The Issue This is a rule challenge proceeding pursuant to Section 120.56(4), Florida Statutes, in which the Petitioners and the Intervenor assert that they are substantially affected by an agency statement that violates Section 120.54(1)(a), Florida Statutes. The subject matter at issue here concerns the method of determining the order of layoff of some of the Respondent's employees.
Findings Of Fact Stipulated facts In 1996, the federal government modified and/or reformed welfare to require eligible participants to obtain employment. The Florida Legislature enacted Chapter 414, Florida Statutes, also known as the WAGES law, which required the Respondent to provide certain services to applicants for and participants in the WAGES program, including work activities, training, and other job-related services, which the Respondent termed "front-end services." Those services were primarily provided by Career Service employees of the Respondent. In 1998, the Florida Legislature amended portions of the WAGES law to require that local WAGES coalitions, instead of the Respondent, provide those front-end services to WAGES participants, effective October 1, 1998. As a direct result therefor, the Respondent was required to lay off approximately 700 career service employees. As a part of the implementation of the announced layoff of employees, Respondent requested approval of a method of determining the order of layoff, pursuant to Rule 60K- 17.004(3)(g), Florida Administrative Code, which provides: (g) Agencies shall then choose and consistently apply one of two methods, or another method as approved by the Department of Management Services, in determining the order of layoff. These methods are commonly referred to as "bumping." Option 1: The employee at the top of the list shall have the option of selecting a position at the bottom of the list based on the number of positions to be abolished, e.g., 20 positions in the affected class, 5 positions to be abolished. The employee at the top of the list can select any of the positions occupied by the 5 employees at the bottom of the list. The next highest employee on the list then has the option of selecting any of the positions occupied by the 4 remaining employees at the bottom of the list with the process continuing in this manner until the 5 employees at the top of the list have exercised their option. Option 2: The employee at the top of the list has the option of selecting any position occupied by any employee on the list with fewer retention points in the class. The next highest employee and remaining employees shall be handled in a similar manner until the list is exhausted. Rather than selecting Option 1 or Option 2, set forth in the published rule, the Respondent requested approval of an alternative method of determining the order of layoff. By letter dated August 17, 1998, the Department of Management Services (DMS) approved the method of determining order of layoff set forth in its correspondence. The method of determining the order of layoff is described by DMS in its approval letter as: The option you have chosen will allow adversely affected employees to select any position in the affected class and series, in the competitive area approved in our August 5, 1998 letter. Neither the Respondent's request for approval of the alternate method of determining the order of layoff, nor DMS' approval of that method, have been adopted in substantial conformity with Section 120.54, Florida Statutes. The Respondent's request for approval of the alternate method of layoff was intended to apply solely to the layoff occasioned by changes in the WAGES law. Facts based on evidence at hearing Florida Public Employees Council 79, AFSCME, is the certified bargaining agent for approximately 67,000 career service employees of the State of Florida. As such, it represents the employees of the Department who were affected by the subject layoff. The individual Petitioners, Betty Hall, Diana Lomas, Mercedes Valdez, and Elizabeth Judd, are members of the AFSCME collective bargaining unit. The challenged bumping procedure was not reached by collective bargaining. Under the alternative layoff method approved for the Respondent by DMS, employees with the greater number of retention points received enhanced bumping rights, permitting them to "bump" employees with fewer retention points in the same class and in the class series. Conversely, by this alternative procedure, employees with fewer retention points were accorded diminished protection against bumping. These employees could be bumped not only by employees with greater retention points in the class, but also by employees with greater retention points in other classes in the class series. For example, Consuelo Casanovas, from Petitioners' Exhibit 8, who was adversely affected in her position of Employment Security Representative I, was accorded bumping rights to positions in her class and to positions in the other two classes in the class series, Customer Services Specialist and Interviewing Clerk. Had the Respondent elected Option 1 or Option 2 in the published rule, Rule 60K-17.004(3)(g), Florida Administrative Code, Ms. Casanovas would not have had the right to bump to positions in the other two classes, and persons in those other two classes would not have been subject to bumping by Ms. Casanovas.1
The Issue This matter was referred by the Public Employees Relations Commission to the Division of Administrative Hearings for hearing to determine: Whether the Respondent, Seminole County, is a Public Employer within the meaning of Chapter 447, Florida Statutes. Whether the Petitioner, Union, is an employee organization within the meaning of Chapter 447, Florida Statutes. Whether there has been a sufficient showing of interest has required for the filing of a representation election petition under Chapter 447, Florida Statutes. Whether the employer organization is a properly registered organization with the Public Employees Relations Commission. What is the appropriate unit of public employees within the Public Employer? PRE-HEARING MATTERS Prior to the commencement of the hearing, Respondent filed the following motions with the Hearing Officer who made the indicated disposition of the motion: Motion for Discovery; denied on the basis of prior PERC rulings. Motion to Transfer Jurisdiction to Local PERC; denied because the local ordinance had not been approved by the Public Employees Relations Commission. Motion for Oral Argument on Motion to Transfer Jurisdiction; denied, see Petitioner's Motion to Amend, below. Motion to Dismiss Based on Employer Not Having Denied Recognition; denied. Motion to Dismiss or Limit Hearing on the Basis that Local PERC Ordinate Controls; denied. Motion to Dismiss on the Basis of Inappropriateness of Units Sought; denied. Motion to Quash Hearing on Basis that Acting Chairman Lacked Authority to Notice Hearing; denied. Motion to Dismiss on Basis of Lack of Due Process and Lack of Authority; denied. The Petitioner moved orally in response to the suggestion that paragraph 11 of the Petition indicated concurrence in local PERC authority to amend paragraph 11 to "no". Motion was granted by the Hearing Officer. After having presented its motions the Respondent thereafter filed its Answer, asserting therein certain affirmative defenses. Succinctly stated the position of the Respondent was that the county had defined the appropriate units within the Public Employer by local ordinances as professional, supervisory and blue collar, and that the unit sought by the Petitioner did not conform to the units the County had defined by ordinance. The Petitioner sought all employees of the Road and Arthopod Divisions of Seminole County excluding officers, clericals, supervisory and guard employees.
Findings Of Fact The Hearing Officer directed the Employer to go forward and present its evidence in support of its definition of the units. The Employer sought to call Pat Hill and Jack McLean, both previously subpoenaed by the Employer. Neither of the individuals were present in the hearing room. The Hearing Officer, noting that the time had not expired to oppose the subpoenas but that no opposition had been filed, allowed the Employer to proffer the testimony these witnesses would have given if present. The Hearing Officer notes that subsequently these subpoenas were quashed. Therefore, the proffered testimony will not be considered by the Hearing Officer. The Hearing Officer would, in light of the fact that the Commission's file was not present at the hearing, direct the Commission's attention to the proffer as it relates to the Commission's file for resolution of any matters appropriately raised. The Employer then called Carl Crosslin who was present but whose subpoena had been timely opposed by his Counsel. The subpoena having been issued by the Acting Chairman, the Hearing Officer deferred to the Acting Chairman for his ruling on the subpoena in question. The Hearing Officer allowed the Employer to proffer the testimony which would have been presented by Carl Crosslin and Commissioner Paul Parker. Thereafter, the Employer moved for a continuance which motion was denied by the Hearing Officer. The Employer then made a demand for presentation of the authorization cards, which were not present at the hearing. The Employer then sought to introduce the affidavit of Chris Haughee which was rejected by the Hearing Officer. The Employer then filed its motion for Determination of Managerial and Confidential Employees. This motion is preserved for consideration by the Commission. It is appropriate to note at this point that upon the conclusion of the taking of testimony the Petitioner amended its petition to seek a unit composed of non-exempt employees of the Road Construction and Maintenance Division, the Heavy Equipment and Vehicle Maintenance Division, and Arthopod Division of the Public Works Department of the County of Seminole, or in the alternative, all non-exempt employees of the Public Works Division and as a final alternative, a unit of all blue collar workers of the Public Employer who are in construction, maintenance and trades, but excludes clerical, secretarial and similar positions. The parties also stipulated to the managerial status of division directors within the Administrative Services Department and their secretaries. However, in light of the fact that not all division directors within the employ of the Public Employer were not included within the stipulation, and further, because the Employer has filed a motion for Determination of Managerial and Confidential Status and because the stipulation between the parties would not be binding upon others who might have an interest, the facts relating to the duties and functions of division directors and similar positions are set forth so that the Public Employees Relations Commission may resolve the status of these employees as it relates to the motion filed by the Public Employer. The general organization of the Public Employer is indicated on Exhibit 6. The Board of County Commissioners, as the elected representatives of the citizens of Seminole County, head the Public Employer. An executive assistant manages the office and staff of the Board of County Commissioners and functions as general coordinator for the other department heads of the county government. Each of the several departments of government is headed by a department head. Each department head is directly responsible for the management of his department to the Board of County Commissioners. Although the executive assistant, as a coordinator, would have some coordinating function with the department heads, the department heads are the first level of management below the Board of County Commissioners. The department heads prepare the budgets for their department, manage and direct their personal staffs and their division heads, make policy within their department, and participate in the resolution of grievances. They have the authority to hire and fire all employees making less than $10,000 per year and they participate in evaluations of all employees. Department heads have the ability to effectively recommend the employment and discharge of division heads and employees making more than $10,000 per year. All of the department heads meet on Mondays to discuss their joint duties and coordinate their activities. The division heads or directors have the authority to effectively recommend hiring and firing of personnel. The division heads assign work and determine the manner in which work shall be done by their subordinates. The division heads have the authority to discipline their personnel or effectively recommend disciplinary measures dependent upon the action taken. Division directors prepare and submit budget data to the department heads upon which the departmental budget is based. The division heads constitute the second level of supervision or management in county employment. Among their other functions they make determinations regarding the manner in which programs will be accomplished and participate in the resolution of grievances. In all but the smallest divisions and in all of the departments, the department heads and division directors have secretaries assigned to them to handle their personal correspondence, In the larger divisions and in the majority of the departments there are additional clerical personnel assigned to handle general typing and filing and to maintain fiscal records. The parties with regard to the RC petition in question have stipulated that the secretaries to the department heads and division directors should be excluded as confidential. There are divisions within the county government whose function is primarily administrative and whose employees perform administrative duties. These divisions or activities would include the Personnel Division, Microfilm Division, Division of Manpower Planning, Purchasing Division, Office of Management and Evaluation, Veterans' Service Officer, Division of Social Services and Seminole County Industrial Development Authority. In the aforelisted activities, all of the personnel are involved in totally administrative functions. In addition to these totally administrative divisions or activities, there are additional divisions in which there are mixed administrative and other functions. The administrative employees of these divisions would include Switchboard Operators and the Mail Clerk in Support Services Division; the Biologists in Operations Division of the Department of Environmental Services; the Operator Inspector, Pollution Control Technician, Account Clerk in the Division of Environmental Control of the Department of Environmental Services; Cashiers within the Division of Motor Vehicles of the Department of Public Safety; the Deputy Civil Defense Director in the Division of Civil Defense, Department of Public Safety; Permit Clerks and a Secretary II of the Building Division of the Department of County Development; two Secretaries and a Site Planner within the Office of the Land Development Administrator, Division of Land Development, Department of County Development; a Secretary, two Draftsmen, two Planners, Drafting