked him (D'Ambrosia) if he knew where she could get some "blow." D'Ambrosia stated that she would have to talk to Brownyard. Brownyard returned to the bar and Scola approached him and asked about the going rate for blow. Brownyard stated $80.00 for a gram and $40.00 for a half gram. Brownyard said that he could handle a half gram right now. Scola agreed and handed Brownyard some currency. Brownyard took the currency, left the bar, existed the premises and returned approximately five minutes later. Brownyard handed Scola a small plastic baggie. Officer D'Ambrosia left the bar at approximately 7:30 and Officer Wheeler left approximately 15 minutes later. The conversations between Brownyard, Janette and Officers D'Ambrosia, Wheeler and Scola concerning the purchase of drugs occurred in normal tones of voice. Officer D'Ambrosia made no attempt to conceal the transaction. On May 18, 1984, at approximately 11:30 p.m., Officer D'Ambrosia entered the licensed premises in an undercover capacity. Janette was tending the bar. Officer Phillips was seated at the bar as the backup officer. Brownyard and Scola were also at the bar. Officer D'Ambrosia sat down and Brownyard approached him. D'Ambrosia asked Brownyard if he had any "stuff" with him tonight. Brownyard said "sure." D'Ambrosia asked if it was still the same price and Brownyard said "yes." D'Ambrosia said "OK." Brownyard left the bar and walked away from D'Ambrosia's view. About three minutes later Brownyard returned and placed a matchbox on the bar counter in front of D'Ambrosia. Officer D'Ambrosia pulled out four twenty dollar bills from his pocket and paid Brownyard. D'Ambrosia opened the match box up, lifted out a clear plastic zip lock bag containing suspected cocaine. Janette was in a position to see this transaction. Officer Phillips also observed this transaction. While tending bar, Janette spoke to Scola, "You want to go halves with me?" Scola stated that she would think about it since she had previously arranged a one half gram buy with Brownyard before officers D'Ambrosia and Phillips entered the bar. Janette later remarked that her boyfriend was later coming in with some medicine. Officer Phillips heard Scola and Janette discussing a cocaine deal. Janette told Scola it would be $35. Janette walked over to her boyfriend, Jeff Acosta, who gave her a small packet of aluminum foil. Janette gave the foil to Sonia and reminded her it was $35. Scola gave Janette two U.S. currency bills and told her to keep the rest as a tip. Janette gave Jeff the requested amount of the money. Scola later walked to the women's restroom. Officer Phillips later entered the women's restroom and observed Scola standing next to a toilet tank cover with an open packet of aluminum foil containing the suspected cocaine. Scola asked Officer Phillips to do a "line" with her, but Officer Phillips declined. Conversations at the bar area concerning the use of drugs occurred in a normal tone of voice. On May 25, 1984, at about 9:20 p.m., Officer Jenkins entered the licensed premises as a back up officer to Officer D'Ambrosia. At that time there were approximately six patrons in the bar area. Officer D'Ambrosia entered the premises approximately 9:25 and spoke to Janette about cocaine. Janette was told by Officer D'Ambrosia that the cocaine he bought from Brownyard was "poor quality" whereupon Janette allegedly admitted she was now dealing through her boyfriend Jeff. D'Ambrosia asked Janette if she would talk to Jeff about getting him some coke and she complied stating she would talk to him at about 10:10 p.m. when he (Jeff) entered the bar. D'Ambrosia approached and asked Jeff if he could get him an ounce and Jeff replied that he could. Later that night, D'Ambrosia and Jeff made a deal for one gram of coke that would be a sample for a future one ounce deal. According to D'Ambrosia, the purchase of one gram would take place on the next night, May 26, 1984. During that evening, Chi Che Muniz, the restaurant and lounge manager, entered the bar area. Officer D'Ambrosia approached Chi Che and told him that maybe Chi Che could pick up a woman if he did a couple of lines of coke. Chi Che refused. On May 26, 1984, at approximately 8:45 p.m., Officers D'Ambrosia and Jenkins entered the licensed premises. Shortly thereafter, Officer Aliva and Sergeant Roberts entered the bar. D'Ambrosia greeted Janette and had a general conversation with her. Janette asked D'Ambrosia if he had scored any cocaine and he reply "no." Janette stated that she would try and contact Jeff by phone because he had beeper. Janette made a short phone call from the bar and later told D'Ambrosia that she had left a message that he (D'Ambrosia) was at the bar. At approximately 9:30 p.m., a person later identified as Bill Hawkins entered the licensed premises. Bill approached Janette and told her that he was trying to locate some cocaine for her. Janette stated that she would buy a half from Bill for $35.00. Bill left the bar area and walked to the men's restroom. Officer Oliva went to the men's restroom. As Officer Oliva entered the restroom, he observed Bill changing clothes putting on a security uniform, complete with badge and night stick. Bill left the restroom and returned to the area. Bill told Officer D'Ambrosia that he worked part time as a security guard for Respondent on an as needed basis. At that time there were approximately 15 people in the lounge area. Bill Hawkins told Janette that the cocaine would be on the premises but that he would have to leave for a while to pick it up. Bill left for approximately 30 minutes and returned to the bar area. When he returned, he engaged in conversation with Bob Skirde. Janette later handed D'Ambrosia a small clear plastic zip-lock bag and asked D'Ambrosia to give it to Bill and tell him it was from me. D'Ambrosia complied with Janette's request. D'Ambrosia asked Bill if he had an extra half gram and Bill replied no that he could give D'Ambrosia "a nose full." Bill Hawkins then walked to the men's restroom where he found Officer Oliva who had previously arranged to buy a half gram of cocaine from Bill for $35. Bill asked Officer Olive to hold the door leading into the men's restroom while he did a line of coke. Officer D'Ambrosia observed Bob Skirde walk to the men's restroom and attempt to enter. Skirde was unable to enter the restroom inasmuch as Officer Olive was holding the door shut. Bill later approached Janette and asked her to get something to put it in. "Get me something." Janette handed Bill a napkin. Bill placed an object in the napkin, wrapped it up and gave it to Janette. Janette took the napkin and placed it in her purse. Janette later left the bar area and went to the restroom with what appeared to be the napkin she had received from Bill. Chi Che watched the bar while Janette was away. Officer D'Ambrosia states that he asked Janette "how was it?" and she replied "OK, but not as good as Jeff's." Later, Bill asked Officer D'Ambrosia to go to the men's restroom with him. Inside the restroom, Bill pulled out a clear plastic zip-lock bag containing suspected cocaine. Bill asked D'Ambrosia to do a couple of lines with him and he (D'Ambrosia) refused. D'Ambrosia asked Bill if he could purchase a half gram from him and Bill stated yes he would look into it. On June 1, 1984, at approximately 11:30 p.m., Officers D'Ambrosia and Jenkins separately entered the bar area. Officer Olive and Sergeant Roberts were there as back-up officers. D'Ambrosia talked to Jeff in Janette's presence about setting up a deal for an ounce of cocaine. Bill entered the premises and walked directly to Officer Jenkins. Bill and Officer Jenkins discussed cocaine and set up a deal for one gram to occur the next night at 7:00 p.m. On June 2, 1984, at approximately 7:10 p.m., Officer Jenkins entered the Riviera Resort Motel. Officer Jenkins asked an employee at the front desk if the bar was closed. The employee stated that it would be opened soon and suggest that she go to the patio bar. Sergeant Roberts was at the patio bar. Bill Hawkins called Officer Jenkins and they both walked to the patio bar. Janette was sitting on the patrons' side of the bar. At approximately 7:30 p.m., Janette left the patio bar to open the inside bar. Bill asked Beth, the patio bar attendant for a straw. Beth gave Bill a straw and stated that she knew Bill was not going to use it for his beer. Bill cut the straw to a length of approximately two inches and stated to Officer Jenkins "Let's go take care of business." Officer Jenkins and Bill walked to the inside bar. Janette was tending the bar and approximately two patrons were there. Officer Jenkins paid Bill $80 with money from her purse. Officer Jenkins extended the money to Bill over the bar counter and asked how the cocaine was packaged. Bill said "in a small plastic bag" and thereupon reached in his back pocket and pulled out his wallet. Bill laid the wallet on the bar counter and pulled back a flap which exposed a small clear plastic zip-lock bag containing suspected cocaine. Later analysis revealed the substance was in fact cocaine. This transaction was observed by Officer Roberts. Janette later came over to Bill and asked "if he wanted to work as a bell boy tonight because the front desk had called her." Bill was offered fond and drink for his services of helping with the luggage of the guests