The Issue The issue for determination is whether Respondent committed the offenses set forth in the Order of Probable Cause issued June 1, 2007, and, if so, what action should be taken.
Findings Of Fact In the 2006 election, Mr. Lunkins was a candidate for the Florida Senate, District 32. On or about April 20, 2005, Mr. Lunkins filed a State of Florida Appointment of Campaign Treasurer and Designation of Campaign Depository for Candidates form (DS-DE-9), designating himself as his campaign treasurer. By letter dated April 26, 2005, and sent on the same date, to Mr. Lunkins from Kristi Reid Bronson, Chief, Bureau of Election Records, Division of Elections, Ms. Bronson provided Mr. Lunkins with a user identification number and initial password, which allowed him to access the Division of Elections’ electronic filing system. The letter from Ms. Bronson was sent to the address provided to the Division of Elections. Further, Ms. Bronson’s letter contained information about filing campaign treasurer reports. She advised Mr. Lunkins that all candidates filing their campaign treasurer’s reports with the Division of Elections were required to file the reports using the electronic filing system. Also, she advised him that Chapter 106, Florida Statutes, the 2005 Calendar of Reporting Dates, and the 2004 Candidate and Campaign Treasurer Handbook were available for printing on the Division of Elections' website. By letter dated July 12, 2006, and sent on the same date, from Ms. Bronson to Mr. Lunkins, she notified him, among other things, that he had failed to file his 2006 Q2 Campaign Treasurer’s Report, which was due on July 10, 2006. By a second letter dated August 30, 2006, and sent the same date by certified mail, from Ms. Bronson to Mr. Lunkins, she notified him, among other things, that he had failed to file his 2006 Q2 Campaign Treasurer’s Report, which was due on July 10, 2006. On September 1, 2006, Mr. Lunkins claimed and received Ms. Bronson’s certified letter dated August 30, 2006. Mr. Lunkins failed to file his 2006 Q2 Campaign Treasurer’s Report, which was due on July 10, 2006. Mr. Lunkins’ failure to file his 2006 Q2 Campaign Treasurer’s Report was willful.
The Issue Whether Petitioner is entitled to a consumer's certificate of exemption from sales tax as a "charitable institution" as that term is defined by Section 212.08(7)(o)2b., Florida Statutes.
Findings Of Fact Petitioner is a nonprofit organization incorporated under the laws of the State of Florida as a corporation. Petitioner has applied to Respondent for a certificate of exemption from sales and use tax based on its claim that it is a "charitable institution" within the meaning of, and pursuant to the provisions of, Section 212.08(7)(o)2.b., Florida Statutes. 2/ The Internal Revenue Service has determined that Petitioner is exempt from federal income tax under Section 501(a) of the Internal Revenue Code as an organization described in Section 501(c)(3). Edy Sanon, Petitioner's executive director, testified in general terms as to the services performed by Petitioner to persons of Haitian descent. Based on that general testimony, it cannot be determined with any degree of certainty the precise services performed by Petitioner. Mr. Sanon testified that his organization provides translation services and referral services that assist Haitian immigrants in adjusting to life in the United States, becoming employable, and obtaining services from various government agencies. Petitioner engages in fund raising and searches for governmental grants for a center where people can come for help. The extent of its resources expended on fund raising was not established. Mr. Sanon testified that Petitioner provides its services free of charge and that it served approximately 800 clients last year. Chapter 212, Florida Statutes, imposes a tax on sales, use and other transactions. Respondent is the agency of the State of Florida charged with administering Chapter 212, Florida Statutes, and its duties include the issuance of certificates of exemption from tax pursuant to Section 212.08(7)(o), Florida Statutes. Pursuant to its rule-making authority, Respondent has adopted Rule 12A-1.001, Florida Administrative Code, to implement the provisions of Section 212.08(7)(o), Florida Statutes. Although Petitioner has been recognized as a nonprofit organization by the Internal Revenue Service, Petitioner must receive a certificate of exemption from Respondent to be exempt from Florida's tax on sales, use, and other transactions imposed by Chapter 212, Florida Statutes. The provisions of Section 212.08(7)(o), Florida Statutes, and Rule 12A-1.001, Florida Administrative Code, provide the criteria for the exemption sought by Petitioner. Section 212.08(7)(o), Florida Statutes, provides, in pertinent part, an exemption from sales tax as follows: (o) Religious, charitable, scientific, educational, and veterans' institutions and organizations. There are exempt from the tax imposed by this chapter transactions involving: * * * b. Sales or leases to nonprofit religious, nonprofit charitable, nonprofit scientific, or nonprofit educational institutions when used in carrying on their customary nonprofit religious, nonprofit charitable, nonprofit scientific, or nonprofit educational activities . . . * * * The provisions of this section authorizing exemptions from tax shall be strictly defined, limited, and applied in each category as follows: * * * b. "Charitable institutions" means only nonprofit corporations qualified as nonprofit pursuant to s. 501(c)(3), Internal Revenue Code of 1954, as amended, and other nonprofit entities, the sole or primary function of which is to provide, or to raise funds for organizations which provide, one or more of the following services if a reasonable percentage of such service is provided free of charge, or at a substantially reduced cost, to persons, animals, or organizations that are unable to pay for such service: * * * (IV) Social welfare services including adoption placement, child care, community care for the elderly, and other social welfare services which clearly and substantially benefit a client population which is disadvantaged or suffers a hardship . . . 3/ Rule 12A-1.001(3)(g), Florida Administrative Code, implements the provisions of Section 212.08(7)(o), Florida Statutes, and provides, in pertinent part, as follows: (g)1. "Charitable institutions" means only nonprofit corporations qualified as nonprofit pursuant to s. 501(c)(3), United States Internal Revenue Code, 1954, as amended, and other nonprofit entities that meet the following requirements: the sole or primary function is providing a "qualified charitable service" as defined in this subsection; and a reasonable percentage of such service is provided free of charge, or at a substantially reduced cost, to persons, animals, or organizations that are unable to pay for such service. * * * 3.a. For the purpose of this subsection the following terms and phrases shall have the meaning ascribed to them except when the context clearly indicates a different meaning: I. "Persons unable to pay" means persons whose annual income is 150 percent or less of the current Federal Poverty Guidelines . . . * * * "Substantially reduced cost" means the normal charge, market price, or fair market value to a purchaser or recipient, diminished in an amount of considerable quantity. "Sole or primary function" means that a charitable institution, excluding hospitals, must establish and support its function as providing or raising funds for services as outlined in subparagraphs 1. and 2. above, by expending in excess of 50.0 percent of the charitable institution's operational expenditures towards "qualified charitable services", as defined in subparagraph 2.a. - g. within the charitable institution's most recent fiscal year. Petitioner established that it is a nonprofit organization. Petitioner did not present any financial data at the formal hearing. In the absence of that financial information, it cannot be found that Petitioner disburses more than fifty percent of its expenditures to provide or raise funds for a provider of a statutorily listed service. The absence of that information is fatal to Petitioner's application. 4/ The unchallenged testimony of Mr. Sanon was sufficient to establish for the purposes of this proceeding that Petitioner does not charge for its services. Petitioner did not establish at the formal hearing the ability of any of its client to pay a reasonable fee for the services provided by Petitioner. The general testimony of Mr. Sanon failed to establish that the translation, referral, and other services provided by Petitioner are "social welfare services" within the meaning of Section 212.08(7)(o)2.b., Florida Statutes. 5/
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent enter a final order that denies Petitioner's application for a certificate of exemption. DONE AND ENTERED this 1st day of December, 1998, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 Filed with the Clerk of the Division of Administrative Hearings this 1st day of December, 1998.