Technician II, Planner (current plans), Senior Planner, Principal Planner and County Planner within the Planning Division of the Department of County Development. The following personnel hold positions within the county government below that of division director and perform functions which are not clerical or administrative in nature. These remaining personnel will be discussed by division. Within the Building Maintenance Division there is a Supervisor of Custodial Services, Supervisor of Courthouse Custodians, and Building Custodian Supervisor, all of whom report to the Director of Building Maintenance. The Supervisor of Courthouse Custodians directly supervises the fifteen custodians assigned to the Seminole County Courthouse. The Supervisor of Custodial Services supervises the custodians assigned to the maintenance of the other county buildings. The Building Custodian Supervisor supervises the electrical, carpentry, plumbing and air conditioning foremen under whose direction maintenance workers perform such maintenance as is required upon the various county buildings. These three supervisors have the authority to effectively recommend hiring, firing and disciplinary action and assign specific work to those employees under their direction. These supervisors constitute the first level of direct supervision over the county employees for although there are trades foremen designated they function as lead workers. Within the Support Services Division there are three Night Watchmen who are responsible for security of the County Courthouse and one Senior Night Watchman who assigns the work shifts of the Watchman. The testimony would indicate that the Senior Night Watchman functions in the role of a lead worker. It should be noted that this Division does not have a division director but is under the control of the acting executive assistant. Within the Division of Human Services is the Office of Animal Control which is headed by the Animal Control Officer. The Animal Control Officer is responsible for the operation of the County Pound and the supervision of the work of the four Animal Control Officers. He is assisted in his functions by the Animal Control Supervisor who is specifically charged with maintenance of the County Pound. The Animal Control Officer has authority to recommend hiring, firing and discipline of these employees who he evaluates. Within the Operations Division of the Department of Environmental Services there is a Chief Operator and three Operator Trainees who are responsible for the operation and maintenance of the county's water and sewage treatment facilities. The Operator Trainees are under the direct supervision of the Chief Operator whose responsibility is to train then to operate the system and to assign their duties. The Operator Trainees perform maintenance, read meters, and perform such other duties as the Chief Operator assigns necessary to the operation of these facilities. Within the Office of the Director of Public Safety and under the Director's control is Fire Prevention and Arson Investigator, a Training Officer, and two Mechanics. The Investigator and the Training Officer are trained firefighters. The two Mechanics are physically located at Station 14 and are responsible for the maintenance of the County Fire Department's Vehicles. The Fire Department is divided into three shifts or platoons. Each shift or platoon being supervised by a Sector Fire Coordinator. The Sector Fire Coordinator prepares the budget for his shift, establishes field operating procedures, and directs fire fighting, and has access to the personnel files of the employees. Also within the Department of Public Safety is the Communications Division which at present relates primarily to the Fire Department but which will in the future also encompass the 911 telephone number. The Communications' personnel are under the supervision of the Communications supervisor. The Communications' personnel are generally not firefighters, but receive emergency calls and dispatch equipment. Within the Motor Vehicle Inspection Division of the Department of Public Safety there are three Inspection Stations located within the county. The Motor Vehicles Inspection function is under the supervision of the Motor Vehicles Inspection Supervisor who acts as a division director and effectively recommends hiring and firing and discipline of employees and who helps prepare the budget for the Motor Vehicles Inspection activities. He is also responsible for work assignments and development of work procedures. Each Inspection Station is under the direction of a Chief Inspector who is responsible for assigning work at each station and responsible for the function thereof. There are four Motor Vehicle Inspectors at each Inspection Station and one Cashier. Within the Division of Parks and Recreation of the Department of County Development there is a Parks Coordinator/Designer who can effectively recommend hiring and firing and disciplinary action of personnel within the Division. The Parks Coordinator/Designer is also responsible for the direct or specific supervision of work. He functions as an assistant division director. The Parks Supervisor is also able to effectively recommend hiring, firing and disciplinary action. The Parks Supervisor provides direct supervision of the five Maintenance Workers, the Equipment Operator II, and three Trades Workers assigned to the Parks and Recreation Division. In addition to the positions enumerated above there are an additional twenty-nine CETA Workers assigned to Parks and Recreation primarily in the grades of Maintenance Worker and Equipment Operator. Within the Building Division of the Department of County Development the construction inspection function within the county is the responsibility of the Building Official who functions as the division director of the Building Division. He is assisted in his duties by the Plans Examiner who functions as the Deputy Building Official. Both employees have the authority to effectively recommend the hiring, firing and discipline of their subordinate employees. The actual inspection of construction is carried out by one of ten inspectors. There are three Chief Building Inspectors; one assigned to general construction, one to electrical, and one to plumbing, There are six Inspectors who work under the three Chief Inspectors and one Trailer or Mobile Home Inspector who reports directly to the Building Official. Within the Land Development Division of the Department of County Development is the Zoning Department. The Land Development Administrator functions as the division director. He is assisted in his Duties by the Zoning Administrator who acts as the Assistant Division Director. Both employees have the authority to effectively recommend hiring, firing and disciplinary actions. There are three Inspectors assigned to the Land Development Division. One inspects for compliance with the County Tree Ordinance, one inspects with regard to commitments made to the county by developers and the third inspects for violations of the county zoning code. The Engineering Division of the Department of Public Works is responsible for three basic functions: Traffic engineering, design and survey, and survey and inspection. The Traffic Engineer is responsible for the traffic engineering activity and supervises the other employees directly. Signs are prepared in the County Sign Shop which is under the supervision of the Sign Shop Foreman. An Electrician is also assigned to this activity together with an Electronics Technician. They are responsible for the installation and maintenance of traffic signals. A Radio Technician is also assigned to the Traffic Engineer activity. The Radio Technician is responsible for the repair of all county radios. The Design and Survey activity consists of a Design Engineer and a Design Technician who design and draft plans for county construction projects. The Assistant County Engineer heads up the survey and inspection type activity for the Engineering Division. He is responsible for the county's two survey crews which are made up of a Party Chief and three to four crew members. The Assistant County Engineer is responsible for directing the work functions and activities of his subordinates and has the authority to effectively recommend hiring, firing and discipline. The Assistant Road Superintendent is in charge of the Road Construction and Maintenance Division of the Department of Public Works. He is assisted in the performance of his duties by two foremen and three to four crew leaders. The Road Maintenance function contains three supervisors, two of which supervise a foreman and two crew leaders and the third supervisor who supervises a crew leader. Under each crew leader there are from four to six maintenance workers or equipment operators. The Assistant Road Superintendent and the three supervisors in maintenance all function in assigning work to crews and individuals and supervising the work activity. In addition, the Assistant Road Superintendent acts as the assistant to the Road Superintendent who functions as the division director. Both men would have authority to effectively recommend hiring, firing, and disciplinary action together with the three supervisors, The Division of Heavy Equipment Maintenance is under the supervision of the Shop Foreman who functions as a division director, He is assisted by the Parts Manager who acts as the assistant division director. The position of Chief Mechanic is currently vacant and the duties are being performed by the Assistant Chief Mechanic. The primary function of the Parts Manager is the purchasing and stockage of spare parts. The Shop Foreman, Parts Manager and Assistant Chief Mechanic all have the authority to effectively hire, fire and recommend discipline. These three individuals would also provide evaluations of the mechanics, mechanic helpers and equipment servicemen assigned to the Heavy Equipment Maintenance Division. The Arthropod Division of Seminole County is responsible for refuse disposal. The division director is the Refuse Superintendent. Working under him are the Refuse Supervisor and a Landfill Foreman. The Landfill Foreman is responsible for supervision of the actual landfill operations and directly is responsible for three Equipment Operator III's and an Equipment Operator IV. The Landfill Foreman is also responsible for supervision of truck drivers while they are at the landfill area. The Landfill Foreman, Refuse Supervisor and Refuse Superintendent (division director) all have the authority to effectively recommend hiring, firing and discipline and to make work assignments and to evaluate performance. There were approximately twenty-eight employees within the Arthropod Division at the time of hearing. With regard to the employees of the county generally the testimony indicates that all employees of the county are entitled to the same vacation, retirement, and insurance benefits and that their salaries are established within the framework of the pay classification plan. The Petitioner has argued that each division is a totally independent unit, therefore, a unit composed of employees of the Arthropod and Road Construction and Maintenance Divisions of the Department of Public Works would be appropriate. The Employer has urged that the employees of the county be divided into three units: (1) all professional employees (2) all supervisory employees and (3) all employees not contained in the first two units. The Employer's proposal would appear to lump all the clerical employees, all custodial and maintenance employees, and certain highly skilled or specially trained employees in the same unit. The record does not support the Petitioner's contention that the divisions of Seminole County government are independent. The record clearly indicates that divisions are subordinate to the departments of which they are a part. The record further indicates that even departments are not totally independent or autonomous since the department heads are responsible to the County Commission which in turn establishes the salaries and other benefits of employment for all employees of the county. The record clearly indicates that a unit limited to the Arthropod and Road Divisions or even to the Public Works Department would not encompass many employees with essentially the same job functions and in some instances the same job titles and pay classifications. There are maintenance workers, equipment operators and certain custodial personnel and mechanics located in other divisions of county government. The position of the Employer fails to recognize the disparity of interest between the employees which would be "left over" and compose the third unit it has proposed. The record indicates that there are essentially three types of employees below the grade or position of division director as follows: (1) Clerical, (2) Maintenance/Custodial, and (3) Highly skilled. A large portion of the total number of county employees would fall into the clerical category to include secretaries, clerk typists, filing clerks, and fiscal assistants. The maintenance/custodial category would appear to be the next largest grouping of employees and would include custodial and maintenance workers, vehicle operators, watchmen, and mechanics. The highly or specially skilled category would include various planners, biologists, draftsmen, personnel specialists, zoning and building inspectors, and the highest level of skilled trades workers and sanitariums. Based upon the foregoing categorization of county employees, the unit composed of maintenance/custodial employees would encompass all of the job titles and job classifications sought by the Petitioner within the Department of Public Works and consolidate a substantial portion of the total number of county employees who share similar duties and work environments. A unit composed of this category would be almost identical to the last alternative unit sought by Petitioner. At the same time it would prevent fractionalization within county government and better meet the criteria stated in Section 447.009(4), Florida Statutes. This report is respectfully submitted this 11th day of April, 1976. STEPHEN F. DEAN, Hearing Officer Division of Administrative Hearings Room 530, Carlton Building Tallahassee, Florida 32304 (904) 488-9675 COPIES FURNISHED: Thomas J. Pilacek, Esquire Bowels & Pilacek 131 Hark Lake Street Orlando, Florida 32803 David Richeson, Esquire Alley, Alley & Blue 205 Brush Avenue Tampa, Florida Henry Swann, Esquire Alley, Alley & Blue 205 Brush Avenue Tampa, Florida Chairman Public Employees Relations Commission Suite 300, 2003 Apalachee Parkway Tallahassee, Florida 32304 ================================================================= AGENCY FINAL ORDER =================================================================
The Issue The issue in this case is whether Respondent, David McQuay, Jr., committed the violations alleged in a four-count Amended Administrative Complaint issued by Petitioner, Department of Business and Professional Regulation, Board of Accountancy, on February 6, 2008, and, if so, what penalty should be imposed.
