The Issue The issue is whether Florida Administrative Code Rule 61G14-22.012 is an invalid exercise of legislatively delegated authority in violation of section 120.52(8), Florida Statutes (2014).
Findings Of Fact Petitioner BBP is an association of harbor pilots that performs the pilotage services at PortMiami. BBP consists of pilots licensed by the State of Florida in accordance with chapter 310, Florida Statutes. Petitioner PEPA is an association of harbor pilots that performs the pilotage services at Port Everglades. PEPA consists of pilots licensed by the State of Florida in accordance with chapter 310. FHPA is a statewide organization representing the interests of Florida’s approximately 100 state-licensed harbor pilots, the membership of which is comprised of the eleven local pilot associations that serve each of Florida’s 14 deep-water ports. BBP and PEPA are members of FHPA. Chapter 310 governs pilots, piloting, and pilotage in the waters, harbors, and ports of Florida. Section 310.141, Florida Statutes, requires that, except in certain narrow circumstances, all vessels shall have a licensed state pilot or deputy pilot on board to direct the movements of the vessel when entering or leaving ports of the state or when underway on the navigable waters of the state’s bays, rivers, harbors, and ports. Section 310.011 creates the 10-member Board of Pilot Commissioners (“BOPC” or “Board”); each member is appointed by the Governor “to perform such duties and possess and exercise such powers relative to the protection of the waters, harbors, and ports of this state as are prescribed and conferred on it in this chapter.” In addition to other responsibilities, the Board determines the number of pilots in each port (section 310.061) and disciplines licensed pilots when appropriate (section 310.101). Although the BOPC has numerous statutory responsibilities, setting the rates of pilotage in each port is not one of them. Florida Administrative Code Rule 61G14-22.012 (“challenged rule” or “rule”) is entitled “Determination of Disputed Issues of Material Fact; Formal or Informal Hearings.” 5. Rule 61G14-22.012 cites section 310.151(1)(c) as specific authority. The challenged rule lists as “Law Implemented” sections 310.151 and 120.57. The former Pilotage Rate Review Board originally adopted the rule in 1995. When the Legislature amended chapter 310 in 2010, the former Pilotage Rate Review Board’s name was changed to the Pilotage Rate Review Committee (“PRRC” or “Committee”). The Committee consists of seven members, all of whom are also members of the BOPC. The PRRC is responsible for setting rates of pilotage in each port. On November 5, 2014, the BOPC/PRRC published a notice in the Florida Administrative Register announcing a telephone conference call meeting for consideration of “Rate Review Committee Rules.” PRRC members voted at that meeting to repeal rule 61G14-22.012, but determined they did not have enough information to know if a Statement of Estimated Regulatory Costs was required. On December 11, 2014, the BOPC/PRRC published a second notice in the Florida Administrative Register announcing a telephone conference call meeting for consideration of “Rate Review Committee Rules.” At that meeting, the PRRC voted to reconsider its original vote to repeal rule 61G14-22.012, but because the issue of potential reconsideration had not been properly noticed, no official vote on reconsideration was taken. On January 7, 2015, the BOPC/PRRC published a notice in the Florida Administrative Register announcing a meeting on January 22, 2015, and January 23, 2015. Among the subjects noticed for consideration was “Reconsideration of Repeal of Rule 61G14-22.012, F.A.C.” This matter was considered by the PRRC on January 23, 2015. By a 5-2 vote, the Committee voted against repealing rule 61G14-22.012. FCCA is a trade association representing cruise lines that are subject to pilotage fees pursuant to chapter 310, Florida Statutes. FCCA has filed petitions to reduce the rates of pilotage in both PortMiami and in Port Everglades.
The Issue Whether the Respondent committed the violations alleged in the Administrative Complaints and, if so, what penalty should be imposed.
Findings Of Fact The Department is the state agency charged with regulating the construction industry within the State of Florida. At all times material to the allegations of these cases, the Respondent was licensed by the Department as a certified general contractor, license number CG C007009. Additionally, due to the time period from which the Respondent held his license he was "grand- fathered" to perform roofing construction. The Respondent was the qualifying agent of O. Benitez & Associates, Inc., a Florida corporation. On November 13, 1997, the Respondent executed a contract with Maricel Alayon to construct a terrace for a home located at 1215 West 82nd Street, Hialeah, Florida. While Ms. Alayon referred to the structure as a "terrace," it was to be a covered (roofed) open porch attached to her home at the rear of the property. The price for the addition was $14,125.00. The contract that was prepared by the Respondent for Ms. Alayon's signature did not contain the Respondent's license number or a written notice of the consumer's rights under the Construction Industry's Recoveries Fund. Ms. Alayon paid the Respondent the full $14,125.00 on or about November 17, 1997. Despite having been paid the full amount, the Respondent did not complete the Alayon project. The work was begun on or about November 27, 1997, but was never finished. Ms. Alayon did not fire the Respondent, did not refuse access to her property, and never refused to pay the Respondent monies owed for the work. Curiously, the Respondent obtained the building permit for the Alayon project on January 27, 1998. The Respondent never called for a final inspection on the job and, as of March 29, 2001, a final passing inspection for the project had not been performed by building officials. In addition to the contract amount, Ms. Alayon paid $3,575.00 for materials that were used in the construction of the porch. The Respondent did not reimburse Ms. Alayon for that amount. In May of 1998, the Respondent began negotiations with Mr. and Mrs. Piloto for the construction of an addition to their home to include an in-ground swimming pool. From the beginning of the talks, Mr. Piloto advised the Respondent that the couple could only invest $38,000 for the remodeling work as that was the amount the bank had approved for the project. The Pilotos wanted to build a bedroom, an expanded bathroom, and a swimming pool at the rear of their home located at 750 West 73rd Place, Hialeah, Florida. Eventually the Respondent telephoned the Pilotos to advise them that they could get what they wanted within the budget set by the bank. The contract executed by the Pilotos called for the remodeling for a price of $37,890.00. The contract, prepared by the Respondent, did not contain the Respondent's license number or a notice of consumer's rights pursuant to the Construction Industries Recovery Fund. At all times material to the Piloto project, the Respondent did not hold a valid architect's license. In fact, in December of 1997, the Board of Architecture and Interior Design had fined the Respondent for having practiced architecture with a delinquent license. Nevertheless, the Respondent represented himself as an architect to the Pilotos and charged them for blueprints for the remodeling project. Moreover, the Respondent submitted the signed and sealed plans for the Piloto project to the Building Department in order to obtain a building permit for this project. Such plans were filed on or about August 12, 1998. Pursuant to their agreement with the Respondent, the Pilotos paid the Respondent a total of $26,664.00 for the project. In comparison, the value of the work performed by the Respondent did not exceed $10,000. The Respondent asked the Pilotos to increase the amount for the contract to $50,395.75, but they refused. Despite the fact that he had caused their home to be reduced to a dangerous condition (by virtue of exposed wiring and open walls), the Respondent refused to complete the work on the Piloto project for the contracted amount. Instead, he abandoned the project. The Pilotos did not fire the Respondent. They refused to increase the amount of the contract. The Pilotos did not stop the work or refuse workers access to the property. A lien was placed on the Piloto property by a subcontractor to whom the Respondent owed monies. The Pilotos were required to pay the subcontractor in order to satisfy the lien amount. The Respondent has failed or refused to repay the lien amount. The Respondent grossly under estimated the cost of remodeling the Piloto home. He did so either negligently or intentionally. The Piloto home was compromised by the demolition work done by the Respondent's crew. The Pilotos were faced with paying the additional monies to comply with the Respondent's demand or living with their home in an uninhabitable condition. They chose the latter. On or about May 11, 1999, the Respondent applied for and obtained a building permit to re-roof the home of Sam and Daisy Carpenter. The contract for the work was with Banos Remodeling Services, an unlicensed entity, not the Respondent or his company. The Respondent has been the subject of prior disciplinary actions filed by the Department. He settled such actions without admitting or denying the allegations against him. As to his architectural license, it is undisputed that at all times material to these cases, the Respondent did not hold a valid architect's license. The Petitioner has incurred expenses and costs in the investigation of and the prosecution of the instant cases against this Respondent. The Respondent provided no credible explanation for the failure to complete the work contracted for regarding the Alayon and Piloto homes.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Construction Industry Licensing Board, enter a final order sustaining the violations outlined by the Conclusions of Law, imposing an administrative fine in the amount of $5000.00, requiring the Respondent to make restitution to the Pilotos and Ms. Alayon, requiring the Respondent to remit the costs of investigation and prosecution of these cases, and revoking the Respondent's license until all amounts are fully paid. DONE AND ENTERED this 23rd day of October, 2001, 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 23rd day of October, 2001. COPIES FURNISHED: Kathleen O'Dowd, Executive Director Construction Industry Licensing Board Department of Business and Professional Regulation 7960 Arlington Expressway, Suite 300 Jacksonville, Florida 32211-7467 Hardy L. Roberts, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2201 Oscar S. Benitez 3894 Southwest 107th Avenue Miami, Florida 33165 Theodore R. Gay, Esquire Department of Business and Professional Regulation 401 Northwest Second Avenue Suite N-607 Miami, Florida 33128-1765
The Issue The issue presented is whether Rule 61E13-2.012, Florida Administrative Code, is an invalid exercise of delegated legislative authority.
