Findings Of Fact Based upon all of the evidence, the following findings of fact have been determined: These cases involve allegations of misconduct by respondents, John E. Phillips, Jr. (Phillips) and Bruce M. Walker (Walker), both registered as associated persons with Aragon Financial Services, Inc. (Aragon) by petitioner, Department of Banking and Finance, Division of Securities and Investor Protection (Division). The Division alleges that in May 1988 respondents induced a consumer, Jane Hubbard, to make an "investment" of $50,000 in their business by making untrue statements or omitting material facts and then failed to account to her for the monies. For these reasons, the Division also proposes to deny an application by Phillips for registration as an associated person with a new firm. It is further alleged that Walker violated two statutes and a Division rule by failing to disclose certain adverse information on his 1990 application for registration as an associated person with Aragon, and by not timely amending his application to make such disclosure. Finally, it is charged that during the course of the Division's investigation in October 1991, Walker made a false statement to the Division. After the charging document was issued on February 4, 1994, respondents timely requested a hearing. In 1986, respondents formed a Subchapter S corporation known as Phillips, Walker & Associates, Inc. (PWA). Each owned 50 percent of the stock and was a director in the corporation. In addition, Walker served as president while Phillips served as vice president. The business was created for the purpose of selling insurance products. Respondents had previously worked together as agents for Prudential Insurance Company (Prudential). Respondents were promised financial help from Mutual of New York (MONY), an insurance company, in starting up their new insurance firm. When MONY did not provide the promised capital, and Walker saw financial "difficulties looming," he contacted a former insurance client, Jane Hubbard, a Gulf Breeze realtor, whose husband had recently died, to see if she would be interested in providing capital to the firm. The two had previously met when Walker was associated with Prudential, and he had assisted her in collecting more than $400,000 in proceeds from her deceased husband's life insurance policies. Walker also sold Hubbard a prepaid $50,000 whole life insurance policy. Walker talked to Hubbard by telephone on three occasions in late April and early May 1988 ostensibly about arranging a meeting to discuss the money. Hubbard did not recall these conversations. In any event, a meeting was arranged at Walker's office on the morning of May 4, 1988. At the meeting, which lasted more than an hour, Walker did virtually all of the talking while Phillips was "in and out" while attending to other business. This was Phillips' first and only meeting with Hubbard. The facts surrounding the substance of the conversations at the meeting are in sharp dispute. Hubbard could not recall Phillips saying anything at the meeting, but she did recall Walker representing that PWA was in "solid" financial condition and that by investing $50,000, she could make "some real money." She understood that the money was to be used to expand the business and viewed the transaction as an investment. She was also offered the opportunity to purchase 20 percent or 25 percent of PWA's stock later on, an offer that never materialized. Instead of characterizing the transaction as an investment, both respondents view the transaction as a loan. Walker says he told Hubbard that while he was "positive" or upbeat as to the firm's future, he saw difficulties ahead for the firm since a loan application with a bank had been denied, and PWA needed cash to work through this difficult period. Phillips confirmed that while he was in the meeting, Walker stressed the fact that there was some risk in Hubbard providing capital for the firm, that the firm was experiencing some "cash-flow" problems, and that the money was needed to sustain the business until revenues were increased. This testimony is accepted as being credible. Walker agrees, however, that he spoke in "generalities" when describing PWA's financial condition, and that he described his personal financial situation in "only a general sense." Phillips was not asked for, nor did he volunteer, details on his own financial condition. In actuality, Walker described his financial condition in 1988 as "fair but deteriorating," while Phillips said his condition was "good" early on but "deteriorating" as the year progressed. Copies of PWA's financial statements were not requested by Hubbard nor volunteered by respondents. Although Hubbard did not seek collateral for her money, Walker advised her a Subchapter S corporation had no assets of value, but he offered her the then highest legal rate of interest he could give, 18 percent, and for both he and Phillips to personally co-sign on a promissory note. Hubbard accepted this offer and, later on that day, wrote a check for $50,000 to PWA and delivered it to Walker. On the check, she noted it was for a "1 yr loan Int. only mo. 18 percent." She says she used the word "loan" instead of "investment" due to a lack of space on the face of the check. According to the offer presented by Walker, PWA agreed to pay Hubbard the entire principal amount ($50,000) at the end of one year, or on May 1, 1989, and beginning on June 1, 1988, to pay $750 in interest each month until the principal was due. Thereafter, on May 8, 1988, a promissory note reflecting these terms was executed by both Walker and Phillips and was given to Hubbard. In summarizing the transaction, it is fair to say that while Hubbard was not a securities customer of PWA or respondents, she made a commitment of money that was principally induced by respondents' representation that an economic benefit would be derived from her commitment. The money obtained from Hubbard was used by PWA to pay salaries, utilities, rent and other office expenses. According to Phillips, it was used up within 4 to 6 months. By the end of the year, Phillips left the firm to find other employment because the business could not sustain both he and Walker. Although he did not make any formal arrangement concerning the disposition of his interest in the corporation, Phillips says he basically "turned everything over to (Walker) . . . and went and looked for a job." In the words of Walker, at that time the company was just "milling around." Walker, however, stayed on trying to make a go of it. Hubbard received $750 each month for the remainder of 1988 as provided by the note. In early 1989, the payments began to "slow," and they continued in that fashion until mid-1989. At that time, Walker told her he could not repay the principal when it was due. Consequently, Hubbard agreed to allow respondents to execute a second promissory note calling for another year of interest only payments with the principal due on July 1, 1990. The new note was executed on July 1, 1989. The interest payments stopped within a few months and Hubbard received no further repayment of her loan. She reported the interest payments as "interest income" on her income tax returns. In January 1990, Phillips filed a chapter 7 bankruptcy proceeding. Hubbard did not file a claim in that proceeding because Walker had told her that he had assumed the assets and liabilities of PWA when it was dissolved and that he would personally see that she was paid in full. Thereafter, Phillips' personal obligation to Hubbard was discharged by the bankruptcy court. In May 1990, PWA ceased doing business. In August 1992, Walker filed for bankruptcy. In December 1992, Hubbard filed a civil action against PWA and Walker (but not Phillips) seeking to recover her $50,000. Because of the pending bankruptcy filing, and PWA's lack of assets, her suit was unsuccessful, and in May 1993, Walker's personal obligation to Hubbard was discharged by the bankruptcy court. To date, Hubbard has never been repaid her principal by either respondent. The failure to repay the money was due wholly to PWA's steadily deteriorating financial condition and concomitant lack of resources rather than a conscious effort by respondents to defraud Hubbard of her money. Indeed, all of the money was used for its intended purpose, namely, to provide an infusion of capital for PWA until revenues hopefully increased. Both respondents are charged with failing to make adequate disclosures regarding the true financial condition of PWA when they obtained the money. Although the meeting occurred some six years before the hearing, and Hubbard could not recall many of the details, she did not deny respondents' assertions that Walker told her that the loan was "risky," a bank had turned down PWA for a loan, and cash was needed since MONY had not followed through on its promise. At the same time, it is undisputed that Hubbard did not request a copy of PWA's financial statements. Accordingly, it is found that respondents made reasonably adequate disclosures regarding the condition of PWA, and they did not make untrue statements or omit material facts in that respect. Respondents are also charged with failing to disclose other material financial facts to Hubbard while seeking her money. Since these facts pertain to personal debts incurred by Walker during a nine-year period prior to 1988, knowledge of such facts cannot be imputed to Phillips, and he cannot be held accountable for this omission. Two such debts involved Sandra Ray, a friend of Walker's former wife, from whom Walker borrowed $5,000 in 1979 or 1980 to purchase a sailboat, and another $10,000 in 1981 or 1982. Except for $2,000 or $3,000 repaid on the first loan, the balance owed remains unpaid. As to the second loan, Walker approached Ray to offer her an opportunity to make a "tax- free investment" of $10,000. As it turned out, the monies were used by Walker to pay off outstanding federal taxes owed by he and his wife. This loan remains unpaid. It was also established that Walker obtained $25,000 from the cash value of his then sister-in-law's whole life insurance policy in December 1987. The policy had been sold to her by Walker, and as such, she was a former customer. The sister-in-law, Gail Ohler, had been widowed in 1982 when her husband, a Marine, was killed in Beirut, Lebanon. Walker claims he had Ohler's consent to obtain the money. Ohler denies this assertion and says she signed a blank form believing it was merely a credit recommendation for Walker, but that later a check was sent by the insurance company to her sister, who was then Walker's wife. In any event, Ohler later filed a civil action in January 1992 against Walker and MONY seeking to recover her money on the basis of fraud. A judgment was issued against Walker in Ohler's favor for the amount borrowed plus interest. MONY then agreed to repay the principal amount owed in return for Ohler subrogating to MONY her claim against Walker, its former agent. None of these transactions were reported to Hubbard during the meeting on May 8, 1988. Whether such personal information dating back some nine years is normally disclosed to an investor as a matter of practice or custom when soliciting an investment, or is required to be disclosed under agency policy, is not of record. According to Hubbard, had she known of these matters, it would have affected her decision to give Walker the money. During the course of the Division's investigation of this matter, the Division requested by letter dated October 4, 1991, that Walker provide the following information: A list of all customers in which you have directly or on behalf of a business have entered into loan agreements, promissory notes or trust agreements from January 1, 1987 to present. In response to this inquiry, Walker listed only the Hubbard transaction. At the end of his response, Walker noted that he had "tried to be as complete as possible, based upon your letter and our subsequent telephone conversation," and if any further information was required, to "please call and it will be provided." Since Ray was not a customer, and her loans occurred prior to 1987, there was no need for Walker to disclose the two Ray transactions. As to Ohler, she was a former customer, but Walker did not enter into a formal agreement with