Findings Of Fact Petitioner, the Department of Business and Professional Regulation, Board of Accountancy (hereinafter referred to as the "Department"), is the state agency charged with the duty to regulate the practice of certified public accountants in Florida and to prosecute administrative complaints pursuant to Section 20.165, and Chapters 120, 455, and 473, Florida Statutes. At all times relevant to the allegations of the Complaint, Respondent David McQuay, Jr., has been licensed in Florida as a certified public accountant. Mr. McQuay's license number is R 1736, and his address of record is 110 North Lincoln Avenue, Tampa, Florida 33609-2908. Thomas Reilly, an expert in public accounting and auditing, reviewed an audit that Mr. McQuay performed for the Mid-Florida Center, a non-profit organization, for the financial year ending September 30, 2002. The audit was completed on July 18, 2003. Mr. Reilly prepared a report of his findings, dated September 5, 2005. He filed a subsequent report dated June 25, 2007, to include copies of various accounting standards and reference materials that were cited in the original report. In preparing his original report, Mr. Reilly met with Mr. McQuay and reviewed Mr. McQuay's complete set of working papers. Mr. Reilly testified that he billed the Department $3,444.00 for his services. No billing statements, invoices, or other documents were entered into evidence to support the amount of Mr. Reilly's fee. No expert testimony was offered to establish the reasonableness of the fee. As indicated in the Preliminary Statement above, Mr. Reilly identified four issues relating to the financial statements. First, Mr. Reilly found that the audit did not include certain statements that are required by government auditing standards. The "Yellow Book" contains the authoritative auditing standards issued by the federal Governmental Accountability Office ("GAO"). Amendment No. 2 to the auditing standards, adopted in July 1999, requires that certain language be included in the auditor's report on the financial statement. In particular, Section 5.16.1 of Amendment No. 2 provides: When auditors report separately (including separate reports bound in the same document) on compliance with laws and regulations and internal control over financial reporting, the report on the financial statements should also state that they are issuing those additional reports. The report on the financial statements should also state that the reports on compliance with laws and regulations and internal control over financial reporting are an integral part of a GAGAS [Generally Accepted Government Accounting Principles] audit, and, in considering the results of the audit, these reports should be read along with the auditor's report on the financial statements. Mr. McQuay's report on the financial statements did not contain a statement calling the reader's attention to the fact that a separate report on internal control and compliance is included elsewhere in the audit report. Mr. Reilly stated that the quoted language from the Yellow Book is mandatory, and that the GAO felt that the issue was important enough to call for the issuance of Amendment No. 2 to emphasize the revised mandate. In response, Mr. McQuay pointed to his reliance on a commercially produced practice guide that did not include the revised language of Amendment No. 2. While conceding the error, Mr. McQuay continued to contend that the practice guide's position was reasonable: that the statement is required only when the reports on compliance with laws and regulations and internal control over financial reporting are issued separately from the report on financial statements. In Mr. McQuay's case, the reports were issued under a single cover. Given that the express language of Amendment No. 2 references "separate reports bound in the same document," Mr. McQuay's response to the charge is insufficient. The Department has demonstrated that Mr. McQuay's audit report deviated from professional standards as to its failure to include the mandatory Yellow Book language. The deviation is ameliorated by the fact that all of the reports referenced in Amendment No. 2 were in fact contained in Mr. McQuay's audit report. There was no indication that Mr. McQuay's failure to include the mandatory statement was intended to mislead a reader of the audit report, or that his failure to comply with the strict language of Amendment No. 2 had any practical effect on the soundness of the audit report. The second allegation as to the financial statements is that necessary disclosures were missing in the notes to the financial statements. Mr. Reilly stated that the notes to the financial statements did not disclose the entity's capitalization policy for capital assets. The American Institute of Certified Public Accountants ("AICPA") Audit and Accounting Guide for Not-for-Profit Organizations requires disclosure of the entity's capitalization policy. Mr. Reilly testified that it is important for a reader of the audit to understand the dollar threshold at which the entity has decided to capitalize fixed assets, and that the professional standards require the disclosure in the audit report. In response, Mr. McQuay contended that the audit report did disclose the capitalization policy, citing to the following paragraph: Property donated to the Center is stated at its estimated fair market value. Depreciation expense is computed by use of the straight-line method of the estimated economic life of the respective assets. Maintenance and repairs are expensed as incurred. Extraordinary repairs that significantly extend the useful lives of the related assets are capitalized and depreciated over the assets' remaining economic useful life. This response is insufficient because the quoted language does not address the dollar threshold for capitalizing fixed assets, which is required under the standards for audits of nonprofit organizations. Mr. Reilly stated that the notes also failed to include a required statement as to lease commitments. Where the entity has operating leases that commit the entity for more than one year, professional standards require disclosure of the amount of the future commitments for each of the first five years subsequent to the date of the statement of financial position. Mr. McQuay's audit notes indicate that Mid-Florida Center had leases ranging as far as three years into the future, but do not disclose the amount of those lease commitments. Mr. McQuay responded that audit standards provide that immaterial items need not be disclosed, and that it was his professional judgment that the leases in question were not material. Mr. Reilly replied that the audit report gives the reader no basis for making an independent judgment as to the materiality of the leases. Mr. Reilly's view is more consistent with the specific standard regarding lease disclosure, though Mr. McQuay's exercise of independent professional judgment in this instance was not so unreasonable as to constitute a violation of professional standards. Mr. Reilly stated that the notes to the financial statements also omitted a statement of cash flows. However, Mr. McQuay's audit report properly identified this omission as a departure from generally accepted accounting principles ("GAAP"), rendering irrelevant any further discussion of the definition of cash equivalents. In summary, as to the second allegation, the evidence proved that Mr. McQuay violated the standards by failing to address the dollar threshold for capitalizing fixed assets, but did not prove any other violations of the disclosure requirements. The third allegation as to the financial statements was that the Statement of Activities and Statement of Functional Expenses should not contain captions of "Memorandum Only" for their "total" columns. Mr. Reilly contended that the "Memorandum Only" caption was inaccurate and misleading. Historically, the term "memorandum only" was used frequently on local government financial statements, where the auditor must give an opinion on different types of columns. Some of the columns were on a modified accrual basis and others on an accrual basis. Because these are two different bases of accounting, the "total" column was irrelevant. Mr. Reilly pointed out that the only time an auditor would use the "memorandum only" terminology as to a nonprofit organization's audit would be in presenting comparative financial statements, or where the prior year's audit included a summary total that was not in accordance with GAAP. In those situations, an auditor would use the "memorandum only" caption, as well as other disclosures, in the notice of the financial statements and the auditor's report. However, the Mid-Florida Center audit involved a single year's financial statement. Mr. Reilly opined that the total column on these financial statements was extremely significant, and that the "memorandum only" caption was extremely misleading. Mr. McQuay responded that the decision was made to use the "memorandum only" caption because this was the initial audit for Mid-Florida Center, and that the caption does not materially change any substantive aspect of the financial statement and is therefore not misleading. Mr. Reilly's position that the inclusion of the "memorandum only" caption was misleading and a violation of the standards cited in his report was correct, and Mr. McQuay's response was insufficient. The fourth allegation as to the financial statements was that donations of long-lived depreciable assets should not be reported as "Permanently Restricted Net Assets." Mr. Reilly conceded that this was a very complicated issue for which Mr. McQuay had "quite a bit of support." Mid-Florida Center purchased land and some equipment from the Highlands County School Board. The fair value of the property exceeded the price paid by Mid-Florida Center. Under GAAP, the difference between the price paid and the value would be recorded as a donated asset. The dollar amount recorded in the financial statement was $330,000, but there was no documentation showing how that number was arrived at, and no documentation showing the breakout between the land and the equipment. Mr. Reilly testified that when he looked at the fixed assets, he found a $280,000 item for land but could not be certain whether the item was part of this land or another piece of property referenced elsewhere in the notes. However, $330,000 was shown in a column called "permanently restricted." Mr. Reilly did not take issue with placing the land in that column. However, he thought that the equipment, i.e., the depreciable portion of that asset, should not be placed in the "permanently restricted" column. Mr. Reilly testified that an item such as an endowment fund is the only thing that should be placed in a "permanently restricted" column. Once an asset is placed in service and begins depreciating, it must be placed in the "unrestricted" column. In his response, Mr. McQuay referenced a reversionary clause in the purchase agreement, whereby if Mid-Florida Center gave up its 501(c)(3) nonprofit status, the property would revert to the School Board. Mr. Reilly testified that this is a standard clause in government contracts, and is not a reason to classify the item as permanently or temporarily restricted. While his report took issue with the placement of depreciable assets in the "permanently restricted" column, Mr. Reilly conceded that the relevant Statement of Financial Accounting Standards is not crystal clear and that he used non- authoritative practice guides to arrive at his conclusion. Mr. Reilly believed that it was misleading to label equipment in operation as "permanently restricted," but also conceded that the notes to the financial statement fully disclosed the issue. Mr. McQuay insisted that his audit did distinguish between the land and equipment in the fixed assets and depreciation schedules. While his treatment of the item was subject to dispute, Mr. McQuay cannot be found to have violated professional standards as to this issue. As indicated in the Preliminary Statement above, Mr. Reilly identified six issues relating to the working papers. The first allegation is that there was no evidence of a reporting and disclosure checklist for not-for-profit organizations. Mr. Reilly opined that it is common practice to include such a checklist, and that Mr. McQuay should have used one on this audit because nonprofits have unique disclosure requirements and Mid-Florida Center was the only nonprofit organization that Mr. McQuay was auditing at the time. Mr. Reilly noted that failure to use a checklist does not violate a particular auditing standard, but could be held to violate the more general professional standard of due care. Mr. Reilly believed that due professional care mandates that a CPA use a checklist when auditing a nonprofit organization, and that a CPA "would be a fool" not to use one. A typical checklist is 70 pages long, and an accountant needs the list to jog his memory as to the many unique requirements of nonprofits. Mr. Reilly thought that Mr. McQuay might have avoided some of the cited deficiencies if he had used a checklist. Mr. McQuay responded that professional standards do not require the use of a checklist. Moreover, he asserted that his auditing software contains the functional equivalent of a disclosure checklist. While conceding that this was the only nonprofit he audited during the year in question, Mr. McQuay testified that he has been auditing nonprofit organizations for over 36 years and that his previous firm conducted 35 to 40 such audits annually. A checklist would be of no assistance out in the field, where the auditor is examining the client's working papers. Mr. McQuay stated that he does use a checklist when he is reviewing the work of a staff auditor, but that he did not need a checklist here because he was performing the audit himself. Even after hearing Mr. McQuay's response, Mr. Reilly continued to hold that it was foolish not to complete a disclosure checklist. The fact that Mr. McQuay was the only person working on the audit provided all the more reason for the use of a checklist. Accepting Mr. McQuay's testimony that his auditing software contained the equivalent of a checklist, it is found that his failure to use a paper checklist was not a violation of auditing