The Issue The issues presented for determination are whether Respondent violated Subsections 106.11(3) and 106.19(1)(d), Florida Statutes, as alleged in the Order of Probable Cause dated May 22, 2001, and the Statement of Findings dated April 3, 2001.
Recommendation It is recommended that the Florida Elections Commission enter a final order dismissing all charges against Petitioner, Bruce Grady. DONE AND ENTERED this 26th day of November, 2001, in Tallahassee, Leon County, Florida. JEFF B. CLARK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 26th day of November, 2001. COPIES FURNISHED: Mark Herron, Esquire Mark Herron, P.A. 215 South Monroe Street, Suite 701 Tallahassee, Florida 32301 Eric M. Lipman, Esquire Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050 Barbara M. Linthicum, Executive Director Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050 Patsy Rushing, Clerk Florida Elections Commission The Capitol, Room 2002 Tallahassee, Florida 32399-1050
The Issue Whether Respondent, Jean M. Hovey, willfully violated Subsection 106.143(1)(a), Florida Statutes (2008), as alleged in the Order of Probable Cause dated August 26, 2009, and, if so, what is the appropriate penalty.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing, the following Findings of Facts are made: Respondent was a candidate for Winter Springs, Florida, city commission in 2008. Respondent was a first-time candidate for public office. She evidenced her decision to enter the city commission race by qualifying on August 28, 2008, one day prior to the deadline to qualify. A component of qualifying is the candidate's assertion that they have read and understand the requirements of Chapter 106, Florida Statutes. As a result of her late filing, Respondent had only five or six weeks to actively campaign. Responding to the advice of volunteer advisors, on September 4, 2009, Respondent hired Denise Ryser to manage her campaign. Ms. Ryser had previously managed a successful city commission race and was managing two other Winter Springs city commission races. Ms. Ryser was qualified to manage a city commission campaign. Ms. Ryser's initial focus was to prepare a campaign mailer. It was important that the mailer be presented to the voters as quickly as possible. Respondent provided the biographical information for the mailer; Ms. Ryser did the graphics, layout, color selection, and the "marketing" of the mailer. Several layouts/mock-ups of the mailer were prepared by Ms. Ryser and submitted to Respondent for approval. Each layout/mock-up submitted to Respondent contained the statutorily-mandated disclaimer. Subsection 106.143(1)(a), Florida Statutes, requires that: Any political advertisement that is paid for by a candidate and that is published, displayed, or circulated prior to, or on the day of, any election must prominently state: "Political advertisement paid for and approved by (name of candidate), (party affiliation), for (office sought)." After Respondent finally approved what she believed to be the final layout/mock-up, Ms. Ryser, on September 19, 2008, electronically forwarded a layout/mock-up to a printer in Miami. Inexplicably, the layout/mock-up forwarded by Ms. Ryser did not contain the statutorily-mandated disclaimer. This failure was attributed to a transmission error. Because Ms. Ryser perceived a need for "handouts" to be distributed by Respondent at personal appearances, Ms. Ryser, on the same day, September 19, 2008, ordered 100 additional mailers from a local printer. These mailers contained the statutorily- mandated disclaimer. When the Miami printer returned the mailers to Ms. Ryser, without further examining the mailers, she took them directly to a "mail-house" in Winter Park, Florida, to be mailed to 11,000 registered Winter Springs, Florida, voters. They were mailed on October 2, 2008. Respondent did not receive a mailer, as she was not on the mailing list. Ms. Ryser received a mailer at her home on Saturday, October 3, 2008. It was not until Sunday, October 4, 2008, that she noticed the absence of the statutorily-mandated disclaimer. Ms. Ryser immediately called Michael Ertel, Seminole County, Florida, supervisor of elections, and advised him of the error. Mr. Ertel did not testify. However, the parties stipulated that he would have testified that he advised Ms. Ryser to remail the mailer with the proper disclaimer and destroy the remaining mailers without the disclaimer. On Monday, October 6, 2008, Ms. Ryser discarded the mailers in her possession. At Ms. Ryser's direction and paid for by her, the mail-house printed the appropriate disclaimer on the remaining 3,000 mailers in its possession and mailed them to voters. On Tuesday, October 7, 2008, Respondent attended a candidates' night at Highland's in Winter Springs, and mailers were available to the public at this event. Unrefuted testimony indicates that Respondent's mailers, without the statutorily- mandated disclaimer, were available to the public at this meeting. Respondent did not learn that the mailers did not have the statutorily-mandated disclaimer until October 8, 2008, when she and her volunteer campaign advisors confronted Ms. Ryser about the error. Ms. Ryser acknowledged that the failure to include the statutorily-mandated disclaimer was her error and that Respondent was unaware of the error until October 8, 2008.
The Issue Whether the Respondent committed the violation alleged in the Order of Probable Cause entered November 18, 2010, and, if so, the penalty that should be imposed.
Findings Of Fact Because Mr. Horan failed to respond to the Petitioner's First Request for Admissions, the matters of which admissions were requested are deemed conclusively established for purposes of this administrative proceeding. See Fla. R. Civ. P. 1.370. The Petitioner's First Request for Admissions is attached to this Final Order, and the matters of which admissions were requested are adopted herein as findings of fact.
The Issue The issue is whether Respondent, as campaign treasurer, signed two checks drawn on the candidate's primary campaign account when such account lacked sufficient funds to cover the checks and, if so, what penalty should be imposed.