her, and thus disclosure was not required under the terms of the Division's inquiry. Even if it was required, there was no evidence to establish that such nondisclosure was intentional, or that Walker intended to deceive the Division. Since October 25, 1993, Phillips has had an application pending with the Division for registration as an associated person with Meeder Advisory Services, Inc. Based on the alleged misconduct associated with the Hubbard transaction, the Division proposes to deny this application. Since Phillips has not been found to have made misrepresentations in procuring the money from Hubbard, and the money was not repaid because of a business failure and personal bankruptcy (but not fraud), there is no basis upon which to deny his new application. In 1990, Walker filed an application (Form U-4) to become an associated person with Aragon. This application was later approved. According to Division Rule 3E-600.010(1)(a), Florida Administrative Code, an applicant or registrant is required to notify the Division within thirty days after any charges are filed against the applicant or registrant which pertain, either directly or indirectly, to his activities as a registrant or "any other activity in which he was involved where a breach of a fiduciary trust is alleged." It may be fairly inferred that information of this nature must be disclosed on the initial application. When such events occur after an application has been filed, a registrant (or applicant) notifies the Division by filing an amended Form U-4. On June 8, 1993, and presumably at the Division's request, Walker filed an amended Form U-4 to reflect that (a) he had sought bankruptcy protection in August 1992, (b) a civil action was filed against him by Jane Hubbard in August 1992, (c) another civil action was filed against him by Jane Hubbard's son, Van Hubbard, in September 1991, (d) a third civil action was filed against him by Gail Ohler in January 1992, and (e) in 1987 the Internal Revenue Service had placed a lien on his house and garnished his family's wages for failing to pay income taxes. When the original Form U-4 was filed in 1990, Hubbard, her son and Ohler had not yet filed suit against Walker, and no bankruptcy proceeding had been filed. Therefore, those items could not have been disclosed on the original form. As to the IRS lien, there is no evidence that it involved an activity where "a breach of a fiduciary trust is alleged" as required by the rule. Therefore, there was no need to make such a disclosure on the application. As to the amended Form U-4, it was clearly not filed within thirty days after the reported events occurred. Even so, none of the transactions pertained to his registration with Aragon, and thus they could not relate, directly or indirectly, to Walker's activities as a registrant. As to the remaining items, there is no proof concerning the nature of Van Hubbard's suit and whether it falls within the perameters of the rule, and the personal bankruptcy filing is not identified in the rule as an item requiring disclosure. The Hubbard and Ohler lawsuits arguably represent "civil . . . charges filed against him . . . where a breach of fiduciary trust is alleged," and thus they should have disclosed in a timely fashion. There is no evidence, however, that Walker intentionally violated the rule. The Division commenced its investigation of respondents in late 1991 after Hubbard had lodged a complaint seeking assistance in collecting her money. Although the adminstrative complaint was not issued until February 4, 1994, or more than two years later, there was no showing that the agency violated any procedural time limitation during the investigative phase, or that respondents were otherwise seriously prejudiced by this delay.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Department of Banking and Finance enter a final order dismissing all charges against John E. Phillips, Jr. and approving his application for registration as an associated person with Meeder Advisory Services, Inc., and that Bruce M. Walker be found guilty of failing to timely update his Form U-4 in two respects for which his registration should be suspended for thirty days. DONE AND ENTERED this 13th day of September, 1994, in Tallahassee, Florida. DONALD R. ALEXANDER 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 13th day of September, 1994. APPENDIX TO RECOMMENDED ORDER Petitioner: 1-2. Partially accepted in finding of fact 1. 3. Partially accepted in finding of fact 2. 4-6. Partially accepted in finding of fact 6. 7-16. Partially accepted in finding of fact 14. 17-18. Partially accepted in finding of fact 3. 19. Partially accepted in finding of fact 5. 20. Partially accepted in finding of fact 7. 21. Partially accepted in finding of fact 6. Partially accepted in findings of fact 7 and 8. Partially accepted in finding of fact 10. Partially accepted in finding of fact 11. 25-26. Partially accepted in finding of fact 12. 27. Rejected as being contrary to the more persuasive and credible evidence or irrelevant. 28-29. Partially accepted in finding of fact 14. Partially accepted in finding of fact 5. Partially accepted in finding of fact 14. Partially accepted in finding of fact 17. Partially accepted in finding of fact 15. Respondent (Phillips): 1. Partially accepted in finding of fact 1. 2. Partially accepted in finding of fact 16. 3. Partially accepted in finding of fact 1. 4-7. Partially accepted in finding of fact 2. 8-10. Partially accepted in finding of fact 4. 11. Partially accepted in finding of fact 3. 12-15. Partially accepted in finding of fact 4. 16. Partially accepted in finding of fact 5. Partially accepted in findings of fact 5 and 7. Partially accepted in finding of fact 5. Partially accepted in finding of fact 8. Partially accepted in finding of fact 6. 21-22. Rejected as being unnecessary. 23-24. Partially accepted in finding of fact 8. Partially accepted in finding of fact 6. Partially accepted in finding of fact 7. Partially accepted in finding of fact 6. 28-29. Partially accepted in finding of fact 7. Rejected as being unnecessary. Partially accepted in finding of fact 7. 32-36. Rejected as being unnecessary. Partially accepted in finding of fact 5. Partially accepted in finding of fact 10. Partially accepted in finding of fact 8. Partially accepted in finding of fact 10. Partially accepted in finding of fact 7. Partially accepted in finding of fact 7. Partially accepted in finding of fact 5. 44-45. Partially accepted in finding of fact 10. 46. Rejected as being unnecessary. 47-48. Partially accepted in finding of fact 9. Partially accepted in finding of fact 11. Partially accepted in finding of fact 18. Rejected as being unnecessary. 52-55. Partially accepted in finding of fact 13. 56-73. Rejected as being unnecessary. 74-75. Partially accepted in finding of fact 14. Partially accepted in finding of fact 16. Rejected as being being contrary to the evidence. Respondent (Walker): 1-77. These findings are identical to those submitted by Phillips and the same rulings are hereby made. Partially accepted in finding of fact 6. Rejected as being irrelevant. Partially accepted in finding of fact 8. Partially accepted in finding of fact 6. 82-83. Partially accepted in finding of fact 17. 84. Rejected as being irrelevant. Note - Where a proposed finding has been partially accepted, the remainder has been rejected as being unnecessary, irrelevant, cumulative, not supported by the evidence, a conclusion of law, or subordinate. COPIES FURNISHED: Honorable Gerald Lewis, Comptroller Department of Banking and Finance The Capitol, Plaza Level Tallahassee, FL 32399-0350 William G. Reeves, Esquire General Counsel Department of Banking and Finance The Capitol, Room 1302 Tallahassee, FL 32399-0350 Margaret S. Karniewicz, Esquire Suite 1302, The Capitol Tallahassee, FL 32399-0350 J. Lofton Westmoreland, Esquire Post Office Box 1792 Pensacola, FL 32598-1792 Paul R. Miller, Esquire 201 East Government Street Pensacola, FL 32501
The Issue Whether the Respondent discriminated against the Petitioner for exercising her rights under Sections 760.01-760.011, Florida Statutes (2001), and, if so, the appropriate remedy.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing and on the entire record of this proceeding, the following findings of fact are made: Miami-Dade Community College is an employer within the meaning of the Florida Civil Rights Act, Sections 760.01- 760.011, Florida Statutes (2000). General Information In October 1998, Ms. Rodriguez was hired as Technical/Classified Staff at the Consolidated College Warehouse ("Warehouse") maintained by Miami-Dade Community College. At the times material to this proceeding, the main section of the Warehouse served as a storage facility for furniture and equipment that was no longer being used on the various campuses of Miami-Dade Community College. In another section of the Warehouse, called the "surge" section, furniture and equipment were stored temporarily, while portions of the campuses were undergoing renovations. Two employees were responsible for doing the manual labor in the Warehouse, which involved collecting furniture and equipment from the campuses, storing them in the Warehouse, and retrieving them when necessary. A third section of the Warehouse was devoted to collecting used computers that were being replaced on the various campuses of Miami-Dade Community College. There were four employees in this section of the Warehouse, including the head of the section, Maggie Zilliner. The old computers were collected from the campuses and logged into the property control system. The computers were sorted into those that worked, those that did not work but could be repaired, and those that could not be repaired. Two of the four employees were responsible for doing the computer repairs. The Warehouse also served as the site for storing records generated on the various campuses of Miami-Dade Community College. A large part of the work in this section consisted of maintaining a computer record containing the identification and location of the records stored in the facility. In addition, records were retrieved and provided to the campuses as requested, and documents were destroyed in accordance with state regulations. Frank Meistrell, who is now retired, was the Risk Manager for Miami-Dade Community College and was in charge of setting up and managing the Warehouse. He reported to Will Bailey, who was at the time the Director of the Budget for Miami-Dade Community College. The employees working in the Warehouse were, at the times relevant to this proceeding, part- time employees of Miami-Dade Community College with the exception of James Roof, who held a full-time position as the supervisor of operations for the Warehouse. Mr. Meistrell was Mr. Roof's direct supervisor, and he had recommended that Mr. Roof be promoted to the supervisor's position at the Warehouse. Mr. Meistrell and Mr. Roof had both worked for Miami-Dade Community College for many years, and, at one time, their offices were close to one another. The relationship between Mr. Meistrell and Mr. Roof was, however, strictly a business relationship; Mr. Meistrell did not know Mr. Roof socially and never interacted with Mr. Roof outside of the office. Mr. Meistrell may have gone to lunch with Mr. Roof one or two times over the years they worked together, and Mr. Meistrell may, on occasion, have shared a sandwich with Mr. Roof and other Warehouse staff. Ms. Rodriguez was initially hired in October 1998 as a part-time employee to work in general warehouse operations, when the Warehouse was just getting established. Ms. Rodriguez's only job experience prior to being hired to work at the Warehouse was as a leasing agent for an apartment building, a position she occupied from 1990 to 1999 and which involved some clerical duties. Once the Warehouse was somewhat organized, Ms. Rodriguez worked as a technician in the computer section, where she inventoried computers coming into the Warehouse and removed the software from the computers; Maggie Zilliner was her immediate supervisor in the computer section. In the fall of 1999, Ms. Rodriguez was asked to work with other Warehouse employees, under the supervision of Mr. Meistrell, to organize the layout of the records section of the Warehouse. After