standards or of due professional care. The second allegation relating to the working papers was a lack of audit evidence for fraud risk factors or planning materiality. Statement on Auditing Standards No. 82 states that the auditor "should specifically assess the risk of material misstatement of the financial statements due to fraud and should consider that assessment in designing the audit procedures to be performed." The auditor should consider fraud risk factors relating to misstatements arising from fraudulent financial reporting and from misappropriation of assets. Statement on Auditing Standards No. 47 provides that the auditor should consider audit risk and materiality in planning the audit and designing auditing procedures and in evaluating whether the financial statements "taken as a whole are presented fairly, in all material respects, in conformity with generally accepted accounting principles." Mr. Reilly found nothing in Mr. McQuay's working papers documenting that an assessment in conformance with Statement on Auditing Standards No. 82 was made, or that an audit risk and materiality assessment was made in accordance with Statement on Auditing Standards No. 47. Mr. McQuay responded that a separate section in his work papers dealt with fraud risk factors and materiality. He testified that his firm is careful in selecting clients and looks carefully at management capabilities and the risks involved in the representation. Mr. Reilly reviewed Mr. McQuay's response and concluded that it did not come close to meeting professional standards. As to this issue, it is found that Mr. McQuay did violate professional standards as to documentation, though he may well have performed the assessments in question. The third allegation relating to the working papers was that the management representation letter omitted the specific representations relative to the single audit and the referenced schedule of uncorrected misstatements in the management representation letter. The "single audit" is an Office of Management and Budget ("OMB") A-133 audit of an entity that has received $500,000 or more of Federal assistance for its operations. Mr. Reilly found the omissions in the management representation letter constituted a violation of professional standards. Mr. Reilly testified that the standards require that on every audit, the auditor obtain a management representation letter signed by the appropriate levels of management. Statement on Auditing Standards No. 85 contains the basic requirements for management representations. Mr. McQuay obtained a management representation letter from Mid-Florida Center in compliance with this basic requirement. However, because this was a single audit, additional representations were required in the management representation letter over and above those found in a generic audit. AICPA's Statement of Position 98-3, "Audits of States, Local Governments, and Not-for-Profit Organizations Receiving Federal Awards," paragraph 6.68 requires the auditor conducting an OMB A-133 audit to obtain written representations from management about matters related to federal awards. Paragraph 6.69 of the same document lists 22 items for which the auditor should consider obtaining written representations in a single audit. Mr. Reilly testified that most of these items were applicable in this case, but that none of them were included in the Mid-Florida Center's management representation letter. In response, Mr. McQuay pointed to his engagement letter with the client. The engagement letter states that this would be an OMB A-133 audit, and that Mr. McQuay has explained to the client and the client has understood that management is responsible for compliance with the OMB A-133 audit requirements. Mr. McQuay did not think he needed to include the detailed representations of paragraph 6.69 when he already had an extensive engagement letter that covered these areas of management responsibility. Mr. Reilly replied that the engagement letter and the management representation letter are two entirely different things. The engagement letter spells out the scope of representation to the client at the outset of the engagement; completely different standards require the auditor to obtain written representations from management regarding elements spelled out in the standards, at the conclusion of the engagement. The engagement letter is irrelevant for purposes of the single audit's requirement that representations be obtained from management about matters related to federal awards. None of the specific statements referenced by Mr. McQuay in his engagement letter dealt with the specifics of federal awards. As to this issue, it is found that Mr. McQuay violated professional standards. The fourth allegation relating to the working papers was that no documentation was evident regarding a consideration of a going concern with the entity's financial position. Mr. Reilly testified that it was apparent from a glance at the financial statements that the entity had severe financial problems. It had an adverse current ratio, with assets of $33,000 and liabilities of $138,000, not considering the issue of liability for back pay owed to the executive director. Under Statement on Auditing Standards No. 59, an auditor has the responsibility to evaluate and document any causes for doubt about the continuing viability of the entity, and further to evaluate and document management's plans to turn around the entity. Mr. Reilly saw nothing that came close to meeting this standard. The only items of substance he found were a statement that the Mid-Florida Center was creating a new charter school and that fundraising activities were "ongoing." There were no specifics as to the charter school or the fundraising. Mr. Reilly found these statements "grossly inadequate" to comply with professional standards. Statement on Auditing Standards No. 59 includes specific items that an auditor should evaluate, such as management's specific plans to curb expenditures and increase revenue. Mr. McQuay supplied a document titled "Going Concern Evaluation," but the document provided no specifics as to the evaluation that was performed. Mr. McQuay responded that any startup organization such as the Mid-Florida Center will have poor current ratios. However, the entity had the management wherewithal to raise money and a committed, competent board of directors. The proposed charter school had already received funding for building renovation for the 2003-2004 school year. Mr. McQuay believed that his field work and evaluation of the management plans was sufficient to satisfy the standard. As to this issue, it is found that Mr. McQuay violated professional standards, at least insofar as he failed adequately to document his consideration of a going concern with the entity's financial position in accordance with Statement on Auditing Standards No. 59. The fifth allegation relating to the working papers was that the management representation letter addressed the $158,429 liability owed to the executive director, which was reversed off the books, but failed to justify the removal of the liability from the financial statements by specifically finalizing the matter. Mr. Reilly explained that, as of the balance sheet date, Mid-Florida Center owed several years' salary to its executive director, Dr. Arthur Cox, a significant liability that would make Mid-Florida's poor current ratio even worse. Mid-Florida removed the liability for Dr. Cox' salary from its books. Mr. Reilly did not have a problem with removing the salary, in the amount of $158,429 from the books, provided Mid-Florida had secured a separate, standalone confirmation from Dr. Cox that he was totally relinquishing any rights to those funds. However, the relinquishment issue was addressed in a management representation letter by way of what Mr. Reilly termed "squirrely wording." Rather than completely extinguish any rights Mr. Cox had to the salary, the Mid-Florida Center's board voted to change the liability from deferred compensation to amounts owed for future salary increases. Essentially, the board took the liability off the books at the present time, but left open the possibility of reinstating it when Mid-Florida Center's finances permitted it to pay Dr. Cox the amount he was owed. Mr. McQuay responded that the Form 990 for the year in question had been completed by another CPA and filed prior to his retention. Form 990 is the tax return for organizations exempt from income tax. The working trial balance prepared by the other CPA indicated that the liability for the back pay had been removed, and the Form 990 had been filed with the Internal Revenue Service without including the liability. In reconciling the Form 990 with the working trial balance for purposes of his audit, Mr. McQuay obtained the management representation letter referenced by Mr. Reilly. Mr. McQuay testified that he viewed the letter as firming up the matter that the previous CPA had dropped in his lap. Selvin McGahee, a member of the Mid-Florida Center's board of directors, testified that Dr. Cox founded the Mid- Florida Center, writing the initial grants that got the entity started. Dr. Cox' focus on providing services led him to forego some of the salary that was budgeted for his position, in order to spend the funds on other positions. Mr. McGahee testified that this situation persisted for a couple of years, with Dr. Cox supplementing the organization's revenues by not paying himself. The board ultimately decided to remove the back pay from its books, but had the intention of paying Dr. Cox his back salary if and when the organization generated sufficient unrestricted revenue to do so. As to this issue, it is found that that Mr. McQuay violated professional standards and departed from generally accepted accounting principles. Removing the liability for back salary payments to the executive director should have been accompanied by an unequivocal renunciation of those funds by the executive director. As matters were allowed to stand by Mr. McQuay, Mid-Florida Center's balance sheet was significantly improved in a manner that did not finalize the issue of the possible reinstatement of the back pay liability in the future. The sixth allegation as to the working papers was that, relative to compliance testing, the working papers contained evidence of testing only one monthly invoice/progress report. Mr. Reilly testified that the problem here was a lack of documentation. Though the auditor's judgment is paramount as to compliance testing, there are stated requirements that the auditor must meet. Because this was a single audit, OMB Circular A-133 Compliance Supplement was used. This Circular lists fourteen specific items of testing, each of which should be addressed by the auditor at least to the point of indicating that the auditor has determined the item to be inapplicable to the audit at hand. Mr. Reilly testified that one of the specific issues he was called to investigate involved the lack of documentation regarding a grant that the Mid-Florida Center had obtained from the City of Bartow. The grant required the submission of a monthly invoice/progress report. Mr. Reilly could find evidence that Mr. McQuay had tested only one such invoice. Mr. Reilly conceded that it was "tough to say" what professional judgment demanded in this situation because he was not there when the audit was conducted. Mr. Reilly stated that he would probably have tested more than one invoice, but he could not say how many. The usual practice is to expand the testing if a problem is found with the first invoice. Mr. McQuay found no problems with the one invoice and progress report that he tested, and made the judgment that his examination was adequate. Mr. Reilly believed that, based on the overall scope of problems with Mid- Florida Center's documentation, Mr. Reilly concluded that the entity's invoices and progress reports were "lightly tested." As to this issue, it is found that Mr. McQuay did not violate professional standards or generally accepted accounting principles. Mr. Reilly testified that he might have conducted the compliance testing more strenuously than did Mr. McQuay, but he could not state that Mr. McQuay's actions were outside the boundaries of his professional judgment. Petitioner offered the testimony of Allan Nast, an expert in accounting and auditing. Mr. Nast reviewed the audit performed by Mr. McQuay, and also reviewed the reports prepared by Mr. Reilly. Mr. Nast agreed with Mr. Reilly's opinions in every particular. Mr. Nast's opinion has been considered and is respected by the undersigned, but does not change the findings of fact made above. Mr. Nast testified that he billed Department $1,365.00 for his services. No billing statements, invoices, or other documents were entered into evidence to support the amount of Mr. Nast's fee. No expert testimony was offered to establish the reasonableness of the fee. Mr. McQuay testified that he believes he has been singled out for disciplinary action based on business reasons. Mr. McQuay pointed out that the initial complaint in this matter was filed by a competitor who was also the father of an accountant whose firm Mr. McQuay had rejected for work in his role as director of quality assurance for WorkNet Pinellas, Inc. Mr. McQuay, an African-American, also testified as to incidents of racism as he pursued his career in a profession dominated by white men. The undersigned has considered this testimony by Mr. McQuay, but cannot find that these matters had any bearing on the merits of the allegations lodged by the Department in the Complaint after its thorough investigation of the initial complaint. In summary, as to the four allegations regarding the financial statements recited in the Preliminary Statement above, it was found that the first allegation as to missing statements in the audit was proven, though ameliorated by the fact that all of the reports referenced by the missing statements were included in the audit report. As to the second allegation as to missing disclosures, it was found that Mr. McQuay violated professional standards as to only one of several of the alleged omissions. As to the third allegation regarding the "Memorandum Only" statement in the "total" columns, it was found that Mr. McQuay violated the relevant standards. As to the fourth allegation regarding the categorization of long-lived depreciable assets, it was found that Mr. McQuay did not violate professional standards. There were six allegations regarding the working papers recited in the Preliminary Statement above. As to the first allegation regarding the disclosure checklist, it was found that Mr. McQuay did not violate auditing standards or the duty of professional care. As to the second allegation regarding lack of evidence for fraud risk factors or planning materiality, it was found that Mr. McQuay violated professional standards as to documenting his work, though he may have performed the assessments in question. As to the third allegation regarding omissions in the management representation letter, it was found that Mr. McQuay violated professional standards. As to the fourth allegation regarding going concern considerations, it was found that Mr. McQuay violated professional standards. As to the fifth allegation regarding removal of liabilities owed to the executive director, it was found that Mr. McQuay violated professional standards. As to the sixth allegation regarding the sufficiency of compliance testing, it was found that Mr. McQuay did not violate professional standards.