at the hotel. On June 4, 1984, Officer D'Ambrosia entered the Riviera Resort Motel and talked to Janette, the on-duty bartender. D'Ambrosia asked why Jeff was not at the bar. Janette replied that she would call Jeff about 10:30 or 11 p.m. and tell him that Officer D'Ambrosia was there at the bar. According to D'Ambrosia, Janette acknowledged that Jeff was to sell him (D'Ambrosia) a gram of cocaine. Officer D'Ambrosia left the bar and returned at approximately 10:45 p.m. D'Ambrosia and Jeff talked about setting up a deal for an ounce. On June 5, 1984, at about 8:10 p.m., D'Ambrosia telephoned Jeff at the Riviera Resort Motel to reschedule the drug deal to January 8, 1984 at 11:00 p.m. On June 8, 1984, at approximately 8:45 p.m., Officer D'Ambrosia arrested Tommy Brownyard outside the Rodeo Lounge. A search of Brownyard's person produced a quantity of cocaine. Between 10:00 and 10:30 p.m., Officer D'Ambrosia, Jenkins, Oliva, Wheeler, and Sergeant Roberts entered the Riviera Resort Motel and proceeded to the bar area. D'Ambrosia talked briefly with Jeff. D'Ambrosia pulled $1500 from his wallet and showed the money to Jeff. Jeff told D'Ambrosia that it would take him approximately 10 minutes to get the cocaine and he (Jeff) left. Jeff came back to the bar area in approximately 15 minutes. Jeff was then carrying a short black leather jacket over his shoulder. Sergeant Roberts observed a large clear plastic bag with cocaine stuck inside the jacket. Officer D'Ambrosia and Sergeant Roberts placed Jeff under arrest. The weight of the cocaine was determined to be 28.18 grams. The Respondent's Defense When Bob Skirde became responsible for total management of the Riviera, he inherited a security agreement with a service operated under contract with "Chief Bill Heinklein." The service provided one guard stationed at Riviera for patrol seven nights per week from 10:00 p.m. till 6:00 p.m. This service was terminated with Chief Heinklein's company on March 15, 1984 due to a seasonal decline in the occupancy in the hotel and due to unsatisfactory performance by guards supplied by Chief Heinklein. William (Bill) Hawkins was hired by the "Chief" in January of 1984 and was terminated on March 15, 1984 because he was sleeping on duty while at the Riviera. Subsequent to terminating the relationship with Heinklein's company, Robert Skirde hired security on an as needed basis when heavy occupancy was anticipated such as the Memorial Day weekend. In this regard, Walter Patskanick was hired to provide security services during that weekend. During the weekend of May 26, 1984, William Dale Hawkins was at the facility and offered to "help out" in a conversation with Chi Che in exchange for food and drink. Bill Hawkins did not receive any monetary compensation for any services he provided. Employees Chi Che hired Tommy Brownyard as a bartender on February 19, 1984. His pay was $25 per shift. His employment application indicated that he had worked as an internal revenue service agent from January, 1976 until January, 1982. On May 12, 1984, Brownyard was fired by Chi Che for failure to observe company rules and policy. On April 1, 1984, Chi Che hired Janette Hawkins to work the patio bar. Her pay was set at $25 per shift. Her employment application, as did the application of Tommy Brownyard, indicated that she had never been convicted of a crime. Following May 12, 1984, when Brownyard was fired, Janette was transferred to the inside lounge to work as bartender. Respondent denies having any knowledge of any specific work being performed by Bill Hawkins on June 1, 1984. In this regard, the evidence revealed that Bill was not on Respondent's payroll and did not receive any pay on that date. Further, Respondent denies that Bill Hawkins was an employee at any time following his termination on March 15, 1984. Upon the retention of Robert Skirde as the general manager of the Riviera Resort Motel, he (manager Skirde) immediately started to refurbish the facility and to generally upgrade the facility to serve the tourist market and to attract international tourists. The facility increased its occupancy more than 200 percent above the occupancy level that existed while the prior operator, Lodging Unlimited, operated the hotel. Manager Skirde has completely refurbished the lobby; has renovated the plumbing; has recarpeted all of the villas; has painted selected areas of the facility to "change the theme"; has repaired the south side of the roof; has spent in excess of $12,000 in landscaping has published another brochure which is being forwarded to travel agencies and, as stated earlier herein, has retained the services of the Hallandale Police Department to rid the facility of derelicts. Manager Skirde has been in the hotel business in excess of 24 years and in Florida for more than 12 years in that business. He started his employment in the Industry with the Sheraton Hotel Chain and has worked at several large tourist hotels in the area before being retained by the Respondent. Manager Skirde is the incoming President of the HSMA, a trade association of hotels and motels. Respondent has installed an electronic device which can contact police during an emergency, as needed. While Respondent used Chief Heinklein's services to provide security at the facility, manager Skirde reviewed a log book which was maintained by the security personnel, a daily basis, immediately after he got to the facility each morning. During May, 1984, occupancy declined significantly at the hotel and, for that reason, manager Skirde cut back on security and other areas until the season picks up during mid- July, 1984. Prior to that time, there had been no evidence of any drug transactions either by employees or patrons, by management or other persons involved in the operation of the Respondent's facility. During manager Skirde's tenure, he has issued several memos concerning problems with security and other means of maintaining security at the facility. At his arrival at the facility each morning, he usually "walked the property off and has instructed all employees that they can contact him on a 24- hour basis if needed." Manager Skirde has a policy of prohibiting employees from being on the property after their normal work hours have ended. Additionally, manager Skirde has instructed employees to contact him at any hint of drug activity. Manager Skirde has never overheard any conversation regarding drug use on the premises of the Riviera motel. Manager Skirde has not seen any memo published by the Petitioner as to a drug educational program for licensees. Elvis Reyes, a resident of New York City, New York, is employed by DBG properties, the owner of the Respondent's facility as an internal security officer. As part of his duties as an internal security officer, Reyes visits various properties owned by DBG properties unannounced and, in that connection, visited the Riviera Motel on May 2, 1984. Part of his instructions were not to divulge his affiliation with the parent company. During Reyes' visit to the Riviera Resort Hotel on May 2, 1984, he was there for the specific purpose of trying to find drugs on the property, either through the use by patrons or the sale of drugs in the bar areas. When Reyes went to the facility, he visited the lounge on May 2 and while in the bar lounge, there were 3 people present, 2 of whom were bartenders and 1 patron. Reyes asked the bartenders and the 1 patron if they knew where he could get some "toot" or some "blow." On each occasion, Reyes got a negative response. Reyes returned to the lounge on May 3 and again tried to buy some drugs from both the on-duty bartenders and the patrons without any success. Mr. Reyes filed a report with his superior, a Mr. Fruitbind of DBG properties in New York City, and related to him that there was no evidence of drugs being used on the premises by either patrons or employees. (Respondent's Exhibit 5.) Dr. Robert Baer is the holder of a doctorate degree in Public Affairs and Administration and is employed at Nova University in Ft. Lauderdale. Dr. Baer has extensive educational training and experience in drug detection training and experience in the installation of security measures at hotel facilities. Dr. Baer served as a police officer with the Metro-Dade County Police Bureau from 1971 through 1977. He has served as an Officer in the Narcotics Unit and in the Organized Crime Bureau. Dr. Baer was received as an expert in these proceedings in surveillance, drugs and narcotics usage in hotels. Based on Dr. Haer's interview of Respondent's management team and the security service in force at the facility, he concludes that the security at Respondent's facility is at least average or better than average. His opinion was based on his study of the area which is a low crime area, the fact that police officers frequent the area in the lounge and they regularly are seen patroling the area. Based on the following reasons, Dr. Baer felt that security at the Respondent's facility was more than adequate: The security personnel are told not to go into the bar area; The Security Director goes into the bar on a daily basis; Brownyard was fired for dereliction of duties; There was a penetration study conducted by Internal Security Officer Hayes, and Management was unaware of any problems relative to drug usage by either employees or patrons.
