Findings Of Fact Swiftline Trucking, Inc., was incorporated in Florida in 1979 by Rose Laquidara. The Articles of Incorporation filed with the Florida Secretary of State reflect Rose Laquidara as President and Treasurer, Carl Laquidara, her son, as one Vice- President, and Felix Laquidara, her other son, as the other Vice- President and Secretary. These same individuals were also identified as the initial Directors of the corporation. Anthony Laquidara, Rose Laquidara's husband, was neither an officer nor a director. Carl is no longer with the firm. The corporation originally operated out of the Laquidara home with Anthony Laquidara serving as a truck driver and Rose serving as bookkeeper and general manager. The two sons, Carl and Felix, ages 14 and 15 at the time, acted as mechanics. Ultimately the corporate offices were moved to a commercial site owned by Rose and Anthony Laquidara, personally, which was leased to the corporation. The Laquidaras moved to Florida sometime prior to 1979 when Anthony retired from his position as a police officer in New York City. When the family moved to the Ft. Myers area, Rose went back to school and Anthony spent his time fishing and driving a truck part time. In 1978, when the trucking industry was deregulated, Rose got the idea of starting her own trucking company. Swiftline Trucking, Inc., the result of that idea, was started with $5,000.00 that she inherited from her father. This $5,000.00 was used to purchase the company's first truck. Later on, during the growing years, additional money was put into the business to cover payroll. This money came from Rose's share of the proceeds of the sale of the family home in New York. The business operated continuously from its inception until the present. On October 10, 1986, as President of the corporation, Rose submitted an application for certification as a disadvantaged business enterprise. Thereafter, the Department sent Tyrone Reddish to Ft. Myers to interview her and to inspect the records of the company. In the course of his review, Mr. Reddish examined the documents, looked at the corporate books, records, and files, and examined contracts and purchase vouchers as well as subcontracts, and financial records. He concluded that Swiftline met two of the five standards necessary for certification as a disadvantaged business enterprise. These were: (1) that the applicant was a female and, (2) that the applicant owned 51 percent of the stock issued in the corporation. However, he also concluded that three other standards were not supported by independent evidence. These were: (1) that the applicant failed to exercise substantial control over the operation, (2) that the applicant was responsible for the day to day operation of the company, and (3) that the applicant was, in fact, in charge of company management. Because of this, he could not conclude that the business should be certified and he prepared a report outlining his findings and conclusions which he sent for review by the Department. Specifically, Mr. Reddish found several discrepancies between stock certificates issued and the stock ledger. Corporate records reflect that from the time of incorporation in 1979 to 1984, Rose Laquidara held 80 percent of the stock. Records for 1984 indicate a directors' meeting at which Rose Laquidara was not present. The minutes of that meeting reflect only that her stock was sold. They are silent as to how much, if any, compensation was received by Rose Laquidara for the sale of her stock. The minutes of a 1986 meeting reflect that Rose Laquidara reacquired her original 400 shares (80 percent), and an additional 510 shares. However, the minutes did not provide any information regarding the transfer or furnish the background for it. Additional discrepancies found by Mr. Reddish include the fact that the income tax forms filed in 1986 reflected that Rose Laquidara held 80 percent of the stock and two other individuals, her sons, held 9.8 percent of the stock. The stock record book reflects that 39 percent of the stock was at that time owned by Anthony Laquidara, Rose's husband, 51 percent was owned by Rose Laquidara, and 5 percent each was owned by the sons. This discrepancy and the previous one are explained by Mrs. Laquidara who indicates that in 1984, she and her husband were divorced. As a part of the divorce settlement, she transferred all her stock in Swiftline to her husband who paid her compensation therefor. This compensation came from the proceeds of the corporation. However, Mr. Laquidara was unable to make a go of the business and suffered a nervous breakdown in 1986. He called Mrs. Laquidara from New York and advised her he had walked away from the business and if she didn't want it to fail completely, she had best step in and take over again. Thereafter, Rose Laquidara accepted transfer of the ownership back from Anthony who indicated he wanted no ownership interest in the corporation. She felt, however, that because he had provided so well for the family for the first years of their marriage, it would be unfair for him to end up without anything and she insisted he be given a 39 percent interest in the corporation. This stock was issued from treasury stock. The sons, who were identified as each owning 9.8 percent of the stock, in reality each own 50 shares representing 5 percent of the 1,000 shares authorized and issued. According to the stock record book, 1400 shares of stock have been issued to various members of the Laquidara family. This is incorrect. Only 1,000 shares was authorized by the Articles of Incorporation and have been issued. Another discrepancy disclosed by Mr. Reddish was in the report of profits for 1986 which showed an 80 percent distribution to Rose Laquidara and 10 percent to each of her sons. Anthony Laquidara was not represented at all. Nonetheless, he later wrote a letter stating he had no claims on profits in 1986 and this constituted a discrepancy in Mr. Reddish's mind for which he could find no explanation. It really is quite clear, however. Mr. Reddish also concluded there were other discrepancies such as, (1) the By-Laws had some restrictions which impacted on total control resting in Rose Laquidara; (2) a problem with employment of other family members in supervisory positions; (3) several checks were made payable to Tony Laquidara for which there were no supporting documents. With respect to those three discrepancies, the By-Laws have been amended to remove any impediments to Rose, as majority stockholder, having controlling voice in the operation of the business. There is nothing wrong with other family members exercising supervision over portions of the business operation so long as this supervision is delegated to them by the majority stockholder. The two checks in question were issued to Tony for, in one case, rent for the office building, and in the other for payment of the property taxes. These notations are clearly inscribed on the checks. It is difficult to understand why Mr. Reddish did not see them. Mr. Reddish was also concerned about he fact that even though Swiftline had done in excess of one million dollars worth of work with the Department, he could find only one or two purchase orders from the Department to back this up. When questioned, Mrs. Laquidara was unable to provide answers to satisfy him. This area of inquiry, however, is not pertinent to a determination of minority or disadvantaged business status. In the course of his visit with Swiftline, Mr. Reddish did not speak with any employees or customers because, he claims, the Department's method of certification is to talk only with the owner. This was not, he states, a compliance review and though he found several things as described above with which he was dissatisfied, he asked no one other than Mrs. Laquidara for an explanation. He claims it is the Department policy to talk only with the majority owner in a validation review and that validation is accomplished by an examination primarily of documentation. He claims he does not know who hires, who fires, within whom the decision making authority rests, or who is responsible for personnel actions. When he asked who performed these functions, he was told Mrs. Laquidara did some and others did other things. He does not know who delegated this authority to these other people but he asked only Mrs. Laquidara and, apparently, he did not ask her either enough questions or the right questions. The interview was taped but a copy of the tape was not forwarded for review with his report. Had Mr. Reddish's interview been more inclusive, he would have found, for example that Felix Laquidara, Rose's son and a road supervisor for the company, monitors its operation, seeks out jobs for the fleet to perform, and reports to Mrs. Laquidara. He makes no decisions as to the business without consulting with Mrs. Laquidara, nor can he commit the company to new work without her approval. He cannot hire or fire employees without consulting her nor does he take any part in determining employee salaries. That is done by Mrs. Laquidara who also determines how many employees the company should have. Felix is not permitted to extend credit to customers based on his own determination of creditworthiness, nor does he make any decisions about collecting outstanding fees. Mrs. Laquidara does both. In the event of any problem with customers, they are referred to Mrs. Laquidara for the resolution of their complaints. Felix has no idea how much income the company grossed during the last business year, (or, for that matter, in any business year), nor does he know how much profit was earned by the company. Though he is given a portion of the year-end profit as a bonus, the amount of bonus is determined by Mrs. Laquidara and it may take a form other than cash. Felix works between 14 and 16 hours per day and is paid a flat salary not based on the number of hours worked. Each week, he and the other road supervisors meet with Mrs. Laquidara to