the records section became operational, and at the times material to this proceeding, Ms. Rodriguez worked in that section of the Warehouse. Mr. Roof was her immediate supervisor. Mr. Meistrell developed and distributed to the campuses a manual for handling records that was based on the state's record retention requirements. He obtained standardized boxes for the storage of records, and he developed a form to be used through Miami-Dade Community College to record the contents of each box. Personnel on the various campuses packed their records in the boxes and completed the form recording the contents of each of the boxes. One copy of the form was retained, one copy was put in each box, and one copy was taped to the top of the box. Warehouse employees collected the boxes from the campuses and delivered them to the Warehouse. The boxes were stacked on pallets, and the pallets were stored on racks in the Warehouse. A Miami-Dade Community College faculty member, Sally Musay, wrote a program for a database to keep track of the boxes of records stored in the warehouse. The program was written in English, and Ms. Rodriguez worked with the faculty member developing the program, which required entry of, among other items, the names of the Miami-Dade Community College employees whose records were stored in the Warehouse, the year in which each record was to be destroyed, and the location of the records in the Warehouse. In March 1999, Olga Mejia Morales ("Ms. Morales") was hired as a part-time employee in the Warehouse. Ms. Morales began working for Miami-Dade Community College in April 1996 as a student assistant in the Bursar's office at Miami-Dade Community College's north campus. Her duties included typing, filing, and answering the phone. In the spring of 1997, Ms. Morales moved to the property control section at Miami-Dade Community College's north campus, where she continued to work as a student assistant. Her duties in this position included filing, inputting data into the computer, typing, and answering the telephone. Ms. Morales worked at this position for two years before applying for the part-time position in the Warehouse. During the time she worked as a student assistant, Ms. Morales was attending Miami-Dade Community College, studying business software applications. When Ms. Morales came to work in the records section of the Warehouse, she was very familiar with computers and with various types of business software, such as Excel, Access, Power Point, and Microsoft Word. Ms. Rodriguez introduced Ms. Morales to the computer program developed by Ms. Musay to inventory the boxes of records sent from the various campuses to the Warehouse, although Ms. Morales was familiar with the type of program because it was a variation of the Access program. Because of her familiarity with the type of program used to keep track of the records, Ms. Morales was able to suggest to Ms. Musay some ways in which the program could be improved. Both Ms. Rodriguez and Ms. Morales input data into the computer regarding the records, although Ms. Morales was more proficient in using computers than Ms. Rodriguez as a result of her studies in business software applications. When requests for records were received from Miami- Dade Community College campuses, the location of the boxes of files to be retrieved would be obtained from the computer program, and either Ms. Rodriguez or Ms. Morales or another employee of the Warehouse would retrieve the boxes. Ms. Rodriguez was trained in the operation of a forklift and was certified to operate one. Ms. Rodriguez used a forklift to retrieve pallets on which the boxes of records were stored when the pallets were stored on one of the higher storage racks. Ms. Rodriguez also used a pallet jack to move pallets of boxes around the warehouse, and she would pick up and move individual boxes of records, which weighed 40 to 50 pounds. Ms. Morales was not an employee at the Warehouse when the forklift training was offered, and she did not know how to operate a forklift. She did, however, know how to use a pallet jack, and she used one routinely to move pallets of boxes around the warehouse. When pallets were stored on the second or third level, she often requested that Rafael Rodriguez, an employee who routinely operated a forklift in the Warehouse, retrieve pallets of records for her. Both Ms. Morales and Ms. Rodriguez prepared the boxes for delivery to the office requesting them. Before Ms. Morales began working in the records section, when the records storage and retrieval system was first implemented, Ms. Rodriguez would load boxes of records in her Jeep Cherokee and deliver them herself to the person requesting the files. Once the records section was better organized, a mail service picked up the boxes and delivered them to the persons requesting the records, and the mail service also returned the boxes of records to the Warehouse. In addition to her duties involving records storage and retrieval, Ms. Morales did typing and general office work for Ms. Zilliner and Mr. Roof, including answering the telephone. Ms. Rodriguez is fluent in both English and Spanish. Ms. Morales's first language is Spanish, but she began studying English in 1994. All of her courses at Miami-Dade Community College were taught in English, and Ms. Morales also took formal classes in English. At the times relevant to this proceeding, Ms. Morales could understand, speak, and read English; her command of spoken English has improved since September 2000. During the times relevant to this proceeding, when a telephone caller spoke only English, Ms. Morales would often ask another Warehouse employee to handle the call. She was, however, able to communicate adequately with Mr. Roof and Ms. Zilliner, and she had no trouble doing her work.3 Ms. Rodriguez's grievance In May 2000, Ms. Rodriguez filed a complaint against Mr. Roof, the supervisor of warehouse operations and her direct supervisor, with Dr. Joy Ruff, Miami-Dade Community College's Director of Employee Relations. The complaint was misplaced in Dr. Ruff's office, and, in July, 2000, when Dr. Ruff realized the error, she apologized and asked Ms. Rodriguez to re-file the complaint, which Ms. Rodriguez did on July 17, 2000. In her complaint, Ms. Rodriguez described several instances in which she believed Mr. Roof had acted inappropriately towards her, and she confirmed to Dr. Ruff that the basis for her complaint was discrimination on the basis of gender, specifically sexual harassment. Because he was Mr. Roof's supervisor, Dr. Ruff advised Mr. Meistrell that Ms. Rodriguez had filed the grievance. Mr. Meistrell told Dr. Ruff that he would make sure that Dr. Ruff had access to all the Warehouse employees for interviews and that the employees were paid for their time. Mr. Meistrell had no further involvement in the investigation of Ms. Rodriguez's complaint against Mr. Roof. During the course of her investigation, Dr. Ruff interviewed the employees who worked in the Warehouse. In their statements to Dr. Ruff, which were given on July 11, 12, 13, 24, and 28, 2000, several of the employees indicated that they had heard Mr. Roof make inappropriate comments to and about Ms. Rodriguez; three employees told Dr. Ruff that they had not observed Mr. Roof make inappropriate comments to or about Ms. Rodriguez, one of which was Ms. Morales. In addition to denying ever having heard Mr. Roof make any inappropriate comments to or about Ms. Rodriguez, Dr. Ruff's notes reflect that Ms. Morales commented during her interview that Ms. Rodriguez was a liar. This statement was not, however, related to the complaint Ms. Rodriguez had made against Mr. Roof; rather, Ms. Morales commented that Ms. Rodriguez lied about the hours she worked and about Maggie Zilliner, the head of the Warehouse's computer section. Specifically, Dr. Ruff's notes reflect that Ms. Morales commented that she "observed Janet coming in at 9 & leaving at 12, but tells people she's in at 8 & out at 4" and that she "sees Brian and Jorge (computer technicians) talking & talking & Maggie (Zilliner) only one working. Janet lies about Maggie & Maggie is a good woman." At some point during the investigation, Dr. Ruff suggested that Ms. Rodriguez work in the computer section of the Warehouse, at her original job, so that she would be directly supervised by Ms. Zilliner rather than Mr. Roof. Dr. Ruff completed her investigation in late July 2000, and she had a meeting with Mr. Meistrell, Mr. Roof's supervisor, on August 2, 2000, during which she advised Mr. Meistrell of her findings that Mr. Roof had made inappropriate comments to Ms. Rodriguez but that he had not engaged in discrimination based on sex. Dr. Ruff also told Mr. Meistrell that disciplinary action would be taken against Mr. Roof and that Mr. Roof would be required to write Ms. Rodriguez a letter of apology. Dr. Ruff met with Ms. Rodriguez on August 2, 2000, and Dr. Ruff discussed with her, in detail, the results of the investigation, including Dr. Ruff's conclusion that Mr. Roof had made inappropriate comments to Ms. Rodriguez. Dr. Ruff advised Ms. Rodriguez during the meeting that disciplinary action would be taken against Mr. Roof by Miami-Dade Community College and that he would be required to write her a letter of apology. Dr. Ruff also documented attempts to arrange a meeting with Mr. Roof on August 2, 2000, but Mr. Roof was not available. Dr. Ruff did, however, discuss the investigation and her conclusions with Mr. Roof in August 2000, while she was on vacation, and she advised him during the discussion that he would be subject to disciplinary action, that he would be required to write Ms. Rodriguez a letter of apology, and that he should begin drafting the letter of apology. After she returned from vacation, Dr. Ruff prepared a letter to Ms. Rodriguez dated September 1, 2000, in which Dr. Ruff formally advised Ms. Rodriguez that she had completed the investigation of Ms. Rodriguez's complaint against Mr. Roof and had concluded that Mr. Roof had made inappropriate comments to her in specific instances but that this behavior did not constitute discrimination based on sex. Dr. Ruff further advised Ms. Rodriguez in the letter that Mr. Roof would be disciplined for his behavior and that he would provide her with a written apology. On September 5, 2002, Dr. Ruff provided Mr. Meistrell with a draft of a formal letter of reprimand to be issued to Mr. Roof. Mr. Meistrell, as Mr. Roof's supervisor, incorporated the draft provided by Dr. Ruff into a memorandum of reprimand addressed to Mr. Roof and dated September 5, 2000. Dr. Ruff confirmed that Mr. Roof had received the written reprimand and that it had been included in his personnel file. The letter of complaint against Mr. Roof sent via facsimile to Dr. Ruff by Ms. Rodriguez on July 17, 2000, was not signed. A note dated August 14, 2000, that appears in the margin of Dr. Ruff's notes of her August 2, 2000, meeting with Ms. Rodriguez states: "Schedule mtg w/ Janet Rodriguez - signature on complaint." Decision to terminate Ms. Rodriguez In a memorandum dated July 26, 2000, Mr. Bailey, Mr. Meistrell's supervisor and Director of the Budget for Miami- Dade Community College, notified Mr. Meistrell that there was a shortfall in Miami-Dade Community College's operating budget for the 2000-2001 fiscal year of approximately $4 million, and he directed Mr. Meistrell to conduct his operations within the budget assigned to his areas of responsibility. The salaries for part-time employees at the Warehouse exceeded the amount budgeted for the 2000-2001 fiscal year by approximately $75,000. It was, therefore, necessary for Mr. Meistrell to reduce the staff at the Warehouse. Mr. Meistrell developed a plan for reducing the number of staff at the Warehouse, and he advised Mr. Bailey of the plan and of the corresponding reduction in the services that could be provided by the Warehouse. Mr. Bailey approved Mr. Meistrell's plan for staff reductions at the Warehouse, and Mr. Meistrell implemented the plan. Mr. Meistrell cut the program involving the repair of old computers, and the two part-time computer technicians who repaired the computers were terminated. Another employee of the computer section had recently quit, so three employees were cut from that section, leaving the supervisor of the computer section