Findings Of Fact Respondent has been a certified public accountant since 1996. Since 2000, Respondent has been employed with a Hollywood, Florida accounting firm, where he is now a partner. Respondent has been licensed since 1996 to practice accounting in Florida. Sometime prior to June 2005, a friend of Respondent told him that a candidate for office in Miami needed help with his campaign. Respondent agreed to meet with the candidate, Richard Dunn, who was running for the District 5 seat on the City of Miami Commission. At the meeting, Respondent became acquainted with Mr. Dunn, who is a minister and an experienced candidate for public office. During the meeting, Mr. Dunn asked Respondent to serve as his campaign treasurer. Mr. Dunn explained that his main duty would be to maintain the campaign checkbook and make deposits of campaign contributions. Respondent also understood that he would have to attend some fundraising events. Respondent had never previously served as a campaign treasurer, but the parties agreed upon a satisfactory payment, and Respondent assumed his duties as campaign treasurer in July 2005. When Respondent started as treasurer, Mr. Dunn's campaign staff gave him checkbooks and deposit slips. At no time did Respondent ever investigate whether the election laws imposed upon him any special requirements. No one on Mr. Dunn's campaign staff gave Respondent a copy of the explanatory campaign materials provided each campaign by the Clerk's Office of the City of Miami. These materials include all relevant campaign finance laws. Respondent's lack of familiarity with the duties of a campaign treasurer emerged early. He learned that he had to file campaign treasurer reports when campaign staff informed him of this responsibility. At the same time, Respondent learned that campaign staff, including Mr. Dunn, were not careful in the management of the campaign's finances. In trying to prepare his first report, Respondent had problems obtaining all of the necessary information, such as all of the checks that had been written. Despite his lack of familiarity with campaign finance laws, Respondent knew that he could not write a check if an account had insufficient funds. Respondent assumed (wrongly, as noted below in the Conclusions of Law) that he could sign a check, even if the account lacked funds to cover it, as long as sufficient funds would be deposited before the check was presented for payment at the payor's bank. Respondent was not the first campaign treasurer for this campaign. However, the existence of a prior treasurer did not make it any easier for Respondent to assemble the necessary documents, such as copies of bank statements, so that he could do his job. Also, 30-45 days after taking over as treasurer, Respondent learned that the campaign maintained at least one other checking account. In short order, Respondent learned that the bank mailed the statements to Mr. Dunn, not the treasurer. Respondent suggested to Mr. Dunn that the bank issue a copy to Respondent. Mr. Dunn agreed with this proposal, but the bank, Wachovia Bank, said that it could not do so. Respondent never suggested to Mr. Dunn that he direct the bank to mail the statements to Respondent, who would then send a copy to Mr. Dunn. Quickly, Respondent also learned that Mr. Dunn was writing most of the checks, including counter checks. Respondent repeatedly impressed upon Mr. Dunn the importance of keeping Respondent informed about these checks, but Mr. Dunn and his campaign staff did not routinely do so. After failing to convince Mr. Dunn to restrict check- issuing privileges to Respondent, Respondent prepared a check authorization form that Mr. Dunn and his campaign staff could use each time that they issued checks. However, despite all of these efforts, consisting of five to ten telephone calls and meetings, Respondent never succeeded in obtaining Mr. Dunn's cooperation for very long. On the 10-15 occasions that Respondent wrote and signed campaign checks, he often, but not invariably, contacted the bank and asked it to fax transaction reports or partial statements to cover a specific date range. On those 10-15 occasions, Respondent often, but not invariably, called Mr. Dunn for confirmation of deposits before writing. If Respondent ever attempted to obtain this information by online banking, he never so indicated during the hearing. Although Respondent did something to update himself on current activity in the checking account each time that he had to write and sign a check, his information was necessarily incomplete. Overall, Respondent admits that he never was able to get the accounting problem within the campaign under control. Although Respondent wrote and signed relatively few checks, he wrote and signed the two checks at issue in this case many months after discovering the problems described above. On October 27, 2005, Respondent signed a check to The Miami Times for $3625.63 and drawn on the campaign account. Account balances were $542.34, $792.34, and $1892.34 on October 26, 27, and 28, 2005, respectively. Clearly, Respondent signed this check at a time that the account lacked sufficient funds to cover it. Respondent delivered the $3625.63 check to a member of the Dunn campaign and instructed her to ensure that the account had sufficient money before giving it to the payee. He added that she should deliver the check only to Mr. Dunn. On the same day, Mr. Dunn signed a check drawn on the same account in the amount of $500 and payable to the prior campaign treasurer, Johnny Studstill. Although the October bank records reveal no insufficient funds fees, the November bank records reveal seven instances of insufficient funds: November 10, 21, 22, and 30 (four times). Respondent explained that the bank imposed these fees because deposits had not yet cleared, but the imposition of these fees was sufficient to alert Respondent to mounting problems, and two of these instances had arisen prior to the date on which he signed the November 22 check, which is the second check at issue in this case. On November 22, 2005, Respondent signed a check to radio station WMBM for $2000 and drawn on the campaign account. Account balances were $694.25, $2909.25, and $6091.84, on November 21, 22, and 23, 2005, respectively. The relevant day is November 22, so it would appear that the bank balance was sufficient to cover this check. However, on the same day, Respondent signed checks in the amounts of $1065 and $1492.65 and payable to ASAP Mailing Service and Dodd Printing, although the latter check was marked void shortly after Respondent signed it. Thus, the total of the $2000 check to WMBM and $1065 check to ASAP (counsel for Petitioner conceding at the hearing that a voided check should not count) exceeded the account balance of $2909.25. On the same day, Mr. Dunn signed three checks drawn on the same account. One was in the amount of $850 and payable to radio station WEDR, one was in the amount of $185 and payable to Isaiah Walker, and the third was in the amount of $2000 and payable to radio station WHQT. About three weeks prior to the end of the campaign, Respondent realized that the situation was unworkable, even though his administrative assistant at the accounting firm was devoting 20 hours weekly to campaign-related bookkeeping work. Respondent remained with the campaign only to avoid the negative appearance that would be created by his leaving his post in the days running up to the election. Respondent asked Mr. Dunn not to leave him "high and dry," but Respondent was never paid for his services to the campaign, beyond a single $1000 check to cover costs. When signing the October 27 check, Respondent knew that, due to the campaign's poor financial management practices, he lacked even the information to determine whether the account