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that A final order be entered finding that David McQuay, Jr. committed the violations alleged in Counts One, Two, and Four of the Amended Administrative Complaint and requiring Mr. McQuay to take sixteen hours of Continuing Professional Education beyond the regular requirement, including eight hours related to nonprofit organizations, and placing Mr. McQuay on probation for a period of two years. During the first year of probation, all audits (including financial statements and working papers) will be reviewed by a consultant selected by the Board, at Mr. McQuay's expense. If any audit is deemed deficient upon review by the Board, review of all audits will continue through the second year of Mr. McQuay's probation. DONE AND ENTERED this 27th day of October, 2008, in Tallahassee, Leon County, Florida. S LAWRENCE P. STEVENSON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 27th day of October, 2008. COPIES FURNISHED: Eric R. Hurst, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202 David McQuay, Jr. 110 North Lincoln Avenue Tampa, Florida 33609-2908 Veloria A. Kelly, Director Department of Business and Professional Regulations, Board of Accountancy 240 NW 76th Drive, Suite A Gainesville, Florida 32607 Ned Luczynski, General Counsel Department of Business and Professional Regulations Northwood Centre 1940 North Monroe Street Tallahassee, Florida 32399-0793
Findings Of Fact On May 20, 1989, Respondent was employed as a radio teletype operator with the Bureau of Registration Services, Division of Motor Vehicles, a division of the State of Florida, Department of Highway Safety and Motor Vehicles. He had held that position for approximately four years and nine months. Respondent's duty shift was from 12:00 a.m. to 8:00 a.m. His days off were Thursday and Friday. He had held this shift assignment since 1987. Respondent had another employment position at Florida State University, a day shift that ran from 8:00 a.m. to 5:00 p.m., Monday through Friday. The equipment which Respondent operated for the Petitioner was linked to the Florida Department of Law Enforcement and was part of the Florida Criminal Information Center. Given this affiliation, it was necessary for the Respondent to maintain his qualification to operate the terminal. That qualification was through a certification process. To this end Respondent had undergone training on May 2 and 3, 1989, through the Florida Department of Law Enforcement, to include a test to ascertain his skills. He failed to pass that test. Thus, he was not certified. As a consequence of Respondent's failure to obtain a satisfactory score on the certification examination to continue as a teletype operator on the Florida Criminal Information Center equipment, a letter was written from the Florida Department of Law Enforcement to Jeanette Spooner, Respondent's immediate supervisor. A copy of that correspondence may be found as Petitioner's Exhibit No. 1 admitted into evidence. Through the correspondence Patrick J. Doyle, Director, Division of Criminal Justice Information Systems for the Florida Department of Law Enforcement explained to Ms. Spooner that terminal operators who did not pass the examination, Respondent among them, could not continue operating the Florida Criminal Justice Information Center terminal until an minimum test score of 70 had been obtained. It was suggested in this correspondence that the arrangements be made to allow the operators who had failed to attend the next regularly scheduled training class. This letter is dated May 18, 1989. Ms. Spooner, whose job title has been identified in the Preliminary Statement, works from 8:00 a.m. to 4:30 p.m., Monday through Friday. She is on call weekends and holidays and after hours by contact through a beeper system. As a consequence, she was not in attendance when Respondent arrived for his midnight shift on Saturday, May 20, 1989. The midnight shift has one operator on duty with a float person being available for relief. The float operator also is available to work days. The primary operator on the midnight shift on May 20, 1989 would ordinarily have been the Respondent. Given that Ms. Spooner was not at work when Respondent arrived for his next duty shift beyond the notification that he had failed the certification examination, other arrangements were made by the Petitioner to confront this dilemma. These arrangements were made through a conversation between Mr. Pelham, whose job title with the Petitioner is identified in the Preliminary Statement, and a Ken Wilson who is a personnel official within the Petitioner's Department. Wilson devised a set of options that could be made available to the Respondent in view of his inability to function in his normal position of radio teletype operator. Those options may be found in Petitioner's Exhibit No. 2 admitted into evidence. They were: Transfer to day shift (8:00 a.m. 4:30 p.m.) and work in class other than teletype. Take annual leave and comp. leave until after next class by FDLE on July 13th and 14th 1989. Take leave of absence until FCICV test is passed. Transfer into another position of like pay grade either day shift or night shift. The options were then given from Pelham to Spooner, with a copy prepared to be provided to the Respondent along with a copy of the May 18, 1989 letter from Mr. Doyle. Spooner spoke to the Respondent on the telephone at 12:15 a.m. on May 20, 1989, after Respondent had clocked in for his duty shift at 12:03 a.m. on that date. In the course of this conversation, Spooner told Respondent that he could not operate the terminal and she discussed the options that had been prepared by Mr. Wilson in some depth. She also briefly spoke to Respondent about what the letter of May 18, 1989 said. The circumstance of trying to identify an alternative placement for the Respondent was one in which no equivalent position to radio teletype operator was found within the Bureau that Respondent was employed by. Through the conversation on May 20, 1989, Respondent was told that he needed to go home and read the options and make a decision about which option he wanted. This remark was made because Respondent had asked for a day or so to think about the situation. Ms. Spooner allowed Respondent to take annual leave for May 20 and 21, 1989 and up through May 22, 1989, if need be. On that latter date Respondent was to contact Mr. Pelham and Ms. Kirkland, whose position with the Petitioner's department has been set forth in the Preliminary Statement. Ms. Spooner was not going to be available on May 22, 1989, so she made the arrangements for the Respondent to contact Pelham and Kirkland on that date to explain his choice of the option that he preferred. May 22, 1989, was the first work day that the Respondent could be in contact with Pelham and Kirkland whose duty days did not include the weekend. The Respondent's duty shift was left to the replacement teletype operator. Ms. Spooner did not hear from the Respondent from May 20, 1989 through May 30, 1989. She did talk to him on May 31, 1989, between 10:00 a.m. and 11:00 a.m. Respondent appeared at the offices of the Petitioner to pick up his check. Ms. Spooner asked Respondent to wait a moment while she went to get Ms. Kirkland and told Respondent Ms. Kirkland needed to speak to him. When she got to Ms. Kirkland's office, Ms. Kirkland was on the telephone and Ms. Spooner waited for that conversation to be concluded before going back to speak to the Respondent. This took between 5 and 10 minutes. When she arrived back at her office, the Respondent had departed. He left a note for her, a copy of which may be found as Petitioner's Exhibit No. 4 in which he says: "Mrs. S I had to leave I'm sorry!!! I'll contact you today from the office." Respondent did not call her back as his note envisioned. To be absent from his duty assignment it was necessary for Respondent to contact Ms. Spooner in advance and if he were not going to be able to meet one of his shift requirements he had to give four hours notice to obtain a substitute operator. Respondent never asked Ms. Spooner for leave of any kind following the discussion of May 20, 1989. On May 22, 1989, Ms. Spooner had spoken to Ms. Kirkland by telephone and Ms. Spooner relayed the details of her conversation with the Respondent which took place on May 20, 1989. Around 10:00 a.m. on May 22, 1989, Kirkland, Pelham and Respondent met in Pelham's office to discuss Respondent's employment situation. In that discussion the May 18, 1989 letter was discussed and it was made clear to the Respondent that he could not be left in his position as radio teletype operator at present and that he could not return to that assignment until another class of instruction had been conducted in July, 1989. Respondent was told that he could do day clerical work somewhere within the Bureau that he was employed by with the same pay status that he had. It was emphasized that the teletype operation had to be covered, taken to mean by a certified employee. Respondent asked if he could work night clerical and was told that there were no night clerical positions available. Respondent mentioned the fact of his day time employment at Florida State University. Respondent was told that he could take annual leave, compensatory leave or a leave of absence until he went back to his position as teletype operator. The possibility was discussed of a transfer to a like pay position other than a clerical position and the existence of a vacancy in the tag office was discussed. This was a Senior Clerk position of the same pay grade as Respondent's current position. Respondent said that he would have to think about the situation and get with his supervisor at Florida State University. In the discussion of May 22, 1989, Respondent indicated that he did not like the option of working a morning job because it caused problems with his Florida State University position. Although his supervisors with the Petitioner were not sure of the details, it was remarked that the Respondent might consider a position with a Bureau within the Florida Highway Patrol, to which Respondent shook his head. Mr. Pelham told Respondent that he should think about his options the rest of the day and that he should contact Ms. Kirkland that day about the option the Respondent favored. The Respondent said it may take a little time to make the choice. Ms. Kirkland told Respondent that he should make sure to call her on May 22, 1989, or the first thing the following day and let her know his decision, because the Department would expect him to start in the morning at a new position if that were his choice. Respondent's claim that a deadline for decision was not given is rejected. Respondent stated that "If I have a problem I'll get back with you I'll let you hear from me." When the discussion was being held on May 22, 1989, Respondent had the options form and a copy of the letter of May 18, 1989, and he left the conference room with those items. This meeting lasted for approximately 30 to 45 minutes. During the course of that meeting Respondent did not ask for any form of leave or otherwise express his preference at any time contrary to his assertion that he had asked Ms. Spooner to calculate his annual and compensatory leave balances. Neither Ms. Kirkland nor Mr. Pelham heard from the Respondent between May 23 and May 30, 1989. Respondent did not report to a day shift, which shift would have had a work cycle of Monday through Friday with the weekends off, nor did he return to his duties as a teletype operator which had days off on Thursday and Friday. If he had elected to do the day shift work his duty days beyond the May 22, 1989 meeting would have been May 23-26, 1989, and May 29-31, 1989. The night shift would have been duty days on May 23 and 24, 1989 and May 27 - May 31, 1989. When Respondent did not confirm his choice of options, Mr. Pelham tried to make telephone contact with him at 9:30 a.m., 11:00 a.m., and 3:00 p.m. on May 26, 1989, at his employment at Florida State University and left messages on each occasion. Respondent did not return those calls. Had Respondent elected to go to a day shift position that change would have been placed in writing. No election having been made, it has not confirmed in writing. When the agency did not hear from the Respondent about his choice, it took action on May 30, 1989 noticing the Respondent of its intent to find that he had abandoned his position. The abandonment letter was dated May 30, 1989. It sets forth that the work days that Respondent did not attend were May 23-26, 1989. It contemplates the day schedule. As described before, whether Respondent is seen as having continued to operate on a night schedule or to have moved over to a day schedule, both being choices that he remained silent about, he still failed to appear at his duty assignment for more than three consecutive days. After dispatching the letter of abandonment on May 30, 1989, Respondent made known his intent to appeal the decision of the Petitioner. This point of view was expressed on June 7, 1989.