as the only employee. Mr. Meistrell decided that, for safety reasons, he could not reduce the staff doing the manual labor in the Warehouse from two employees to one. He, therefore, decided to reduce the staff of the records section of the Warehouse from two part-time employees to one. At the time, Ms. Morales and Ms. Rodriguez were the two part-time employees in the records section, and Mr. Meistrell decided to terminate Janet Rodriguez. Mr. Meistrell was solely responsible for choosing the individuals that would be terminated under the staff-reduction plan, and he did not consult with anyone at the Warehouse regarding who should be terminated. In making the decision to retain Ms. Morales and terminate Ms. Rodriguez, Mr. Meistrell concluded that Ms. Morales was better qualified than Ms. Rodriguez for the position in the records section, based on his consideration of the following factors: Mr. Meistrell believed that both Ms. Rodriguez and Ms. Morales understood the system for keeping track of the records stored at the Warehouse, and both had participated in the development of the program for keeping track of the records. Ms. Morales was first employed by Miami-Dade Community College as a student assistant in April 1996, and she worked as a student assistant until she accepted the part-time position at the Warehouse in March 1999. Mr. Meistrell believed that, during her employment with Miami-Dade Community College, Ms. Morales had acquired secretarial, administrative, and general office skills. She was, in addition, certified in business software applications. Mr. Meistrell believed that Ms. Morales would be a long-term employee, given her length of service with Miami-Dade Community College. Mr. Meistrell considered Ms. Rodriguez to be a good employee who knew a great deal about the operation of the records section of the Warehouse. He believed, however, that Ms. Rodriguez had very little experience in general office work, and he believed that, with her limited experience working at Miami-Dade Community College, Ms. Rodriguez was not as familiar with the source of the records and the operations of Miami-Dade Community College in general as Ms. Morales. Mr. Meistrell considered this lack of knowledge a drawback as the Warehouse received more and more records from the various Miami-Dade Community College campuses. In addition, Mr. Meistrell believed that Ms. Rodriguez would not be a long-term employee because she was attending college and was about to graduate with a bachelor's degree. In Mr. Meistrell's estimation, Ms. Rodriguez was not as proficient as Ms. Morales in inputting data into the computer and handling the paperwork relating to the records stored at the Warehouse, and he believed that Ms. Morales's administrative and organizational skills were superior to those of Ms. Rodriguez. Both Ms. Rodriguez and Ms. Morales did typing and filing for the computer section, but Mr. Meistrell believed that Ms. Morales was more proficient at this type of work than Ms. Rodriguez. In addition, because Ms. Morales was familiar with the property control system, Mr. Meistrell believed that she could also assist the computer section by handling the paperwork and inputting data relating to the old computers being sent to the Warehouse for the various Miami-Dade Community College campuses. Although Ms. Rodriguez was certified to use a forklift and Ms. Morales was not trained in the use of a forklift, Mr. Meistrell did not consider the use of a forklift to be a job requirement for those working in the records section of the Warehouse; usually, one of the employees of the furniture and equipment section of the Warehouse would retrieve pallets of boxes from the higher levels. Pallet jacks were then used to move the pallets of boxes around the Warehouse, and both Ms. Rodriguez and Ms. Morales knew how to use a pallet jack. Mr. Meistrell was aware that both Ms. Rodriguez and Ms. Morales were bilingual in Spanish and English. Mr. Meistrell was also aware that Ms. Rodriguez's command of spoken English was superior to that of Ms. Morales, but, in his opinion, Ms. Morales could communicate adequately in person or on the telephone with the staff in the Warehouse, including Mr. Roof and Ms. Zilliner, and with Miami-Dade Community College staff and others who spoke only English. In a memorandum dated September 6, 2002, Mr. Meistrell notified Mr. Roof, the head of warehouse operations; Ms. Zilliner, the head of the computer section of the Warehouse; and Rafael Rodriguez, the head of the storage section of the Warehouse, of the budget reduction and the decision he had made to reduce the number of staff in the Warehouse. Mr. Meistrell advised in the memorandum that, in addition to reducing the number of employees at the Warehouse, the maximum hours of the remaining Warehouse employees were restricted to 30 hours per week. Mr. Meistrell notified Ms. Rodriguez and the two employees from the computer section of their termination on September 6, 2000; he went to the Warehouse and gave the termination letters to each of the three employees. Ms. Rodriguez was advised that she would receive her salary through September 17, 2000. On September 6, 2000, after she was told of her termination and while she was packing up her belongings to leave the Warehouse, Ms. Rodriguez received a call from Dr. Ruff's office asking that she visit Dr. Ruff's office to sign some documents before she left. Ms. Rodriguez went to Dr. Ruff's office, where she signed and dated the complaint that she had sent to Dr. Ruff by facsimile on July 17, 2000. At this time, Dr. Ruff presented her with a letter of apology prepared by Mr. Roof and dated September 1, 2000. Computer records maintained by Miami-Dade Community College's indicate that Ms. Rodriguez was actually terminated from her employment on May 25, 2001. It was, however, Mr. Meistrell's practice to keep many terminated part-time staff on active status in the computer system, at no cost to the college, so that, if he needed a part-time employee to work for a couple of weeks, he could call and offer work to one of the people in the system without going through hiring formalities; because they were retained in the computer on active status, these employees could start working almost immediately. Ms. Rodriguez was one of the Warehouse employees that Mr. Meistrell kept on active status in the computer after her termination-in-fact. When he was told that he had too many people on active status in the computer, he cleaned out the records, and Ms. Rodriguez's was one of the records he took off of the computer. Ms. Rodriguez has not been employed since her termination from the Warehouse. Even though she has had interviews, Ms. Rodriguez believes that prospective employers lose interest in her when she explains that she has a pending sexual harassment complaint against Miami-Dade Community College. No one has been hired to fill the positions held by Ms. Rodriguez and the two employees from the computer section that were terminated on September 6, 2000. Summary Ms. Rodriguez presented evidence (1) that she filed a grievance against her supervisor, Mr. Roof, with Miami-Dade Community College in July 2000, charging that he had sexually harassed her in the workplace; (2) that she was terminated from her part-time employment with Miami-Dade Community College on September 6, 2000; and (3) that Mr. Meistrell was aware that she had filed a grievance against Mr. Roof and notified her of her termination less than two months after she filed the grievance, approximately one month after he was advised by Dr. Ruff that Mr. Roof would be reprimanded for making inappropriate comments to Ms. Rodriguez, one day after Mr. Meistrell prepared a memorandum of reprimand to Mr. Roof, and the same day Ms. Rodriguez was given Mr. Roof's letter of apology. Miami-Dade Community College in its turn produced evidence that, because of a reduction in the funds allocated for part-time salaries in Miami-Dade Community College's budget for Fiscal Year 2000-2001, Mr. Meistrell decided to re-organize the operations of the Warehouse and to cut the staff of the records section of the Warehouse from two employees to one employee. Miami-Dade County also produced evidence that Mr. Meistrell's decision to terminate Ms. Rodriguez rather than Ms. Morales was based on the length of Ms. Morales's employment with Miami-Dade Community College and his determination that Ms. Morales had more experience in general office work and was better qualified to carry out the duties of the remaining position in the records section than Ms. Rodriguez. Ms. Rodriguez's proof is insufficient to establish with the requisite degree of certainty that the reasons articulated by Mr. Meistrell were not the true reasons for her termination and that her filing a grievance against Mr. Roof was the true reason for her termination. Ms. Rodriguez did not dispute Mr. Meistrell's explanation that budget cuts required him to re-organize the Warehouse and reduce the staff of the records section to one part-time employee. Rather, Ms. Rodriguez claimed she was more qualified for the position than Ms. Morales; she implied that the removal of Ms. Rodriguez's position from Miami-Dade Community College's computer records on May 31, 2001, somehow undercut the credibility of Mr. Meistrell's explanation of the reasons for her termination; and she asserted that Ms. Morales strongly supported Mr. Roof when she was interviewed by Dr. Ruff during the investigation of Ms. Rodriguez's sexual harassment complaint. Ms. Rodriguez's perception that she was more qualified for the one remaining position in the records section of the Warehouse than Ms. Morales does not discredit the reasons given by Mr. Meistrell for his decision to terminate Ms. Rodriguez. Mr. Meistrell's explanation of the factors that he considered in reaching the decision to terminate Ms. Rodriguez rather than Ms. Morales establishes that he chose Ms. Morales based on his determination that she was more qualified for the position that Ms. Rodriguez, given his understanding of the duties that the person in the position would be required to perform and of the office skills and work experience of Ms. Morales and Ms. Rodriguez. Second, although the evidence supports the finding that Ms. Rodriguez's position was not removed from Miami-Dade Community College's computer files until May 25, 2001, Ms. Rodriguez does not dispute that she was terminated in fact on September 6, 2000, and she has failed either to establish that the deletion of her position from the computer records in May 2001 was more than a ministerial act or to explain how the delay in deleting her position from the computer records supports in any way her contention that she was terminated because she filed a claim of sexual harassment against Mr. Roof. Finally, Ms. Rodriguez presented no evidence tending to show that Mr. Meistrell knew the details of Ms. Morales's statement to Dr. Ruff regarding Ms. Rodriguez's sexual harassment complaint against Mr. Roof. Ms. Rodriguez has failed to produce proof sufficient to permit the inference that Mr. Meistrell intentionally discriminated against her when he decided to terminate her employment in the records section of the Miami-Dade Community College Warehouse. Not only did she fail to present sufficient evidence to discredit Mr. Meistrell's explanation of the reasons underlying his decision to terminate Ms. Rodriguez, she failed to establish that Mr. Meistrell's decision was influenced in any way by the fact that she filed a sexual harassment grievance against Mr. Roof. The evidence presented by Miami-Dade Community College is sufficient to establish that Mr. Meistrell did not have a close personal relationship with Mr. Roof, did not seek Mr. Roof's input regarding whether Ms. Rodriguez or Ms. Morales should be terminated or discuss the matter with him, and did not make Mr. Roof aware of his decision to terminate Ms. Rodriguez prior to September 6, 2000.4
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Florida Commission on Human Relations enter a final order dismissing the Petition for Relief filed by Janet Rodriguez. DONE AND ENTERED this 29th day of January, 2003, in Tallahassee, Leon County, Florida. PATRICIA HART MALONO 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 29th day of January, 2003.