balance would be sufficient when the check was presented to Wachovia. He did not consider whether the account balance was sufficient when he signed the check because he was not aware of this requirement of law. Respondent's violation of law was willful when signing the October 27 check. By this time, Respondent had been serving as campaign treasurer for nearly four months. He was increasingly aware that he did not have the full cooperation of the candidate. Although he did not know the relevant requirement of law, Respondent recklessly disregarded this requirement because he had never made any effort--let alone a reasonable effort--to inform himself of this legal requirement. The circumstances likewise establish recklessness in the signing of the November 22 check. Factually, Respondent's acts and omissions on November 22 were less defensible because the account had twice incurred insufficient-funds fees in the two weeks preceding the signing of the November 22 check, and he had another month to see that Mr. Dunn and the campaign staff would not agree to reasonable financial-management controls. Legally, Respondent's ongoing failure to inform himself of the applicable legal requirements imposed upon him as a campaign treasurer remained entirely unreasonable, with the passing of another month, the incurring of insufficient-funds fees, and the repeated confirming that Respondent would not have any significant cooperation from Mr. Dunn as his campaign approached its completion. The key factual determination in this case is that Respondent willfully violated the legal requirement that sufficient funds be in the account when the checks were signed. Respondent was understandably unfamiliar with this requirement, which is different from the more common requirement, with which he was familiar, that sufficient funds must be available when a check is presented to the issuing bank for payment. The requisite finding of Respondent's recklessness in failing to exercise any apparent effort to inform himself of this requirement of law is facilitated by the manner in which he handled the more common responsibilities of bookkeeping. Respondent proceeded recklessly in this area, as well. Respondent knew that the probability of bounced checks elevated considerably, the longer that more than one person wrote checks and the campaign staff was so lax in getting him the information on their activity in the account. Reckless disregard for the proper discharge of basic bookkeeping responsibilities is evidence of Respondent's overall state of mind at the relevant time. If Respondent did not initially realize his ignorance of campaign finance laws, he had to understand the limits of his knowledge when campaign staff told him he had to file campaign treasurer reports. By not informing himself of Section 106.11(4), Florida Statutes, by the time that he signed the two checks that are the subject of this case, Respondent displayed reckless disregard of his legal obligations. Under the law set forth below, Respondent's reckless disregard of the law constitutes a willful violation of the law. Here, Respondent, an accountant, has wholly disregarded Section 106.11(4), Florida Statutes, without making any reasonable inquiry into the limitations on check signing in a campaign.
Recommendation It is RECOMMENDED that the Florida Elections Commission enter a final order finding Respondent guilty of two counts of violating Section 106.11(4), Florida Statutes, and imposing a civil penalty of $500. DONE AND ENTERED this 21st day of August, 2007, in Tallahassee, Leon County, Florida. S ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 21st day of August, 2007. COPIES FURNISHED: Barbara M. Linthicum, Executive Director Florida Elections Commission The Collins Building, Suite 224 107 West Gaines Street Tallahassee, Florida 32399-1050 Patsy Rushing, Clerk Florida Elections Commission The Collins Building, Suite 224 107 West Gaines Street Tallahassee, Florida 32399-1050 Eric M. Lipman, Esquire Florida Elections Commission Collins Building, Suite 224 107 West Gaines Street Tallahassee, Florida 32399-1050 Mark Herron, Esquire Messer, Caparello & Self, P.A. 2618 Centennial Place Post Office Box 15579 Tallahassee, Florida 32317
The Issue Whether Respondent, James Jennings, violated Subsections 106.021(3), 106.07(5), or 106.19(1)(b), Florida Statutes (2002), as alleged in the Amended Order of Probable Cause dated February 20, 2004, and, if so, what is the appropriate penalty.
Findings Of Fact Based on the oral and documentary evidence presented at the final hearing, the following findings of facts are made: Respondent has taught in the public schools of Lee County, Florida, for 31 years. He has a bachelor of science degree. Respondent was a first-time candidate for public office, although he had limited political experience as a precinct committeeman and president of the Sanibel-Captiva Republican Club. He had not been actively engaged in any previous campaign as a campaign treasurer or deputy. Incidental to becoming a candidate he met with appropriate municipal and county election officials and received a campaign handbook which included the following: A Compilation of The Election Laws of the State of Florida (2001), published by the Department of State; 2002 Handbook for Candidates, published by the Department of State; 2002 Handbook for Treasurers, published by the Department of State; Chapter 106, Florida Statutes, published by the Department of State; various Sanibel municipal ordinances related to city elections; a calendar listing important dates for filing campaign documents. Respondent signed a Statement of Candidate which advised that he had received a copy of Chapter 106, Florida Statutes, and that he had read and understood same. It is apparent that Respondent did not understand the Florida Election Law as embodied in Chapter 106, Florida Statutes. Respondent designated a campaign treasurer and a deputy campaign treasurer. Notwithstanding the fact that Subsection 106.021(3), Florida Statutes (2002), clearly states that no campaign expenditure shall be made except through the duly- appointed campaign treasurer, Respondent personally signed 30 campaign checks. In fact, he signed all campaign checks with the exception of one check. On that particular check he directed his wife, the deputy campaign treasurer, who was statutorily authorized to sign the campaign check as deputy campaign treasurer, to sign his name. Inexplicably, Respondent believed that he, personally, was obligated to sign all campaign checks because he was the candidate. Respondent prepared his own Campaign Treasurer's Reports. It is suggested that he received some limited assistance from his wife. On February 28, 2003, Respondent was required to file a Campaign Treasurer's Report for the reporting period of February 8, 2003, through February 27, 2003. Two previous Campaign Treasurer's Reports for periods January 1, 2003, through January 24, 2003, and January 25, 2003, through February 7, 2003, had reporting dates which were seven days after the reporting period ended (January 31, 2003, and February 14, 2003). Respondent believed that the Campaign Treasurer's Report due on February 28, 2003, covered the period from February 8, 2003, through February 21, 2003. The campaign calendar presented by a city elections official clearly indicated the accurate reporting period. On February 28, 2003, immediately prior to filing the subject Campaign Treasurer's Report, Respondent discovered that the report should have included activity through February 27, 2003. He did not include appropriate information for February 21, 2003, through February 27, 2003, because he did not have time to return to his home, obtain the additional information, make appropriate inclusions, and file the report before 