Recommendation Based upon the findings of facts, conclusions of law, it is, RECOMMENDED: That a Final Order be entered which fines that Lamichael Proctor has abandoned his position as a radio teletype operator with the State of Florida, Department of Highway Safety and Motor Vehicles. DONE and ENTERED this 9th day of November, 1989, in Tallahassee, Florida. CHARLES C. ADAMS, 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 9th day of November, 1989. APPENDIX TO RECOMMENDED ORDER, CASE NO. 89-3756 The following discussion is given concerning the proposed facts of the parties. Petitioner's Facts Petitioner's facts are subordinate to the facts found in the recommended order. Respondents's Facts Paragraphs 1 and 2 are subordinate to the facts found. The first sentence to Paragraph 3 is subordinate to facts found. The remaining sentences in Paragraph 3 are contrary to facts found. Paragraph 4 is subordinate to facts found with the exception that Petitioner's Exhibit No. 2 admitted into evidence in its fourth option discussed not only a night shift transfer but a day shift transfer as well. Paragraph 5 is confusing in its second sentence where it suggests that the Respondent resumed his work shift on Saturday following a Thursday and Friday off, which would correspond to Thursday and Friday being May 25 and 26, 1989 and Saturday being May 27, 1989. If this is truly the contention of the Respondent, it is an erroneous statement because Respondent did not report for work on Saturday, May 27, 1989. Where it is suggested in this paragraph that the Respondent was not scheduled to work on Thursday, May 25 and Friday, May 26, 1989, that assumes a night shift. If he was seen as working a day shift those days should have been the days that he should have been in attendance at his employment. In any event, under the interpretation that he was a day employee or night employee he has abandoned his job position. COPIES FURNISHED: Judson M. Chapman, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building Tallahassee, Florida 32399-0504 Lamichael Proctor 1233 Cross Creek Way Apartment A Tallahassee, Florida 32301 Charles J. Brantley, Director Division of Motor Vehicles Department of Highway Safety and Motor Vehicles Neil Kirkman Building Tallahassee, Florida 32399-0504 Enoch J. Whitney, Esquire Department of Highway Safety and Motor Vehicles Neil Kirkman Building Tallahassee, Florida 32399-0504 Larry D. Scott, Esquire Department of Administration Carlton Building Tallahassee, Florida 32399-1550 Aletta Shutes, Secretary Department of Administration 435 Carlton Building Tallahassee, Florida 32399-1550
The Issue The issue presented for decision herein is whether or not the Petitioner, Margie Ann Sims, was unlawfully terminated (by Respondent), Niagara Lockport Industries, Inc., due to her age in violation of the Florida Human Rights Act of 1977, Section 760.10, Florida Statutes (1983).
Findings Of Fact Based upon my observation of the witnesses and their demeanor while testifying, documentary evidence received and the entire record compiled herein, I make the following relevant factual findings. Petitioner is forty eight (48) years old. She commenced work for Respondent, Niagara Wires, a subsidiary of Niagara Lockport Industries, Inc., located in Quincy, Florida during 1965 as an Accounts Payable Clerk. Petitioner was terminated on August 5, 1983, as a result of a reduction in staff and unsatisfactory work performance.1 During Petitioner's job tenure, she held various accounting and secretarial positions. Petitioner's initial duties were that of an accounting clerk and she later progressed to Assistant Chief Accountant. She later served as Corporate Bookkeeper and Secretary. Throughout her employment, her job duties were very broad and encompassed many areas of responsibility including overseeing accounts receivable, billings, payroll, bank statements, journal entries, wire transfers and financial statements. During 1975, Respondent's corporate office was moved to Quincy, Florida and Petitioner handled accounting and secretarial duties for the corporate office, dealt with banks making fund transfers, loan balancing and note arrangements; managed financial consolidation of Respondent's eight companies on a quarterly basis; maintained all pension plan records for Respondent's fourteen pension plans which included calculations of pension benefits, submission of wages and credited service to actuaries in preparation of various pension reports. Petitioner's other duties involved maintenance of company minute books, typing, submission and maintenance of files for all letters of credit issued; keeping patent and trademark files and assisted with telecopy, switchboard and TWX. (Petitioner's Exhibit 2). During 1976, Petitioner worked directly for Respondent's corporate secretary/treasurer, Robert Worrall. The assignment occurred as a result of a recommendation by Respondent's manufacturing manager, Don Anderson. Petitioner was considered the best of the three employees available to work for Worrall. Thereafter, several changes were made in Respondent's corporate makeup including the addition of the Lockport Felt Division in 1977. As a result, additional employees were placed in the accounting department and Petitioner's duties became more secretarial and clerical in nature than accounting. This situation remained unchanged until Petitioner's termination in 1983. Although Petitioner worked directly for Worrall, she was also expected to perform secretarial and clerical work for others in the accounting department, specifically including Harry Kurtz, Vice-President of Finance, Bruce Kennedy, Controller and Hank Burnett, Corporate Administrative Manager. While Petitioner's primary responsibility was to complete Worrall's work, she was also expected to perform work for other accountants and fiscal employees in the accounting department as she was the only trained employee in the accounting department available for typing duties. (TR 35, 106, 133-134, 117-119, 138, 142 and 153). Respondent has not maintained a formal policy concerning employee discipline or warnings for salaried employees, as Petitioner. (Testimony of Cairns and Worrall, TR 19, 46-47, 60 and 77). Commencing in 1980, Worrall became unhappy with Petitioner's work performance. This unhappiness took the form of counseling with Petitioner during year-end annual reviews and included the following deficiencies: "away from her work station when needed; too much time spent socializing with others; unwilling to work; pushing work back on Worrall; untimeliness and failing to timely complete work as assigned." (TR 85, 110, 116- 117). Like Worrall, other employees in the accounting department for whom Petitioner worked were dissatisfied with her performance during the years 1980-1983. Harry Kurtz, Vice- President of Finance, experienced problems with Petitioner's work quality including errors in typing and formatting, misspelled words and inaccurate numbers to the point where he did not want her (Petitioner) to perform his (Kurtz) work. He was thus forced to seek assistance from persons outside the accounting department, including Pat Simmons who replaced Petitioner, to perform his work. Kurtz related these problems to Worrall. (TR 128, 129-133, 131 and 136). Bruce Kennedy, Controller, experienced similar problems with Petitioner's work quality. He noted Petitioner frequently misspelled words and transposed numbers. Kennedy experienced problems concerning timeliness and the invalid excuses by Petitioner for failing to complete assigned work as scheduled. (TR 137-139). Based on Petitioner's poor work quality, Kennedy went outside the accounting department to get assistance in performing his clerical and secretarial duties. Kennedy informed Worrall of his dissatisfaction with Petitioner's work. Hank Burnett, Corporate Administrative Manager, also experienced problems with Petitioner's work quality in regards to accuracy and neatness. Burnett related an incident where Petitioner used so much "white-out" to make corrections that numbers on ledger sheets were not legible. Burnett also experienced problems with Petitioner in getting work returned timely. He also found it necessary to go outside the accounting_ department to solicit the assistance of Pat Simmons to perform his work. Burnett related to Worrall his dissatisfaction with Petitioner's performance. (TR 128, 150). Linda Jaudzimas is presently employed with Niagara Wire Weaving Employees Credit Union. She has held that position since approximately May of 1980. During the years 1978 through May of 1980, Jaudzimas was employed as an accounting clerk in the corporate accounting office for Niagara Lockport Industries. During that time period, she worked directly with Petitioner and Worrall. Jaudzimas described Petitioner and Worrall as having a very good work relationship and that Worrall depended upon Petitioner a lot. However, since May of 1980, Jaudzimas had only limited contact with Petitioner The typical degree of contact would be only to "pick up reports; I would get information from pensions for time reporting periods." (TR 54 and 58). Don Anderson is presently employed as the Manufacturing Manager for Respondent. Anderson has been in Respondent's employ since 1971. From 1971 through January 1, 1974, Anderson was Respondent's Chief Accountant. Anderson had no direct knowledge concerning Petitioner's work performance since January of 1974. Anderson corroborated Cairns and Worrall's testimony that Respondent had no formal policy concerning disciplinary action taken against salaried employees, as Petitioner. (TR 60). Respondent conducted informal evaluations of salaried employees, including Petitioner, at the end of each year in conjunction with salary increases. During Petitioner's 1981 work performance evaluation, Worrall discussed his concerns with Petitioner including the fact that she spent too much time talking to other people; that he always had to look for her and she pushed work back on him. Petitioner's time away from her work station and her negative attitude toward the company's insurance program were items of discussion. (TR 17; 84-88). An entire list of Worrall's concerns respecting Petitioner's job performance were placed in her personnel file during the 1981 annual performance review. (Respondent's Exhibit 1). Petitioner recalls Worrall using that list during their meetings. (TR 36). Petitioner's performance did not improve during the following year and Worrall expressed the same concerns to her during her annual work performance review during 1982. (TR 115-116). Petitioner received "good" salary increases during the late 70's however, due to her poor performance from 1980-1982, Worrall recommended that she receive only the minimum cost of living increases for the years 1981, 1982 and 1983. In mid 1983, Respondent made a decision to reorganize its corporate offices by moving the sales office of Niagara Lockport from Quincy to Starkeville, Mississippi and by making a change in the research and development department. Pat Simmons, age 41, was secretary for the vice-present of research and development. Worrall was familiar with Ms. Simmons and her work having seen it first hand. Additionally, she was highly recommended by her then supervisors. Finally, she had performed work considered to be "high quality" by other employees in the accounting department including Kurtz, Kennedy and Burnett. When Simmons became available due to the reorganization, Worrall decided to replace Petitioner with Simmons. Petitioner's job had become primarily secretarial and clerical in nature and Worrall desired a competent executive secretary to replace her. (TR 88 90, 92, 94, 121-122, 127). Petitioner was 45 years of age at the time of her termination. (Respondent's Exhibit 3). Petitioner's duties were assumed by Simmons (95 percent) and Elaine Hall (5 percent) who was retained since she- possessed requisite accounting skills. Hall was able to complete the cash report in two hours, a job that had taken Petitioner the better part of a day to perform. (TR 86). As a result of the reorganization, two other employees, Loretta Hood (mid 30's) and Virginia Jeffcoat (mid 50's) were terminated. Petitioner was terminated in August, 1983 for the reasons that her performance was not satisfactory and a qualified person (Simmons) had become available due to Respondent's corporate reorganization and staff reduction. This was told to Petitioner at the time of her termination. (Respondent's Exhibit 2; TR 68, 93). Subsequent to her termination, Petitioner requested that Worrall write her a letter of recommendation. Worrall complied, however, Petitioner was not pleased and asked him to write a second one giving him an example to follow (Respondent's Exhibit 7). Petitioner wanted a "good" letter of recommendation so that she could easily obtain another job. In writing the recommendation, Worrall followed his policy of not commenting on negatives but merely set out the type of work Petitioner performed. Petitioner was still unsatisfied with Worrall's second letter and she therefore asked the Respondent's President, Malcolm Cairns, to write a letter of recommendation for her. As with Worrall, Petitioner participated in the drafting of the letter for Cairns by providing him with an example. (TR 22, 23 and 70). Cairns did not include anything negative in the letter so that it would be easier for Petitioner to obtain another job.