The Issue The issue presented is whether Petitioner's application for certification as a minority business enterprise should be granted.
Findings Of Fact Petitioner filed an application to be certified as a sole proprietor offering accounting services, telecommunication services, and building products. At the final hearing in this cause, Petitioner withdrew her application for certification as to accounting services and telecommunication services. As amended, her application for certification is solely in the area of building products. On her application, Petitioner indicated that her minority status is Hispanic American. She included a copy of a passport indicating that she was born in Jamaica and a copy of her marriage license reflecting Jamaica as her birth place. Petitioner's resume reflects a background in accounting and some office manager experience. Most recently, she had a former arrangement with Brenda Chambliss whereby Petitioner was given office space in exchange for providing accounting services. Through that association, Petitioner met Joe Chambliss, the owner of Tom Rockey Building Products, a non-minority business. On September 15, 1993, Tom Rockey Building Products loaned Petitioner $250,000 at 5 percent interest to be re-paid monthly commencing September 15, 1995. No amount of monthly payment is set forth. The Demand Note specifies that the money is to be used by Petitioner "for capitalization of Building Products inventory." Petitioner then used that money to purchase inventory from Tom Rockey Building Products, which inventory was, and still is, physically located in Tom Rockey Building Products' warehouse. Although the inventory is the collateral for the loan, Petitioner now has only approximately $125,000 to $150,000 worth of inventory. She has used some of the loan proceeds for operating her business. Petitioner's business office is her home. She has an occupational license in her individual name, using her home address. That occupational license specifies sales representative as Petitioner's occupation. As part of the application process, Petitioner was requested to provide information regarding her inventory. The response to that request for information came not from Petitioner, but rather from Joe Chambliss. The letter was on Tom Rockey Building Products letterhead and was signed by Chambliss as the president of that company. The inventory itself is a computer printout entitled "Tom Rockey Bldg. Products inventory control inventory status report." The document itself does not indicate any relationship between that inventory belonging to Tom Rockey Building Products and the Petitioner, Michelle Wolf. Petitioner concentrates on selling building products in Jamaica. She contacts companies there who import building products, finds out what products they are purchasing now, and attempts to sell them the same products at a lower price. If her inventory does not include the products needed, she obtains the products from Chambliss. If she sells some of her inventory, the products are delivered by Tom Rockey Building Products. On large projects where Petitioner cannot provide building products to the purchaser and wait for payment, which requires Petitioner having some capital, Chambliss will provide the funding necessary. According to Petitioner's application when she needs assistance or guidance regarding her business, she relies on Chambliss. Petitioner and Chambliss also have a separate partnership agreement which, although executed on January 2, provides that it commenced on January 1, 1995, and, according to Petitioner, simply memorializes an ongoing relationship. While that agreement is vague in its terms, it does provide that the partnership will engage in the "business of sales and consulting services." That agreement provides that Petitioner will receive 51 percent of the profits and Chambliss 49 percent, a percentage commensurate with the initial capital contributed by each of the two partners. Yet, the partnership agreement provides that each partner shall have a voice in managing the partnership and requires that both agree in financial decisions affecting the partnership. Although that partnership agreement has no relationship with the loan for $250,000 made to Petitioner by Tom Rockey Building Products, it does reflect the interrelationship between Petitioner and Chambliss in Petitioner's business activities.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order be entered finding that Petitioner's application for certification as a minority business enterprise be denied. DONE and ENTERED this 13th day of October, 1995, at Tallahassee, Florida. LINDA M. RIGOT, 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 13th day of October, 1995. COPIES FURNISHED: Ms. Michelle Wolf 6331 Southwest First Court Plantation, Florida 33317 Joseph L. Shields, Esquire Commission on Minority Economic and Business Development 107 West Gaines Street 201 Collins Building Tallahassee, Florida 32399-2005 Crandall Jones, Executive Administrator Commission on Minority Economic and Business Development Suite 201, The Collins Building 107 West Gaines Street Tallahassee, FL 32399-2000
Findings Of Fact In 1987, the Respondent DOT began its review of the public roads within Glades County in order to assign maintenance and jurisdictional responsibility in accordance with the current functional classification of each road. By law, the DOT is required to conduct such a review every five years. Section 05040 of State Road 78 is located within the unincorporated area of Glades County. This paved, two-lane road segment is 14.8 miles in length, and predominantly runs in an east-west direction. Approximately two miles of the eastern portion veers to the north, where the segment then connects with State Road 25 (U.S. Highway 27). The western terminus of this road segment adjoins State Road 29, and the eastern terminus as mentioned previously, adjoins State Road 25 (U.S. Highway 27). There is a radical change in direction at both ends where the segment connects with the two adjacent roads. At the western terminus, State Road 29 runs in a southwesterly to northeasterly direction. The southwesterly portion of State Road 29 runs in a southwesterly to northeasterly direction. The southwesterly portion of State Road 29 enters into Hendry County and extends to LaBelle, the county seat. At the eastern terminus, State Road 25 (U.S. Highway 27) runs for approximately five miles before it reconnects with another portion of State Road 78 which runs in a northeasterly direction around the border of Lake Okeechobee into Okeechobee County, and onto the City of Okeechobee, the county seat. Through the use of approximately four miles of the southwesterly portion of State Road 29 and approximately five miles of the easterly portion of State Road 25 (U.S. Highway 27), State Road 78 becomes a transportation corridor which connects Hendry County, Glades County, and Okeechobee County. This corridor is used by members of the Gulf Citrus Growers Association in Hendry County to transport citrus to market in other parts of the state. State Road 29 and State Road 25 (U.S. Highway 27) are functionally classified as arterial roads on the state highway system. During the functional classification evaluations within Glades County, Section 05040 of State Road 78 was reviewed by DOT. As part of the process, an inventory worksheet was used to determine how the road would be classified under the current scoring system. A Rural Arterial Inventory Worksheet (Respondent's Exhibit 15) was used to determine the roadway's System Attribute Score (SAS). As part of the evaluation process, the system element coefficient must be located within Table Number 4 of Chapter 14-12, Florida Administrative Code. The Administrator of Transportation Data for District 1 correctly determined that the system element coefficient was 5, and the rural element number was 12. The first attribute reviewed on the worksheet in order to obtain the SAS was the Traffic Factor. Under the definitions found in Table 1 of Chapter 14-12, Florida Administrative Code, the Traffic Factor is calculated by multiplying the Average Daily Traffic Count by the county's normalizing coefficient Tpd of 1.73. Again, the administrator correctly assessed the value of 2,782 on the worksheet. Usually, a score below 3,000 under the Traffic Factor results in an evaluation score of "zero" on the Rural Arterial Inventory Worksheet. However, Table Number 1 of Chapter 14-12, Florida Administrative Code, notes that when 50% of traffic volume is non-local traffic, a score of "one" is placed on the worksheet instead of a "zero." Competent and credible testimony presented at hearing from local citizens, who had the opportunity to know the composition of the traffic on the road segment, revealed that a relatively small percentage of Section 05040 of State Road 78 traffic was local. The majority of the traffic was comprised of out-of-county motorists. Based upon this testimony, the Traffic Factor score on the worksheet should be changed from "zero" to "one." The second attribute reviewed on the worksheet was the Access Factor. This score is calculated by dividing the average daily traffic (ADT) by the number of access points per mile. Instead of using available information with the DOT or asking for information from local authorities regarding this attribute, the administrator grossly overestimated that the road segment contained twenty access points per mile. No reasonable basis was presented at hearing by the administrator for his "estimate" of twenty access points per mile on a rural segment in one of the more remote and under populated areas within his district. The videotape presented at hearing clearly demonstrates that there are not twenty access points per mile on this roadway. Unrefuted testimony presented at hearing revealed that approximately twenty-five families reside along this 14.8 mile stretch of road. There is also a large rock mine, a cemetery, and the county landfill. Respondent's Exhibit 5, the General Highway Map of Glades County, shows that a DOT facility is located on this road segment. There are four roads which intersect the road segment and one railroad grade crossing. A locked gate at the Caloosahatchee Rock Mine has a driveway which connects to the road. To deny the road segment the minimum score of "one" on the access factor, the DOT would have to estimate in its calculation that there are more than ten access points per mile on this road. Based upon the evidence presented at hearing, there are far less than ten access points per mile on this road segment. Therefore, the Access Factor score on the worksheet should be changed from "zero" to "one." The Trucks and Network Factor attributes which each received a score of "one" from the administrator. These scores were not challenged by Petitioner. The Extent of Road attribute was not properly tested by the administrator. Under Rule 14-12.015(2), Florida Administrative Code, the entire State Road 78, along with the southwesterly portion of State Road 29, and the eastern portion of State Road 25 (U.S. Highway 27) should be utilized for the Extent of Road (miles) measurement. As the entire length of the extended transportation corridor exceeds twenty miles, the score should be "one" instead of "zero." The Mobility Attribute was not properly assessed. Rule 14-12.015(2), Florida Administrative Code, allows the extended transportation corridor to be used to determine the total number of counties in which the road is located. Testimony presented at hearing regarding the use of the road segment as part of the transport route of citrus from Hendry County through State Road 78 in Glades County to Okeechobee County supports the finding that the road is located in three counties. The score as to the Mobility Attribute should be changed from "zero" to "one." Section 05040 of State Road 78 is in an overall physical condition which is at least commensurate with contemporary roads of like age and existing functional classification (rural major collector) within Glades County.