5:00 p.m. at the Sanibel City Hall. He merely changed the end of the reporting period on the Campaign Treasurer's Report from February 21, 2003, to February 27, 2003, knowing that it was inaccurate. The Campaign Treasurer's Report failed to include 24 contributions that should have been reported. During the telephone conversation in which he discovered the actual reporting period, he testified that he was advised by a Lee County elections official to file the report even though it was inaccurate, and then immediately file an accurate amended report. This is not credible. February 28, 2003, was a Friday. Respondent filed an Amended Campaign Treasurer's Report on Wednesday, March 5, 2003. The election was on Tuesday, March 4, 2003. Unfortunately, the Amended Campaign Treasurer's Report was not accurate. On June 2, 2003, Respondent filed a Second Amended Campaign Treasurer's Report, which included seven previously unreported contributions. This particular inaccuracy was attributed to the fact that two pages in the spiral notebook used to record contributions had stuck together for some unknown reason concealing these seven contributions. Petitioner failed to present evidence in testimony or stipulated facts as to the amount of unreported contributions. Respondent acknowledged his failure to report 24 contributions, but not the amount of each contribution or of a total amount of unreported contributions. While the orders of probable cause contain specific reference to the amount of each unreported contribution, this is not evidence. It may be possible to sift through the Campaign Treasurer's Reports and estimate the unreported amounts by comparing each report. An examination of the various Campaign Treasurer's Reports suggests that obtaining an accurate figure would be problematic and not exact. I find that there is no basis for an administrative fine predicated on the amount of unreported contributions. Respondent's attempts at campaign bookkeeping mirrored his understanding of the election laws. He, at first, attempted to keep contributions and expenditures in a checkbook register. When this proved inadequate, he started recording contributions and expenditures in a spiral notebook and on lined paper. These records were received into evidence. After a cursory examination of these documents, it is easy to understand why there was confusion. Respondent's campaign bookkeeping lacked basic organization. There does not appear to be any ulterior motive for Respondent's glaring errors, in particular his lack of basic understanding as to who should sign campaign checks. No one was deceived by the candidate's signing his name to the campaign checks. Equally as baffling and disappointing is his failure to understand the reporting periods and his response to his discovery of the error in the time covered by the reporting period in question. While it is argued that the voting public is deceived by Respondent's failure to disclose contributions, it is unlikely that any voters were waiting to examine the Campaign Treasurer's Report on the Monday before a Tuesday election. Clearly, Respondent did not comply with Subsection 106.021(3), Florida Statutes (2002), when he signed 30 campaign checks. This failure is obviated by granting the motion to dismiss the counts related to this violation. He also certified the correctness of the Campaign Treasurer's Report for the February 8, 2003, through February 27, 2003, reporting period knowing that the report was inaccurate and did not accurately reflect contributions. The March 5, 2003, Amended Campaign Treasurer's Report was similarly inaccurate. The real issue regarding Respondent's filing inaccurate Campaign Treasurer's Reports is whether or not these activities were "willful" as defined by Section 106.37, Florida Statutes (2002). Notwithstanding his written assertion that he understood the Florida Election Law, he did not. This is demonstrated by the fact that he clearly did not understand the law regarding who could sign campaign checks. The fact that he directed his wife to sign his name to a campaign check when she was a deputy campaign treasurer and an statutorily authorized signer, demonstrates that he just did not understand the law. Signing a Campaign Treasurer's Report, knowing it did not accurately reflect required reportable activity, clearly violates the law, and cannot be attributed to misunderstanding the law. Even if it is believed that he was advised to file an inaccurate report and file an immediate amended report, which is not credible, Respondent knowingly violated the law. He filed an inaccurate report and certified that it was true and correct when it was not. He should have waited until the following Monday, filed an accurate report, and suffered the fine and potential attendant political repercussions. The Amended Campaign Treasurer's Report filed March 5, 2003, failed to report seven campaign contributions that were ultimately reported on the Second Amended Campaign Treasurer's Report filed on June 2, 2003; this inaccuracy was not done knowingly; however, it does reflect reckless disregard for the law. Respondent's excuse that the pages were stuck together by fruit juice is unacceptable. Respondent did an inexcusably sophomoric job in his campaign record keeping; this failure as a record keeper rises to the level of recklessly filing an inaccurate Campaign Treasurer's Report. Respondent's Statement of Financial Interests (CE Form 1) for the 2002 calendar year reflects an annual income of $51,279, from the Lee County School Board, joint-residential home ownership, modest tax sheltered annuities, and typical debt. This is the only financial information presented. In addition, Respondent has no previous history of involvement with Petitioner and was fully cooperative with the investigation.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Respondent be found to have violated Subsections 106.07(5) and 106.19(1)(b), Florida Statutes (2002), and fined $3,900. DONE AND ENTERED this 24th day of September, 2004, in Tallahassee, Leon County, Florida. S JEFF B. CLARK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 24th day of September, 2004.
The Issue Whether Petitioner, as a candidate for the Leon County Commission, District 1, in the 1998 elections, willfully violated Subsection 106.07(5), Florida Statutes, which prohibits a candidate from certifying to the correctness of a campaign treasurer's report that is incorrect, false or incomplete, on 13 separate occasions; and Subsection 106.11(3), Florida Statutes, which prohibits a candidate from authorizing any expenses from the primary campaign account without sufficient funds on deposit in the primary campaign account to pay the full amount of the authorized expenses, to honor all outstanding checks, and to pay all previously authorized but unpaid expenses, on five separate occasions. Whether Petitioner, as a candidate for the Leon County Commission, District 1, in the 1998 elections, knowingly and willfully violated Subsection 106.19(1)(a), Florida Statutes, which prohibits a person from accepting a contribution in excess of $500 for each election, on one occasion; Subsection 106.19(1)(b), Florida Statutes, which prohibits a person or organization from failing to report a contribution required to be reported by Chapter 106, Florida Statutes, on 53 separate occasions; Subsection 106.19(1)(c), Florida Statutes, which prohibits a person or organization from falsely reporting or failing to report information required by Chapter 106, Florida Statutes, on 130 separate occasions; and Subsection 106.19(1)(d), Florida Statutes, which prohibits a person or organization from making or authorizing any expenditure prohibited by Chapter 106, Florida Statutes, on five separate occasions; and, if so, the appropriate penalty.