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 finding that Petitioner was not terminated due to her age in violation of the Florida Human Rights Act of 1977, as amended. Section 760.10, Florida Statutes (1983) and that Petitioner's Petition for Relief be DISMISSED. DONE and ORDERED this 10th day of March, 1986, in Tallahassee, Florida. JAMES E. BRADWELL, 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 10th day of March, 1986. COPIES FURNISHED: Steven L. Seliger, Esquire 229 E. Washington Street Quincy, Florida 32351 Swift, Currie, NcGhee and Hiers, P.A., by Victor A. Cavanough 771 Spring Street, N.W. Post Office Box 54247 Atlanta, Georgia 30379-2401 Donald A. Griffin, Executive Director Florida Commission on Human Relations 325 John Knox Road Building F, Suite 240/ Tallahassee, Florida 32303. Dana Baird, General Counsel Florida Commission on Human Relations 325 John Knox Road Building F, Suite 240 Tallahassee, Florida 32303
The Issue The issues in this case are whether Petitioner was provided incorrect, inaccurate, and erroneous information, and, if so, if she may transfer to the Florida Retirement System (FRS) Pension Plan (Pension Plan) by paying a “buy-in” amount of $2,418.55, consistent with the amount quoted to Petitioner in January 2020.
Findings Of Fact Ms. Evangelisto has been continuously employed by an FRS- participating employer since August 2012. As a new employee of an FRS-participating employer, Ms. Evangelisto had a choice to enroll in one of two FRS retirement plans: the Pension Plan or the Investment Plan. The Pension Plan is administered by the Florida Division of Retirement (Division of Retirement), which is housed within the Department of Management Services. The Pension Plan is a defined benefit plan; the benefit is formula-based. The formula used for calculating a pension plan benefit is based on total years of creditable service at the time of retirement, membership class, and average final compensation. See § 121.091, Fla. Stat. The Investment Plan is administered by SBA. The Investment Plan is a defined contribution plan; the benefit is based on gains and losses due to market performance. On January 22, 2013, Ms. Evangelisto enrolled in the Investment Plan, with an effective date of February 1, 2013. This choice is considered Ms. Evangelisto’s initial election. Ms. Evangelisto is still enrolled in the Investment Plan. After making an initial election, an employee may make a “second election” if still employed with an FRS-participating employer, earning salary and service credit. Ms. Evangelisto may utilize a second election to move into the Pension Plan, but must pay a “buy-in” amount to do so. This sum is derived from an actuarial calculation conducted by the Division of Retirement. To effectuate a second election, Ms. Evangelisto must complete and submit a 2nd Election Retirement Plan Enrollment Form (2nd Election Form) to the Plan Choice Administrator. The 2nd Election Form may be obtained by calling the MyFRS Financial Guidance Line or through the MyFRS.com website. When completed, the form may be submitted by facsimile, mail, or by electronic submission through the MyFRS.com website. Respondent is required to provide FRS Investment Plan participants with educational services, including: disseminating educational materials; providing retirement planning education; explaining the Pension Plan and the Investment Plan; and offering financial planning guidance on matters such as investment diversification, investment risks, investment costs, and asset allocation. See § 121.4501(8)(b), Fla. Stat. Respondent provides these educational services through Ernst & Young (EY), a contracted third-party administrator. EY financial planners provide information to FRS employees via the MyFRS Financial Guidance Line. On multiple occasions over the years, going back to as early as July 2018, Ms. Evangelisto spoke to EY financial planners via the MyFRS Financial Guidance Line to request a calculation of her buy-in amount.2 In July 2018, Ms. Evangelisto contacted the MyFRS Guidance Line to request her buy-in amount. In August 2018, she received a comparison estimate. The comparison estimate provided the estimated buy-in amount, the current value of her Investment Plan, and the amount of out-of-pocket funds 2 Ms. Evangelisto testified that she made requests to determine her buy-in amount even prior to 2018. Ms. Evangelisto would have to pay to buy into the Pension Plan. This out-of- pocket sum is the result of the difference between the buy-in amount determined by the Division of Retirement and her Investment Plan account balance. The amounts contained in the comparison estimate are only valid for the calendar month in which they are issued. From July 2018, through March 2019, there were numerous communications between Petitioner and EY Financial Planners by telephone conversation, email, and through voice messages. Ms. Evangelisto made requests for buy-in amounts and received updated comparison estimates in November 2018 and March 2019. On January 13, 2020, Petitioner requested a calculation of her buy-in amount. On January 22, 2020, she received a comparison estimate which set forth an out-of-pocket cost of $2,418.55 to transfer to the Pension Plan. The estimate indicated that it was valid until January 31, 2020. On February 14, 2020, Petitioner requested another calculation of her buy-in amount. On March 12, 2020, she received a comparison estimate with an out-of-pocket cost of $7,198.64. The estimate indicated that it was valid until March 31, 2020. Ms. Evangelisto testified that she did not transfer to the Pension Plan, after being provided comparison estimates, because she did not have the funds to pay for the associated out-of-pocket cost. On June 24, 2020, Petitioner called the MyFRS Guidance Line to request yet another comparison estimate. During this conversation, Petitioner inquired about potential changes to the buy-in amount associated with becoming “vested.” The conversation was recorded and later transcribed by a court reporter: Ms. Evangelisto: Does the cost to buy into the pension change significantly once you would be vested at the eight years? EY financial planner: I actually don’t know if it would or not. Ms. Evangelisto: Okay. EY financial planner: I can try to find out. I don’t think it’s necessarily based on vesting, but more the years of service. Ms. Evangelisto: Okay. During the June 24, 2020, call, the EY financial planner told Ms. Evangelisto that she could expect the comparison estimate in three weeks. Ms. Evangelisto agreed to July 16, 2020, for a follow-up call. On July 9, 2020, Ms. Evangelisto received an email from EY, but the email did not contain the requested comparison report. On July 15, 2020, Ms. Evangelisto called the MyFRS Guidance Line to follow up on her June 24 request and to ask about the July 9 email. The EY financial planner calculated the buy-in costs for her over the phone. He provided a verbal, estimated out-of-pocket cost of $17,657.00 to buy into the Pension Plan. Surprised by this number, which was over $10,000 higher than the out-of-pocket estimate provided in March 2020, Ms. Evangelisto asked why the cost increased. This telephone call was also recorded and later transcribed by a court reporter. Relevant parts of the conversation are as follows: Ms. Evangelisto: Does it normally jump up heftily at eight years of service -- EY financial planner: No. No. Ms. Evangelisto: -- or like in a yearly increment? EY financial planner: No. Ms. Evangelisto: It doesn’t? EY financial planner: It -- okay, you have been watching in and monitoring it very closely, so you had in December, January, March, and now we are a July figure. If all of those other figures were consistent, while the increase due to the change in the underlying interest rate might have a negative impact, it shouldn’t be so much that it’s going to bump up the cost by another $10,000. The EY financial planner promised to look into the numbers to ensure they were not miscalculated. On the same day, the EY financial planner called Ms. Evangelisto back and left a voicemail. He stated that the out-of-pocket cost he provided on the earlier phone call was correct and that the number had substantially increased because Ms. Evangelisto hit the eight-year vesting mark.3 The previous calculations were based on having an unvested account balance. Ms. Evangelisto returned the EY financial planner’s call and he confirmed the information he provided in the voicemail. Ms. Evangelisto asked EY financial planners, on two occasions, if her buy-in amount (and resulting out-of-pocket costs) would increase upon becoming vested. On the first occasion, during the June 24 call, the EY financial planner told her that he “did not know” and would endeavor to provide her with an answer by July 16. Unfortunately for Ms. Evangelisto, the final date to make the switch to the Pension Plan before the substantial increase4 was June 30. Ms. Evangelisto reached out to the MyFRS Guidance Line on July 15, prior to her scheduled July 16 call. On this occasion, the EY financial planner provided incorrect information when he told her that buy-in amounts did not 3 In her Proposed Recommended Order, Ms. Evangelisto asserted that she became “vested” on July 1, 2020, after completing eight years of creditable service with FRS-participating employers. 4 It is important to note that the amount to buy into the Pension Plan increased every time Ms. Evangelisto requested a calculation, albeit not the sizeable jump that occurred when she became vested. substantially increase upon vesting. This proved to be inconsequential, however, as the increase to Ms. Evangelisto’s buy-in amount had occurred as of July 1, 2020, prior to the EY planner providing the incorrect information. An EY financial planner provided inaccurate information to Ms. Evangelisto when he indicated that no substantial jump would occur upon vesting. Nevertheless, Ms. Evangelisto is required to pay a buy-in amount as calculated by the Division of Retirement when she chooses to move forward with making the second election. Petitioner did not prove that she should be entitled to pay the buy-in amount calculated in January 2020. That amount was valid until January 31, 2020, and the document provided to Ms. Evangelisto clearly notified her of such. Ms. Evangelisto still has a one-time second election to move into the Pension Plan.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the State Board of Administration enter a final order dismissing Petitioner’s Florida Retirement System Investment Plan Petition for Hearing. DONE AND ENTERED this 21st day of January, 2021, in Tallahassee, Leon County, Florida. S JODI-ANN V. LIVINGSTONE Administrative Law Judge 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 www.doah.state.fl.us COPIES FURNISHED: Elisha Marie Evangelisto 4604 20th Avenue West Bradenton, Florida 34209 Deborah Stephens Minnis, Esquire Ausley McMullen, P.A. Post Office Box 391 Tallahassee, Florida 32302 Ash Williams, Executive Director & Chief Investment Officer State Board of Administration 1801 Hermitage Boulevard, Suite 100 Post Office Box 13300 Tallahassee, Florida 32317-3300