Findings Of Fact l. Petitioner South Florida Cargo Carriers Association, Inc., is a Florida not-for-profit corporation with its principal office in Miami, Florida. Petitioner's purpose is to promote, advance, and secure laws, rules and regulations concerning vessels utilizing the navigable waters of the State of Florida, in particular the Port of Miami and Port Everglades, in order that the waters, harbors, and ports of the State and the environment, life, and property of all persons be protected to the fullest extent possible consistent with sound financial principles. Petitioner consists of the following companies: members of the Florida-Caribbean Cruise Association; Maersk, Inc.; Seaboard Marine; Kirk; SeaLand; Zim; Cari Freight; Thompson Shipping, and Burmuth. Intervenor Florida State Pilots Association, Inc., is a Florida not-for-profit corporation. It is a voluntary organization whose membership is comprised of all individual pilot associations serving the various ports of the State of Florida, as well as approximately 100 pilots licensed by the State of Florida. Among other things, Intervenor advances and defends the interests of its membership on the state level. The Port Everglades Pilots' Association (hereinafter "PEPA") is an association composed of present and retired harbor pilots that is treated as a partnership for tax purposes and which performs the pilotage services at Port Everglades. PEPA and its affiliates Port Everglades Pilots, Inc., and PEP, Inc., are located in Fort Lauderdale. The purpose of PEPA is to provide pilotage services in Port Everglades in a safe and efficient manner and in compliance with the provisions of Chapter 310, Florida Statutes, the rules promulgated thereunder, and any other provisions of law governing the provision of pilotage services. As such, PEPA is entitled to charge pilotage rates as provided in Section 310.151, Florida Statutes, and, as further provided therein, to seek rate changes by filing a petition with the Department of Business and Professional Regulation, Pilotage Rate Review Board. A number of Petitioner's members are affected by the rates of pilotage set for Port Everglades, inasmuch as they are required by Chapter 310, Florida Statutes, to utilize and compensate the pilots whose rates are established by the Board, and they are utilizing and compensating pilots in accordance with the rates currently established for Port Everglades. In January 1997 PEPA submitted to the Board an application for an increase in the pilotage rates for Port Everglades. In February 1997 Petitioner submitted its own application for a decrease in the rates of pilotage for Port Everglades. On May 20, 1997, the Board held a public hearing on both applications. At the conclusion thereof, the Board preliminarily determined to grant PEPA's application for a rate increase in its entirety and to deny Petitioner's application for a rate decrease. The Board's preliminary determination was reduced to writing on July 3, 1997. On July 28, 1997, Petitioner filed with the Board a Petition for Formal Administrative Hearing challenging the Board's decision to grant PEPA's application and to deny Petitioner's application. The Board thereafter transmitted that Petition to the Division of Administrative Hearings. The Board's transmittal letter filed August 7, 1997, cautioned the Division not to carry out its full statutory functions because: it is the Board's position , as expressed in rule 61E13-2.012(3), F.A.C., that the resolution of any disputed issue of fact by an [Administrative Law Judge] cannot result in a recommendation from that ALJ as to what the rate should be. The ALJ's recommendation should only extend to resolving the disputed issues of material fact. Subsequently, and based upon the resolved issues of fact, the Pilotage Rate Review Board will set the appropriate rates. On August 18, 1997, Petitioner filed its Petition Seeking an Administrative Determination of the Invalidity of an Existing Rule, challenging Rule 61E13-2.012(3), Florida Administrative Code, pursuant to Section 120.56(3), Florida Statutes. Petitioner has standing to file and maintain this rule challenge proceeding. Intervenor has standing to intervene in this rule challenge proceeding. Rule 61E13-2.012(3), Florida Administrative Code, was adopted before October 1, 1996. It was included on a list submitted by the Pilotage Rate Review Board in accordance with Section 120.536(2), Florida Statutes. It was subsequently amended by the Board, effective October 14, 1997, so as to delete all portions of the Rule except for Subsection (3) which is now the entire Rule.
The Issue The issues remaining to be resolved in this proceeding concern whether the above-named Petitioner is a "small business party" as described in Section 57.111(3)(d)1.a. b. and c., Florida Statutes (2007); whether the action of the above-named Agency in the underlying case was substantially justified in law and fact and whether an award of attorney's fees and costs would be unjust.