Findings Of Fact Respondent, James Barker (Barker), has been a city commissioner for the City of Coral Gables (City) since 1989. The Country Club of Coral Gables (Country Club) was established by City founder George Merrick, prior to the City's incorporation. Since 1929, the City which owns the land and buildings from which the Club operates, has leased the property to private entities. Since 1935, the lessee of the property has been the Country Club, a non-profit corporation run by a board of directors elected by the Country Club membership. Between 1935 and 1958, the lease underwent various modifications and extensions. In 1958, the City Commission voted to extend the lease to July 31, 1990. Under the terms of the lease, the Country Club paid three percent of its gross annual income, but in no case less than $5,000 per year, to the City as rent. In 1977, the Country Club again came before the City Commission requesting a lease extension, this time to the year 2002. There was no change in the rent amount. The request for extension was to allow the Country Club to borrow money for construction, and the request was approved. In 1978 the Country Club asked the City Commission for rezoning so that it could expand its tennis courts. This request was approved. In May, 1980, the Country Club asked the City Commission for a $23,000 loan to repair its roof. The City Attorney advised that the City could not lawfully make such a loan, and no further action was taken on the matter. In 1981 the Country Club asked to expand its tennis club facilities, and this request was approved. In 1983 a significant portion of the Country Club burned down. A request by the Country Club to support its efforts to raise funds from citizens for the Country Club, was on the July 26, 1983, City Commission agenda, but was not taken up. A discussion of the status of the building was held on that date, but no action was taken. Instead of rebuilding the burned section with the insurance money, the Country Club decided to construct an already planned new section. On November 22, 1983, representatives of the Country Club presented a plan for restoration to the City Commission, which on motion of Commissioner Kerdyk, approved the plan. On March 27, 1984, the City Commission authorized the City Manager to sign an affidavit needed by the Country Club to obtain a building permit. In April 1984, the Country Club requested extension of its lease to the year 2020. On motion of Commissioner Kerdyk, the City Commission agreed to the extension. In September 1984, the Country Club asked that the lease be reworded in order to satisfy the lending institutions from which the Country Club was borrowing money for renovations. The request was approved. When the Country Club initially undertook its restoration and remodeling plan, the Country Club leadership believed that there would be sufficient funds to accomplish both the rebuilding and the new construction. Cost overruns, diminishing membership, and other factors combined, however, to leave the Country Club with a new section, an old, burned-out section, and a significant debt. In 1987, the Country Club asked the City Commission to assist it, by contributing funds or otherwise, in overcoming that debt. On November 24, 1987, the City Commission met and discussed the problem. The only action taken was to invite the Country Club leadership to an up coming City Commission meeting to discuss proposed improvements. On January 26, 1988, the City Commission met with the Board of Directors of the Country Club to discuss the Country Club's request. The City Commissioners were informed that the Country Club's rent payments had been generating approximately $40,458.64 per year in income to the City. The Country Club vice-president proposed that the City rebuild the outside shell of the building, at a cost of $1,000,362 and the Country Club finance the remainder of the construction, about $1,900,000. The City Attorney advised that the City could not loan funds to the Country Club, because it was a private club. However, he opined that the City could participate in the rebuilding because it was the owner of the property. Action was postponed until the next meeting. On February 3, 1988, the Country Club made an offer to the City to increase its rent payment from three percent to six percent, if the City would rebuild the shell. The matter was raised at the February 9, 1988, meeting of the City Commission. Mayor Corrigan proposed that the City finance the rebuilding, but made no motion. Commissioner Wolff proposed that the City obtain funds from the Sunshine State Governmental Financing Commission and lend that money to the Country Club. The motion was seconded by Commissioner Kerdyk, and ultimately the City Commission resolved to refer the matter to the acting city manager to "work out financing without using taxpayer dollars." At the February 9 meeting, discussion was had on the issue of whether the City Commissioners had conflicts of interest, since they all had complimentary memberships to the Country Club. Mr. Zahner, the City Attorney, advised that they had no conflict. The issue of conflict of interest was again raised at subsequent meetings. Alternative proposals identified by the City Manager for funding the Country Club's rebuilding were discussed at the City Commission's March 8, 1988 meeting, but no action was taken. On June 30, 1988, the Country Club proposed that the City forgive lease payments until the year 2000. On August 30, 1988, the City Commission voted to suspend the lease payments, with the funds going instead to the maintenance and reconstruction of the facility. Membership in the Country Club is open to any person, provided they can pay the initiation fee and membership dues. At all times pertinent to this proceeding, the initiation fee was $1,000, although it sometimes was reduced to $500 during membership drives. The annual fee was $750. Membership entitles the member and his or her family to use the swimming pool, health club, tennis courts, and bar and restaurant. Members must pay for their meals. Occasionally Barker would stop by the Country Club for cocktails or brunch. For more than twenty years the Country Club has traditionally awarded memberships to city officials and various other persons. The Country Club bylaws provide for such memberships. The bylaws provide for honorary memberships and complimentary memberships. Only one honorary membership has been given. The only difference between what the Country Club calls a complimentary membership and an honorary membership is the duration of the membership. Complimentary memberships run from year to year. Persons awarded complimentary memberships include the City Commissioners, Mayor, City Manager, Assistant City Managers, the City Clerk, City Attorney, Director of Public Works, Finance Director, City Architect, Fire and Police Chief, the University of Miami President, Football Coach, and Assistant Athletic Director, the Golf Pro at the City golf course, and the editor of the local social magazine. The complimentary memberships are reviewed each year and are not renewed after the recipient leaves his or her office. The Coral Gables Executive Club (Executive Club) is located in an office building at 550 Biltmore Way. The building and the Executive Club are owned by Albert Sakolsky, a local real estate developer. The Executive Club, which opened in the late 1980's, consists of a dining room and health club. Membership costs $700.00 initiation, and $50.00 per month dues. Mr. Sakolsky hired a public relations firm to promote the Executive Club. The firm recommended that complimentary memberships be given to community leaders and developed a list of persons who receive memberships. Over a hundred free memberships were granted. In February, 1989, Mr. Sakolsky wrote to City Manager Jack Eads, presenting the City with a "permanent corporate membership." Although the letter appeared to infer that the use of the health facilities would be free to those applying through the City's corporate membership, the practice was to change holders of complimentary memberships such as Barker $30 a month for the use of the health facilities if they desired to use them. With his letter, Mr. Sakolsky included membership applications for all the City Commissioners, as well as the Mayor the City Attorney, and Mr. Eads. Mr. Sakolsky and the City had had numerous disputes over the years on various issues. His presentation of the free corporate membership was an effort to, in his words, "bury the hatchet." A complimentary membership entitled the member to use the dining facilities. Soon after its inception the Executive Club was opened to the pubic. The only privilege members received over non-members was a discount on their meals. A non-member could be given a complimentary membership after first visit, thereby entitling him to receive a discount on subsequent visits. In September, 1989, the City Commission voted to lease space in the 550 Building. The rental rate was $20 per square foot. When the lease expired, the owner of the building proposed a higher rate, which the City did not accept. The City vacated the building and rented space elsewhere. Barker has been a member of the Country Club since 1986, and was a member when he was elected to the City Commission in 1989. Barker's private employment is in marketing. Until he was elected to the City Commission, Mr. Barker's employer paid his membership dues. Subsequent to his election, Barker's membership was changed by the Country Club to a complimentary membership. Under the terms of the complimentary membership, Barker was not allowed to vote in Country Club elections or hold an office in the Country Club, but continued to retain all the other benefits he had been entitled to as a paying Country Club member. The Country Club dues were paid by Barker's employer until Barker was elected to the City Commission. Barker understood that the complimentary memberships were a tradition in the City. No one from the Country Club ever asked him for favors. No vote concerning the Country Club was pending before the City Commission when Barker received his complimentary membership. The only vote concerning the Country Club in which Barker participated while a Country Club member was a vote to postpone action. No one from the Country Club ever asked Barker for any favors. No vote concerning the Executive Club was pending before the City Commission when Barker received his complimentary membership. Barker thought that his membership to the Executive Club was a public relations gesture. He viewed the Executive Club not as a private club but as a restaurant. Barker usually went to the Executive Club as someone else's guest. Barker never voted on a matter concerning the Executive Club. The Executive Club and Country Club memberships were given to a variety of private community leaders as well as City officials. Barker cancelled his complimentary memberships when the State advised him of his position regarding a conflict of interest.