decide what business will be taken on for the next week. There is no question in his mind that Mrs. Laquidara runs the business. He is on the books as corporate secretary, and has attended corporate meetings but has had no input. Had he checked deeper, Mr. Reddish would also have found that when Rose Laquidara started Swiftline in 1979, her husband had little to do with it. He had no input as to the form of the business nor did he sign or file any of the paperwork involved. When the company was first started, with the first truck bought with Rose's money, their original business was the hauling of sand, stone and dirt, and he drove the truck part time. Now, he helps out with estimates, assists with collections, checks job sites and the like, but has no specific duties nor does he make any decisions regarding the operation. He works from 10 to 30 hours per week and draws no salary. Mr. Laquidara has no part in deciding how many jobs the company can handle at one time; he has no part in deciding which jobs to take on; he does not grant credit; nor does he decide how many employees should be kept on the payroll or who should be hired or fired. The individual with ultimate authority in all aspects of Swiftline's operation is Rose Laquidara who makes her decision after input from her employees. By the same token, she is the source from whom all authority flows. That which is not specifically delegated by her to her underlings is retained by her. Though Anthony Laquidara is an authorized signatory on company checks, along with Mrs. Laquidara, he was made so because he was also a signatory on some of the outstanding business loans of the corporation. The lender wanted a personal guarantee from him, as well as Mrs. Laquidara. He rarely signs corporate checks, however. As a shareholder in the corporation, he receives a portion of the business profits distributed at year end. The amount of distribution is determined by Mrs. Laquidara. This information, given by Felix and Anthony as to business and organizational arrangements and responsibilities, was confirmed by Mrs. Laquidara. In the early years of the business she did the dispatching herself, assigning jobs to individual truckers who signed on with her. Now she spends the majority of her time in management, settling problems within the operation and talking with customers. She opened the east coast office on her own, putting one of her former drivers in as manager, and he reports to her, alone. There are presently approximately 100 independent contractor drivers working for her who are paid about 89 to 90 percent of what the job brings in. She has arranged a line of credit with a financing institution, but Anthony was required to join her in personally guaranteeing the loans. As to the share breakdown, prior to her divorce, she held 90 percent of the corporate stock. Pursuant to the settlement agreement, she signed her shares over to Anthony and received a cash settlement in return. When he subsequently had a nervous breakdown and she had to step in and take back control of the business, she chose to take only a 51 percent share instead of the 90 percent share she previously held. She felt it was only equitable that Anthony keep a 38 percent share of the company stock because during the early years of their marriage, he supported them all. The stock decision was hers alone, however, and had nothing to do with the disadvantaged business certification. She now runs the corporation taking care of all financial, legal, and personnel matters. She employs an office manager and 7 office personnel. She discharged her son, Carl, because he could not take orders. Swiftline was certified as a minority business enterprise by Lee County for several years, renewed each year until the last year when it was turned down since the Lee County application is based on undefined federal guidelines which, apparently, were not met. When Swiftline was turned down by Lee County, Mrs. Laquidara applied for state minority certification. This application resulted in the visit by Mr. Reddish which ultimately culminated in the denial of this application as well. Without certification as a minority business enterprise, Swiftline is precluded from preforming many jobs for state, city, or county governments which require such certification and which, up until the present, have made up a substantival portion of Swiftline's business. Mr. Reddish's validation review was not sufficiently comprehensive. It was insufficient to generate adequate information upon which to base an informed conclusion and recommendation. It appears to be more an attempt to support denial of certification than a bona fide attempt to determine if the applicant qualified for certification. When Mr. Reddish completed his validation review, he forwarded his report to the validation committee which unanimously voted, based on the record, to deny Swiftline its certification. This decision was based on what the committee had before it which included only the documentation submitted with the application and Mr. Reddish's report. Mr. Sweet and the committee identified several problems with the file which included: (1) that Swiftline was a family business which could not demonstrate that control rested within one person. It appeared that everything was within the control of various family members with responsibility equally shared, and that, therefore, non-disadvantaged business people had more than one-half the control even though Mrs. Laquidara admittedly owned 51 percent of the stock. (2) The corporate By-Laws were not followed and there was no documentation to show compliance. (3) Last year the corporation did $4.6 million in gross business and this does not appear to be a small business so as to justify operating without formal procedures as was done here. Mr. Sweet indicated there were several deficiencies in the By-Laws. For example, 3/4 of the stockholders are required to appoint the Board of Directors. Article I, Section 7 of the Constitution provides that 4/5 of the voting stockholders are required to validate. This is far more than 51 percent and if applied, would divest Mrs. Laquidara of control. Directors are required to conduct certain specific types of business and only two are required to do others. As a result, the Board can operate and conduct corporate affairs without participation of the 51 percent owner. The committee's conclusions, however, can be no more valid than those of Mr. Reddish since it's deliberations were based solely upon the information he provided.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that Swiftline Trucking, Inc.'s application for certification as a disadvantaged business enterprise be granted. RECOMMENDED this 7th day of March, 1988, at Tallahassee, Florida. ARNOLD H. POLLOCK, Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 7th day of March, 1988. Appendix to Recommended Order The following constitutes my specific rulings pursuant to Section 120.59(2), Florida Statute, on all of the proposed Findings of Fact submitted by the parties to this case. FOR THE PETITIONER 1., 2. Accepted and incorporated herein. 3., 4. Accepted and incorporated herein. 5. Accepted and incorporated herein. 6. Accepted and incorporated herein. 7. Accepted and incorporated herein. 8., 9. Accepted and incorporated herein. 10.-13. Accepted and incorporated herein. Accepted and incorporated herein. Accepted and incorporated herein. 16.-19. Accepted and incorporated herein. 20. Accepted and incorporated herein. 21.-22. Accepted and incorporated herein. This is not a completely true statement. His authority to sign checks is not conditioned upon something happening to Mrs. Laquidara but was required because he is a co-signer in lending arrangements. Accepted and incorporated herein. Mr. Reddish also talked with Mrs. Laquidara. Accepted and incorporated herein. 27.-29. A summary of testimony - not a Finding of Fact 30. Accepted. 31.-32. Accepted and incorporated herein. FOR THE RESPONDENT Accepted and incorporated herein. Accepted as the original determination of the department on which this hearing is based. 3.-5. Accepted and incorporated except for the comment that Anthony and Felix share the control of the company which is rejected as contra to the evidence. First sentence as rejected as a Conclusion of Law as is the last. Remainder is accepted. Accepted. Rejected as an incorrect statement of Fact. Store records are unclear, but ownership, upon inquiry was clarified. The finding that Rose owns only 40 percent of the store is rejected. Rejected as contra to the weight of the evidence and as argument. The loan from Anthony's further, classified as "substantial", was not otherwise described. Accepted. Accepted, but not controlling. Accepted except for last sentence, which is rejected. Accepted in that the family worked together. Rejected as implying management responsibility was shared. The Finding that decision making and actual power was shared by the family as a unit is rejected. No evidence was presented to show that by the Department. Accepted. Accepted. 17.-19. Accepted. COPIES FURNISHED: LEIBY AND ELDER 290 NORTHWEST 165TH STREET PENTHOUSE 2 MIAMI, FLORIDA 33169 JUDY RICE, ESQUIRE DEPARTMENT OF TRANSPORTATION 605 SUWANNEE STREET, MS 58 TALLAHASSEE, FLORIDA 32399 KAYE N. HENDERSON, SECRETARY DEPARTMENT OF TRANSPORTATION HAYDON BURNS BUILDING 605 SUWANNEE STREET TALLAHASSEE, FLORIDA 32399-0450 THOMAS H. BATEMAN, III, ESQUIRE GENERAL COUNSEL DEPARTMENT OF TRANSPORTATION HAYDON BURNS BUILDING 605 SUWANNEE STREET TALLAHASSEE, FLORIDA 32399-0450 =================================================================