Findings Of Fact In the instant case the Respondent Agency (Department) does not dispute the amount of attorney's fees and costs sought in this proceeding and does not contest that the Petitioner is a prevailing party. Moreover, the Department admits that it was a real party in interest in the underlying proceeding involving the Administrative Complaint and was not merely a nominal party. The parties also waived an evidentiary hearing in this attorney fee proceeding. The parties, rather, submitted memoranda and affidavits in support of their respective positions. The present Petition for Attorney's Fees and Costs is based upon the above-referenced Administrative Complaint action brought against Wittmer and JR. Wittmer's Remodeling, Inc., by the Department, which came before the Division of Administrative Hearings by a request for formal hearing filed by Wittmer. Prior to filing that Administrative Complaint the Department performed an investigation related to the Complaint which had been filed by Kenneth Hatin of Palm Coast, Florida, against Wittmer. The Complaint by Hatin alleged that on August 10, 2005, he and Wittmer had entered into a contract for the building of an addition to the complainant's home in Palm Coast, Florida. Hatin had alleged and testified at hearing that Wittmer was unlicensed to perform the work under the contract and had been paid in excess of $30,000.00 for the project. Hatin maintained that Wittmer had abandoned the job before completion and that he had to hire another person or entity to complete the work, at further expense. The Department considered the results of its investigation, in the form of an investigative report, and considered the investigative file it had developed concerning Hatin's complaint. This included the original contract on JR. Wittmer's Remodeling, Inc.'s, stationary, signed by Wittmer, as well as copies of original checks amounting to approximately $30,000.00 written to Wittmer and/or his company or business. It also considered a copy of the local licensing records concerning Wittmer, revealing an expired occupational license, as well as records of the Department showing that Wittmer was unlicensed as any sort of contractor in the State of Florida. The Department also considered various invoices and receipts regarding the work contracted by complainant Hatin with another person or entity, to finish the job purportedly abandoned by Wittmer. During the investigation, the complainant and the complainant's fiancée were interviewed and made no mention of any familial relationship or friendship relationship between Wittmer and the complainant and his family members at the time of the investigation. Wittmer himself was interviewed by the investigator and did not mention any familial or personal relationship he had with the complainant or the complainant's family. The familial or friendship relationship between Wittmer and the complainant and the complainant's family only arose through the evidence adduced at the hearing. That evidence became a significant portion of the reason for the Findings of Fact and Conclusions which resulted in the Complaint against Wittmer being ultimately dismissed. JR. Wittmer's Remodeling, Inc., was dissolved by the State of Florida, Department of State, Division of Corporations on September 16, 2005, for failure to file required annual reports or Uniform Business Report. This fact was confirmed by Wittmer's affidavit submitted on January 18, 2008, in this proceeding, attesting that his corporation was dissolved and that it ceased business due to "financial hardship of the business." As a result of the hearing it was determined in the Recommended Order (with Findings of Fact adopted in the Final Order) that Wittmer performed work on the subject construction project without making any profit. It was performed, in essence, as a cooperative project between family and friends of Wittmer, in the sense that Wittmer's fiancée was related to the complaining witness's family and/or they were close friends. The circumstances established by preponderant evidence did not show that Wittmer was actually performing contracting, as defined in the above-referenced statutory authority underlying the charges in the Administrative Complaint. It was also determined, based upon the preponderant evidence at that hearing, that Wittmer made no profit on the project after paying all the subcontractors. The Department, in essence, adopted the Recommended Order of the Administrative Law Judge (with non-dispositive modifications of several Conclusions of Law) and entered a Final Order dismissing the charges in the Administrative Complaint. The subject Petition for Attorney's Fees and Costs was thereafter filed and this case ensued. The Department proceeded against Wittmer by naming as Respondents, in the underlying, case JR Wittmer's Remodeling, Inc., which corporation had actually already been dissolved at the time of the filing of the Administrative Complaint. It also named in that Complaint, and proceeded against, Willis Wittmer, Jr., personally. The Petitioners herein have established that Wittmer never had more than 25 full-time employees or a net worth in excess of two million dollars, whether functioning as JR Wittmer, Jr., an individual or as JR Wittmer's Remodeling, Inc. The Petitioner has also established that the construction contract at issue in the underlying case was entered into by the Petitioner herein under the name "JR Wittmer's Remodeling" and not "JR Wittmer's Remodeling, Inc." Moreover, that contact was not signed by Mr. Wittmer as president of JR Wittmer Remodeling, Inc. Aside from the fact that the Department filed the original Administrative Complaint against JR Wittmer Remodeling, Inc., it also named JR Wittmer individually as a Respondent in that Administrative Complaint, so he had defend against the action personally, regardless of the question of whether the corporation was in legal existence at the time of the filing of the Administrative Complaint. The evidence, as referenced above, shows that he met the requirements of having less than 25 full- time employees and a net worth of less than two million dollars. Thus, the totality of the evidence shows that Mr. Wittmer has standing, as the sole proprietor of an unincorporated business, to pursue the subject attorney's fee claim as a sole proprietor, even if not as a corporation or the president of the originally named, but now dissolved corporation. The Petitioner contends that the Department should have recognized the lack of a factual basis for the Administrative Complaint and, before finding probable cause, should have been able to determine that the construction arrangement between Wittmer and Hatin did not meet the legal definition of contracting or contracting services based upon the familial/friendship relationship of the protagonists. The Department, however, conducted a reasonable investigation and has been shown to have had a reasonable basis to determine, before hearing, that contracting and contracting services had been, in a legal sense, performed by Wittmer, based upon the results of its investigation (interviews, etc.). This is especially the case since Wittmer himself, when interviewed, had not revealed such exculpatory facts to the Department.
Findings Of Fact On November 15, 1982, Petitioner applied to Respondent to take the January 31, 1983, pilot's examination for the Port of Miami. Prior to that time, Petitioner had served as an apprentice pilot in the Port of Miami from January 1, 1967, through January 1, 1971. Petitioner was terminated from his position as an apprentice pilot with the Port of Miami in 1971, and has not piloted any ships in the Port of Miami or any other port in the state since that time. At the time of his application to take the pilot's examination, Petitioner was over 18 years of age, had been awarded a high school diploma, and was in good physical and mental health. Petitioner had also obtained a valid first class unlimited pilot's license issued by the United States Coast Guard in 1971. In addition to Petitioner, three other persons, William A. Arata, Stephen E. Nadeau, and Robert K. Brownell, also applied to take the January 31, 1983, pilot's examination for the Port of Miami. Arata submitted his application to sit for the examination on November 19, 1982. At that time, Arata had been licensed as a deputy pilot for the Port of Miami since January 28, 1980. In addition, he possessed an unlimited first class pilot'S license for the Port of Miami and had successfully completed the deputy pilot training program for that port. On November 24, 1982, Nadeau submitted his application to sit for the January 31, 1983, pilot's examination. Nadeau had been licensed as a deputy pilot in the Port of Miami since July 23, 1980, possessed an unlimited first class pilot's license for the Port of Miami, and had successfully completed the Port of Miami deputy pilot training program. Brownell applied on November 29, 1982, to sit for the same pilot's examination. At that time, Brownell had been licensed as a deputy pilot for the Port of Miami since July 31, 1980, also possessed an unlimited first class pilot's license for the Port of Miami, and had successfully completed the Port of Miami deputy pilot training program. In accordance with the provisions of Section 310.071, Florida Statutes, the applications of Petitioner, Arata, Nadeau, and Brownell were submitted to the Department of Professional Regulation which, in turn, submitted those applications to Respondent for a determination of eligibility to sit for the licensing examination. Respondent ultimately determined and advised the Department of Professional Regulation that all four applicants were qualified to sit for the licensing examination. All four applicants took the examination on January 31, 1983, and each of them received a passing grade. In accordance with Rule 21-8.09, Florida Administrative Code, the Department of Professional Regulation ranked the grades received by the applicants from highest to lowest. Petitioner received the lowest grade of the four applicants. Accordingly, since Respondent had certified three openings to be filled for licensed state pilots in the Port of Miami, the Department of Professional Regulation, act some time between February 1, 1983, and May 6, 1983, issued state pilot licenses for the Port of Miami to Captains Arata, Nadeau, and Brownell. There is in force in the Port of Miami a Deputy Pilot Training Program which has been approved by Respondent. The minimum time required for completion of the program, which is a prerequisite for applying for a state pilot's license, is two years. One of the requirements of the program is that participants obtain a first class unlimited pilot's license from the United States Coast Guard. This license allows the holder to pilot coastwise vessels which sail under the American flag. A state pilot's license standing alone permits the holder only to pilot ships sailing under foreign flags. In order to acquire a first class unlimited pilot's license, an applicant must possess another maritime license, such as a master's or male's license, must meet age and sea experience requirements, and must pass an examination prepared and administered by the United States Coast Guard. In addition, a condition to obtaining a first class unlimited pilot's license is that the applicant must possess a radar observer's certificate. The Florida State Pilot's Association, Inc., is a nonprofit corporation composed of 59 licensed state pilots from every port in Florida with the exception of Jacksonville and Fort Pierce. Captains Arata, Nadeau, and Brornell are members of that organization. The purpose of the organization is to represent the interests of its members at local, state, and federal levels.