Recommendation Accordingly, it is RECOMMENDED: That the Department of Transportation enter a Final Order that the Department's functional classification of the road segment was incorrect, that the functional classification of the road as a rural minor arterial be reinstated, and that the jurisdiction over the road remain with the Department. DONE and ENTERED this 2nd day of October 1989, in Tallahassee, Florida. VERONICA E. DONNELLY Hearing Officer Division of Administrative Hearings 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 2nd day of October 1989. APPENDIX TO RECOMMENDED ORDER IN CASE NO. 89-1227 Petitioner's proposed findings of fact are addressed as follows: Accepted. See Preliminary Statement. Rejected. Not a factual finding. Accepted. Accepted. See Preliminary Statement. Accepted. See Statement of the Issues. Accepted. Accepted. Rejected. See HO #19. Accepted Accept the first sentence. The second sentence is rejected as irrelevant. Accepted. Accepted. Accepted. Accepted. Accept that the Hearing Officer found the road to be improperly classified. The rest is rejected as conclusionary. Accepted. See HO #10. Accepted. See HO #4. Accepted. See HO #10. Accepted. See HO #4. Accepted. Rejected. Irrelevant. Rejected. The financial ability provision within the statute was repealed, and a determination cannot be made on the basis of factors outside rule or statute. Respondent's proposed findings of fact are addressed as follows: Accept the first two sentences. The third sentence is rejected. See HO #2. Fourth sentence is accepted. See HO #5. Fifth sentence is accepted. See HO #7. Sixth sentence is rejected. See HO #7-#18. Seventh sentence is accepted. See HO #8. Eighth sentence is rejected. Improper conclusion. Ninth sentence is accepted. See Conclusions of Law. Tenth sentence is accepted. See Preliminary Statement. Accepted. See HO #19. Rejected. The financial ability provision within the statute was repealed, and a determination cannot be made on the basis of factors outside the rule or statute. COPIES FURNISHED: Michael A. Rider, Esquire Post Office Box 608 Lake Placid, Florida 33852 Vernon L. Whittier, Jr., Esquire Department of Transportation 605 Suwannee Street, M.S. 58 Tallahassee, Florida 32399-0458 Ben G. Watts, P.E., Interim Secretary Department of Transportation 605 Suwannee Street, M.S. 58 Tallahassee, Florida 32399-0458 Thomas H. Bateman, III, Esquire General Counsel Department of Transportation 605 Suwannee Street Tallahassee, Florida 32399-0458 =================================================================
The Issue The issues in this case, a bid protest, are as follows: Whether Respondent, Tampa Bay Estuary Program, an independent special district ("TBEP"), failed to follow the review process as outlined in the Request for Proposals ("RFP") and TBEP's own procurement policies. Whether TBEP failed to properly apply the scoring and review criteria set forth in the RFP. Whether the RFP instructions were followed, whether they lacked certain direction or standards, and whether these failures led to actions that were clearly erroneous, contrary to competition, arbitrary, or capricious. Whether the evaluation committee members acted arbitrarily in scoring, ranking, or making recommendations to the Management Board.
Findings Of Fact (Findings of Fact 1 through 17 are taken from the parties' Prehearing Stipulation.) Dynamic is a Florida limited liability company with its principal place of business in Knoxville, Tennessee. TBEP is an independent special district formed by an Interlocal Agreement between 13 governmental entities pursuant to section 163.01, Florida Statutes. Janicki is a Florida corporation with its principal place of business in St. Petersburg, Florida. TBEP issued the RFP (for the Project) on or about March 4, 2011. The stated purpose of the RFP was to develop, calibrate, and validate an integrated set of numerical and/or empirical models. Nine project teams submitted responses to the RFP. Dynamic and Janicki timely submitted proposals on or about April 15, 2011. TBEP distributed, via email, its final rankings of the nine-project teams on May 13, 2011. TBEP notified Dynamic that it was the second-ranked candidate. TBEP notified Janicki that it was the first-ranked candidate. Dynamic timely filed its notice of written protest on May 19, 2011. Dynamic timely filed its Petition for Formal Administrative Hearing on May 31, 2011. In lieu of a security bond, Dynamic submitted a cashier's check as security in the amount of $11,979.08 to TBEP on May 31, 2011. TBEP referred Dynamic's Petition to DOAH on June 2, 2011. Janicki served its Petition to Intervene on or about June 8, 2011. Dynamic submitted a cashier's check as replacement security to TBEP on June 10, 2011. Dynamic did not submit a protest bond. Background on TBEP TBEP's mission is to assist local and regional governments in developing a comprehensive plan to restore and protect the body of water known as greater Tampa Bay. TBEP has an Interlocal Agreement whose stated purpose is to emphasize regional cooperation and regulatory flexibility that allows it to select cost-effective and environmentally beneficial bay improvement options for the surrounding communities. The Interlocal Agreement seeks to implement the Comprehensive Conservation & Management Plan for Tampa Bay, known as Charting the Course. TBEP's Interlocal Agreement establishes a Management Board and a Policy Board with specified duties and responsibilities, which are further described in TBEP's By-Laws. The Management Board serves as an advisor to the Policy Board. The Policy Board exercises all the powers of the entity and manages the business and affairs of TBEP. Only the Policy Board may promulgate TBEP policy or procedures or issue waivers of such policies and procedures. TBEP has adopted an Operating Procedures Manual ("OPM"), which sets forth procurement procedures. It provides that all procurement shall be conducted in accordance with the Code Of Federal Regulations (40 C.F.R. § 31.36) and, as applicable, chapter 287 and Florida Administrative Code Chapter 60A-1, to the extent the statutes and rules are not in conflict with applicable federal laws and standards. The OPM provides that the Policy Board must approve all contract awards for services in excess of $25,000, unless delegated by the Policy Board to the Management Board. Also, the OPM says an evaluation committee appointed by TBEP's executive director will review proposals received by TBEP in response to an RFP for services in excess of $25,000. The results of an evaluation committee's review of proposals are presented to the Management Board, which makes a recommendation to the Policy Board. The final procurement decision is made by the Policy Board. The Project is the result of a cooperative agreement between TBEP and Southwest Florida Water Management District (SWFWMD) to develop comprehensive models, to evaluate potential management actions, to improve water quality, and to expand seagrass coverage in Old Tampa Bay. The Project includes development, calibration, and validation of an integrated set of numerical (and/or empirical) models of: 1) watershed loading; hydrodynamic circulation; and 3) water quality/ecological response that will be used to evaluate management action scenarios in Old Tampa Bay. Total cost of the Project is estimated to be $1,200,000 to $1,300,000; the length of time needed to carry out the Project would be approximately 36 months. The Project will be jointly funded by TBEP and SWFWMD. TBEP is funded by the Environmental Protection Agency, the City of Clearwater, the City of St. Petersburg, the City of Tampa, Hillsborough County, Pinellas County, Manatee County and SWFWMD. The Project is the largest single project undertaken by TBEP in terms of costs, but TBEP has previously procured services and entered into contracts for other projects which are as technically complex as the Project. TBEP and SWFWMD developed a team of professionals in the fall of 2010 to begin development of the Project. In March 2011, TBEP issued the RFP for the Project. Proposals in response to the RFP were accepted until 2:00 p.m. (Eastern Standard Time) on Friday, April 15, 2011. Information was to be provided in each proposal under the following headings: Project Summary, Title Page, Table of Contents, Letter of Transmittal, Understanding and Approach, Respondent Qualifications, Quality Control and Conflict of Interest, Time Schedule and Effort Proposal, Listing of Deviations, and Additional Data. Respondents were also directed to indicate whether they had an affirmative action plan in effect. In addition, respondents had to disclose whether they had been involved in a government contract that ended in termination, litigation due to substandard quality, untimely submittal of deliveries, or for other reasons. All team members for each respondent were to be disclosed, including prime contractors and subcontractors. Responding entities were allowed until March 18, 2011, to submit any questions they had about the RFP process. All questions submitted, along with TBEP's responses, were then compiled and made a part of the RFP package. The RFP package was available to anyone who requested it. In response to one of the questions asked by a respondent, TBEP provided a list identifying all of the evaluation committee members. Dynamic represented that it was the respondent and provided appropriate contact information. Dynamic named Christopher Wallen, its vice-president, as the person authorized to make representations for and bind Dynamic to its proposal. The proposal indicated that Dynamic agreed to hold TBEP and SWFWMD harmless from any claims resulting from injury or damages incurred by volunteers participating in the program, although no executed hold harmless agreement was included in its proposal. Dynamic indicated some support or collaboration with other entities as part of its proposal. Both Old Dominion University ("ODU") and the University of South Florida ("USF") were named as part of Dynamic's "team" for purposes of their proposal. Professional biographical information for Dr. Mark Luther from USF and Dr. Richard Zimmerman from ODU was included in the proposal, along with information for Dynamic's employees and experts from other entities. There is no documentation from either of the universities, however, indicating they are expecting to participate in the Project. Dynamic takes the position that the two university-based experts were hired as independent consultants, working for their private consulting businesses, rather than for the universities. (This position is similar to TBEP's position on two of its committee members. See discussion herein.) However, the universities' logos appear on the front cover of Dynamic's proposal. Dynamic did not have, at the time of its proposal or even as of the date of final hearing, an affirmative action plan in place. However, as a minority-owned business (Wallen's wife is the president of the company), Dynamic does not believe it is required by law to have such a plan. Therefore, no plan was included in its application. By not having, or creating such a plan, Dynamic forfeited a point in its evaluation by committee members. Dynamic did not include information in its proposal concerning a government contract it had previously been awarded that had been terminated. However, the reason for that termination was that the government had stopped work on the project, when another party entered a protest of some sort. The contract was "terminated" pending resolution of the dispute, but was then reinstated. Dynamic did not feel as if those circumstances would warrant disclosure of the contract under the terms of the RFP. The RFP included instructions for the evaluation committee's use in reviewing proposals. Each committee member was to score each proposal and rank the respondents. The evaluation committee