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Commission on Ethics enter a final order and public report finding that James Barker violated Section 112.313(4), Florida Statutes, by accepting a free membership to the Coral Gables Country Club and by accepting a free membership to the Executive Club. I therefore recommend a civil penalty of $750 and restitution of $750 for the violation involving the Coral Gables Country Club and a civil penalty of $1,000 and restitution of $600 for the violation involving the Executive Club for a total penalty $3,100. The civil penalty for the violation involving the Country Club is mitigated due to the advice given to Barker by the City Attorney that there was no conflict of interest. The restitution in both cases is the amount a member of the general public would have had to pay for one year's dues. DONE AND ENTERED this 23rd day of May, 1994, in Tallahassee, Leon County, Florida. SUSAN B. KIRKLAND 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 23rd day of May, 1994. APPENDIX TO RECOMMENDED ORDER, CASE NO. 93-3911EC To comply with the requirements of Section 120.59(2), Florida Statutes (1993), the following rulings are made on the parties' proposed findings of fact: Advocate's Proposed Findings of Fact Paragraphs 1-18: Accepted. Paragraph 19: The first sentence is rejected as unnecessary. The remainder of the paragraph is accepted in substance. Paragraph 20: The first sentence is accepted. The second sentence is accepted in substance. Paragraph 21: Accepted. Paragraph 22: The first sentence is accepted. The second sentence is accepted in substance. Paragraphs 23-26: Accepted. Paragraph 27: Accepted in substance. Paragraph 28: Accepted. Paragraph 29: The first sentence is accepted. The second sentence is Rejected as unnecessary. Paragraphs 30-34: Accepted. Paragraph 35: The first sentence is Rejected as constituting a Conclusion of Law. The remainder of the paragraph is accepted in substance. There is no paragraph 36. Paragraphs 37-38: Rejected as constituting argument. Paragraph 39: Accepted. Second Paragraphs 38-39: Accepted. Paragraph 40: Accepted. Paragraph 41: The first and second sentences are accepted in substance. The third sentence is accepted in substance to the extent that the City officials who were receiving complimentary memberships through the City's corporate membership could use the health facilities for a fee of $30 per month but Rejected to the extent that it implies that the City officials could use the health facilities at no cost. Paragraphs 42-43: Accepted. Paragraph 44: The first sentence is Rejected as constituting a conclusion of law. The second sentence is Accepted. The third sentence is Rejected as constituting argument. Paragraphs 45-46: Rejected as constituting argument. Respondent's Proposed Findings of Fact Paragraphs 1-4: Accepted. Paragraph 5: Rejected as subordinate to the facts actually found. Paragraph 6: Rejected as unnecessary. Paragraph 7: Accepted. Paragraph 8: The last sentence is rejected as unnecessary. The remainder of the paragraph is accepted. Paragraphs 9-12: Accepted. Paragraph 13: The last sentence is Rejected as constituting a conclusion of law. The remainder of the paragraph is Accepted as substance. Paragraphs 14-15: Accepted in Substance. Paragraph 16: Accepted. 10 Paragraph 17: Accepted in Substance. Paragraph 18: Accepted. Paragraphs 19-23: Accepted in Substance. Paragraph 24-25: Accepted. Paragraph 26-34: Accepted in Substance. Paragraph 35: The first sentence is Accepted in Substance. The second sentence is Rejected as unnecessary. Paragraph 36: Accepted. Paragraph 37: Accepted in Substance. COPIES FURNISHED: Raoul G. Cantero, Esquire Suite 1600 2601 South Bayshore Drive Miami, Florida 33133 Virlindia Doss, Esquire Department of Legal Affairs The Capitol, PL-01 Tallahassee, Florida 32399-1050 Bonnie Williams Executive Director Florida Commission On Ethics Post Office Drawer 15709 Tallahassee, Florida 32317-5709 Phil Claypool, Esquire General Counsel Ethics Commission 2822 Remington Green Circle, Suite 101 Post Office Drawer 15709 Tallahasee, Florida 32317-5709
Findings Of Fact 1. Petitioner is a corporation not for profit organized under Florida law in December of 1981, to "operate a supper club and lounge and to promote the culinary arts in Panama City, Florida, and the affording of facilities to members of the club for the enjoyment of same." Respondent's Exhibit No. 1. David McCurdy, John Diamond and Lorette Chance signed the articles of incorporation. The articles of incorporation specify that membership "shall consist of persons over the age of nineteen (19) years who shall be admitted on the majority vote of the directors of the corporation." Respondent's Exhibit No. The bylaws provide simply that "[n]ew members must be spons[o]red by a member in good standing . . . ." Respondent's Exhibit No. 2. For the first year of its existence, The Back Door Lounge and Supper Club, Inc. (the supper club) was operated solely for its members' enjoyment, on the premises of what had been the Chat 'N' Chew, a beer bar Mr. and Mrs. McCurdy had operated. Membership dues are $20.00 annually, and the supper club is open from six in the evening till six in the morning. Weekly there are covered dish suppers, and several members attested to learning about spices in connection with these suppers. Organization as a private club also discouraged "rowdyism . . . [like that to be found in some] other lounges within the P. C. area." Respondent's Exhibit No. 4 (Goss letter of 16 March 1984). In seeking to establish a private club, Mr. and Mrs. McCurdy have acted in good faith at all times and in keeping with their understanding of the legal advice they received. When Jerrold Hill, a sergeant with the Division of Alcoholic Beverages and Tobacco, was in the supper club in late 1983, he saw no difference between what was going on then and what he had earlier seen in the Chat 'N' Chew. In December of 1983, petitioner applied for the license at issue here. Eleven months earlier, there had been discussions with the local chapter of the American Cancer Society about donating money made on the suppers to the Society. On March 16, 1984, the day after one of respondent's investigators visited the supper club, petitioner gave the American Cancer Society a check for $500.00.
Recommendation It is, accordingly, RECOMMENDED: That respondent deny petitioner's application for licensure. DONE and ENTERED this 5th day of September, 1984, in Tallahassee, Florida. ROBERT T. BENTON, II Hearing Officer Division of Administrative Hearings 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 5th day of September, 1984. COPIES FURNISHED: Sandra P. Stockwell, Esquire Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32301 Mr. David A. McCurdy Back Door Lounge & Supper Club 4130 West Highway 98 Panama City, Florida 32405 Gary Rutledge, Secretary Department of Business Regulation The Johns Building 725 South Bronough Street Tallahassee, Florida 32301 Howard M. Rasmussen, Director Department of Business Regulation Division of Alcoholic Beverages and Tobacco The Johns Building 725 South Bronough Street Tallahassee, Florida 32301
The Issue Whether Respondent's beverage license should be suspended or revoked, or a civil penalty assessed, for alleged violations of Sections 562.13(3)(a)(1), and 561.20(7)(a)(3), 562.23, Florida Statutes and Rule 7A-3.19(2), Florida Administrative Code, pursuant to Section 561.29, Florida Statutes, as set forth in Notice to Show Cause issued by Petitioner.
Findings Of Fact The Florida Voluntary Roadside Improvement Association (Association) was incorporated in 1951 as a nonprofit corporation under the laws of the State of Florida by the Circuit Court of Leon County. The general objects of the Association as set forth in its certificate of incorporation are to develop and carry out a program of voluntary mutual cooperation among businesses occupying lands adjoining highways of Florida, highway users, and others concerning highway utilization. Petitioner has issued beverage licenses to the Association in several business names since 1969 at several locations in Tallahassee. In November, 1974, a Series 11-C beverage license (club license) was issued to the Association in the name of 1221 Club located at 1221 Alabama Street, Tallahassee, Florida. The license was in effect at the time of the alleged violations set forth in Petitioner's Notice to Show Cause and is presently held by the licensee. (Petitioner's Exhibits 1, 2, Testimony of Schoenfeld) The Association has rented space in a building owned by Willie Bennett at 1221 Alabama Street for several years. When he first purchased the building some seven years ago, it was rented to Alberta Walker who was then operating a place of business known as the Psychedelic Shack under a beverage license issued by Petitioner. In October, 1974, on a plea of nolo contendere, she was sentenced to eight months in the Leon County Jail by the County Court of Leon County for a violation of the State Beverage Law and another offense. Her beverage license was cancelled in May, 1974. City utilities for 1221 Alabama Street have been supplied under a contract with Walker in the name of Psychedelic Shack since 1970. (Petitioner's Exhibits 6, 10, 12, Testimony of Bennett, Schoenfeld, Connell, Walker) On June 3, 1977, Petitioner's beverage officer, Gary E. Sams, took a paid informant, Nathan Jones, to the vicinity of the 1221 Club and instructed him to enter the premises and attempt to become a member of the club and purchase alcoholic beverages there. Some 20 minutes later, Jones came out of the club and had a membership card. On several later occasions during the month of July, 1977, Jones purchased beer and vodka at the club from Walker who was tending the bar. Although Jones relied on a recent memorandum prepared by Sams to recall the precise dates of the beverage sales by Walker, his testimony concerning the incidents is deemed credible. (Testimony of Sams, Jones, Simmons, Respondent's Exhibit 1) On July 14, 1977, Sams observed Walker go to the door of the club, insert a key and enter the premises. On July 18, he observed Walker take a key from her purse, give it to Theodore Simmons, who thereafter unlocked the door. On July 19, Sams served a subpoena duces tecum upon Walker at the club premises for cancelled checks and bank statements of her personal checking account during the period January through June, 1977. She expressed no objection to turning over the required documents and did so that day. Theodore Simmons, the president of the Association, voluntarily turned over checks from the Association banking account in the Second National Bank of Tallahassee, which were variously dated in May and June of 1977. Upon comparison of the two sets of checks, a handwriting expert employed by the Florida Department of Criminal Law Enforcement found that Walker had written many of the words and figures appearing on the face of the checks, but had not signed them. (Petitioner's Exhibits 7-9, Testimony of Sams, Deposition of McCarthy (Petitioner's Exhibit 13) The bylaws of the Association provide that the membership committee inquires into the eligibility of applicants and submits findings to the board of directors who then vote on membership. The bylaws further provide that the treasurer of the organization shall have charge of the funds and deposit all monies in Association bank accounts, make disbursements, and maintain the books. In fact, two former treasurers of the Association resigned from their duties because they were given no functions to perform and never saw any books of the Association or handled any of its monies. Both individuals had become members of the Association by paying a $1.00 membership and were unaware as to whether any vote had ever been taken on their membership. Although at one time, the Association contemplated creating recreational facilities across the street from its premises, all that was accomplished was a clearing of land. Several times, the membership was solicited for funds to assist families of deceased members. The primary function of the club was social in nature. (Petitioner's Exhibit 3, Testimony of Dixie, Allen) Both Theodore Simmons and Alberta Walker testified at the hearing. Simmons was president of the Association from 1975 until a few months ago. Walker has been a member since May of 1975. During the period that Simmons was president, the