Findings Of Fact Prior to commencement of the hearing, the parties stipulated and agreed to the following matters, which are incorporated into and made a part of the Findings of Fact: Petitioner has a two-person household; Petitioner made application for low income energy assistance benefits; Petitioner's total monthly income in the month of application was $535, which consisted of $143.70 SSI, $276.90 Social Security disability benefits to Petitioner and $141.50 Social Security benefits to Petitioner's daughter: The maximum monthly income a two-person household may receive and be eligible for benefits is $418; Except for exceeding the maximum income limit, the petitioner is otherwise eligible for low income energy assistance benefits; and Petitioner's application was received as Petitioner's Exhibit 1. The Petitioner also testified concerning her expenses in the month in which she applied for benefits. Her expenses were $45 for medication for both Petitioner and her daughter, $10 for batteries for her daughter's hearing aids, $10 for counseling for her daughter, $25 for doctor's bills, $390 for rent, $40 for utilities, $72 for telephone (the average bill would be approximately $30, but Petitioner had surgery in that month and it was higher), and $150 for food. Petitioner's bills for the month of application were $742. Petitioner has emphysema and cancer, and her daughter has a breathing disorder and is deaf. Her electric bills have jumped from $30 to $190. Petitioner's income and expenses were carefully compared with the rules governing this program to determine whether any portion of her income was excludable or any portion of her expenses could be deducted from her income in determining her eligibility. None of her income was excludable, and none of her expenses could be deducted. Copies of the Department's rules were introduced as Respondent's Exhibit 1, together with its policy outlining excludable income, Respondent's Exhibit 2.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, the Hearing Officer recommends that the Department of Health and Rehabilitative Services deny Petitioner's application for low income energy assistance benefits. DONE AND ORDERED in Tallahassee, Leon County, Florida, this 25th day of September, 1981. STEPHEN F. DEAN Hearing Officer Division of Administrative Hearings Collins Building Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 28th day of September, 1981 COPIES FURNISHED: Mrs. Bette Kaufman 950 NE 171st Street North Miami Beach, Florida 33162 Leonard Helfand, Esquire Department of HRS Room 1040, Rhode Building 401 NW Second Avenue Miami, Florida 33128 Alvin J. Taylor, Secretary Attn: Susan B. Kirkland, Esquire Department of HRS Building One, Room 406 1323 Winewood Boulevard Tallahassee, Florida 32301
Findings Of Fact The Petitioner is a Florida not-for-profit corporation which is exempt from federal income tax under Section 501(c)(3) of the Internal Revenue Code. The Petitioner has established a Mark Twain Scholarship Fund the purpose of which is to give recipients funds to pay for post-secondary tuition and books. On or about September 26, 1994, Petitioner filed an application with Respondent for a consumer certificate of exemption and stated as its basis "other." The applicant then identified itself as "state/church separation" organization. Petitioner did not check any of the other categories for exemptions such as "religious," "educational," or "charitable." The application was reviewed by the Department considering all of the categories listed on the application and available under the pertinent statute. Based on the criteria set forth in Section 212.08(7), Florida Statutes, the Department reached a preliminary decision which denied the Petitioner's application for a certificate of exemption. Petitioner was notified of the denial and timely challenged the agency action. All of the members of the Petitioner's group are voluntary, unpaid, participants who pay yearly dues to join the organization. Students pay $10.00, individuals $30.00, and couples $35.00. If someone were to allege poverty, Petitioner would arrange a free membership for such individual. No evidence of members of that category was presented. The only information about its members Petitioner seeks is their educational background. Documentation regarding financial circumstances of each member is not requested nor kept. Petitioner provides benefits to minors by providing speakers for various topics at the university and high school levels, and by allowing students to attend monthly meetings. Monthly meetings for the south Florida group are held in the Fort Lauderdale library. Other chapters in Tampa and Sarasota also hold meetings periodically and such meetings are, presumably, available to students. In Tampa, for example, Petitioner has an information booth on the campus of the University of South Florida. Petitioner attempts to offer a "scientific and more rationale" point of view to young adults. For the south Florida meetings, approximately 5 to 10 persons under 18 years of age might attend. The average attendance of all members is 20 to 40 persons. Petitioner also produces a public access cable television program consisting of twelve half-hour episodes per year. Topics of this program have included "Sin and Sexuality." Petitioner established the scholarship fund indicated above. One recipient was a woman in prison for life in California who wanted to attend the University of California. More recently, Petitioner conducted an essay contest and two men from that event received awards. None of the scholarship recipients was a minor. The total amounts expended on scholarships by the Petitioner did not exceed 10 percent of its total expenditures. The Petitioner's group started with approximately 53 members but has grown to over 200 members. Petitioner provides support to its members who may encounter scorn or harassment from the public and has a telephone line set up so that messages can be taken twenty-four hours of the day. Someone from the organization can then return the call and assist the caller. Public harassment is not uncommon for members of the group. For example, when Mr. Tzanetakos opposed the use of public monies in connection with the Pope's visit to south Florida, he received so many telephone calls that he had to change to an unpublished number. Mr. Tzanetakos maintains that while his organization's views are an unpopular minority in this country, that they are in the majority in Europe and other places. One of the purposes of the Petitioner's group is to advocate, support, and defend "in all lawful ways the complete and absolute separation of church and state." Another purpose is to promote freedom of expression. Thirdly, the group seeks to "protect the constitutional and civil rights of Atheists as members of a free and democratic society." According to its articles of incorporation, Petitioner promotes the following concepts: Because human beings, along with all other species of animal and plants, evolved from a primordial cell, Homo sapien is only a link in the chain of living matter. Because Homo sapiens is the species with the most advanced brain and the most manipulative hands, and because we have developed excessively destructive weapons (nuclear and others), we are solely responsible for the well-being of our own species and to a great extent the rest of the life on planet Earth. Global population control is vital, and the extinction of other living animal and plant species must be avoided. Cooperation and equality--not conflict-- among all peoples must be encouraged and promoted. Because all humans have a common origin, and because the classification of peoples by races and ethnic groups is divisive and detrimental to our species and to life itself, all inhabitants on planet Earth (sic) [should?] be called "Homo Sapiens", and the current national names to denote the geographical origin of peoples and their distinctive cultures. Minors are not specifically mentioned in the Petitioner's articles of incorporation nor given benefits of membership not available to other members or, in the case of the television broadcasts, the public as a whole. Mr. Tzanetakos conceded that one of the television topics, "Euthanasia," may not have been of particular interest to minors. He further acknowledged that it is difficult to get children to watch educational television. The Petitioner does not advertise its programs to the general public, nor does it survey viewers to determine the numbers of minors, if any, that support its television program. Petitioner accepts only "what can be verified by the scientific method and rejects supernatural entities, acceptable only as articles of faith." Accordingly, Petitioner's members do not "worship" god or anything. The Petitioner did not present evidence that it is qualified for accreditation by, or membership in, the Department of Education, the Southern Association of Colleges and Schools, the Florida Council of Independent Schools, or the Florida Association of Christian Colleges and Schools.
Recommendation Based on the foregoing, it is, hereby, RECOMMENDED: That the Department of Revenue enter a final order denying the application for a consumer's certificate of exemption filed by Petitioner. DONE AND ENTERED this 8th day of March, 1996, in Tallahassee, Leon County, Florida. JOYOUS D. PARRISH, Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 8th day of March, 1996. APPENDIX TO RECOMMENDED ORDER, CASE NO. 95-0654 Rulings on the proposed findings of fact submitted by Petitioner: 1. None timely submitted. Rulings on the proposed findings of fact submitted by the Respondent: 1. Paragraphs 1 through 22 are accepted. COPIES FURNISHED: Linda Lettera General Counsel Department of Revenue 204 Carlton Building Tallahassee, Florida 32399-0100 Larry Fuchs Executive Director Department of Revenue 104 Carlton Building Tallahassee, Florida 32399-0100 Mark Trop Shoreview Building 9999 Northeast Second Avenue, Suite 201 Miami, Florida 33138 Ruth Ann Smith Assistant General Counsel Department of Revenue Post Office Box 6668 Tallahassee, Florida 32314-6668
The Issue The issue is whether Petitioner is entitled to formal training and education sponsored by the Division of Workers' Compensation, pursuant to Section 440.491(6), Florida Statutes.