Findings Of Fact Based on the testimony, documentary evidence, entire record of this proceeding, the following Findings of Fact are made: At the time of the alleged violations, Petitioner was a candidate for re-election to the office for the Leon County Commission, District 1, for the general election in November 1998. Respondent had won the primary, run-off and general election in 1996. He had been a candidate for election to the office of Leon County Superintendent of Schools in 1992. Petitioner has a Bachelor of Arts degree from Howard University (1981), a Doctorate of Jurisprudence from Howard University (1984), and has done advanced studies in Theology and Ethics at Boston University School of Theology. He has been employed as a Legal Assistant and Training Specialist by the State of Florida. In addition, he has served as a Staff Assistant to a United States Senator and a Special Assistant to a Governor of Florida. He serves as an adjunct professor at a local university. Prior to the alleged violations, Petitioner signed a statement indicating that he had a copy of Chapter 106, Florida Statutes, and that he had read and understood same. Petitioner is a highly educated, sophisticated individual and an experienced candidate. The charging document in this case is the Order Of Probable Cause, which set out in unnumbered paragraphs, each statutory provision that Petitioner allegedly violated and the number of times of each alleged statutory violation. Attached to the Order of Probable Cause, and incorporated in the Order of Probable Cause by reference, is a Statement of Findings which lists with specificity each alleged violation. Specifically, it alleged: Probable cause to believe that the Respondent[²] violated Section 106.07(5), Florida Statutes, prohibiting a candidate from certifying to the correctness of a campaign treasurer's report that is incorrect, false, or incomplete, on 13 occasions; Probable cause to believe that the Respondent violated Section 106.11(3), Florida Statutes, prohibiting a candidate from authorizing any expenses from the primary campaign account without sufficient funds on deposit in the campaign account to pay the full amount of the authorized expenses, to honor all outstanding checks, and to pay all previously authorized but unpaid expenses, on six occasions; Probable cause to believe that the Respondent violated Section 106.19(1)(a), Florida Statutes, prohibiting a person or organization from accepting a contribution in excess of $500 for each election, on one occasion; Probable cause to believe that the Respondent violated Section 106.19(1)(b), Florida Statutes, failure of a person or organization to report a contribution required to be reported by this chapter, on 56 occasions; Probable cause to believe that the Respondent violated Section 106.19(1)(c), Florida Statutes, prohibiting a person or organization from falsely reporting or failing to report information required by this [sic], on 131 occasions. Probable cause to believe that the Respondent violated Section 106.19(1)(d), Florida Statutes, prohibiting a person or organization from making or authorizing any expenditure prohibited by this chapter, on seven occasions. Attached to the Order of Probable Cause, and incorporated in the Order of Probable Cause by reference, is a Statement of Findings which lists with specificity each alleged violation. As it relates to the 13 alleged violations of Subsection 106.07(5), Florida Statutes, paragraph 17 of the Statement of Findings lists each of the 13 Campaign Treasurer's Reports and each alleged unreported or incorrectly reported campaign contribution or expenditure. As it relates to the six alleged violations of Subsection 106.11(3), Florida Statutes, paragraphs 19-26 list each check returned for non-sufficient funds and other relevant information to the alleged violations. As it relates to the alleged violation of Subsection 106.19(1)(a), Florida Statutes, it is discussed with specificity in paragraph 34 of the Statement of Findings. As it relates to the 56 alleged violations of Subsection 106.19(1)(b), Florida Statutes, paragraphs 17 and 36 of the Statement of Findings specifically list each of the unreported contributions. As it relates to the 131 alleged violations of Subsection 106.19(1)(c), Florida Statutes, paragraphs 17, 38 and 39 of the Statement of Findings specifically list the 131 unreported or incorrectly reported expenditures. As it relates to the seven alleged violations of Subsection 106.19(1)(d), Florida Statutes, each of the prohibited expenditures is discussed with specificity in paragraphs 19-26 and 41 of the Statement of Findings. In his Petition for Formal Administrative Hearing, Petitioner "disputes issues of material fact" listed in paragraphs 3-6, 8-10, 13-20, 22-28, 30, and 33-43 of the Statement of Findings which is incorporated by reference into the Order Finding Probable Cause. In so doing, Petitioner specifically delineates his denial of each of the specifically alleged violations incorporated in the Order of Probable Cause by the Statement of Findings and demonstrates his awareness of the specific number of alleged violations and that the Commission intended to impose a fine for each violation. On June 17, 1996, Petitioner opened a campaign account at the Florida A & M University Credit Union which was given the account number 9174. This account was opened for Petitioner's 1996 campaign. The only bank signature card on file for the campaign account is the original card dated June 17, 1996. It designates two signatories: William Proctor and Fredrick T. Smith, campaign treasurer. Although account 9174 was inactive after the end of the 1996 campaign, it was activated for the 1998 campaign. On May 19, 1997, on opening his re-election campaign, Petitioner filed form DS-DE 9 designating himself Campaign Treasurer and the Florida A & M University Credit Union as campaign depository. On January 12, 1998, he filed a second form DS-DE 9 designating Thomas Rollins as Campaign Treasurer. None of the campaign checks or deposit slips offered into evidence were signed by Tom Rollins. An examination of records of the campaign account records produced by representatives of the Florida A & M University Credit Union indicate that Petitioner personally handled essentially all campaign banking activities. In his sworn responses to inquiries directed to unreported transfers of funds from the campaign account to Petitioner's personal accounts, unreported cash received by Petitioner at the time he deposited checks payable to the campaign account, cash withdrawals, unreported campaign contributions, and other financial irregularities, Petitioner typically gave the following answer: My campaign staff was instructed to record all expenditures [or contributions ] for reporting purposes. However, this expenditure was not reported because the campaign staff included inexperienced, non- professional clerical and bookkeeping personnel who did not always follow instructions to record the contributions and expenditures for reporting purposes. In addition, the campaign had