Association had officers but not a board of directors. The club did not have a paid manager or employee. The practice was for Simmons to make sales of beverages and snacks during the hours of operation, and sign checks prepared by Walker for payment of rent, supplies and other Association expenses. Although Walker was not a paid employee, she possessed keys to the establishment, kept the books, handled the monies and made the periodic deposits in the club bank accounts. Simmons was aware that Walker had been convicted of a beverage violation and testified that "I didn't start the club until she came out of jail." Although Simmons wasn't paid for his work at the club, if he needed money, he would routinely take some from the club receipts. Walker testified that Simmons was her "boy friend" for five years and that she spent a lot of time at the 1221 Club to be with him and because she was unemployed. She testified that she kept the books of the Association because Beverage Officer Sams had said in 1975 that it was all right to "work there" due to the fact that her criminal conviction had been for a misdemeanor; but that he told her in August, 1977, that a 1976 state law prohibited her working as a bartender, although she could continue to keep the books. At the hearing, Sams conceded that he had informed Walker that she could continue to maintain the books of the Association. Walker claimed that the reason the utilities for the premises remained in her name was that it would cost $300 to transfer the account to the 1221 Club. Her claimed reason for making the club bank deposits was that Simmons had no motor vehicle and that the bank was located on the route to her home. She admitted selling alcoholic beverages as a consequence of Sams telling her that she could work at the club. The reason she had a key to the premises was that the one used during her operation of the Psychedelic Shack still opened the lock on the door of the premises. Her reason for filling out checks for Simmons to sign was that he was nervous and a poor speller. (Testimony of Simmons, Walker, Sams)
Recommendation It is recommended that Petitioner impose a civil penalty against Respondent, Florida Voluntary Roadside Improvement Association, in the amount of $100, pursuant to the authority granted under Section 561.29(1)(e) and (4), Florida Statutes, for violation of Rule 7A-3.19(2), Florida Administrative Code. DONE and entered this 21st day of February, 1978, in Tallahassee, Florida. THOMAS C. OLDHAM Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Francis Bayley, Esquire Department of Business Regulation The Johns Building 725 South Bronough Tallahassee, Florida 32304 W. R. Phillips, Esquire Post Office Box 594 Carrabelle, Florida 32322 Charles A. Nuzum, Director Division of Beverage Department of Business Regulation 725 South Bronough Street Tallahassee, Florida 32304
Findings Of Fact The Subject Property. The Applicant is the owner of approximately 799.58 acres of land (hereinafter referred to as the "Country Club Property"), located on Loch Rane Boulevard, Clay County, Florida. In the early part of 1987, the Applicant applied to rezone the Country Club Property as a planned unit development district (hereinafter referred to as a "PUD"). The Country Club Property is to be developed in phases. At issue in this proceeding is that portion of the Country Club Property other than Unit One, which consists of lots 1 through 295. Development of the Property; Government Action Relied Upon by the Applicant. Prior to approving the rezoning of the Country Club Property requested in the early part of 1987, Clay County advised the Applicant that it would be required to commit to resignalize and expand the Loch Rane/Blanding Boulevards interchange as a condition to Clay County approving the rezoning of the Country Club Property as a PUD. Clay County approved the requested rezoning of, and the master land use plan for, the Country Club Property on March 24, 1987. The master land use plan specifies that the Country Club Property will include development of the following: (a) up to 599 single-family dwelling units within the residential portion; (b) ten acres of commercial uses, including retail shops, a day-care center and a restaurant; (c) a sales center; and (d) a golf course and club facilities. Engineering plans for phase one of the proposed development were submitted to Clay County in 1987. As part of the engineering plans, the Applicant obtained permits from the Army Corps of Engineers, the St. Johns' River Water Management District and the Florida Department of Environmental Regulation. The plat for phase one of the Country Club Property was submitted to Clay County and on May 12, 1987, Clay County approved the final plat for phase one. In April, 1989, the Applicant applied for building permits for construction of the golf course clubhouse, pool facilities and the golf cart storage barn. Permits for these facilities were issued by Clay County in October, 1989. In 1991, engineering plans for phase two of the Country Club Property were submitted to Clay County. They were approved effective January 1, 1992. On February 12, 1993, Clay County issued a Vested Property Certificate for phase one of the development, Lots 1 through 295 of Unit One, pursuant to Section 20.8-6 of the Vested Rights Review Ordinance of Clay County, Florida. The Applicant's Detrimental Reliance. In reliance on Clay County's actions in approving the PUD rezoning and accompanying master plan and the engineering plans for phase one and phase two, the Applicant constructed master infrastructure improvements for the project. Improvements have included drainage, water and sewer systems, a master road system designed and sized to serve the entire development at a cost of approximately $4,972,670.00. These improvements were made between November, 1988 and April, 1990. The Applicant has also constructed the entry features for the Country Club Property, master recreational facilities, including an eighteen-hole golf course, golf course clubhouse, pool and tennis facilities and a sales center. Total costs of these improvements were approximately $7,224,917.00. These improvements were made between November, 1988 and April, 1990. Finally, the Applicant has resignalized and expanded the Loch Rane/Blanding Boulevards interchange. The cost of these improvements was approximately $72,000.00. These improvements were made between October, 1991 and January, 1992. Rights That Will Be Destroyed. Pursuant to the Clay County 2001 Comprehensive Plan, the portion of Blanding Boulevard impacted by the Country Club Property development does not have sufficient capacity to develop the property as proposed. To comply with the comprehensive plan will require considerable delays in completion of the project which will result in a substantial adverse financial impact on the Applicants. Procedural Requirements. The parties stipulated that the procedural requirements of the Vested Rights Review Process of Clay County, adopted by Clay County Ordinance 92-18, as amended by Clay County Ordinance 92-22 have been met.
The Issue The issue for consideration in this case is whether Respondent, Katherine Harris, violated the provisions of Section 106.08, Florida Statutes, by making payments of organizational dues from her campaign account prior to the 1998 election.
Findings Of Fact As to the Merits: At all times pertinent to the issues herein the Commission was the state agency responsible for the oversight of public elections in this state. Respondent was a candidate for public office whose activities were subject to scrutiny by the Commission. The Division of Elections (Division) was a branch of the office of the Secretary of State. Respondent initially notified the Division on June 8, 1997 that she was seeking re-election to the Florida Senate seat she then held. However, on November 19, 1997, she filed the appropriate forms with the Division to signify her candidacy for the office of Florida Secretary of State. At or near each filing, Respondent filed with the Division a "Statement of Candidate" in which she stated she had received, read, and understood the requirements of Section 106, Florida Statutes. From April 1997, through mid-March 1998, 21 separate checks were written by her campaign treasurer on Respondent's campaign account with the Barnett Bank for dues payments to organizations. This is the issue here. The organizations to which the checks were written are organizations established for the public good. The checks in issue are as follows: CH # DATE PAYEE AMT 0101 04/03/97 Charlotte County 9.00 Republican Club 0102 04/03/97 Peace River Federated 5.00 Republican Women 0103 04/03/97 Manasota Republican 11.00 Women's Club Fed. 0104 04/03/97 Venice-Nokomis Fed. 11.00 Women's Club 0105 04/03/97 Sarasota Bay Republican 5.00 Women's Club 0106 04/03/97 West Charlotte 5.00 Republican Club 0108 06/05/97 Bernice Furrow 25.00 0109 07/03/97 Venice Area C of C 50.00 0110 08/06/97 Charlotte County C of C 65.00 0111 08/11/97 Republican Women's Club 10.00 of Sarasota 0112 09/04/97 Sarasota Bay Republican 15.00 Women's Club 0114 10/29/97 Taxpayer's Association of Sarasota County 12.00 0120 11/30/97 Sarasota Republican Club 15.00 0162 02/11/98 Mid-County Republican 15.00 0163 02/11/98 Club Venice-Nokomis Federated 7.50 0164 02/11/98 Republican Club West County Republican 5.00 0165 02/11/98 Club Siesta Key Republican 6.00 0189 03/03/98 Club Sarasota County Young 30.00 0199 03/09/98 Republicans Republican Women's Club 10.00 of Sarasota 0204 03/16/98 Republican Women's Club 15.00 0206 03/16/98 of Lakeland Federate Manasota Republican 10.00 Women's Club Federate All of the checks except number 0108 were for dues to the organization shown, and totaled $325.00. Check number 0108, in the amount of $25.00, was made to Bernice Furrow, and the memo space on the instrument indicates it was issued in reimbursement of dues to the Peace River Forum. These checks were written at the direction of Respondent. Clifford M. King, the maker of the checks in question, is an attorney admitted to practice in Florida in 1988. He served as campaign treasurer for Respondent during her successful campaign for the Florida Senate in 1994, and was her attorney and campaign treasurer during her campaign for Secretary of State. His major areas of practice include business transactions, estate planning, and probate. He has not worked for any other candidate nor has he ever been employed by any other client to give advice on elections law. Nonetheless, he considered himself to be qualified to advise Respondent on the Florida Election Code during her campaigns. It is so found. To prepare for giving that advice, Mr. King reviewed the Florida Statutes pertinent to elections and the campaign handbook prepared and issued by the Division of Elections. However, he did not read any opinions issued by the Division or opinions of the Attorney General dealing with elections law. When issues arose with which he did not feel comfortable, he would seek the advice of the Division of Elections. Mr. King cannot recall whether it was Respondent or one of her campaign workers who asked him if it were permissible to spend campaign funds for dues, but he is sure the question was asked. In response, he advised that to do so was a permissible expenditure of the campaign. Mr. King recalls that this same issue arose during the 1994 campaign at which time, based on his research of the statutes and the Division's campaign handbook, and after consultation with individuals involved in other campaigns, he concluded that expenditures for dues were permissible and he so advised Respondent. Though Mr. King recalls having discussed with Respondent the issue of the permissibility