Findings Of Fact From 1985 through 1995, Petitioner was employed by Truly Nolen, a pest-control company. In April 1995, Petitioner was a termite supervisor engaged in fumigation work. In this job, Petitioner set up crews and sent different crews to do jobs. He scheduled work and performed actual work on the job, such as dragging sand bags around a building and putting tarps on the roofs of buildings. While so employed on April 26, 1995, Petitioner fell while spreading tarp on a roof. Petitioner injured his back, suffering what the neurosurgeon described as “fundamentally a frozen back,” and was unable even to bend forward and touch his knee caps. Diagnosed with a herniated disc in the lumbar region, Petitioner had surgery on September 12, 1995. Although the surgery repaired the herniated disc, Petitioner’s recovery was prolonged. The surgeon determined that Petitioner reached maximum medical improvement on January 19, 1996. At this time, the surgeon stated that Petitioner was capable of working in light- to medium-duty work with no lifting of more than 50 pounds and no repetitive lifting of 25 pounds or more. The surgeon assigned Respondent a 12 percent impairment of the person as a whole, but later agreed that it was a 16 percent permanent partial impairment. The surgeon believes that Petitioner may have intermittent problems with his back for the rest of his life, but it is not medically probable that he will require surgery or any other form of aggressive intervention. The day after being released by the surgeon, Petitioner met with the branch manager of the Truly Nolen office, out of which Petitioner had worked at the time of his accident. For about one month, Petitioner had been performing part-time, light office duties at this office as part of a work-hardening program. The branch manager offered Petitioner a residential pest-control route, rather than Petitioner’s old job as a termite supervisor. Although not entirely clear in the record, the office appears to have employed only one termite supervisor. By the time that Petitioner was able to return to work, the branch manager had hired another person for the job of termite supervisor. It is, in any event, unclear whether Petitioner would have been able to do his old job anymore, as it required the supervisor to drag heavy tarps over the tops of buildings, as Petitioner was doing when he fell and was injured. Petitioner and the branch manager discussed two routes, but the manager was inclined to give Petitioner the route that Petitioner found less preferable. Petitioner visited one house on the route and determined that the value of the route, as posted in the office, was less than one-half of what Petitioner had been making at the time of the injury. Petitioner then informed his supervisor that he would not take the job due to inadequate money. Petitioner admits that money, rather than the physical demands of the job, was the sole reason for declining the job offer. The most productive pest-control routes in this Truly Nolen office earn $35,000 annually. Petitioner could probably earn $20,000 to $25,000 from the route that the branch manager offered him. Two weeks prior to the hearing, Petitioner started work as a car salesperson at a local Chevrolet dealer. He was earning about $250 weekly and 4 percent of the profit on each car sold. He had sold only one car for a commission of $50. Previously, he had worked on an occasional basis for his uncle driving a mowing tractor and earning $5.25 hourly; however, he had not worked over one week consecutively on this job. At the time of his injury, Petitioner’s average weekly wage was about $800. He was born on January 15, 1966. Petitioner completed his formal education when he finished high school. Petitioner is a certified pest-control technician. Except for some general construction and service work experience, Petitioner’s entire work history consists of his employment with Truly Nolen. The record does not disclose if Petitioner applied to Truly Nolen or its competitors for work as a termite supervisor or pest-control technician. Petitioner has not proved that he is physically unable to work in either position. To the contrary, it is likely that he could do the job as a pest-control technician, given his refusal to take the offer of such a job solely on monetary grounds and the relatively light physical demands of this work. In light of Petitioner’s age, education, work history, transferable skills, previous occupation, and injury, the job offered by the branch manager in January 1996 gave Petitioner a chance to regain as soon as practicable and as nearly as possible his pre-accident average weekly wage. Thus, the branch manager’s offer to take a pest-control route represented suitable gainful employment.
Recommendation It is RECOMMENDED that the Division of Workers’ Compensation enter a final order denying Petitioner’s requests for training and education sponsored by the Division and attorneys' fees. DONE AND ENTERED this 19th day of February, 1998, in Tallahassee, Leon County, Florida. ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 19th day of February, 1998. COPIES FURNISHED: Peter C. Burkert Burkert & Hart Post Office Box 2485 Fort Myers, Florida 33902 Attorney Michael G. Moore, Sr. Department of Labor and Employment Security 2012 Capital Circle, Southeast 307 Hartman Building Tallahassee, Florida 32399-2189 Russell Schropp Henderson Franklin Post Office Box 280 Fort Myers, Florida 33902 Edward A. Dion General Counsel Department of Labor and Employment Security 2012 Capital Circle, Southeast 307 Hartman Building Tallahassee, Florida 32399-2189 Douglas L. Jamerson, Secretary Department of Labor and Employment Security 2012 Capital Circle, Southeast 303 Hartman Building Tallahassee, Florida 32399-2189
The Issue The issue in this case is whether Petitioner is entitled to an exemption from sales and use tax as a religious or charitable organization.
Findings Of Fact By Application for Consumer Certificate of Exemption dated March 17, 1992, Petitioner requested a sales tax exemption as a religious organization. The application indicates that Petitioner was incorporated on February 18, 1992. At all times, the president of Petitioner has been Reverend Robert M. Rinaldi. By letter dated April 16, 1992, Respondent requested that Petitioner supply information concerning its primary purpose, including a list of all activities or services and to whom they are generally offered. The letter also requested, among other things, statements of receipts and expenditures and a copy of the letter determining that Petitioner is exempt from federal income tax. Petitioner submitted to Respondent evidence of 12 expenditures during the quarter ending March 31, 1992. The expenditures and their descriptions are as follows: Morrisons-- dinner business; Holiday Inn in Tampa--lodging for quarterly convention; Maas Brother in Naples--attire; Marshalls-- personal; Martha's Health Food Shop--personal; Things Remembered--card case/business cards; RJ Cafe Tropical--lunch interview; Beach Works Marco Island--attire; annual membership fee for vice president's American Express card; Las Vegas Discount golf and tennis in Naples--personal; Eckerd's Vision Works--medical eyeglasses; Quality Inn Golf Country Club in Naples--lodging during business travel; Avon Fashions/Hampton-- personal; Del Wright in Sarasota--automobile expenses and travel; JC Penney--personal; Amador's Restaurant in Naples-- dinner/lunch; Avon Fashions/Hampton--personal; annual membership fee for treasurer's American Express card; and Mobil Oil--business travel. Petitioner produced other evidence of similar types of expenditures, such as for fitness center fees, car insurance, car service, car payments, utilities, and rent. Nothing in the record links these expenditures to religious or charitable activities. There were expenditures for printing religious tracts and self- improvement educational materials, but they do not appear to be a substantial part of the total expenditures of Petitioner during the time in question. After receiving these materials, a representative of Respondent telephoned Reverend Rinaldi and stated that Petitioner would have to submit additional documentation of its income and expenses and formal affiliation with prison chapels where Petitioner reportedly conducted outreach programs. Respondent's representative also asked for evidence of Reverend Rinaldi's counselling credentials. Petitioner next submitted a copy of a letter from the Department of Treasury determining that Petitioner was exempt from federal income tax. Petitioner also submitted a budget for the year ending 1992 and a proposed budget for the year ending 1993. However, the budgets did not document a charitable purpose. The budget reveals that the largest disbursement was $4200, which was rent for an office and living quarters. The largest single receipt was $1764.27, which was a contribution from the incorporator, who was Rev. Rinaldi. There were no charitable receipts, such as from contributions from members, the public, or anonymous sources. On November 10, 1992, Respondent sent a letter to Petitioner requesting additional information, including statements of the primary purpose of the organization and of receipts and expenditures. The request asked for a description or explanation for each charity-related program expenditure. On November 18, 1992, Petitioner submitted a second Application for Consumer's Certificate of Exemption. The information was essentially unchanged from the first application. Rev. Rinaldi also sent Respondent a religious flyer. On February 10, 1993, Petitioner submitted a third Application for Consumer's Certificate of Exemption. The material was essentially unchanged from the preceding two applications. On March 30, 1993, one of Respondent's representatives sent a letter to Petitioner stating that Petitioner does not meet the criteria for exemption from sales tax. In response, Petitioner sent a letter to Respondent received April 8, 1993, requesting reconsideration of the denial. On May 4, 1993, Respondent sent Petitioner a letter stating that, as indicated during an earlier telephone conversation, Respondent had not yet received sufficient documentation to justify a sales tax exemption. Following up on Rev. Rinaldi's opinion that Petitioner qualified as a charitable organization, the letter suggests that he submit materials describing each charitable service or activity, the types of persons receiving such services, the frequency that the services are offered, the demonstrated benefit provided by Petitioner to disadvantaged persons, the fees charged by Petitioner, and the availability of Petitioner's services at the same or less cost elsewhere. The letter also asks for a statement of income and expenses. In response, Petitioner filed a fourth Application for Consumer's Certificate of Exemption on November 10, 1993. Rev. Rinaldi explained Petitioner's activities as informing people of the truth and the second coming of Jesus Christ and stopping addictions to drugs and alcohol. The enclosed materials included a church telephone number. The materials state that services are available 24 hours a day for no fees and are provided solely for the spiritual preparation of humanity. The materials also indicate several addresses at which religious activities are conducted. Upon investigation, Respondent learned that Petitioner's telephone number had been disconnected, the street address is Rev. Rinaldi's apartment, and the addresses at which religious activities are conducted are locations of Alcoholic Anonymous, from which Rev. Rinaldi and his church had been barred as public disturbances. Checking with the post office, the investigator learned that all mail for Rev. Rinaldi and Petitioner is being forwarded to an address in New York. Respondent asked for more information, and Petitioner supplied information no different than that previously supplied. By letter dated April 26, 1994, Respondent informed Petitioner that its application was denied. Following another exchange of correspondence, Respondent sent Petitioner a Notice of Intent to Deny dated June 17, 1994. The Notice of Intent to Deny states that Respondent determined that: [Petitioner] travels from church to church and does not assemble regularly at a particular established location. [Petitioner] conducts services for short periods of time at numerous temporary locations. [Respondent] has reviewed your application and supporting documents and has determined that the primary purpose of your organization fails to meet the qualifications for sales tax exemption authorized by Section 212.08(7), Florida Statutes. By letter dated June 24, 1994, Petitioner requested a formal hearing on its application for sales tax exemption. Petitioner does not regularly conduct services. Petitioner does not engage in other religious activities nor does Petitioner provide services typically associated with a church. Petitioner has no established physical place for worship. Petitioner has generalized plans to construct one or more places for worship. However, these plans are post-apocalyptic in nature and thus do not assure the commencement of construction in the immediate future.