The Issue Whether the proposed amendment to Florida Administrative Code Rule 6A-2.0020(4) is an invalid exercise of delegated legislative authority because of conflict with section 1008.34(1)(a), Florida Statutes (2016), or because the rule will be arbitrary and capricious in its application and administration.
Findings Of Fact Petitioner Florida Association of Independent Charter Schools is a Florida non-profit corporation. The association is substantially affected by the proposed amended rule. Petitioner Aspira Raul Arnaldo Martinez Charter School is a charter school in Miami-Dade County and is currently serving 573 students. Its school grades over the past two consecutive years are: “D” for 2014-2015 and “D” for 2015-2016. If the proposed amended rule becomes effective and the school receives a school grade lower than “C” for 2016-2017, the school will not be eligible for the 2017-2018 Capital Outlay Appropriation. The school is substantially affected by the proposed amended rule. Petitioner Miami Community Charter Middle School is a charter middle school in Miami-Dade County currently serving 283 students. It is a Title I school serving 99 percent Free and Reduced Lunch. Its school grades over the past two consecutive years are: “D” for 2014-2015 and “D” for 2015-2016. If the proposed amended rule becomes effective and the school receives a school grade lower than “C” for 2016-2017, the school will not be eligible for the 2017-2018 Capital Outlay Appropriation. The school is substantially affected by the proposed amended rule. Respondent State of Florida Board of Education is “the chief implementing and coordinating body of public education in Florida . . . [with] the authority to adopt rules pursuant to ss. 120.536(1) and 120.54 to implement the provisions of law conferring duties upon it for the improvement of the state system of K-20 public education . . . .” § 1001.02(1), Fla. Stat. Respondent Florida Department of Education “act[s] as an administrative and supervisory agency under the implementation direction of the State Board of Education.” § 1001.20(1), Fla. Stat. “The Commissioner of Education is the chief educational officer of the state . . . , and is responsible for giving full assistance to the State Board of Education in enforcing compliance with the mission and goals of the K-20 education system except for the State University System.” § 1001.10(1), Fla. Stat. Charter school capital outlay funding is the state’s contribution to capital funding for charter schools. A charter school’s governing body may use such funds for the following purposes: purchase of real property, construction of school facilities, purchase or lease of permanent or relocatable school facilities, purchase of vehicles, renovation, repair, maintenance of school facilities, and insurance for school facilities. § 1013.62(3), Fla. Stat. The charter school statute, section 1002.33, Florida Statutes, specifically authorizes the State Board of Education to adopt rules which address charter school eligibility for capital outlay funds. “The Department of Education, after consultation with school districts and charter school directors, shall recommend that the State Board of Education adopt rules to implement specific subsections of this section.” § 1002.33(28), Fla. Stat. One of the specific subsections of section 1002.33 is subsection (19), entitled “CAPITAL OULAY FUNDING.” Subsection (19) provides, in pertinent part: “Charter schools are eligible for capital outlay funds pursuant to s. 1013.62.” Each year, the Commissioner of Education is required to allocate charter school capital outlay funds, if any are appropriated by the Legislature, to eligible charter schools.1/ One of the eligibility criteria, which is at the center of the parties’ dispute, is set forth in section 1013.62(1)(a)3., Florida Statutes: “Have satisfactory student achievement based on state accountability standards applicable to the charter school.” The 2016 Florida Legislature amended section 1013.62, but it did not amend the statute regarding satisfactory student achievement. With regard to satisfactory student achievement, presently effective rule 6A-2.0020 provides: (2) The eligibility requirement for satisfactory student achievement under Section 1013.62, F.S., shall be determined in accordance with the language in the charter contract and the charter school’s current school improvement plan if the school has a current school improvement plan. A charter school receiving an “F” grade designation through the state accountability system, as defined in Section 1008.34, F.S., shall not be eligible for capital outlay funding for the school year immediately following the designation. On February 28, 2017, Respondents published a Notice of Proposed Rule, which proposed to amend rule 6A-2.0020. On March 22, 2017, the State Board of Education approved the proposed amendments to rule 6A-2.0020. As approved, the portion of the proposed rule which addresses satisfactory student achievement provides: (4) Satisfactory student achievement under Section 1013.62(1)(a)3., F.S., shall be determined by the school’s most recent grade designation or school improvement rating from the state accountability system as defined in Sections 1008.34 and 1008.341, F.S. Satisfactory student achievement for a school that does not receive a school grade or a school improvement rating, including a school that has not been in operation for at least one school year, shall be based on the student performance metrics in the charter school’s charter agreement. Allocations shall not be distributed until such time as school grade designations are known. For the 2016-2017 school year, a charter school that receives a grade designation of “F” shall not be eligible for capital outlay funding. Beginning in the 2017-2018 school year, a charter school that receives a grade designation of “F” or two (2) consecutive grades lower than a “C” shall not be eligible for capital outlay funding. Beginning in the 2017-2018 school year, a charter school that receives a school improvement rating of “Unsatisfactory” shall not be eligible for capital outlay funding. Proposed amended rule 6A-2.0020(4), if adopted, will provide the standard for what constitutes failure to meet satisfactory student achievement for purposes of receiving capital outlay funding. A school with a grade of “F” or two (2) consecutive grades lower than a “C” will be ineligible for funding. Proposed amended rule 6A-2.0020(4), if adopted, will allow a charter school with a single “D” grade to continue receiving capital outlay funds for the next fiscal year. On April 5, 2017, Respondents published a Notice of Change for a technical change for rule 6A-2.0020, referencing the following rulemaking authority for the rule: sections 1001.02(1), (2)(n); 1002.33(19), (28); 1013.02(2)(a); and 1013.62(5).
The Issue As described in the parties' Prehearing Stipulation Petitioners are challenging the Respondent's (SJRWMD) solicitation process with regard to the "Invitation to submit an Offer to Purchase property known as the Zellwin Airstrip." Petitioners seek to set aside the award of purchase to Intervenors and to have the solicitation process re-advertised. The issue for resolution is whether Petitioners are entitled to that relief.