was expected to reach a consensus on a ranked list of the respondents at the end of the process. A hypothetical ranking table was included in the RFP instructions for consideration by the committee. TBEP's standard practice for RFP reviews was to use the rankings to award a contract. The scores assigned by each committee member were not generally as consistent, so rankings were used to reach a better decision. There were no instructions in the RFP as to how the committee was to handle a tie. Each evaluation committee member was allowed to use their own judgment as to how to reflect a tie. Some committee members used fractions while some would rank two respondents equally and leave one rank vacant. For example, one reviewer might rank the respondents: 1, 2, 3, 4, 4, 6, 7, 8, 9; another reviewer might use 1, 2, 3, 4, 4.5, 5, 6, 7, 8 to reflect the same ranking. Dynamic correctly pointed out that the instructions provided to the committee members included a sample format for making rankings. The sample did not include a ranking based upon a tie, but the instructions did not prohibit ties either. The evaluation committee was made up of nine members, each having a special area of knowledge or expertise as to the proposed project. The team members were: Mark Flock, Pinellas County staff; Lizanne Garcia, SWFWMD staff; Kristen Kaufman, SWFWMD staff; David Glicksberg, Hillsborough County staff; Holly Greening, TBEP staff Edward Sherwood, TBEP staff; Charles Kovach, Department of Environmental Protection; Dr. William Kemp, subject matter expert; and Dr. James Martin, subject matter expert. The Scoring Process The RFP Instructions include a set of eight criteria used to evaluate the proposals by assigning scores to the proposals based on the provided criteria. Evaluation committee members were to apply the first five technical criteria to score proposals.3/ Those criteria and potential scores for each were: Project Team Qualifications--20 points; Project Approaches--35 points; Level of Effort and Cost by Task--15 points; Performance Considerations--20 points; and Management Approach--5 points. The remaining three non-technical criteria were assigned by TBEP staff and were applied to each proposal. Those criteria were: Minority (business ownership); Previous Work Awarded; and Total Proposed Project Costs. The reviewers could then add "extra" points for the candidate's purported ability to adequately complete the tasks as outlined in the RFP. A total of 95 points could be awarded for each candidate. On April 15, 2011, the committee members were provided copies of the nine proposals submitted by interested respondents. Each committee member was also given a copy of the RFP, a blank score sheet, and a "Code of Standards of Conduct" statement to be completed for the purpose of showing no conflict of interest. The committee members were then directed to assign scores for the various criteria as the initial element of their review. The RFP provided directions as to how the process would work. At page 7 of the RFP, it states that "[E]valuation committee members may adjust scores based on discussion during the evaluation committee meeting prior to the finalization of scores" and that "each evaluation committee member will then add up their scores for Criteria 1 through 5 and staff-provided scores 6 through 8 for each respondent, and rank respondents based on their individual scores." The RFP then provided that once the scoring was complete, "[r]anks from each evaluation committee member shall be totaled, and an overall ranked short-list developed therefrom." Each of the committee members then completed scoring sheets for each respondent. The committee then met on April 29, 2011, to review, discuss, and rank the proposals. A short list of proposals was made at that time for the purpose of allowing certain respondents to make oral presentations to the committee. The list was developed by having each committee member give a score (or rank) of one or zero for each respondent. The four respondents who were ranked the highest were allowed to make oral presentations. The scores assigned by each committee member in their individual review on score sheets were not the sole basis for creating the short list. However, each committee member made a 1 or 0 rank for the respondents based at least, in part, on how they had scored the respondents. On May 6, 2011, the four highest ranked respondents, including Dynamic and Janicki, were allowed to make oral presentations to the committee. After the presentations, the committee met and deliberated for approximately two hours concerning their choices. At that time, the initial rankings were created. Each member's initial ranking of the nine respondents was placed on a white board at the front of the meeting room. As the rankings were discussed, some members decided to alter their rankings based on consideration of other members' input. Each of the committee members brought a particular expertise to the table, so each had pertinent insight to share with other committee members as to the abilities or capabilities of each respondent. The scores that each member had individually assigned to the respondents for the various categories were not specifically discussed as part of the ranking dialogue. Those scores were a preliminary method for each reviewer to compare the respondents' proposals on a comparatively even "apples to apples" review. The scores may or may not have formed the primary basis for each reviewer's initial ranking placed on the white board at the May 6, 2011, meeting. Nonetheless, the rankings could be changed upon discussion with other members of the committee. Dynamic argues that the scores on each evaluation committee member's score sheets should have been used without consideration of any other factors to make the final rankings. Although it is possible to interpret the scoring instructions in that fashion, the approach used by the evaluation committee was sufficiently consistent with the instructions and based on a logical, reasonable approach. There is nothing inherently deficient about how the committee reached its decision. The committee reached a consensus at the May 6, 2011, meeting that Janicki should be awarded the contract. Although the vote was close, 16 to 17, the committee all agreed with the final decision. With the exception of Kaufman, none of the committee members deviated from their individual final ranking made at the meeting. Kaufman, subsequently, determined that her ranking as shown on the white board mistakenly had Dynamic ranked as 1 and Janicki as 2, just the opposite of what she intended. Making that change would have resulted in Janicki winning by three points instead of one point. The committee then reported its decision to the Management Board, which met on May 12, 2011, and approved the evaluation committee's recommendation. The Management Board then recommended to the Policy Board that Janicki be awarded the contract. The Policy Board modified the committee's recommendation slightly, deciding that if contract negotiations were not successful with Janicki, then Dynamic should be awarded the contract. On May 13, 2011, the Policy Board accepted the recommendation and awarded the contract to Janicki. After the May 6, 2011, meeting, the committee members were asked to submit their final score sheets to TBEP to be used by TBEP to evaluate strengths and weaknesses of the proposals for future consideration. Some members submitted several erroneous score sheets prior to sending their final score sheet. Kaufman initially submitted a blank score sheet for one respondent and had mathematical errors showing the two top-ranked respondents as tied, even though Janicki actually had a higher score. Garcia submitted an additional score sheet along with a justification as to how she broke a tie by using the higher technical score. Kemp submitted revised score sheets in order to provide justification for how he derived his final rankings. Inasmuch as there were discussions between committee members after the initial scoring was done but before the final rankings, it is logical and reasonable that the final rankings may not be consistent with the scoring done by each committee member. Notification to Respondents Once the decision was made to award the contract to Janicki, all respondents were notified via email. The OPM states that TBEP will "provide notice of a decision concerning a bid solicitation or a contract award to all respondents by United States mail or by hand delivery or telephone facsimile." Email is not listed as a means of notification. Even though TBEP provided the notification via email, there is no showing that such notice prejudiced any respondent in any way. Email is similar to and as fast as facsimile transmission. There is no evidence that any respondent failed to receive the notice. Just as Dynamic failed to disclose information about the government contract that had been technically terminated, TBEP's use of email, rather than U.S. Mail or fax, is a minor error in the process that is not material to the final decision. Bid Protest Process After receipt of the notice that Janicki had been awarded the contract, Dynamic timely filed a bid protest. Part and parcel to any bid protest is the submission of a bid protest security, usually in the form of a security bond. Dynamic submitted a cashier's check on May 31, 2011, in the amount of $11,979.08, representing one percent of Dynamic's estimated contract amount. The check was erroneously made out to Holly Greening, the executive director of TBEP, rather than to TBEP, as stated in its cover letter. Dynamic cured this scrivener's error when it became aware of the mistake. TBEP objected to the amount of the security provided, saying that $50,000 was required, but did not substantiate the basis for that amount. TBEP also objected to the sufficiency of the cashier's check because it had a termination date, i.e., if not cashed within 90 days, the check would become void. Although that objection is well taken, Dynamic cured the defect when it sent in the replacement check made out to TBEP. Makeup of the Evaluation Committee Dynamic takes exception to the appointment of two consultants, Dr. Martin and Dr. Kemp, to the evaluation committee. According to the OPM, "[c]onsultants, whether or not they submit proposals to TBEP, are not permitted to serve on selection committees." It is clear that both Dr. Martin and Dr. Kemp often provide services to clients as private consultants. However, both are also university professors and were purportedly serving on the evaluation committee as representatives of their respective universities. Nonetheless, all respondents were advised about the makeup of the evaluation committee prior to submission of their proposals. It is disingenuous for a respondent to claim, after the fact, that it did not wish to be evaluated by certain members of the committee. Dynamic takes exception that Janicki's status as a local company was considered, because local connection was not a designated RFP criterion. It is logical and reasonable, however, for TBEP to consider that factor (and any other relevant information about the respondents) during discussions in a close decision such as this.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a final order be entered by Respondent, Tampa Bay Estuary Program, upholding the award of the contract to Intervenor, Janicki Environmental, Inc. Tampa Bay Estuary Program shall include a statement of its costs and charges in the final order. If the parties cannot agree on the amount of such costs and charges, this matter may be remanded to the Division of Administrative Hearings for further proceedings as to that issue. DONE AND ENTERED this 31st day of August, 2011, in Tallahassee, Leon County, Florida. S R. BRUCE MCKIBBEN Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 31st day of August, 2011.