Recommendation Based on the foregoing, it is hereby RECOMMENDED that the Department of Revenue enter a final order denying Petitioner's application for an exemption certificate from sales and use tax. ENTERED on December 20, 1994, in Tallahassee, Florida. ROBERT E. MEALE Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings on December 20, 1994. COPIES FURNISHED: Larry Fuchs, Executive Director Department of Revenue 104 Carlton Building Tallahassee, FL 32399-0100 Linda Lettera, General Counsel Department of Revenue 204 Carlton Building Tallahassee, FL 32399-0100 Rev. Robert Rinaldi P.O. Box 1081 167 N. Collier Blvd. J-3 Marco Island, FL 33937-1081 Attorney Lisa M. Raleigh Office of the Attorney General The Capitol--Tax Section Tallahassee, FL 32399-1050
The Issue The issue for consideration herein is whether the Respondent, Department of Labor and Employment Security, erred in awarding the contract in response to its Proposal No. 91-064-AS to some firm other than the Petitioner. By Petition And Notice Of Protest dated July 10, 1991, the Petitioner herein, Toplis & Harding, Inc., (Toplis), formally notified the Respondent, Department of Labor and Employment Security, (Department), that it was protesting the bid tabulation in this procurement as scored by the Department, and the following day, July 11, 1991, filed its Formal Notice of Protest regarding the same matter. Thereafter, by letter dated July 17, 1991, the Department forwarded the file to the Division of Administrative Hearings for appointment of a Hearing Officer, and by Notice of Hearing dated July 19, 1991, the undersigned set the case for hearing in Tallahassee on July 29, 1991, at which time it was heard as scheduled. At the hearing, Petitioner presented the testimony of Robert L. Russell, its head of risk management, and introduced Petitioner's Exhibits 1 through 4. Petitioner's Exhibits 5 - 7 for Identification were offered but not received into evidence. Respondent presented the testimony of Ann Lee Clayton, Director of the Department's Division of Worker's Compensation but introduced no exhibits. No transcript was presented. Only the Department submitted Proposed Findings of Fact which have been incorporated in this Recommended Order. Petitioner submitted a written summation and final argument which has been carefully considered in the preparation of this Recommended Order.
Findings Of Fact At all times pertinent to the allegations herein, the Respondent, Department, was the state agency responsible for the administration of the Florida Worker's Compensation Act. One division of the Department deals with the regulation of worker's compensation self insurers and self insurance funds. Petitioner is a 75 year old insurance adjusting and service company consisting of nearly 400 employees and 31 offices in the United States. For the purpose of this procurement, Toplis is the head of a joint venture also utilizing the services of the Fred R. White companies of Dallas, a subcontractor, and Florida agent Lee A. Black. In January, 1991, Toplis broadened its service base to include risk management consulting which is the primary function of Mr. Fred White, head of the Fred R. White companies, mentioned above as one of the partners in the joint venture. The other party, L. A. Black & Associates, is an agency for Travelers, Hartford, and Lloyds of London in Florida and is a certified minority business enterprise in this state. On April 15, 1991, Ann Clayton became the Director of the Respondent's Division of Worker's Compensation and after reviewing the administrative function of that division, determined there was a need for a study of the solvency and liquidity of self insurers and self insurance funds under the jurisdiction of the Division as well as the different ways in which those funds are regulated by the Division. In furtherance of this decision, she appointed Joe Mastrovito, Chief of the Bureau of Self Insurance, to prepare a request for proposals for such a study. The RFP in issue here, developed as a result of those directions, was distributed on June 5, 1991, and required proposals in response thereto by July 3, 1991. At paragraph 2.8 of the RFP, the proposer was required to show evidence: ... that the contract team includes individuals or firms which, by virtue of education, experience, certification and/or licensure, provides expertise in the areas of law, actuarial science, government, accounting, business management, and insurance (including claims, underwriting, and risk management). The provision went on to require that the contractor designate in the technical proposal at least one individual within the contract team with expertise in each of the above areas. The contractor was required to provide resumes for each designated team member which was to include information concerning education, experience, and current employment. This requirement for a recitation of contractor qualifications was also contained in paragraph 3.3, PROPOSAL FORMAT, of the RFP, where the foregoing request for a recitation of qualifications was repeated almost verbatim. Six firms, including Petitioner, submitted timely proposals in response to the RFP. The responses were evaluated by a team composed of Ms. Clayton and Mr. Mastrovito, as well as an actuary and an attorney, both of whom were also from the Department. This committee determined that Petitioner's proposal was nonresponsive in that the resumes of Joyce Armstrong, Fred White, and Lee Black did not support the qualifications listed for them in the RFP in the areas of economics, actuarial science, and government, respectively. Specifically, with regard to Ms. Armstrong, designated by Petitioner as its expert in the area of economics, her resume included with the RFP reflects that she "studied" economics at Southern Illinois University in 1976, but no employment in the field of economics, either before or after that date, was listed. Mr. White's expertise in actuarial science, was claimed on the basis of his resume statement that he is currently completing requirements for membership in his accrediting societies, but the resume reflects no prior work experience in that field. A similar situation pertains in the case of Mr. Black, designated by Petitioner as its expert in the area of government. Here, Petitioner's narrative indicates that Mr. Black held a "senior position" with the United States Department of Housing and Urban Development, yet his resume makes no reference to any government service or experience. At the hearing, Petitioner attempted to introduce affidavits from Mr. Black, Mr. White, and Ms. Armstrong in an effort to bolster their credentials. However, these affidavits, which were objected to by Respondent, were not received into evidence and were not considered by the undersigned. The evaluation committee also failed two of the other five offerors as being unresponsive to the RFP and a second two of the five as having a conflict of interest which disqualified them from award. Only Sterling Partners, Inc. was considered both responsive to the RFP and without a conflict of interest. Both of these categories are "pass/fail" criteria. It was only after an offeror passed both of those that its response was scored on the basis of the other factors for evaluation. Since Petitioner and the other four disqualified submittors did not pass the first two qualifications, they were not scored on the technical proposals or price. Only Sterling Partners, Inc. was, receiving 83 out of a possible 100 points. Since Sterling Partners, Inc. was the only offeror to survive the evaluation process, the team recommended a contract be issued to it.