Findings Of Fact In 1996 the Florida Legislature mandated that the St. Johns River Water Management District (SJRWMD) attempt to purchase farms on the north shore of Lake Apopka as part of a long-term restoration and reclamation project. Petitioners, Rex Shepherd and Dale Harper, are pilots and owners of an aerial advertising business, American Outdoor Aerial Advertising. In early 1998 the business was operating out of Crakes field, a small airstrip owned by Kent Crakes as part of Crakes' North Lake Apopka farm. Petitioners' business owned airplanes and banners which it flew for its advertising clients such as Sears and GEICO. Sometime in early 1998 it became obvious that Petitioners would need to move their operation to another field. There were break-ins at the hanger, and the airstrip was beginning to flood as a result of the reclamation project. Kent Crakes referred Rex Shepherd to Leonard Freeman, the individual with SJRWMD who was involved with land acquisition in the area. Around March or early April 1998 Petitioners commenced discussions with Mr. Freeman regarding their use of the farm airstrip at Zellwin Farms, also part of the SJRWMD Lake Apopka farms acquisition program. Mr. Freeman was the SJRWMD point of contact for the Zellwin Farms acquisition. By early 1998, the property was already under contract and was scheduled to close some time around June 1998. Mr. Freeman and the Petitioners met at the Zellwin Farms airstrip in June 1998, and Petitioners determined the property would be suitable for their operation. Eager to accommodate Petitioners because of their predicament and also in anticipation of the SJRWMD's eventual sale of the Zellwin parcel, Mr. Freeman gave permission for Petitioners to store their equipment on the site and gave them a key. Because Zellwin Farms was beyond what SJRWMD considered to be the lake's historic shoreline, the SJRWMD knew that it would need to dispose of its 1400 acres as surplus, in whole or part. Mr. Freeman's desire was to find a way to dispose of the property as the best thing for the SJRWMD. Thus, because of the Petitioners' immediate interest in relocating their business, Mr. Freeman began negotiating with them for their purchase of the airstrip and related buildings. In September 1998, Mr. Freeman met again with Petitioners at the airstrip and discussed a specific proposal. Petitioners talked about offering $250,000 under a lease-purchase arrangement, and sent a letter dated September 10, 1998, to Mr. Freeman with that offer. Mr. Freeman later suggested that since the appraised value was $275,000, an offer in that amount would be easier to get approved. Mr. Freeman did not have the authority to obligate the SJRWMD to sell the property and Petitioners understood that. Still, Petitioners felt they were negotiating in good faith with staff who could make a strong recommendation to the board. Petitioners believed in early October that they had a hand-shake deal subject to further discussions regarding specific terms. They knew that a competitive solicitation might be an option for the SJRWMD but they also believed that they would be given an opportunity to meet another third party's offer. This belief was based not on some specific agreement for a "right of first refusal," but rather on Mr. Freeman's good-natured assurances that they would work it all out. Mr. Freeman requested that the SJRWMD special counsel develop a draft contract based on Petitioners' offer. The offer would then need to be signed by Petitioners and approved by Mr. Freeman's supervisor before going to the SJRWMD governing board. The counsel never finished the draft and it was never given to Mr. Freeman or the Petitioners. By the end of October 1998, Robert Christianson, Mr. Freeman's supervisor and director of the SJRWMD Department of Operations and Land Resources, learned that Petitioners were flying in and out of the Zellwin airstrip and using it for their business base of operations. This activity was beyond the storage permission that Mr. Freeman had granted. (Even that permission was beyond his individual authority.) Mr. Freeman and Mr. Christianson met with Petitioners on October 27, 1998, to work out a license agreement for their use of the airstrip. Such an agreement was necessary to protect the parties' respective interests and to cover the SJRWMD for any liability in the landlord/tenant relationship. The result of that meeting was a written license agreement for Petitioners to use, maintain, and provide protection for the property for a period from October 30, 1998, to April 30, 1999, subject to revocation with advance notice. Petitioners used the airstrip property under that agreement and made improvements, mostly cleaning up the facility so it could be used. At the October meeting it became obvious to Petitioners that the informal negotiations for their purchase were terminated and that the SJRWMD was going to solicit competitive offers for the purchase. This concerned the Petitioners and they felt let- down by Mr. Freeman. Still, they concentrated on getting the license agreement worked out. Rex Shepherd's account of the October meeting was that Mr. Christianson was very clear about the fact that the SJRWMD had to go for competitive bid, that they were bound by a board and rules and regulations even though both he and Mr. Freeman would like for Petitioners to have the airport, and that they should be able to work it out. At the end of the meeting, and as they were leaving the trailer, Mr. Shepherd commented to Mr. Freeman that he really did not want to lose the airport and wanted to be apprised of what was going on so that if there were a higher bid, he could have the opportunity to match it, or if it were too high, that they would have 30 or 60 days to vacate the property. According to Mr. Shepherd, Mr. Freeman simply responded, "We'll work all that out, don't worry about it." On November 11, 1998, the SJRWMD governing board voted to surplus the Zellwin Farms property with direction to the staff that the sale be widely advertised in the aviation community and not be a sole source deal. Consistent with the board's direction and pursuant to Section 373.089(3), Florida Statutes, the SJRWMD advertised a "Notice of Intention to Sell" the airstrip property in the Orlando Sentinel for three consecutive weeks, November 9, 16, and 23, 1998. The notice identifies the airstrip property as an "Approximately 47-acre agricultural airport facility, 2,200'? square feet asphalt runway, 5,250 ? square feet metal hanger, 2,048 ? storage square feet building, well and septic tank at a location of northwest Orange County, Florida, Sections 20 and 29, T-20-S, R-27-E, on Jones Avenue, 1 ? mile west of U.S. Highway 441, Zellwood." The Notice of Intention to Sell states that "[a]ll interested persons are invited to submit an offer to the District for purchase of said lands. Contact the District . . . and request an Airport Sales Package." Both the Airport Sales Package and the Notice of Intention to Sell state that the airport property will be sold for the highest price obtainable. The sales package states that full cash offers to be paid at closing will be given first consideration and that 10 percent of the purchase price must be paid when the offeror was notified that it was successful. The sales package also states that any person adversely affected by an offer solicitation shall file a Notice of Protest, in writing, prior to the date on which the offers are to be received, and shall file a formal written protest within ten (10) days after filing the Notice of protest pursuant to Florida Administrative Code Rule 40C-1.801. * * * Failure to timely file a notice of protest or failure to timely file a formal written protest shall constitute a waiver of proceedings under Chapter 120, Florida Statutes. (SJRWMD Ex. 3). Both the Notice of Intention to Sell and the sales package require that sealed "offers for purchase" be submitted to the SJRWMD prior to 2:00 p.m. on December 4, 1998, the advertised time for opening of the offers. Nothing in the Notice or sales package reserves a right of first refusal for any person. Instead, both plainly state "no offer will be accepted after the date and hour specified for