The Issue Are the February 13, 2014, letters of Respondent, Department of Business and Professional Regulation, Division of Pari-Mutuel Wagering (Division), requiring totalisator reports to "identify the Florida [permitholder] in reports as both host and guest when applicable," statements that amount to a rule, as defined in section 120.52(16), Florida Statutes (2013).1/
Findings Of Fact Florida permits and regulates betting on greyhound racing,2/ jai alai games,3/ quarter horse racing,4/ and harness racing.5/ The Division is responsible for administration of Florida's statutes and rules governing this betting. JKC and OPKC are separate, individually permitted facilities. Jacksonville Greyhound Racing owns and operates both the JKC and the OPKC. It is not, however, a party to this proceeding. The betting system is a pari-mutuel system. This "means a system of betting on races or games in which the winners divide the total amount bet, after deducting management expenses and taxes, in proportion to the sums they have wagered individually and with regard to the odds assigned to particular outcomes."6/ Each race, contest, or game is an "event."7/ The aggregate wagers called "contributions" to pari-mutuel pools are labeled "handle." § 550.002(13), Fla. Stat. An "intertrack wager" is "a particular form of pari-mutuel wagering in which wagers are accepted at a permitted, in-state track, fronton, or pari-mutuel facility on a race or game transmitted from and performed live at, or simulcast signal rebroadcast from another in-state pari-mutuel facility."8/ The JKC offers intertrack wagering at its permitted facility located in Jacksonville, Florida. It does not offer live events. The OPKC offers intertrack wagering and wagering on live events conducted at its permitted facility in Orange Park. The Racetracks are host tracks when they transmit live greyhound racing to other in-state and out-of-state facilities for off-track wagers.9/ They are guest tracks when wagers are made at their separate permitted locations on pari-mutuel races or games conducted at third-party facilities.10/ Florida statutes and the Division's rules require detailed reports from permitholders to the Division and other permitholders, including tables of wagers, pool data, and winnings.11/ These reports are generated by "totalisators." A totalisator is "the computer system used to accumulate wagers, record sales, calculate payoffs, and display wagering data on a display device that is located at a pari-mutuel facility."12/ The Division's Form DBPR-PMW-3570 requires host permitholders to report intertrack wagering "handle" by guest on a monthly basis. The host permitholders must sign and attest to the accuracy of the information submitted in the form. Also, Florida Administrative Code Rule 61D-7.023(2) requires generation of reports for each pool within each contest to be printed immediately after the official order of finish is declared. On March 9, 2012, the Division issued a letter to AmTote International ("AmTote"), a licensed totalisator company, and copied Jacksonville Greyhound Racing, notifying AmTote that Florida permitholders and the Division would need a breakdown of the handle of the Racetracks in order to pay appropriate purses, taxes, or other liabilities. It sent a similar letter to other totalisator companies. This was an effort to be accommodating and flexible. The letter concluded: "Please continue to provide handle information broken down by source, which is required by rule to all those in the state of Florida who have been users of that information in the past." The Racetracks rely upon AmTote to provide their totalisator services. Between March 2012 and March 2014, AmTote commingled the Racetracks' wagering data into a single "community," reporting all wagering as coming from the OPKC in order to reduce interface fees paid for the totalisator service. The guest track wagering data and reports exchanged with the other totalisator companies from the Racetracks show up on the AmTote settlement files as OPKC. The reports do not differentiate between wagers made at each of the Racetracks. Before March 1, 2012, AmTote segregated wagering data as coming from either JKC or OPKC. During the two years reported by the Racetracks as a single community, the Racetracks separately provided Florida host tracks a supplemental report breaking down the sources within the common community. The Racetracks provided these supplemental reports--via email or other means--to assist Florida host tracks with reporting requirements. They did not provide them simultaneously with the other reports and data. There were frequently errors that had to be identified and corrected. In an effort to be flexible and work with the Racetracks, the Division tolerated this method of reporting for two years. But it created problems for both the Division and for the other permitholders in the state. On February 13, 2014, the Division prepared and issued correspondence to AmTote, as well as the two other Florida totalisator companies, announcing that it intended to require proper reporting of the data required by rule, including reports of each permitholder. The letter states: This letter is to address the issue of proper and complete identification of each individual permitholder in totalisator reports. Rule 61D-7.024(1), Florida Administrative Code, requires all Florida pari-mutuel permitholders to use an electronically operated totalisator. Rule 61D-7.023(9), F.A.C. states in part, ". . . Each report shall include the permitholder's name . . .," and Rule 61D-7.024(4), F.A.C. states in part, ". . . reports shall be kept logically separate . . . ." Further, Rule 61D-7.023(1), F.A.C. states, "The totalisator licensee shall be responsible for the correctness of all tote produced mutual accounting reports. " In accordance with Florida Administrative Code, the division requires each permitholder to be properly and uniquely identified by totalisator reports provided to the division and to the permitholders. In addition, the totalisators are responsible for the correctness of all tote produced mutual accounting reports. Reports provided after February 28, 2014 must properly identify the Florida Permitholder in reports as both host and guest when applicable. Improper identification of permitholders will be considered a violation of the Florida Administrative Code. On March 11, 2014, AmTote began segregating wagering data from the Racetracks in compliance with the February 13, 2014, letter. The Racetracks will incur additional financial costs if AmTote ends the reporting of all wagering data as coming from OPKC for purposes of reports provided to other totalisator companies licensed in Florida and begins segregating their wagering data by individual permitholders. These costs stem from additional interface fees incurred outside the regulatory jurisdiction of Florida. The only evidence of these costs is the testimony of Matthew Kroetz, vice-president of Operations for Jacksonville Greyhound Racing. The testimony of Mr. Kroetz about the cost of the required change is confusing because he mingles assumed costs for a third closed track as if it were reactivated and operational. Bayard Raceways is that track. The Racetracks' parent company owns it. But the likelihood and timing of that reactivation is speculative. In addition, Bayard is not a party to this proceeding. Neither is the parent company. Mr. Kroetz' testimony establishes that the current cost for the two petitioners is a total of $1,500 per month. He projects that costs for reporting, as the letter requires, would be $4,500 per month for the two Petitioners and the track that may reopen in the future. That testimony is unrebutted and consistent with his testimony that the recurring fees for all three tracks would total over $50,000 annually. It is accepted as accurate. But the $3,000 increase from $1,500 to $4,500 per month is not due solely to the reporting requirement. It is also due to lumping in the non-active track. The evidence does not support including that track, the opening of which is speculative. The monthly fee for the two operating tracks is $1,500 divided by two or $750. Subtracting that, as the current cost for an existing track, from the $3,000 increase, lowers the estimated increase to $2,250. Dividing that by three gives the increased monthly cost per track, or $750 per track. This results in the projected annual cost increase for each of the Racetracks of $9,000. Although Mr. Kroetz testified in summary that the changes would result in an increased cost of "about a thousand dollars per month per facility," that testimony is not persuasive. It is inconsistent with the more detailed testimony relied upon above and would require the improbable and unsupported conclusion that the monthly increase would be more than the existing fees.
Findings Of Fact At all times relevant to these proceedings, the Respondents were licensed as real estate brokers in Florida. In March, 1979, a Ms. Stockton contacted Respondent Rappaport and proposed renting a small wood-frame house which he owned and was then using as a storage facility. Rappaport verbally agreed to rent the premises for nine months, giving Stockton an option to purchase at the end of that period. Monthly rental payments of $100, plus $75 in tenant repairs, were to constitute partial down payment on the purchase price of $25,000. However, at the conclusion of the nine month period in December, 1979, Ms. Stockton made a counter offer that would have required Rappaport to make substantial improvements or accept a reduced price of $20,000. Since Rappaport did not accept the counter offer, there was no valid contract. Around December, 1979, Respondent Rappaport became a 50 percent stock owner of Respondent Mike Novak Realty Corporation. Respondent Michael T. Novak retained 50 percent stock ownership in this corporation and, as part of the merger, acquired a 50 percent interest in certain properties previously owned solely by Rappaport. The residential parcel discussed above, along with an adjacent office building, were included in this transaction. On January 30, 1980, the Respondents contracted to sell the above described residence and office building to a group of investors for $175,000. The contract required that termite inspections and any fumigation would be provided by the sellers. The required termite inspections were provided, but the inspector furnished a certificate only on the office building since the wood-frame house was found to have termites. He reported this fact to Mike Novak Realty, but nothing was done to correct the problem prior to closing. The termite infestation was discovered by the purchasers after they had closed on the property. Respondent Rappaport was aware of the termite problem prior to closing since it had been called to his attention by the Stocktons in mid-1979. After being confronted by the purchaser subsequent to the closing, Respondents agreed to pay the fumigation costs which amounted to $300. They did not, however, reimburse the buyers for these expenses on demand, but did so only after this Administrative Complaint was filed. Although these omissions by Respondents leave much to be desired in terms of broker reliability, there was no evidence of intentional concealment of the termite infestation or willful withholding of the $300 fumigation payment. Rather, this negligence by Respondents resulted, at least partly, from the minimal interest shown by the contracting parties in the condition of the wood- frame house. Respondents had reached their valuation of this property virtually without consideration for the wood-frame house. The buyers were primarily interested in the office building and the land occupied by the house. They expressed their intention to tear down or move this house so they could develop the underlying land. Even though two members of the purchasing group had real estate experience and all were represented by counsel, none of them noticed the missing termite inspection report. Furthermore, none of the buyers had even entered the wood-frame house to determine its condition prior to closing.
Recommendation From the foregoing, it is RECOMMENDED that Petitioner enter a Final Order dismissing the charges contained in the Administrative Complaint. DONE and ENTERED this 23rd day of May, 1983, in Tallahassee, Florida. R. T. CARPENTER Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32301 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 23rd day of May, 1983. COPIES FURNISHED: Grover C. Freeman, Esquire 4600 West Cypress Avenue Suite 410 Tampa, Florida 33607 Peter J. Kelly, Esquire Post Office Box 3324 Tampa, Florida 33601 William M. Furlow, Esquire Department of Professional Regulation Post Office Box 1900 Orlando, Florida 32802 Fred Roche, Secretary Department of Professional Regulation 130 North Monroe Street Tallahassee, Florida 32301