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is, therefore: RECOMMENDED that a Final Order be entered denying the protest of Petitioner herein, Toplis & Harding, Inc. as to Proposal # 91-064-AS. RECOMMENDED in Tallahassee, Florida this 12th day of September, 1991. ARNOLD H. POLLOCK Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 12th day of September, 1991. COPIES FURNISHED: Edward A. Dion, Esquire Department of Labor and Employment Security Suite 307, Hartman Building 2012 Capital Circle, Southeast Tallahassee, Florida 32399-0657 Robert L. Russell, Esquire ARM, Risk Management Consultant Toplis & Harding, Inc. 222 South Riverside Plaza Chicago, Illinois 60606 Thomas Jones, Esquire Holland & Knight Post Office Drawer 810 Tallahassee, Florida 32302 Frank Scruggs, Secretary Department of Labor and Employment Security 303 Hartman Building 2012 Capital Circle, Southeast Tallahassee, Florida 32399-2152 Stephen Barron General Counsel DLES 307 Hartman Building 2012 Capital Circle, Southeast Tallahassee, Florida 32399-2152
Findings Of Fact Jennifer Morales-Allison is Hispanic-American and qualifies as a minority as defined in Section 278.012(9), Florida Statutes (1989) (Ex. 6). TSI was incorporated with the intent to obtain certification as a Disadvantaged Business Enterprise (DBE). In carrying out this intent Ms. Allison owns 510 shares of the 1000 shares issued in TSI which constitutes 51% of the stock of TSI. Richard Alberts, the non-minority shareholder of TSI, owns 490 shares or 49% of the stock of TSI. Alberts is president of TSI. TSI is primarily an environmental planning consultant and contracts generally with governments to provide environmental consulting involving road and airport construction. Accordingly, the work performed is technical in nature. Richard Alberts has some 22 years experience in environmental consulting primarily under contracts with the Federal Aviation Administration involving environmental effects of airport construction and state road departments involving environmental effects of highway construction. Prior to the incorporation of TSI Alberts worked at Greiner, an engineering firm doing extensive environmental consulting work, for some eight years. Ms. Allison also worked at Greiner during the time Alberts was employed there. She started out as a word processor-typist, moved up through secretary to office manager. During her eight years at Greiner she worked as secretary for Alberts and later as his administrative assistant. Her working experience was predominantly administrative such as in the preparation of contracts as opposed to technical. She has never served as a project manager or been involved with carrying out environmental contracts other than seeing that the proper personnel were assigned to the project and the agency was properly billed for the services. Although the evidence indicates Ms. Allison contributed $19,876 (51%) and Alberts contributed $19,092.32 (49%) as start up capital for TSI, Ms. Allison's contribution was obtained as a loan from Alberts for which promissory notes were signed. These notes were intended to be repaid from profits of the corporation, although the promissory notes are not so conditioned. Alberts' salary is set at $60,000 per year and Ms. Allison's salary at $40,000. Prior to leaving Greiner Alberts' salary was $80,000 and Ms. Allison's salary was $28,000. The bylaws of TSI (Ex. 5) provide that the president of the corporation shall be the principal executive officer of the corporation and, subject to the control of the board of directors, shall in general supervise and control as manager of technology all of the business and affairs of the corporation. Both Alberts and Allison testified that it was their intent that Alberts supervise the technical aspects of the corporation and Allison would supervise the business aspects of the corporation, and, if necessary, the bylaws of the corporation would be redrawn to express that intent. Both incorporators, Allison and Alberts, testified that Allison made final decisions for the corporation and as 51% owner controlled the vote of the board of directors comprised of Allison and Alberts. As such she had the authority to hire and fire employees, including Alberts. Without Alberts' expertise the corporation could not have successfully commenced operations. He is the incorporator with the knowledge and experience to bid on projects and carry out environmental consulting contracts once obtained. He is also the person who provided all necessary working capital for TSI to commence operations. Finally, he holds the necessary licenses and is qualifying officer for the company's projects. Evidence was submitted that Allison signs checks and contracts on behalf of TSI, that she hires and fires employees, and that she has the final say in all corporate decisions. This evidence is not credible with respect to her having final say in all corporate decisions. If Allison attempted to fire Alberts he could move out with the remaining capital he provided and forthwith start another company similar to TSI; and, if he did so, TSI would undoubtedly fail.
Recommendation It is, RECOMMENDED: That the application of Transportation Solutions, Inc. for certification as a Disadvantaged Business Enterprise be disapproved. DONE and ENTERED this 9th day of September, 1991, in Tallahassee, Florida. K. N. AYERS Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of September, 1991. APPENDIX Proposed findings submitted by Petitioner are generally accepted as testimony of the witnesses but, insofar as this testimony is that Ms. Allison controls the operation of TSI, those findings are rejected. Petitioner filed no findings of fact separate from conclusions of law; accordingly, without assigning a number to each paragraph, a ruling on Petitioner's proposed findings cannot be made. Nevertheless, the ultimate paragraph, starting at the bottom of page 6 of the proposed Order, is rejected insofar as it concludes that Ms. Allison has the requisite control to qualify TSI as a minority business enterprise. Proposed findings submitted by Respondent are accepted and are generally included in the Hearing Officer's findings of fact. COPIES FURNISHED: Mark M. Schabacker, Esquire P.O. Box 3391 Tampa, FL 33601-3391 Harry R. Bishop, Esquire 605 Suwanee Street Tallahassee, FL 32399-0458 Ben G. Watts, Secretary Department of Transportation Haydon Burns Building 605 Suwanee Street Tallahassee, FL 32399-0458 Thornton J. Williams, General Counsel Department of Transportation 562 Haydon Burns Building Tallahassee, FL 32399-0458
The Issue Whether the Respondent, the Gadsden County School Board (Respondent or Board), acted illegally, arbitrarily, fraudulently, or dishonestly in rejecting all proposals for telecommunications services as set forth in its E-Rate application for the school year 2003-2004 (the sixth year).