submittal of offers." (SJRWMD Exhibits 1 and 3) Although Petitioners did not see the newspaper notice, they had knowledge that the SJRWMD advertised the sale of the airstrip property through a competitive solicitation process in the newspaper. They had been clearly informed of need for the competitive process by Mr. Christianson at the October meeting and they were present when a pre-solicitation meeting/inspection took place at the airstrip in November prior to the offers being accepted by the SJRWMD. Intervenors requested a sales package from the SJRWMD on November 30, 1998, and December 2, 1998. Petitioners requested and received a sales package prior to the opening of the offers to purchase. The sales packages were not available to the public until December 2, 1998, the same day Petitioners received their package. Mr. Freeman told Petitioners they needed to submit their bid. Although the sales package stated that facsimile offers would not be accepted by the SJRWMD, Leonard Freeman informed Petitioners that they could fax their Offer to Purchase. The SJRWMD did accept a facsimile offer to purchase from Petitioners on December 4, 1998, at 1:07 p.m. Offers to purchase were opened by the SJRWMD at 2:10 p.m. on December 4, 1998. Petitioners submitted an offer to purchase the airstrip property for $275,000, where Petitioners would pay $1,500.00 per month for 60 months ($90,000 with $72,000 applied toward principal) with a balance of $203,000 cash to be paid at the end of the 60-month term. Intervenors submitted an offer to purchase the airstrip property for $310,000, where Intervenors would put 10 percent down ($31,000 earnest money deposit) at award of Agreement of Purchase and Sale and the balance of $279,000 cash would be paid at closing on or before May 1, 1999. Petitioners' offer to purchase was not the highest offer; it did not provide for cash at closing; and it did not meet the requirement of 10 percent to be paid upon notification. Staff recommended to the SJRWMD board that it award the purchase of the airstrip property to the highest offeror, Intervenors. The governing board approved staff's recommendation at its regularly scheduled meeting on December 9, 1998. On December 9, 1998, Petitioners filed a Notice of Protest. On December 18, 1998, Petitioners filed a copy of their Formal Bid Protest with the SJRWMD. Petitioners never grasped the implications of the competitive solicitation process until after the offers were opened and the award was made to Intervenors. Even if Petitioners had seen the newspaper notice and had received the sales package sooner, they still would not have protested because they understood that their "agreement" was outside of the process. That is, they mistakenly perceived that after the offers were in they could negotiate further to exceed the high offer. Chagrined, and genuinely regretful of the misunderstanding, Mr. Freeman had to tell Petitioners that further negotiations were foreclosed after the offers were opened. Mr. Freeman's earlier assurances to Petitioners were the result of an excess of bonhomie rather than any deception. He wanted them to have the airport and he wanted to work out the sale of surplus property. Petitioners were aware that he did not have the authority to bind his agency to an agreement. Mr. Freeman never specifically told Petitioners they had a right of first refusal; they wanted that advantage and surmised agreement from Mr. Freeman's and Mr. Christianson's vague counsel to not worry and that it would all be worked out. The SJRWMD devised a competitive process for disposition of the Zellwin airstrip that was consistent with its statute and with the direction of its governing board. Intervenors responded with an offer that met all the published requirements. Petitioners did not, and any culpability of SJRWMD's staff for Petitioners' misunderstanding is not so egregious as to require that the process begin again. Petitioners occupied the property, used it, and made improvements to enhance their use. This, however, was in reliance on their license to use the property and not on some certainty that they would ultimately be able to own the property. As Petitioners testified at hearing, they were disappointed that the SJRWMD decided to solicit competitive proposals; they knew that it was possible someone would offer more than they could match. (Harper, Transcript pages 117-120).
Recommendation Based on the foregoing, it is RECOMMENDED: that the SJRWMD enter its final order denying Petitioners' request to reject all bids and re-advertise the sale. DONE AND ENTERED this 24th day of June, 1999, in Tallahassee, Leon County, Florida. MARY CLARK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 24th day of June, 1999. COPIES FURNISHED: Henry Dean, Executive Director St. Johns River Water Management District Post office Box 1429 Palatka, Florida 32178-1429 John W. Williams, Esquire St. Johns River Water Management District Post Office Box 1429 Palatka, Florida 32178-1429 Clayton D. Simmons, Esquire Stenstrom, McIntosh, Colbert, Whigham And Simmons, P.A. Post Office Box 4848 Sanford, Florida 32772-4848 Stanley Dollen 1230 Kelso Boulevard Windermere, Florida 34786 Herbert Clark 5416 Trimble Park Road Mt. Dora, Florida 32757
Findings Of Fact The Board of Pilot Commissioners, Respondent, is charged with the responsibility of regulating licensed state pilots and certified deputy pilots in the State of Florida. Respondent is also charged with the responsibility and given the authority to license state pilots in various ports in Florida including the Port of Tampa. Section 310.061, Florida Statutes, provides, inter alia, that there shall not be more than 22 licensed state pilots for Tampa Bay. The number of deputy pilots which may be certified by Respondent is not specified by statute. Respondent may certify as many as necessary to meet the demand for pilot services. Currently, there are 20 licensed state pilots for Tampa Bay and four certified deputy pilots. No applications for pilot or deputy pilot for Tampa Bay have been accepted by Respondent for at least the past two years. Captain Gary Murphy applied to take the state pilot examination in 1980 and was qualified to do so. He is still on Respondent's mailing list to be notified when applications for Tampa will next be accepted. Captain Murphy is a member of TRICO. Respondent does not accept applications for state pilot positions in any port, including Tampa Bay, nor is an examination administered until Respondent has first declared an opening or openings for state pilots for the particular port. TRICO was founded by Captain David Rabren to provide piloting and shipping services on Tampa Bay. The other Petitioners signed membership agreements with TRICO. TRICO began operations January 1, 1984, and is an association of pilots who contract with the ship owners to provide certain piloting services in Tampa Bay. These include docking and undocking vessels and other piloting services on vessels these pilots are legally entitled to pilot. Only Captain Rabren of TRICO is a licensed state pilot for Tampa Bay and authorized to pilot foreign ships into and out of the port. Captains Murphy, Cropper, and Farrell all hold first-class pilots licenses issued by the U. S. Coast Guard for Tampa Bay and they all meet the statutory criteria for experience needed to sit for the Tampa Bay state pilot examination. If the proposed rule becomes effective, none of these Petitioners will be qualified to sit for the state pilot licensing examination. By Chapter 84-185, Laws of Florida, Section 310.071 was amended by extensive modification of Subsection (1)(b) and renumbering Subsection (2) to Subsection (3). Section 310.071, Florida Statutes, establishes the qualifications of applicants for licensure as state pilots and certification for deputy pilots. Following the effective date of Chapter 84-185 of October 1, 1984, Respondent issued proposed Rule 21SS-5.125, Florida Administrative Code.
The Issue The issues are whether Respondent violated Sections 489.129(1)(i), (l), (m) and (o); 489.119(2); 489.1195(1)(a); and 489.1425(1), Florida Statutes, for the reasons stated in the Administrative Complaint and, if so, what penalty should be imposed.