a high turnover of staff, which further complicated efforts to insure that staff properly followed instructions. The Florida A & M University Credit Union will, at any time during business hours, print-out the last 30 days' account activity for a $3.00 fee. This allows an account holder to keep track of deposits, paid checks, issued checks that have not yet been paid, etc. Campaign account records show that this was done in August 1998. On July 27, 1998, prior to the first primary election, a $500 transfer was made from the account of William Proctor, Sr. and Patricia Proctor, account number 5016, to Petitioner's campaign account. This transfer is not reported in the campaign treasurer's report. Petitioner's campaign account records indicate that a transfer of $1,000 was made to Petitioner's campaign account from the account of William Proctor, Sr., and Patricia Proctor, account number 5016, which was maintained at the Florida A & M University Credit Union, on October 12, 1998, after the first primary and prior to the general election. This transfer is not reported in the campaign treasurer's report. In addition to the $1,500 in unreported contributions that were transferred from an individual account within the Florida A & M University Credit Union mentioned in paragraphs 17 and 18, an examination of the campaign account records reveals an additional $4,900 in unreported contributions was transferred into the campaign account from another account maintained by Petitioner within the Florida A & M University Credit Union. Petitioner's campaign account records indicated that the following 53 contributions totaling $8,075 were received by the campaign but were not reported in the campaign treasurer's reports: DATE CONTRIBUTOR AMOUNT 7-11-97 1996 Bill Proctor Campaign, Account No. 5016 $345.00 10-6-97 Eight Star Land Company $50.00 10-6-97 A. L. Buford, Jr. $50.00 10-9-97 Lewis Buford $100.00 10-19-97 Barbara Rouse $25.00 10-23-97 Charles Lockhart $150.00 10-28-97 Dr. Clinitia Ford $50.00 12-19-97 R & R Corporate Systems $200.00 2-10-98 Rudolf Maloy $100.00 4-13-98 Mitchell Asphalt $450.00 4-14-98 Hannah Plumbing $100.00 4-14-98 Suber & Weaver Equipment Repair $50.00 4-16-98 Tallahassee Mack Sales $250.00 4-16-98 Capital City Lawn Care $100.00 4-22-98 Eli Roberts & Sons, Inc. $100.00 4-27-98 Fort Knox Center $250.00 4-30-98 McKenzie Tank Lines $150.00 5-7-98 Gilbert Brown $50.00 6-5-98 Jimmy R. Jones Construction $250.00 7-17-98 Walter T. Mathis $100.00 7-20-98 Ron and/or Wanda Brafford $125.00 7-24-98 William and/or Deborah Grudice $100.00 7-27-98 Transfer from Patricia Proctor Account No. 1912 $500.00 7-27-98 Transfer from Patricia Proctor Account $400.00 7-27-98 No. 1912 Transfer from William Proctor Account $500.00 7-28-98 No. 5016 Jessie Dennis $100.00 7-29-98 Mary Middlebrooks $300.00 8-1-98 John and/or Phyllis Green $100.00 8-6-98 James H. Tookes $100.00 8-6-98 Charles Lockhart $100.00 8-7-98 Angela McNair $15.00 8-8-98 Marion Camps $100.00 8-9-98 Estate of Reginal Settles-Yolanda Foutz $100.00 8-11-98 Settles Ruby Seymour Bass $100.00 8-12-98 Martin and/or Susan Proctor $100.00 8-13-98 Cherry Bluff $200.00 8-13-98 Realtors PAC of Florida $500.00 8-18-98 Alfreda Blackshear $100.00 8-19-98 Davis Insurance Agency $25.00 8-19-98 John Haughabrook $50.00 8-19-98 Brown's Paint and Body Shop $100.00 8-20-98 Winnie Davis $100.00 8-24-98 Limm-Ann Griffin $50.00 9-4-98 Charles A. Francis $100.00 9-22-98 Allan Franklin $50.00 9-23-98 Marie Roy $50.00 9-24-98 Mitchell Asphalt $500.00 10-8-98 Marcus Robinson $25.00 10-9-98 Michael Moore $150.00 10-17-98 Sharon Durham $15.00 10-27-98 Catherine Gretsch $50.00 10-27-98 Catherine Gretsch $50.00 11-1-98 Rev. Jaycee Oliver $300.00 Petitioner's campaign account records indicated that the following 35 expenditures totaling $11,149.11 were made by campaign check but were not reported in the campaign treasurer's reports: DATE PAYEE AMOUNT 7-24-98 Lamar Advertising (Check No. 1003) $3,930.00 7-24-98 Sears (Check No. 1004) $26.92 8-5-98 Bill Doolin (Check No. 1003) $25.00 8-15-98 Petrandis Realty (Check No. 1004) $700.00 8-6-98 Morrison's (Check No. 1007) $12.38 8-12-98 Sprint (Check No. 514) $280.00 8-18-98 Bethel Family (Check No. 1012) $30.25 8-21-98 Feron Jones (Check No. 1030) $100.00 8-26-98 Gallery Graphics (Check No. 1076) $350.00 8-18-98 Payee Illegible (Check No. 516) $401.25 8-29-98 Jumbo Sports (Check No. 1077) $121.79 8-29-98 Knights of Pythias (Check No. 1078) $85.00 9-2-98 Sprint (Check No. 520) $269.78 9-2-98 Sprint (Check No. 521) $30.00 9-23-98 Zakiya Williams (Check No. 1079) $300.00 9-23-98 Arthur Gaines (Check No. 1080) $50.00 9-27-98 Angelo's Seafood (Check No. 1102) $68.81 9-28-98 Books-A-Million (Check No. 1103) $29.10 9-28-98 Morrison's (Check No. 1093) $10.93 10-2-98 Zakiya Williams (Check No. 1105) $150.00 10-7-98 All-World (Check No. 1106) $565.00 10-8-98 Comcast (Check No. 1107) $350.00 10-8-98 Comcast (Check No. 1108) $2,023.00 10-9-98 Danny Harris (Check No. 1081) $300.00 10-14-98 CUP, Inc. (Check No. 1109) $25.00 10-20-98 Ada Ibraahim (Check No. 1114) $70.00 10-2-98 Zakiya Williams (Check No. 1086) $125.00 10-26-98 Olive Garden (Check No. 1129) $13.67 10-27-98 Morrison's (Check No. 1091) $12.10 11-5-98 Aaron Rental (Check No. 1093) $310.92 11-5-98 Sprint (Check No. 1094) $245.80 11-9-98 Morrison's (Check No. 1115) $22.26 11-17-98 Ming-Tree (Check No. 1095) $20.80 11-24-98 Gene Sutton (Check No. 1116) $75.00 11-28-98 Soft-Touch (Check No. 1098) $20.00 Petitioner's campaign account records indicated that 56 cash withdrawals were made from the campaign account totaling $20,070.10. None of these cash withdrawals were listed on the campaign treasurer's reports. Sixteen "official checks" (i.e., guaranteed payment checks paid for by withdrawals from the campaign account for which his campaign account paid the amount of the check plus a fee of $2 per check, similar to a cashier's check issued by a bank), totaling $9,000.10 were issued by the Florida A & M University Credit Union, and apparently used to pay campaign debts. None of these official checks were reported in the campaign treasurer's reports. A listing of these "official checks" follows: DATE PAYEE AMOUNT 4-21-98 Eugene Stanton (Check No. 144650) $300.00 4-21-98 Ricky Coring (Check No. 144716) $1,750.00 6-28-98 Lamar Advertising $500.00 7-1-98 Gene Sutton (Check No. 145837) $100.00 7-1-98 Lamar Advertising (Check No. 145843) $530.00 7-1-98 Rugenia Speight (Check No. 145844) $200.00 7-7-98 Lamar Advertising (Check No. 146000) $130.00 7-20-98 Augustus Colston (Check No. 146159) $600.00 9-1-98 The Links, Inc. (Check No. 146837) $150.00 9-1-98 Aaron Roberts (Check No. 146838) $675.10 9-30-98 WHBX Radio (Check No. 147256) $1,700.00 10-1-98 M. Feron Jones (Check No. 147305) $210.00 10-1-98 WHBX Radio (Check No. 147306) $70.00 10-14-98 Zakiya Williams (Check No. 147507) $150.00 10-16-98 Zakiya Williams (Check No. 147528) $350.00 11-4-98 Petrandis Realty (Check No. 147835) $1,585.00 Although the evidence is inconclusive, it appears that all or most of the "official checks" were the result of cash