of writing these checks, he did not advise her of the specific provisions of the elections statute in issue here. He was satisfied at the time he advised Respondent and wrote the checks in issue, that it was lawful and permissible to do so. The Division's investigator, Mr. Smith, contacted representatives of most, if not all of the organizations to whom the checks in issue were written. All checks except the one to Ms. Furrow, were in payment of membership dues paid by all members. Mr. Young could find no instance where a specific benefit accrued to Respondent as a result of her payment of dues which was not received by every other member of the organization, candidate for public office or not. It is so found. As to the Motion for fees: After the Order of Probable Cause involving Respondent was served on Respondent, she requested a formal hearing. This hearing was initially denied by the Commission on the grounds that Respondent had failed to identify issues of fact requiring formal hearing. However, this decision was subsequently reversed and the matter was referred for formal hearing before the Division of Administrative Hearings. While the discovery process was being carried out, it became known that Respondent had twice been advised by Mr. King, her attorney, that the donations/dues payments from campaign funds in issue were permissible expenditures. When this information became known to the Commission's counsel, counsel prepared a Motion to Dismiss the Order of Probable Cause and recommended that action to the Commission. The basis for the recommendation was a lack of evidence to demonstrate that Respondent's actions were willfully illegal. Notwithstanding its counsel's advice, the Commission determined to proceed with the action on the basis that a majority of the Commissioners considered Respondent's counsel/campaign treasurer, the individual who had given the advice to Respondent, a "straw man" whose testimony by deposition was for the sole purpose of exonerating Respondent. That conclusion is not supported by the evidence of record, however.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is recommended that the Florida Elections Commission enter a final order dismissing its Order of Probable Cause in this matter. An award of attorney's fees and costs to Respondent is unwarranted and rejected. DONE AND ENTERED this 30th day of October, 2000, in Tallahassee, Leon County, Florida. ARNOLD H. POLLOCK 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 30th day of October, 2000. COPIES FURNISHED: Phyllis Hampton, Esquire David F. Chester, Esquire Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050 Richard E. Coates, Esquire Christopher B. Lunny, Esquire Katz, Kutter, Alderman, Bryant & Yon, P.A. 106 East College Avenue Post Office Box 1877 Tallahassee, Florida 32302-1877 Barbara M. Linthicum, Executive Director Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050 Steven K. Christensen, Clerk Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050
Findings Of Fact On May 11, 1977, at an establishment advertised as Mr. Big Stuff's Bedroom, female topless dancers were observed either straddling customers legs or dancing between customers legs while either placing their breasts close to or touching the customers' faces. No evidence was introduced purporting to establish that any of the performers were agents, servants or employees of Central Florida Clubs. Accordingly, it is found, as a matter of fact, that the performers were not agents, servants or employees of Central Florida Clubs. No evidence was introduced purporting to demonstrate whether, to the average person applying contemporary community standards, the dominant theme of the dance, taken as a whole, appealed to prurient interests. Accordingly, it is found, as a matter of fact, that to the average person, applying contemporary community standards, the dominant theme of the dance presented at Mr. Big Stuff's Bedroom, taken as a whole, did not appeal to prurient interests. No evidence was introduced purporting to demonstrate whether Mr. Big Stuff's Bedroom was operated under the auspices of the licensee, Central Florida Clubs. Accordingly, it is found, as a matter of fact, that Mr. Big Stuff's Bedroom was not operating under the auspices of the licensee, Central Florida Clubs. On May 11, 1977, an unidentified person declared that if one drink were purchased, then a second drink, at a reduced price, would be provided for a waitress. No evidence was introduced as to the identity of the person nor purporting to establish that such person was an agent, servant or employee or entertainer of Central Florida Clubs. Accordingly, it is found, as a matter of fact, that the unidentified person was not an agent, servant, employee or entertainer of Central Florida Clubs. No evidence was introduced purporting to establish that Harold Ernest Squires, Jr., was an agent, servant or employee of Central Florida Clubs, or that Harold Ernest Squires, Jr., did knowingly permit one Joyce Marie Polakowski to loiter in or about the licensed premises for the purpose of begging or soliciting a person, customer or visitor, to purchase a beverage. Accordingly, it is found, as a matter of fact, that Harold Ernest Squires, Jr., was not an agent, servant or employee of Central Florida Clubs and that Harold Ernest Squires, Jr., did not knowingly permit Joyce Marie Polakowski or any other person to loiter in or about the license premises for the purpose of begging or soliciting a customer to purchase a beverage.
The Issue Whether Petitioner, Barbara Robinson, was subject to an unlawful employment practice by Respondent, Attractions Lodging Leisure, Inc., d/b/a All Guest Services, in violation of the Florida Civil Rights Act.
Findings Of Fact Petitioner requested this evidentiary hearing to prove her allegation that All Guest discriminated against her based on her age, national origin, and race. At the final hearing, Petitioner described herself as “a black Jamaican female over the age of forty.”4/ All Guest operates a tourism business in Orlando, Florida. Its business consists of placing sales representatives, or “concierges,” in hotel lobbies throughout the Orlando area. These concierges assist hotel guests by promoting and selling theme park tickets, answering questions about local attractions, and generally helping the guests feel happy about their stay. All Guest currently employs over 150 concierges in 75 hotels across Orlando. All Guest hired Petitioner as a concierge in October 2012. All Guest assigned Petitioner to work in a specific hotel. Petitioner was 48 years old at the time All Guest hired her. Petitioner worked for All Guest from October 2012 until May 2018. By all accounts, Petitioner was a dependable worker with no noted deficiencies in her job performance. Testimony at the final hearing established that Petitioner was qualified to perform her duties as a concierge, and All Guest was pleased with her work. Petitioner remained in the position of concierge during her five years with All Guest. Beginning as early as 2013, however, Petitioner became increasingly disenchanted by what she perceived to be All Guest’s preferential treatment of younger, white employees. At the final hearing, Petitioner recounted how she desired, but was not considered or selected for, several promotion opportunities. She complained that All Guest was promoting younger individuals who were not more qualified that herself. To support her claim that All Guest (unlawfully) failed to promote her, Petitioner described the following incidents: All Guest promoted Schuyler McVicker to a Team Lead position within six months of his hiring, instead of offering the position to Petitioner. Mr. McVicker is a white male who is younger than Petitioner. All Guest promoted Jenn Janasiewicz to a Team Lead position for which Petitioner was not considered. Ms. Janasiewicz is a white female who is younger than Petitioner. In the summer of 2017, All Guest filled a Concierge Sales Manager position. Petitioner complained that All Guest did not approach her about applying for the opening. Petitioner also identified a position that All Guest filled with Andrea Romero. Like Petitioner, Ms. Romero is over the age of forty. However, she is approximately six years younger than Petitioner. Petitioner asserted that she gave All Guest a lot to be happy about. Ticket sales consistently increased through her efforts. All Guest, however, never approached her about a promotion. Petitioner felt ignored, overlooked, and under- appreciated by All Guest’s failure to acknowledge her strong work ethic, as well as her contributions to its business. Petitioner declared that she deserved advancement based on her performance. Further, Petitioner never received a raise during her time with All Guest. Petitioner claimed that those individuals who All Guest promoted received higher wages than she did. (At the final hearing, no proof was offered establishing the actual amount of the other employees’ pay.) As Petitioner became increasingly demoralized by her stagnant job status and low pay, in the latter part of 2016, she began looking for other employment. Ultimately, on May 28, 2018, Petitioner resigned from All Guest to accept a job that offered better financial opportunities. Armando Vazquez, All Guest’s current General Manager, testified at the final hearing. Initially, Mr. Vazquez commented that Petitioner was a quality employee and a good concierge. Mr. Vazquez remarked that Petitioner did a great job working with her customers. Mr. Vazquez explained that Petitioner’s position as concierge afforded her three avenues for “promotion.” First, Petitioner could transfer to a larger hotel with more guests to whom she could market and sell park tickets (thus receiving larger commission payments). Second, Petitioner could be promoted to a Team Lead position. Third, Petitioner could advance into a management position. Mr. Vazquez explained that in All Guest’s business structure, a Team Lead essentially handles day-to-day operations. A manager, on the other hand, is involved in issues of greater complexity, including business strategy and planning. All Guest employs more Team Leads than managers. Therefore, Team Lead positions become available more frequently than managerial positions. Despite the fact that All Guest was pleased with Petitioner’s performance, Mr. Vazquez testified that All Guest did not consider Petitioner for promotion opportunities for several reasons. First, during her five years with the company, Petitioner never expressed to anyone at All Guest, including Mr. Vazquez, that she was interested in a promotion. Therefore, All Guest was not reasonably aware that Petitioner desired to advance beyond her concierge job. Mr. Vazquez elaborated that during Petitioner’s employment, All Guest did not routinely post or publish specific promotion opportunities, except on one occasion. In June 2017, Mr. Vazquez sent out an e-mail to company employees announcing an open managerial position and articulated that, “If you are interested . . . please contact me immediately.” Petitioner did not apply for the position. Neither did she communicate her interest in the opening with anyone in All Guest management. As a result, All Guest did not consider her for the managerial position.5/ Secondly, All Guest was concerned with the manner in which Petitioner interacted with her coworkers, Team Leads, and managers. Mr. Vazquez expressed that Petitioner was not a “team player.” He testified that, on occasion, Petitioner’s treatment of her coworkers was disrespectful and insubordinate. Mr. Vazquez further relayed that Petitioner did not take criticism well. At the final hearing, Mr. Vazquez described several instances when