Findings Of Fact Based on the oral and documentary evidence adduced at the final hearing, and the entire record of this proceeding, the following findings of fact are made: Petitioner is the state agency responsible for regulating the practice of contracting in the State of Florida. At all times material hereto, Respondent was licensed as a certified general contractor in the state, pursuant to license number CG C008922. Respondent's license is currently inactive. Respondent has been a contractor for nearly 30 years, and has never been subject to disciplinary action against his license until this proceeding. Respondent was licensed as the licensed qualifying agent for ECE from January 1998 through February 2001, for a fee of $400.00 per month. As the qualifying agent, Respondent was responsible for all of ECE's contracting activities, in accordance with Section 489.1195(1)(a), Florida Statutes, which states: "All primary qualifying agents for a business organization are jointly and equally responsible for supervision of all operations of the business organization; for all field work at all sites; and for financial matters, both for the organization in general and for each specific job." Respondent did not obtain a certificate of authority for ECE. On November 16, 1998, ECE entered into a contract in the amount of $15,577.00 with Carl and Darlene Weinzierl to install aluminum siding at their residence in Terra Ceia, Florida. The contract specified that ECE would use Reynolds brand siding in the construction. ECE actually used an inferior grade of aluminum siding. The contract did not contain a notice explaining to the Weinzierls their rights under the Construction Industry Recovery Fund. Such notice is required by Section 489.1425, Florida Statutes. ECE represented to the Weinzierls that they would receive a mortgage to pay for the aluminum siding and to consolidate their other debts at an interest rate of 6.5 percent. The actual interest rate on the mortgage was 18 percent. On December 14, 1998, ECE commenced work on the Weinzierls' house. ECE never completed the work. On January 22, 1999, ECE filed a lien against the Weinzierls' property in the amount of $15,577.00. Respondent had no knowledge of the project on the Weinzierls' house, of the mortgage arrangement made by ECE, or of the lien filed by ECE against the Weinzierls' property. On November 5, 1998, ECE entered into a contract in the amount of $3,624.00 with Barbara Lewis to install soffit and fascia at her residence in Bradenton, Florida. The contract did not contain a notice explaining to Ms. Lewis her rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE represented to Ms. Lewis that she would receive financing to pay for the soffit and fascia at an interest rate of 11 percent. The actual interest rate of the financing was 18 percent. ECE performed the work on Ms. Lewis' house in one day. Respondent had no knowledge of the project at Ms. Lewis' house or of the financing arrangement made by ECE. On August 16, 1998, ECE entered into a contract in the amount of $13,250.00 with John Maxwell to install aluminum siding at his residence in Bradenton, Florida. The contract did not contain a notice explaining to Mr. Maxwell his rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE commenced work at Mr. Maxwell's house on August 18, 1998, and completed the project on August 27, 1998. On August 31, 1998, ECE recorded at the Manatee County Circuit Court a mortgage on Mr. Maxwell's property in the amount of $13,427.55 for the installation of aluminum siding. Mr. Maxwell had signed no documents to place a mortgage on his property, and received a satisfaction of mortgage on May 19, 1999. Respondent had no knowledge of the project to be completed at Mr. Maxwell's house or of the mortgage recorded by ECE. On October 10, 1998, ECE entered into a contract in the amount of $3,663.00 with Richard Lanois and Beverly Carroll to install soffit and fascia on their residence in Bradenton, Florida. The contract did not contain a notice explaining to Mr. Lanois and Ms. Carroll their rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE commenced work at the house on October 13, 1998, and completed the project on October 15, 1998. ECE recorded a financing statement to obtain a lien on the property of Mr. Lanois and Ms. Carroll with the Manatee County Circuit Court on October 22, 1998. Neither Mr. Lanois nor Ms. Carroll had signed the financing statement that ECE filed at the court. Respondent had no knowledge of the project at the residence of Mr. Lanois and Ms. Carroll, or of the financing statement filed by ECE to obtain a lien on their property. On December 2, 1998, ECE entered into a contract in the amount of $5,739.00 with Paul and Linda Porter to install Reynolds brand thermal double pane windows at their residence in Bradenton, Florida. The contract did not contain a notice explaining to the Porters their rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE commenced work at the Porters' house on December 5, 1998, and completed the project on December 17, 1998. ECE installed BetterBilt brand windows rather than Reynolds windows, without the Porters' approval. On December 17, 1998, ECE recorded at the Manatee County Circuit Court a mortgage on the Porters residence in the amount of $5,775.80. The Porters had signed no documents to allow this mortgage to be placed on their property. Respondent had no knowledge of the project at the Porters' residence or of the mortgage recorded by ECE on the Porters' residence. On November 2, 1998, ECE entered into a contract in the amount of $6,426.00 with William C. Roach to install Reynolds thermal double pane windows on his residence in Bradenton, Florida. The contract did not contain a notice explaining to Mr. Roach his rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE commenced work at the Roach residence on November 2, 1998, and completed the project on November 3, 1998. ECE installed BetterBilt brand windows instead of Reynolds windows, without Mr. Roach's permission. ECE represented that Mr. Roach would receive financing to consolidate the cost of the windows, his mortgage, and his credit card debt. In fact, Mr. Roach received financing only for the cost of the windows. Respondent had no knowledge of the project at Mr. Roach's residence or of the financing arrangement that ECE entered into with Mr. Roach. On November 28, 1998, ECE entered into a contract in the amount of $3,635.90 with Carol Lipp to install Reynolds brand soffit and fascia on her residence in Bradenton, Florida. The contract did not contain a notice explaining to Ms. Lipp her rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE commenced work at Ms. Lipp's residence on November 30, 1998, and completed the project on December 7, 1998. ECE recorded a financing statement with the Manatee County Circuit Court in order to obtain a lien against Ms. Lipp's property. Ms. Lipp had not signed the financing statement. Respondent had no knowledge of the project at Ms. Lipp's residence or of the financing statement filed by ECE on Ms. Lipp's residence. On January 22, 1999, ECE entered into a contract in the amount of $13,504.00 with Shirley G. Bradley to install 11 Reynolds thermal double pane windows and to enclose the lanai and front entry of her residence in Englewood, Florida. The contract did not contain a notice explaining to Ms. Bradley her rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE commenced work at Ms. Bradley's residence on January 25, 1999, and completed the project on February 9, 1999. ECE installed BetterBilt brand windows instead of Reynolds windows, without Ms. Bradley's permission. ECE represented to Ms. Bradley that she would receive financing for the project at an interest rate of 16 percent. In fact, ECE obtained a loan for Ms. Bradley at an interest rate of 21 percent. Respondent had no knowledge of the project to be completed at Ms. Bradley's residence or of the financing arrangement between ECE and Ms. Bradley. On October 13, 1998, ECE entered into a contract in the amount of $6,511.10 with George Haight to install Reynolds thermal double pane windows on his residence in Bradenton, Florida. The contract did not contain a notice explaining to Mr. Haight his rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE installed BetterBilt brand windows instead of Reynolds windows, without Mr. Haight's permission. Respondent had no knowledge of the project to be completed at Mr. Haight's residence. On December 7, 1998, ECE entered into a contract in the amount of $15,216.00 with Shirley Behen to install Reynolds thermal double pane windows on her residence in Bradenton, Florida. The contract did not contain a notice explaining to Ms. Behen her rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE represented to Ms. Behen that she would receive financing for the windows that would also consolidate her roof payments and credit card debt. ECE provided none of the promised financing. ECE installed BetterBilt brand windows instead of Reynolds windows, without Ms. Behen's permission. On December 15, 1998, ECE recorded a mortgage on Ms. Behen's residence with the Manatee County Circuit Court in the amount of $10,713.95. Ms. Behen had not signed any document to secure a second mortgage on her property. Respondent had no knowledge of the project to be completed at Ms. Behen's residence or of the mortgage filed on her property by ECE. On November 17, 1998, ECE entered into a contract in the amount of $7,845.00 with Debby and Wally Keefe to install Reynolds thermal double pane windows on their residence in Bradenton, Florida. The contract did not contain a notice explaining to the Keefes their rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE represented to the Keefes that they would receive a mortgage to pay for the windows and consolidate their credit card debt at a rate of 6.5 percent. In fact, ECE provided a mortgage with an actual interest rate of 18 percent. Respondent had no knowledge of the project to be completed at the Keefes' residence or of the mortgage arrangement between the Keefes and ECE. On September 29, 1998, ECE entered into a contract in the amount of $8,531.00 with Joe and Laura Poulin to install vinyl siding on their three duplexes in Bradenton, Florida. The contract did not contain a notice explaining to the Poulins their rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE recorded a financing statement with the Manatee County Circuit Court, obtaining a lien against the Poulins' property. The Poulins did not sign the financing statement. Respondent had no knowledge of the project to be completed at the Poulins' residence or of the financing statement filed by ECE. In August 1998, ECE entered into a contract in the amount of $8,307.00 with Darwin and Joyce Wilson to install 17 Reynolds thermal double pane windows on their residence in Sarasota, Florida. The contract did not contain a notice explaining to the Wilsons their rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE commenced the project on September 5, 1998, and completed the project on September 7, 1998. ECE installed BetterBilt brand windows instead of Reynolds windows, without the Wilsons' permission. Respondent had no knowledge of the project to be completed at the Wilsons' residence. Also in August 1998, ECE entered into another contract with the Wilsons, in the amount of $14,000.00, to install Reynolds vinyl siding on their residence. The contract did not contain a notice explaining to the Wilsons their rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE began installing the vinyl siding on October 15, 1998, and completed the project on November 15, 1998. ECE represented to the Wilsons that they would receive a new first mortgage that would include the price of the windows, the siding, their house payment, and their credit card debt. In fact, ECE provided no such mortgage. Respondent had no knowledge of the second project to be completed at the Wilsons' residence. On October 7, 1998, ECE entered into a contract in the amount of $5,171.00 with Derek Campagna to install vinyl siding and fascia on his residence in Bradenton, Florida. The contract did not contain a notice explaining to Mr. Campagna his rights under the Construction Industry Recovery Fund, as required by Section 489.1425, Florida Statutes. ECE commenced work on October 8, 1998, and completed the project on October 10, 1998. On or about January 5, 1999, ECE filed a lien against Mr. Campagna's property in the amount of $5,171.40. Respondent had no knowledge of the project to be completed on Mr. Campagna's residence or of the lien filed by ECE. The misrepresentation of the actual interest rate to be charged for financing the above projects was the commission of fraud or deceit in contracting by ECE and its representatives. The installation of BetterBilt windows in those houses the owners of which had contracted for Reynolds windows constituted the commission of fraud or deceit in contracting by ECE and its representatives. Respondent was unaware of ECE's fraudulent activities in the Bradenton/Sarasota area at the time they were occurring. Respondent believed that ECE did business exclusively in Indian River, St. Lucie, and Martin counties on the east coast of Florida. Respondent submitted the proper forms for the relevant permits and actively supervised ECE's construction work on the east coast of Florida. There was no evidence that ECE used Respondent's license to obtain permits for the projects it undertook in the Bradenton/Sarasota area. The evidence established that ECE pulled no permits at all for those projects. From all the evidence presented at the hearing, the inference may fairly be drawn that ECE purposely kept Respondent in the dark concerning its activities in the Bradenton/Sarasota area. Respondent first learned of ECE's activities in Bradenton/Sarasota through a telephone conversation with a friend, Peter Green. Mr. Green was a mortgage broker, and told Respondent that he was trying to secure financing for some of the ECE clients named above. Mr. Green told Respondent that some of these clients were very upset with ECE, and asked Respondent if he was aware of the problems. Respondent told Mr. Green that he was unaware ECE was doing any work on the west coast of Florida. Mr. Green gave Respondent the phone number of Darlene Weinzierl, one of the disgruntled ECE customers. Following her own bad experience with ECE, Ms. Weinzierl had undertaken an investigation of the company. She searched courthouse records for liens filed by ECE and contacted all the individuals whose names she found. Ms. Weinzierl heard "horror stories." A woman who could barely speak English told her that ECE had slapped siding over rotting woodwork, sent her a bill for $20,000, then filed a lien on her house. Another woman told Ms. Weinzierl that when she attempted to cancel her contract, the ECE salesman showed up at her door accompanied by a man ostentatiously wearing a gun in a shoulder holster. Other customers told Ms. Weinzierl that ECE had forged mortgages on their property. Ms. Weinzierl's hearsay testimony is unsupported by other competent substantial evidence and therefore cannot be relied on for the truth of the statements contained therein. However, it is undisputed that Ms. Weinzierl later conveyed this information to Respondent. Respondent telephoned Ms. Weinzierl on January 23, 1999. Ms. Weinzierl conveyed to Respondent everything she had learned about ECE. The next day, Respondent spoke with James Pizzo, Jr., one of the principals of ECE. Mr. Pizzo told Respondent that he had a very aggressive salesman who "had made a lot of promises to people," but that he was in the process of responding to the complaints and correcting the situation. Respondent asked Mr. Pizzo why ECE was doing business on the west coast of Florida. Mr. Pizzo replied that ECE's telemarketing effort had saturated the east coast, and he believed there was a fresh market on the west coast. Because he had worked with Mr. Pizzo for over a year and had a good working relationship with ECE, Respondent took at face value Mr. Pizzo's promise to correct the problems. Respondent took no action on his own, and continued to act as the qualifying agent for ECE. Respondent did not visit any of the west coast job sites or make any independent effort to contact ECE's victims. FDLE commenced a RICO investigation of ECE in the spring of 1999. Special Agent Charles Leonard, the FDLE investigator, first interviewed Respondent on May 10, 1999. Respondent was never a target of the investigation, and cooperated fully. Respondent did not sever his relationship with ECE until February 2001. By this time, 14 complaints had been filed against ECE by customers in the Bradenton/Sarasota area, and ECE had taken no action to address the situation beyond ceasing to do business in the area. In mitigation of his failure to take any action for two years after he became aware of ECE's fraudulent practices, Respondent pointed to the precarious state of his health. In January 2000, Respondent's car was stopped on I-95 when it was rear-ended by a truck traveling at 50 to 60 miles per hour. Respondent received a concussion and suffered excruciating headaches. His neurologist ordered an MRI and found a brain tumor. The tumor could not be removed entirely. Respondent is also a diabetic. Respondent continues to have headaches so severe that he requires trigger point injections of pain medication and epidural injections in his neck and upper spine every few months. He regularly takes Tylenol III with codeine. He requires an MRI every six months to monitor his brain tumor. Prior to his brain surgery, Respondent managed his diabetes through oral medication; however, since the surgery he has needed three injections of insulin daily. At the same time he severed his relationship with ECE, Respondent notified Petitioner that he was transferring his license to inactive status. Respondent no longer actively practices contracting. However, his current position as a construction project manager for the Broward County School Board requires that he hold at least an inactive general contractor's license. Respondent credibly testified that if he were to lose his current job, and the health insurance that goes with it, he could not pay his medical bills.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order finding Respondent guilty of violating Section 489.129(1)(l) and (m), Florida Statutes, suspending Respondent's license for three years from the date that Respondent re-activates his license, imposing an administrative fine in the amount of $3,000.00, and requiring Respondent to pay costs of Petitioner’s investigation. DONE AND ENTERED this 12th day of March, 2002, in Tallahassee, Leon County, Florida. LAWRENCE P. STEVENSON 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 12th day of March, 2002. COPIES FURNISHED: Michael Martinez, Esquire Department of Business and Professional Regulation 1940 North Monroe Street, Suite 60 Tallahassee, Florida 32399-1007 E. Cole Fitzgerald, III, Esquire Fitzgerald, Hawkins, Mayans & Cook Post Office Box 3795 West Palm Beach, Florida 33401 Hardy L. Roberts, III, General Counsel Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-2202 Suzanne Lee, Executive Director Construction Industry Licensing Board Department of Business and Professional Regulation Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0792