Findings Of Fact The Petitioner is a municipal corporation operating under authority of law. NetQuincy is the utility/entity through which the City sought to provide "information technology resources" as requested by the Board's RFP. NetQuincy is capable of providing internet access and related telecommunication services. "T1" is a specific type of information technology that identifies internet access. It is undisputed that the Petitioner sought to provide such service in connection with the RFP at issue. On October 9, 2002, the Respondent posted a Form 470 requesting various telecommunication services to be provided during the 2003-2004 school year (the sixth year). T1 service was among the requested technological services identified. Form 470 is required pursuant to E-rate guidelines. In connection with the Form 470, the Board also posted the RFP that is the subject of the instant dispute. The original RFP was amended and reposted on October 25, 2002. T1 service for all eligible school sites was specifically noted on the revised RFP. A vendor's meeting regarding the revised RFP was conducted on October 31, 2002. The Petitioner's representative attended the vendor's meeting. On December 2, 2002, three vendors timely submitted responses to the RFP: the Petitioner, the Intervenor, and Trillion (not a party herein). None of the submittals was evaluated. Instead, the Respondent posted a notice on December 6, 2002, that rejected all responses. More specifically, the notice provided in connection with the service in dispute in this cause: **We would like to thank all those who submitted quotes for this section of our RFP, however, during the 28 day period of the bidding process, the School District learned that the Florida Learning Alliance will be providing this service for us. Since this means zero costs for the School District, we will NOT be filling [sic] for E-rate discounts for this service for the 2003-2004 (Year Six) time period. The rejection notice did not contain the language set forth in Section 120.57(3), Florida Statutes. Nevertheless, the City filed a Notice of Intent to Protest the decision to reject all responses. The timeliness of the Notice of Intent to Protest or the Petition for Administrative Hearing has not been challenged. On December 16, 2002, the Florida Learning Alliance (FLA) filed an RFP requesting vendors for the same services identified in the Respondent's revised request. That is, T1 service for all eligible school sites for E-rate (the sixth year). The deadline for submittals to FLA's RFP was January 16, 2003. No decision on FLA's RFP was rendered as the instant action was initiated on December 23, 2002. The parties contend that by operation of law the bid solicitation process for both RFPs (the Board's and FLA's) was suspended. Thus it is uncertain whether the Respondent will be able to participate in the E-rate program for the sixth year. The E-rate program has existed since the 1998-1999 school year. It provides funding to enable schools to obtain internet access and services. The Schools and Libraries Division (SLD) administers the program and offers funding to eligible school districts computed as a "discount." The level of discount is determined by the level of poverty within the population to be served. The Respondent has participated in the E-rate program for several years. Depending on the school to be served, the Respondent's discount is 86 or 87 percent. The remaining amount, the "undiscounted portion" is not paid by the SLD. Participants in the E-rate program are entitled to apply in two ways: individually (as the Respondent has done) or through a consortium. In this case, the FLA is an alliance through which the Respondent may receive E-rate services. FLA is comprised of three educational consortia covering 34 small rural school districts. The Panhandle Area Educational Consortium (PAEC) encompasses the geographical area within which the Respondent is located. As a member of PAEC, the Respondent is entitled to participate with FLA. By virtue of FLA's Technology Innovation Challenge Grant rural schools may receive T1 lines such as requested herein. More important, however, is FLA's ability to provide the undiscounted portion of the E-rate. That means FLA will provide the 13 or 14 percent not covered by the SLD. In order to benefit in this manner, the Form 470 for the services requested must be filed through the FLA. In this case, the Respondent confirmed this potential benefit of receiving the services at no cost only after its Form 470 and RFP had been posted. When they elected to withdraw their own RFP (to allow FLA to pursue the matter in their behalf) the instant protest followed. The Petitioner did file a response to FLA's RFP in order to be considered for the sixth year E-rate. The issue related to the sixth year is complicated by the fact that unbeknownst to the Respondent FLA acted on behalf of the Board for Year 5 T1 connectivity. As to Year 5, when no vendor replied to the FLA's RFP for T1 service, the Intervenor was selected as the "carrier of last resort." No contract was required or signed in connection with Year 5. The Intervenor was selected for Year 5 because TDS provided service in the areas designated for T1 service E-rate Year 5. That is how it was deemed "carrier of last resort." Other vendors provided services in other areas where they were similarly deemed the "carrier of last resort." In fact it was not until October 2002 that the Year 5 funding was made available. During the discussions over the Year 5 services (and with the deadline for filing the application for the sixth year fast approaching) Respondent filed Form 470 without knowing how or if FLA would participate in the sixth year process. When it later confirmed FLA would be available to administer the sixth year E-rate, the Respondent elected to abandon its revised RFP related to T1 service (thereby hoping to save the 13 or 14 percent not covered by the SLD funding). The revised RFP contained the following information: For Year 6 (July 1, 2003-June 30, 2004), the school district is planning to seek the services listed below. Any company that desires to submit a proposal for these services must meet the following criteria: * * * Be willing to enter into an agreement contingent upon E-Rate funding award. In other words, if the District is not successful in obtaining E-Rate funding on the particular service, the agreement will become invalid. Be willing to accept payment of only the non-discounted portion of the service from the school district and bill the SLD for the remaining portion. (this averages to be 86%) When a vendor is selected to provide E-rate services, SLD requires Form 471 to identify the provider and to complete the requisition started by the process (Form 470). The deadline for filing a Form 471 pertinent to this case (the sixth year) was February 6, 2003. Neither the Respondent nor FLA filed a Form 471 for the T1 services at issue. When the deadline for filing Form 471 passes, the opportunity to receive E-rate funding closes. As of the time of hearing in this cause the possibility of the Respondent receiving E-rate funding was slim to none. No entity filed a Form 471 for T1 services for the sixth year. The Respondent has not selected any vendor to provide E-rate services for the sixth year. The Respondent did not direct FLA to submit the Form 471 with the Intervenor as the provider for T1 during the E-rate sixth year. FLA has not submitted such form. The Respondent did not reject all bids for the purpose of avoiding the procurement process. The Respondent does not have a contract with the Intervenor for T1 services for E-rate, Year 6. The Respondent has not attempted to circumvent policies, rules, laws or statutes governing competitive procurement. The T1 services for the sixth year E-rate are "information technology resources" as defined in Section 282.303(13), Florida Statutes. As such they are not subject to any provision requiring competitive procurement.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Amended Formal Notice of Protest/Petition for Administrative Hearing be dismissed. DONE AND ENTERED this 1st day of May, 2003, in Tallahassee, Leon County, Florida. J. D. PARRISH Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 1st day of May, 2003. COPIES FURNISHED: Sterling Dupont, Superintendent Gadsden County School Board 35 Martin Luther King Boulevard Quincy, Florida 32351-4400 Daniel J. Woodring, General Counsel Department of Education 325 West Gaines Street 1244 Turlington Building Tallahassee, Florida 32399-0400 Honorable Jim Horne Commissioner of Education Department of Education Turlington Building, Suite 1514 325 West Gaines Street Tallahassee, Florida 32399-0400 Stephen C. Emmanuel, Esquire Ausley & McMullen 227 South Calhoun Street Post Office Box 391 Tallahassee, Florida 32302-0391 Roosevelt Randolph, Esquire Knowles, Marks & Randolph, P.A. 215 South Monroe Street, Suite 130 Tallahassee, Florida 32301 William E. Williams, Esquire Huey, Guilday, Tucker, Schwartz, & Williams, P. A. 1983 Centre Pointe Boulevard Suite 200 Post Office Box 12500 Tallahassee, Florida 32308
The Issue Whether Petitioner is entitled to attorneys' fees and costs and, if so, in what amount.
Findings Of Fact On or about April 29, 1993, the Department of Health and Rehabilitative Services issued an agency action letter which rejected certain of Petitioner's cost reports in calculating the Medicaid reimbursement to which Petitioner was entitled. As a result, the Medicaid reimbursement to Petitioner was reduced. Thereafter, Petitioner timely filed a challenge to the agency action, and the matter was forwarded to the Division of Administrative Hearings for formal proceedings, DOAH Case No. 93-3687. Such case was assigned to Judge Arrington and scheduled for hearing in Miami for October 14-15, 1993. On October 12, 1993, the Department filed a suggestion of mootness which led to the withdrawal of the agency action letter, the acceptance of Petitioner's cost reports, and, presumably, to the recalculation of the Medicaid reimbursement favorable to Petitioner. On May 2, 1996, the agency, now the Agency for Health Care Administration, entered a final order adopting the recommended order. On July 1, 1996, the Petitioner filed the instant motion for attorney's fees and costs and supporting memorandum of law together with the exhibits thereto. On or about September 6, 1996, Respondent filed a motion to dismiss or alternatively motion to strike Petitioner's motion for attorney's fees and costs, and argued that the Petitioner is not entitled to fees pursuant to Section 57.105, Florida Statutes; that the affidavit submitted by Petitioner does not comply with the statute; that Petitioner is not a prevailing party under Section 57.111, Florida Statutes; and that the relief requested exceeds the maximum award of $15,000.00. Such responses relate only to the initial pleading filed, however, and not to the amended request filed on February 12, 1997. Petitioner has a net worth of not more than $2,000,000.00 and its principal place of business is Dade County, Florida. Petitioner's attorney's normal billing rate for general matters is $250.00 and he expended in excess of 100 hours of time in the litigation of the underlying matter. Petitioner has requested $87,500.00 in attorney's fees as the prevailing party in the principal case and $21,875 for litigation on the issue of fees and costs. Petitioner alleged it is entitled to fees and costs pursuant to Sections 57.105 and 57.111, Florida Statutes.
The Issue The issue for determination in this case is whether Petitioner is entitled to certification as a Disadvantaged Business Enterprise pursuant to Florida Administrative Code Chapter 14-78.