All Guest felt that Petitioner’s conduct was less than satisfactory, including: November 10, 2014: Petitioner’s e-mail exchange with management. Mr. Vazquez pointed to Petitioner’s confrontational and impertinent tone. September 27 and 28, 2016: Petitioner’s e-mail communication with Team Lead Ricardo Bazan. Petitioner’s comments prompted Mr. Bazan to write, “I find your email to be rude and disrespectful.” October 13, 2016: Petitioner’s e-mails to Mr. Vazquez and Rick Schiebel (Director of Sales) regarding Petitioner’s request for time off. Petitioner’s e-mails caused Mr. Schiebel to reply, “Why do you have to be so negative and nasty to our team, including me?” and “I expect you to treat all managers and leads with dignity and respect.” October 18, 2017: Petitioner e-mailed Mr. Vazquez demanding that her manager must have “a valid REASON to come to [her] site to discuss any work related information, it is unacceptable for him to tell me he will be sitting down in my work site space to work on his laptop.” November 19, 2017: Through e-mail, Concierge Manager Andrea Romero reported a conversation with Petitioner in which Petitioner exclaimed that Mr. Vazquez “should go to management classes because he does not know how to run this company.” Finally, Mr. Vazquez asserted that Petitioner had issues with tardiness, as well as refused to commit to working at least one evening shift a week. (At the final hearing, Petitioner conceded that she was occasionally late for work. But, she adamantly denied that she had any pattern of tardiness, or ever failed to show up at all. All Guest did not refute Petitioner’s claim that All Guest never imposed or recorded any formal discipline on Petitioner for these alleged deficiencies in her work performance.) Based on the above reasons, Mr. Vazquez maintained that All Guest was neither inclined nor motivated to extemporaneously promote Petitioner to a higher position during the time she worked with the company. Regarding Petitioner’s complaints that younger coworkers were promoted instead of her, Mr. Vazquez offered several justifications. Mr. Vazquez explained that All Guest selected Mr. McVicker for a Team Lead position because his training matched All Guest’s business needs. Specifically, Mr. McVicker knew how to process transactions from the travel website Expedia, which distinguished him from Petitioner and others. Further, Mr. McVicker was a supervisor at his prior employment which qualified him to assume a part-time manager position with All Guest. Similarly, All Guest promoted Ms. Janasiewicz because her skill set matched All Guest’s business needs in a way that Petitioner’s did not. Finally, Mr. Vazquez explained that Ms. Romero had previously worked with All Guest for a considerable length of time, then resigned. When Ms. Romero subsequently expressed interest in returning to the company, All Guest believed that she was an excellent candidate for a managerial position given her prior experience and skills. Mr. Vazquez argued that Petitioner left All Guest on her own accord (for a better job opportunity), not because All Guest forced her to resign. Mr. Vazquez relayed that, prior to Petitioner leaving All Guest, he received a telephone call from a prospective employer in the hospitality industry who requested an employment reference. Mr. Vazquez testified that he provided Petitioner a positive reference. Mr. Vazquez denied that All Guest made any promotion decisions or refused to consider Petitioner’s advancement in the company, based on her age, race, or national origin. Based on the competent substantial evidence in the record, the preponderance of the evidence does not establish that All Guest discriminated against Petitioner based on her age, race, or national origin. Accordingly, Petitioner failed to meet her burden of proving that All Guest committed an unlawful employment action against her in violation of the FCRA.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Commission on Human Relations issue a final order finding that Petitioner, Barbara Robinson, did not prove that Respondent, All Guest, committed an unlawful employment practice against her; and dismissing her Petition for Relief from an unlawful employment practice. DONE AND ENTERED this 4th day of March, 2019, in Tallahassee, Leon County, Florida. S J. BRUCE CULPEPPER 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 4th day of March, 2019.
Findings Of Fact Based upon all of the evidence, the following findings of fact are determined: Background Petitioner, John's Island Club, Inc. (petitioner or the club), is a not-for-profit corporation which owns and operates a private country club facility in the John's Island residential development in Indian River County, Florida. It provides a variety of recreational facilities to its members. Among the amenities are three golf courses, nineteen tennis courts, a tennis building, a beach club, a club house, a swimming pool, and dining facilities. Respondent, Department of Revenue (DOR), is a statutorily created agency charged with the administration of the state revenue laws, including Chapter 212, Florida Statutes, and rules promulgated thereunder. As a result of an amendment made in 1991 to Subsection 212.02(1), Florida Statutes, DOR is authorized by law to impose an admissions tax on "dues and fees" paid to private membership clubs providing recreational facilities. As a private membership club, petitioner is subject to this tax. Beginning on July 1, 1994, petitioner made an assessment on each member to raise capital for the purpose of repairing and replacing many of its physical facilities. During the six month period ending December 31, 1994, $10,441,897 was collected from the members and made available to the club. Rule 12A- 1.005(d)1.b., Florida Administrative Code, which was adopted by DOR in December 1991 to implement the admissions tax on dues and fees, imposes a tax on "(a)ny periodic assessment (additional paid-in capital) required to be paid by members of an equity or non-equity club for capital improvements." Under the authority of that rule, DOR required that petitioner pay the applicable sales tax on the assessment collected through December 31, 1994, or $730,932.79, and that it continue to pay the tax as other similar assessments are made in the future. Claiming that the rule exceeds DOR's grant of rulemaking authority, and it modifies, enlarges, and contravenes the law implemented, petitioner filed a petition for administrative determination of invalidity of existing rule. DOR denies all allegations and asks that the validity of its rule be upheld. The Club and the Assessment The composition of the club The club began operation in 1969 but was purchased by its members in 1986. It is an equity private membership club but issues no stock. The club has two types of memberships: golf and sports social. Currently, the cost of a golf equity membership is $85,000 while the cost of a sports social membership is $30,000. After payment of these fees, the member receives a membership certificate, which represents his or her equity ownership interest in the club. At the present time, there are 1125 golf memberships and 257 sports social memberships. Of the 1125 golf memberships, the original developer still owns 67. In addition to having to purchase a membership, members must also pay annual dues. A golf member pays $4,875 in annual dues while a sports social member pays $2,760 in annual dues. A sales tax is also collected on these dues. The dues are used to cover operating expenses such as insurance, administrative costs, staff salaries, and maintenance costs. In addition, members pay fees for additional services such as golf cart use, golf bag storage, locker room use, and golf and tennis lessons. When a member decides to resign or retire from the club, he or she may resell the membership to the club (but not a third party) and receive the greater of (a) the initial amount paid by the retiring member, or (b) 80 percent of the current membership cost (with the remaining 20 percent retained by the club in a separate capital improvement account). The assessment In 1992, the club began studying the feasibility of repairing and replacing many of its physical facilities. The total cost of the proposed work was set at $16,372,000. By majority vote taken in the spring of 1994, the members decided to raise capital for the work by imposing a capital assessment on each current member. It was agreed that the capital contribution would be $12,000 from each golf member and $11,150 from each sports social member. However, the payment of the capital contribution was not intended to, and did not result in any, decrease in the dues which members were required to pay for the use of the club's facilities. A failure to pay the assessment would result in suspension from the club. Three different options were made available to the members for the manner of payment of the capital contribution. The options included (a) a single payment, (b) payment over a three-year period, or (c) payment of interest only until such time as the member either sold the membership or left the club. After making payment in full, the member would be issued a certificate of capital contribution. It is noted that the developer was required to pay the capital contribution for his 67 golf memberships. Further, any person joining the club after the imposition of the assessment would likewise be required to pay the assessment. Beginning in July 1994, the club began collecting the capital contribution from its members. From July through December 1994, some $10,441,897 was collected. A total sales tax of $730,932.79 has been paid on those collections. Shortly thereafter, petitioner opted to file this rule challenge. The Rule and its Origin Rule 12A-1.005(5)(d)1.b. provides as follows: (d)1. Effective July 1, 1991, the following fees paid to private clubs or membership clubs as a condition precedent to, in conjunction with, or for the use of the club's recreational or physical fitness facilities are subject to tax. * * * b. Any periodic assessments (additional paid in capital) required to be paid by members of an equity or non equity club for capital improvements or other operating costs, unless the periodic assessment meets the criteria of a refundable deposit as provided in sub-subparagraph 2.e. below. * * * Under the terms of the rule, the capital contri- bution assessed by the club does not qualify as a refundable deposit. This is because any difference between the amount collected by the club upon the sale of a membership to a new member, and the amount which was paid to the retiring member, is retained by the club. Because Rule 12A-1.005, Florida Administrative Code, covers a wide array of items subject to taxation, the DOR cites Sections 212.17(6), 212.18(2), and 213.06(1), Florida Statutes, as the specific authority for adopting the rule, and Sections 212.02(1), 212.031, 212.04, 212.08(6) and (7), 240.533(4)(c), and 616.260, Florida Statutes, as the law implemented. There is no dispute between the parties, however, that in adopting sub-subparagraph 1.b., which contains the challenged language, the agency was relying principally on Subsection 212.02(1), Florida Statutes, as the law being implemented. That subsection defines the term "admissions" for sales tax purposes. Although the parties did not specifically say so, DOR relies on Section 212.17(6), Florida Statutes, as its source of authority for adopting the rule. That subsection authorizes DOR to "make, prescribe and publish reasonable rules and regulations not inconsistent with this chapter . . . for the enforcement of the provisions of this chapter and the collection of revenue hereunder." For the purpose of assisting DOR