withdrawals from the campaign account. Assuming that to be the case, approximately $11,000 in cash withdrawals remain unaccounted for. In connection with making 12 deposits to the campaign account, cash was deducted from each deposit. The amount of cash received totaled $1,460. The use of this cash was not shown in the campaign treasurer's reports. Four transfers totaling $2,900 were made from the campaign account to accounts numbered 9120-2 and 6038-2 which are Petitioner's personal accounts. These transfers were not listed in the campaign treasurer's reports. The records of Petitioner's campaign account indicate that the following checks in the total amount of $4,132.93 were presented and returned for insufficient funds: CHECK NO. PAYEE AMOUNT OF CHECK 1002 Unknown $319.93 1016 WHBX $1,170.00 1017 WHBX $600.00 1108 Comcast $2,023.00 1097 Unknown $20.00 An examination of campaign checking account records reveal that fees were charged by the campaign depository for returned checks and other special banking services, totaling $165.00, which were not listed in the campaign treasurer's reports. In sum, 123 expenditures (excluding bank fees), amounting to $44,579.31 were not listed in Petitioner's campaign treasurer's reports during the 1998 campaign. On March 2, 1999, Petitioner filed an amended campaign treasurer's report for the period October 10, 1998 to October 29, 1998, indicating that he had loaned his campaign $8,000 on October 12, 1998. The campaign account does not reflect such a loan. The original campaign treasurer's report for the period October 10, 1998 to October 29, 1998, reflects "loans $8,000” without further documentation. Petitioner certified the correctness of 13 campaign treasurer's reports each of which was incorrect, false, or incomplete. On October 8, 2001, Petitioner was convicted of 8 counts of violating Section 106.19(1)(a), Florida Statutes (failure to report campaign contributions during the 1998 campaign), adjudicated guilty, and sentenced to 12 months probation, to be served concurrently, and 100 hours of community service.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is Recommended that the Florida Elections Commission enter a final order: Imposing a civil penalty in the amount of $13,000 for 13 violations of Subsection 106.07(5), Florida Statutes. Imposing a civil penalty in the amount of $2,500 for five violation of Subsection 106.011(3), Florida Statutes. Imposing a civil penalty in the amount of $5,300 for 53 violations of Subsection 106.19(1)(b), Florida Statutes. Imposing a civil penalty in the amount of $59,000 for 130 violations of Subsection 106.19(1)(c), Florida Statutes. Not imposing an enhanced penalty, as provided in Subsection 106.19(2), Florida Statutes, for Petitioner's violation of Subsection 106.19(1)(d), Florida Statutes. Dismissing the alleged violations of Subsection 106.19(1)(a), Florida Statutes. DONE AND ENTERED this 25th day of January, 2002, in Tallahassee, Leon County, Florida. JEFF B. CLARK Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 25th day of January, 2002.
The Issue The issue in this case is whether Respondent, the Department of Revenue, should grant Petitioner's application for a consumer's certificate of exemption from sales and use tax.
Findings Of Fact Petitioner is a nonprofit organization incorporated under the laws of the State of Florida on or about August 27, 1997. Petitioner applied to Respondent for a consumer's certificate of exemption from sales and use tax. While the application indicates that it is based on exemption status as an "enterprise zone," Petitioner clarified at final hearing that it actually was basing its application on exemption status as a "charitable institution." ("Enterprise zone" is not an exemption category under the applicable statutes. See Conclusions of Law, infra.) The IRS has determined that Petitioner is exempt from federal income tax under IRC Section 501(a) as an organization described in IRC Section 501(c)(3). A letter dated February 2, 1999, stated that Petitioner: was formed in 1997 to plan and implement redevelopment efforts in the Greater Newtown Community which lead to overall improvement in the quality of life of its residents. In the short time since our inception, we have responded to community needs by implementing a broad range of programs that will have a positive impact on our community. But from the evidence presented (which included no testimony from either party), it is difficult to ascertain factual detail about Petitioner, its activities, or its finances. In addition to grant application and fund-raising activities, it appears that Petitioner has been involved in informational and participation-recruitment meetings and information-gathering surveys for planning purposes (called the Business Retention and Expansion Survey). Petitioner also appears to have been involved in a Storefront Renovation Program and several community celebrations. Petitioner has plans for other economic and community redevelopment activities. But it cannot be ascertained from the evidence which of the other economic development activities have taken place and which are still in grant application or planning stages. For example, documentation regarding Petitioner's involvement in one activity refers to the activity as the "proposed WAGES Employment Challenge." Petitioner obtained $128,000 of funding from the City of Sarasota for seed money for its economic redevelopment and other activities. Petitioner budgeted to spend the $128,000 in 1998. The entire budget consists of salaries, fringe benefits, and overhead expenses. According to a "Profit and Loss" statement for January through October 1998, Petitioner spent $30,581.49 during that time period. All of those expenditures were in the category of payroll and overhead expenses. One activity referenced in Petitioner's documentation is Petitioner's "partnering" with financial institutions and mortgage brokers to process mortgage loans for affordable housing. In that case, the expenditures would be by the other institutions, not by Petitioner. There is no information as to any other expenditures made by Petitioner.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order denying Petitioner's application for a consumer's certificate of exemption from sales and use tax. DONE AND ENTERED this 5th day of November, 1999, in Tallahassee, Leon County, Florida. J. LAWRENCE JOHNSTON 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 5th day of November, 1999. COPIES FURNISHED: Bill Nickell, Esquire Department of Revenue Post Office Box 6668 Tallahassee, Florida 32314-6668 Cynthia E. Porter, Executive Director Greater Newtown Community Redevelopment Corporation 1751 Dr. Martin Luther King, Jr., Way Sarasota, Florida 34234 Joseph C. Mellichamp, III, Esquire Office of Attorney General The Capitol, Plaza Level 01 Tallahassee, Florida 32399-1050 Linda Lettera, General Counsel Department of Revenue 204 Carlton Building Tallahassee, Florida 32399-0100 Larry Fuchs, Executive Director Department of Revenue 104 Carlton Building Tallahassee, Florida 32399-0100