Findings Of Fact Petitioner is a small business concern organized as a closely held Florida corporation. Fifty-one percent of Petitioner's stock is owned individually by its president, Mr. Jerry Smith ("Smith"). Smith is a black American and a minority for purposes of certification as a disadvantaged business enterprise ("DBE"). All of Petitioner's employees are minorities for purposes of DBE certification. Petitioner's by laws require 51 percent of the vote for any action for which voting approval is needed. Petitioner has no other authorized or outstanding classes of stock, and Smith owns no stock of any kind in any other corporation. Petitioner's remaining stock is owned by P.J. Constructors, Inc. ("P.J."). P.J. is wholly owned by Messrs. Mort Myrick and Paul Guptill ("Myrick" and "Guptill", respectively). Myrick and Guptill served on the board of directors for Petitioner until they resigned on December 18, 1989. Since that time, neither Myrick nor Guptill have functioned in fact as officers or directors for Petitioner; although both are named as officers in various corporate documents executed for specific purposes. Myrick and Guptill were authorized on June 14, 1988, as signatories on Petitioner's bank account at Peoples National Bank of Commerce in Miami, Florida ("Peoples"). Guptill was an authorized signatory as Petitioner's vice president, and Myrick was an authorized signatory as Petitioner's secretary and treasurer. After their resignation from the board of directors on December 18, 1989, no change was made to the form identifying authorized signatories for the bank account at Peoples. Guptill was authorized on July 26, 1990, as a signatory on Petitioner's bank account at First Union in Miami, Florida ("First Union") as Petitioner's vice president. Myrick and Guptill resigned their titles as officers and/or directors for Petitioner on January 8, 1991. Both Guptill and Myrick remain as signatories on the bank account at Peoples, and Guptill remains as a signatory on the account at First Union. Neither Guptill nor Myrick, however, have access to or actual control over Petitioner's checks on either account. Further, it is Smith's clear intent, as communicated to Guptill and Myrick, that the latter two individuals have no actual authority to sign on Petitioner's accounts. Neither Guptill nor Myrick have ever signed checks on behalf of Petitioner or otherwise exercised control over Petitioner's funds. Smith is the only one of the three individuals who actually signs checks and exercises actual control over Petitioner's funds. Petitioner is engaged in the road construction business. Petitioner has its own employees and owns its own construction and office equipment. Petitioner does approximately two percent of its business with P. J. In addition, Petitioner and P. J. occasionally lease equipment to each other at a price that is less than fair rental value. Guptill supervised the so-called "Overstreet Job" for Petitioner in 1990, but has not performed services for Petitioner on any other occasion. Guptill was compensated for his supervisory services. Guptill signed a change order for Petitioner on March 9, 1990, in connection with the Overstreet Job, but neither Guptill nor Myrick have ever signed a contract on behalf of Petitioner. Myrick performed estimating services for Petitioner when Petitioner was without an estimator during 1990. Myrick also performs estimating services for Petitioner in road projects involving large embankments. Road projects involving large embankments comprise about one percent of Petitioner's total business. Myrick is compensated for his estimating services. Petitioner customarily contracts its estimating jobs to outside firms. The work performed by those estimating firms is reviewed and approved by Smith. Smith is Petitioner's president and works full time for Petitioner. Smith has more than eight years experience in the conduct of Petitioner's business. Decisions concerning Petitioner's policies, operation, and management are made solely and exclusively by Smith. Smith does not confer with Petitioner's board of directors before making such decisions. Smith has the exclusive authority and power to hire and fire Petitioner's employees. Smith signs all of Petitioner's checks and makes all decisions regarding bid proposals. Smith shares in Petitioner's profits and losses in accordance with his stock ownership interest. Petitioner's directors act in the best interest of the company. No formal or informal agreements limit Smith's authority and power to conduct the policies, operations, and management of Petitioner. Petitioner's stock is not encumbered. Petitioner does not finance other companies and is not financed by other companies other than by commercial lenders. No other company pays the salaries of Petitioner's officers or employees or the other expenses incurred by Petitioner in the ordinary course of its trade or business. Petitioner was certified by Respondent as a DBE for approximately eight, one-year periods prior to this proceeding. Petitioner was selected as the outstanding DBE for 1986 when Guptill and Myrick were officers and directors for Petitioner. Petitioner is presently certified as a DBE in Dade and Broward counties. Petitioner has consistently disclosed its relationship with P. J. to Respondent during the period of Petitioner's certification as a DBE. On January 3, 1991, Petitioner timely filed a complete application for the certification period from April 3, 1991, through April 2, 1992, with Respondent. Respondent requested additional information not specified in the Florida Department of Transportation's Disadvantaged Business Enterprise's Certification Application, Schedule "A", including a financial statement and records of gross receipts for P. J. for 1989 and 1990. Petitioner attempted unsuccessfully to provide the additional information. The information requested by Respondent for P. J. was not within Respondent's possession or control and P. J. refused to provide such information. Respondent's consultant conducted an on-site review of Petitioner on April 16, 1991. Respondent denied Petitioner's application for recertification on two grounds. First, Petitioner failed to provide the additional information requested by Respondent. Respondent, however, would not have requested the additional information if Respondent had known that Guptill and Myrick were not on the board of directors for Petitioner at the time of the denial. Second, Respondent determined that Petitioner is not an independent business entity. Petitioner is an independent business entity based upon the substance of Petitioner's business rather than the form in which Petitioner's business is conducted. Guptill and Myrick terminated their positions as directors and officers for Petitioner in 1989. Any continued involvement in Petitioner's business by Guptill and Myrick since 1989 as officers or directors has been in form only. Guptill and Myrick remained as nominal officers for Petitioner on selected corporate documents executed for specific purposes. Even the nominal involvement by Guptill and Myrick as officers was terminated on January 8, 1991. Guptill and Myrick have been compensated for any other services performed by them. While Petitioner's record keeping has been ambiguous and less than accurate, the preponderance of competent and substantial evidenced adduced at the formal hearing shows that Guptill and Myrick have exercised no actual control over Petitioner and that their involvement in the conduct of Petitioner's business has been de minimis. The ownership and control of Petitioner, in substance, has remained continuously and resolutely in the hands of Smith.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered certifying Petitioner as a Disadvantaged Business Enterprise. DONE and ENTERED this 1 day of June, 1992, at Tallahassee, Florida. DANIEL MANRY 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 1 day of June, 1992. APPENDIX Petitioner submitted proposed findings of fact. It has been noted below which proposed findings of fact have been generally accepted and the paragraph numbers in the Recommended Order where they have been accepted, if any. Those proposed findings of fact which have been rejected and the reason for their rejection have also been noted. Petitioner's Proposed Findings of Fact Proposed Finding Paragraph Number in Recommended Order of Fact Number of Acceptance or Reason for Rejection 1-3 Accepted in Finding 11 4-5, 8,9, and 11 Accepted in Finding 12 6-7 Rejected as irrelevant 10, 12 Accepted in Finding 13 13 Accepted in Preliminary Statement 14-17 Accepted in Finding 1 18-22, 27-28 Accepted in Findings 8-9 23-26 Accepted in Finding 10 29 Accepted in Finding 5 30-31 Accepted in Finding 9 32-33 Accepted in Finding 1 34-35 Accepted in Findings 3, 14 36 Accepted in Finding 6 Respondent submitted proposed findings of fact. It has been noted below which proposed findings of fact have been generally accepted and the paragraph number in the Recommended Order where they have been accepted, if any. Those proposed findings of fact which have been rejected and the reason for their rejection have also been noted. Respondent's Proposed Findings of Fact Proposed Finding Paragraph Number in Recommended Order of Fact Number of Acceptance or Reason for Rejection 1 Rejected as immaterial 2 Rejected in Findings 3, 14 3-4 Rejected in Finding 3, 4-5, 14 5-6 Rejected in Finding 12 7, 11 Rejected as irrelevant 8 Rejected in Findings 4-5 9 Rejected in Finding 7 10 Rejected in Findings 8-9 12 Accepted in Finding COPIES FURNISHED: Williams H. Roberts, Esquire Assistant General Counsel Department of Transportation Haydon Burns Building, M.S. 58 605 Suwannee Street Tallahassee, Florida 32399-0458 Ben G. Watts, Secretary Department of Transportation Haydon Burns Building, M.S. 58 605 Suwannee Street Tallahassee, Florida 32399-0458 John O. Williams, Esquire Lindsey & Beck, P.A. 1343 East Tennessee Street Tallahassee, Florida 32308