in administering the Florida Revenue Act of 1949, which imposes a sales and use tax on various transactions, Section 212.02, Florida Statutes, provides definitions of various terms used in the chapter, including the term "admissions." Prior to the 1991 legislative session, subsection 212.02(1) read in pertinent part as follows: The term "admissions" means and includes . . . all dues . . . paid to private clubs and membership clubs providing recreational or physical fitness facilities, including, but not limited to, golf, tennis, swimming, yachting, boating, athletic, exercise, and fitness facilities. During the 1991 legislative session, the definition of the term "admissions" was expanded by the addition of the following underscored language: The term "admissions" means and includes . . . all dues and fees . . . paid to private clubs and membership clubs providing recreational or physical fitness facilities, including, but not limited to, golf, tennis, swimming, yachting, boating, athletic, excercise, and fitness facilities. Thus, the legislature added the term "fees" to the term "dues" for those amounts "paid to any private clubs and membership clubs" which would be subject to the admissions tax. Prior to the above change in substantive law, rule 12A-1.005(5), as it then existed, provided that dues paid to athletic clubs which provided recreational facilities were taxable. However, subparagraph (5)(c) of the rule also provided that (c) Capital contributions or assessments to an organization by its members are not taxable as charges for admissions when they are in the nature of payments made by the member of his or her share of capital costs, not charges for admission to use the organization's recreational or physical fitness facilities or equipment, and when they are clearly shown as capital contributions on the organization's records. Contributions and assessments will be considered taxable when their payment results in a decrease in periodic dues or user fees required of the payor to use the organization's recreational or physical fitness facilities or equipment. Therefore, capital contributions were not taxable unless they resulted in decreased dues. That is to say, if a club levied an assessment on members and concurrently lowered its monthly dues, the assessment would be deemed to be taxable and in contravention of the rule. Thus, the effect of the rule was to prevent a club from renaming "dues" as "capital contributions" or "assessments" in order to avoid paying a tax on the dues. After the change in substantive law, the DOR staff began preparing numerous drafts of an amendment to its rule to comply with the new statutory language. At one stage of the drafting process, a DOR staffer recommended that, because the legislature had not provided a definition of the term "fee," the DOR should adopt a rule which provided that capital contributions be "not taxable if assessed under an equitable membership." Relying on what it says is the legislative intent, the DOR eventually proposed, and later adopted, the rule in its present form. In doing so, the DOR relied upon the terms "capitalization fees" and "capital facility fees" which are found in certain legislative history documents pertaining to the new legislation. Legislative History of the Law Implemented Although a number of bills related to the subject of a sales tax on admissions, the bill enacted into law was identified as Committee Substitute for House Bill 2523 (CS/HB 2523). The legislative history of the various bills relating to this subject has been received in evidence and considered by the undersigned. In early 1991, the House and Senate considered bills which addressed amendments to the sales tax on admissions. The first time the issue was addressed was at a meeting on February 21, 1991, of the Subcommittee on Sales Tax of the House Committee on Finance and Taxation. The discussion at the meeting indicated that the intent of the bill was to close a loophole that allowed physical fitness facilities to change their pricing structure to charge a higher initiation fee, which was not taxable, and thereby reduce their monthly dues, which were taxable, so as to reduce the revenue below that originally anticipated by this tax on admissions. This is corroborated by the bill analysis of the proposed committee bill that was offered, PCB FT 91-3A, which summarized the problem and solution as follows: Section 212.02(1), F. S. was amended during the 1990 Legislative Session to include in the definition of admissions those "dues" of "membership clubs" providing "physical fitness" facilities. Some clubs have attempted to avoid the tax (on dues) by shifting a substantial portion of the members' payments from "dues" to "initiation fees." Section 212.02(1), F. S., is amended to include "fees" as well as "dues" in the definition of admissions. All fees, including initiation fees and capitalization fees, paid to private clubs and membership clubs providing recreational or physical fitness facilities would be subject to the sales tax on admissions. It is unclear, but likely, that PCB FT 91-3A became House Bill 2417 (HB 2417). The bill analysis and economic impact statement on HB 2417, which was prepared by the House Committee on Appropriations, contained identical language to that in the bill analysis on PCB FT 91-3A. At the same time, the Senate was considering Senate Bill 1128, which later became Committee Substitute for Senate Bill 1128 (CS/SB 1128). On March 14, 1991, a staff analysis and economic impact statement on CS/SB 1128 was prepared by the Senate Committee on Finance, Taxation and Claims. It provided that: Section 212.02(1), Florida Statutes, defines "admissions" for sales and use tax purposes. Monthly fees of clubs with major facilities such as tennis courts, a swimming pool or a golf course have always been subject to the sales tax. During the 1990 Legislative Session this statute was amended to include dues on membership clubs providing physical fitness facilities, and not having these other major facilities. According to the DOR, such clubs have attempted to avoid payment of this tax by shifting a substantial portion of the members payments from dues to initiation fees which are not taxed. Accordingly, the purpose of the proposed statutory amendment was "to include initiation fees as well as dues in the definition of admissions." HB 2417 was passed by the House on April 17, 1991, and was sent to the Senate, where it was referred to the Committee on Finance, Taxation and Claims. HB 2417 died in that Committee. CS/SB 1128 was passed by the Senate on April 4, 1991, and was sent to the House, where it died in messages. A separate bill, Committee Substitute for House Bill 2523, which addressed similar issues to those addressed in HB 2417 and CS/SB 1128, was passed by the House on April 4, 1991, and was sent to the Senate where it was passed with amendments. The Bill was then returned to the House where further amendments were adopted. The Bill was again sent to the Senate with a request for the Senate to concur with the House amendments. The Senate refused to concur and the Bill was sent to a conference committee. The conference committee on finance and taxation met on April 19, 1991. The entirety of the discussion of the committee on this issue is as follows: Senator Jenne: The - - going down to number 21, admissions, initiation fees. The House includes capitalization fees. Representative Abrams: Which is this? Mr. Weiss: The Senate bill just states initiation fees are additionally included. The House bill, I believe, says that it's just all fees, which would include whether they called them initiation fees or capital facility fees or whatever. Representative Abrams: Because we are using something other than initiation - - Mr. Weiss: It's a fee that is going to be included. Representative Abrams: Yes, they were using - - they were breaking down categories of fees to avoid the tax, I think is what the deal was there. That gets us how much? Senator Jenne: Okay, well, it doesn't matter, because you can do it. Representative Abrams: Okay, good. Although the terms "capital facility fees" and "capitalization fees" were used during the discussion, contrary to DOR's assertion, it is far from clear that the intent of the amendment was to make taxable all capital contributions and assessments paid by members of private clubs providing recreational facilities. When placed in context with the prior debate before the committees and their staff analyses, it is much more likely that the intent was to close a loophole then used by physical fitness clubs who were renaming dues as fees in order to avoid taxes. The report of the conference committee was received by both houses on April 30, and CS/HB 2523 was passed by both houses the same day. The conference committee report for the bill contains only the following language describing the sales tax on admissions/initiation fees: Includes all recreational or physical fitness facility fees in the definition as admissions. The official conference committee report contains no reference to the terms "capitalization fees" or "capital facility fees." Neither does it make reference to the terms "assessment" or "paid in capital," which are the terms used by DOR in its rule. In the final bill analysis and economic impact statement prepared by the House Committee on Finance and Taxation for CS/HB 2523 on June 12, 1991, or 43 days after the bill was passed, the analysis states that subsection 212.02(1) was amended to include: "fees" as well as "dues" in the definition of admissions. All fees, including initiation fees and capitalization fees, paid to private clubs and membership clubs providing recreational or physical fitness facilities would be subject to the sales tax on admissions . . . This amendment should also limit further attempts to avoid taxation by renaming the fees collected from members. The staff analysis was obviously not available to members of the House or Senate when they voted on the bill on April 30, 1991. Although the final bill analysis used the term "capitalization fees," no where in any of the legislative history is there evidence of any legislative consideration of what was actually meant by that term. This is also true of the term "capital facility fees" which surfaced on one occasion prior to the passage of the bill. Capitalization Fees and Their Significance The sole basis for the DOR including the tax on assessments for capital improvements was the appearance in the legislative history of the terms "capitalization fees" and "capital facility fees." Neither term has any meaning to tax accountants. However, the accounting witnesses for both parties agreed that, from an accounting perspective, the phrase "capital facilities" would be understood to be assets having a life longer than one year. A capital contribution is typically a one time payment for the purchase of assets. It does not entitle the member to use the club. It is an equity transaction, not an income transaction, and it represents an intent to make an investment to improve the value of the membership assets separate and apart from the payment of annual expenses for the receipt of some service. "Dues" are a member's contribution to the operating costs of a club. They are assessed over an annual period and they are recurring. They also represent the payment that a member pays for admission to the organization. A capital contribution paid by a member of an equity membership club is not "dues." "Fees" as applied to a club are user charges. They are voluntary so that a member can decide whether or not to incur the charge based on whether the member uses the particular service to which it relates. A capital contribution is not a "fee."