Findings Of Fact Respondent, William "Bill" Harrison (Harrison) served as a member of the City of Laurel Hill City Council (Council) from July 1989 to April 1992. The population of Laurel Hill (City) is approximately 600 people. At the present time, Harrison is an Okaloosa County Commissioner. Harrison's take-home pay as a member of the Council was less than $25 monthly. At the July 6, 1989, meeting of the Council--Harrison's first Council meeting as an elected member of the Council--Harrison moved, and the Council voted, that the City reimburse Council members who used their personal vehicles for City business at the rate of 22.5 cents per mile. The Council had previously authorized the reimbursement for mileage for Council members using their personal vehicles. There was no requirement to receive advance permission from the Council before a member took a trip on official business. There was no written policy for handling mileage reimbursements. In practice, the party seeking reimbursement submitted a written request, which would be circulated at the next Council meeting for approval. In late 1989 or early 1990, Harrison became Chairman of the Council. He was also the City's representative to the Okaloosa County League of Cities (League of Cities) and was the President of the Laurel Hill Volunteer Fire Department which was under the supervision of the Council. As a result of his duties as a member of the Council, representative to the League of Cities, and president of the volunteer fire department, Harrison was required to travel. In September and October, 1989, the Council engaged in a series of discussions concerning reestablishing a police department. This was a controversial issue and was the source of considerable debate and confrontation in the community. Harrison submitted an expense reimbursement request for a trip on February 28, 1990, to the Florida Department of Law Enforcement office in Pensacola, Florida. His reimbursement request was for $35.32, which represented 157 miles at 22.5 cents per mile. The council approved the request for reimbursement, and Harrison received a check for $35.32. An ethics complaint was filed against Harrison, alleging violations of Section 112.313(6), Florida Statutes, in connection with his travel reimbursement from the City. The Florida Commission on Ethics sent Investigator Larry Hill to interview Harrison concerning the alleged violations. When Investigator Hill questioned Harrison about the trip to FDLE in Pensacola, Harrison indicated that he had gone to the FDLE office and talked to someone there. Hill: You just went down and talked to someone at FDLE, there at the office, the big office down there? Harrison: Yes. Yes, exactly right, we talked. When Investigator Hill asked Harrison why he went to the FDLE office, Harrison stated that he had received anonymous, threatening telephone calls relating to a complaint that he had filed against his predecessor on the Okaloosa County Commission, Ferrin Campbell. Investigator Hill made further investigations and learned that Harrison never went to the FDLE office and that Harrison filed his complaint against Mr. Ferrin almost a year after Harrison's alleged trip to the FDLE office. Investigator Hill issued his Report of Investigation on August 9, 1993, including these findings. Harrison was sent a copy of the Report of Investigation. By letter dated August 17, 1993, Harrison notified the Commission on Ethics that he had intended to go to the FDLE office but changed his mind and went to the University of West Florida Resource Library. However, he put on his expense report that the trip was to FDLE because he wanted people in the community to know that he had been in contact with the FDLE. Harrison did not clearly explain in his letter what he was doing at the library. At the final hearing, Harrison stated that he went to the library to research the reestablishing of the police department in Laurel Hill, and that he made a telephone call to FDLE while at the library. He stated that he had originally intended to go to FDLE because he had received threats concerning the police department issue. Having observed the demeanor of Harrison and having judged Harrison's credibility, I find that his testimony concerning doing research at the University of West Florida Resource Library not to be credible. On May 2, 1991, Harrison submitted an expense reimbursement request to the City, which included a request for mileage of 32 miles for a trip to the Supervisor of Elections office in Crestview on April 19, 1991, and for mileage of 31 miles for a trip to the Supervisor of Elections office in Crestview on April 25, 1991. The Council approved his request and reimbursed him for the mileage at 20 cents per mile. On June 6, 1991, Harrison submitted a voucher for reimbursement of traveling expenses to the City, which included a request for mileage reimbursement of 31 miles for a trip to the Supervisor of Elections office on May 3, 1991. The Council approved his request and reimbursed him for the mileage at 20 cents per mile. His total reimbursement for the three trips to the Supervisor of Elections office was $18.80. On April 19, 1991 Harrison went to the Supervisor of Elections office and filed a Statement of Financial Interests 1990, an acknowledgement that he received a notice of the preelection test of the voting equipment, a receipt for a copy of Chapter 106, and an Appointment of Campaign Treasurer. On April 25, 1991, Harrison went to the Supervisor of Elections office and filed a Statement of Candidate. On May 3, 1991, Harrison went to the Supervisor of Elections office and filed a Campaign Treasurer's Report. The documents which he filed on April 19, April 25, and May 3 related to his campaign for reelection to the Council. When Investigator Hill interviewed Harrison about the trips to the Supervisor of Elections Office, Harrison told him that he did not have any documentation of the purpose of the trips. When asked about the filing of the campaign documents, Harrison stated that the reason for the trips was not entirely related to the filing of the documents. He indicated that he may have discussed the Sunshine Law with someone at the Supervisor of Elections office. Harrison did acknowledge that he filed the campaign documents at the Supervisor of Elections office on the dates at issue but he can not specifically recall what else he did there. He speculates that he may have discussed the Data Vote machine and the uniform election day issue with someone at the Supervisor of Elections office on those dates but he is not sure. He also thinks that he may have visited the Director of the County Emergency Medical Service on May 3, in response to a request by the Council made at the Council meeting on May 2, but he had no documentation of such a visit. Having judged the credibility of Harrison, I find that his trips to Crestview on April 19, 25 and May 3, 1991 were for the sole purpose of filing his campaign documents.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that a Final Order and Public Report be entered finding that William "Bill" Harrison violated Section 112.313(6), Florida Statutes, imposing a civil penalty of $1,000 per allegation for a total of $2,000; requiring restitution of $52.12, and issuing a public censure and reprimand. DONE AND ENTERED this 7th day of December, 1994, in Tallahassee, Leon County, Florida. SUSAN B. KIRKLAND Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 7th day of December, 1994. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-1787EC To comply with the requirements of Section 120.59(2), Florida Statutes (1993), the following rulings are made on the parties' proposed findings of fact: Advocate's Proposed Findings of Fact. 1. Paragraphs 1-3: Accepted. Findings of Fact Based on Evidence At Hearing. Paragraphs 1-4: Accepted in substance. Paragraph 5: The last sentence is rejected as constituting argument. The remainder is accepted in substance. Paragraph 6: Accepted in substance that Harrison's explanation of his trip to Pensacola is not credible. The remainder of the paragraph is rejected as constituting argument. Paragraphs 7-8: Accepted in substance. Paragraph 9: Accepted in substance to the extent that Harrison maintained that he could have been in Crestview on City business but he does not remember exactly what it was and speculates on what it may have been. The remainder of the paragraph is rejected as constituting argument. Paragraph 10: Rejected as constituting argument. Paragraph 11: Accepted in substance. Respondent's Proposed Findings of Fact Stipulated Facts 1. Paragraphs 1-3: Accepted. Facts Based on the Record Paragraph 1: Accepted in substance. Paragraphs 2-4: Rejected as subordinate to the facts actually found. Paragraphs 5-8: Accepted in substance. Paragraphs 9-14: Rejected as subordinate to the facts actually found. Paragraph 15: The first sentence is accepted in substance as to 1989 but not as to early 1990 based on the minutes of the Council meetings. The second sentence is accepted in substance. Paragraph 16: Accepted in substance that Harrison received threats concerning the police department issue but rejected to the extent that these threats were received in early 1990. The minutes of the meetings show that the police issue was discussed in the fall of 1989. Paragraph 17: Having judged the credibility of Harrison, the paragraph is rejected . Paragraph 18: Accepted in substance to the extent that Harrison told Mr. Dunn that he had received threats and that he had done some research at the library on police issues, but rejected to the extent that it implies that Dunn's testimony confirms that Harrison went to Pensacola to the library on February 28, 1990, to do research and that Harrison was going to the FDLE office because he had recently received threats. Paragraph 19: The first sentence is accepted in substance. The remainder is rejected as subordinate to the facts actually found. Paragraph 20: Rejected as constituting argument. Paragraph 21: The portion of the first sentence that Harrison did not go to FDLE is accepted in substance. The portion of the first sentence that Harrison did research is rejected as not credible. The remainder of the paragraph is rejected as constituting a conclusion of law. Paragraph 22: Rejected as constituting argument. Paragraph 23: The first and second sentences are accepted in substance. The remainder of the paragraph is rejected as constituting argument. Paragraphs 24-26: Rejected as subordinate to the facts actually found. Paragraphs 27-29: Rejected as constituting argument. COPIES FURNISHED: Carrie Stillman Complaint Coordinator Commission on Ethics Post Office Box 15709 Tallahassee, Florida 32317-5709 Marty E. Moore, Esquire Advocate for the Commission on Ethics The Capitol, PL-01 Tallahassee, Florida 32399-1050 John C. Cooper, Esquire COOPER, COPPINS & MONROE, P.A. Post Office Drawer 14447 Tallahassee, Florida 32317-4447 Bonnie Williams Executive Director Florida Commission On Ethics Post Office Drawer 15709 Tallahassee, Florida 32317-5709 Phil Claypool, Esquire General Counsel Ethics Commission 2822 Remington Green Circle, Suite 101 Post Office Drawer 15709 Tallahassee, Florida 32317-5709
The Issue The issue presented for determination in these causes, pursuant to F.S. Section 120.56(1), is whether or not the "12 hour F rule," F.A.C. Rule 6J- 5.56(11)(b), and/or the "mandatory grade curve rule," F.A.C. Rule 6J-5.56(5)(c), constitute either an invalid exercise of validly delegated legislative authority, or an exercise of invalidly delegated legislative authority. The major contention of petitioner is that the respondent failed to comply with the notice requirements of F.S. Section 120.54(1)(a) when it adopted the rules in question. No other issues, including the wisdom or the applicability of such rules, are appropriate in a Section 120.56 proceeding for an administrative determination of a rule.
Findings Of Fact Based upon the oral and documentary evidence adduced at the hearing, the following relevant facts are found: The petitions filed herein allege that petitioner was academically dismissed from the law school because of the "12 hour F rule" and that he received a failing grade in Tax 601-602 because of the "mandatory grade curve rule." After some student input, the faculty of the FSU law school adopted the "12 hour F rule" and the "mandatory grade curve rule" in 1973 and 1975 respectively, prior to the effective date of Chapter 75-191, Laws of Florida. Effective June 26, 1975, Chapter 75-191, Laws of Florida, included units of the state university system within the confines of the Administrative Procedures Act, Chapter 120 of the Florida Statutes. Pursuant thereto, the respondent, Florida State University, began the process of adopting new and repromulgating its existing rules. The Dean of the FSU Law School was instructed by respondent to submit all of the law school rules to the respondent so that they could be properly promulgated along with other FSU rules. The Dean complied with this request. On August 20, 1975, and again on August 22, 1975, legal ads were placed in the Tallahassee Democrat concerning respondent's intent to adopt proposed rules. Notices were also published, making reference to the aforesaid more complete notice, in the Miami Herald, the St. Petersburg Times and the Jacksonville Times-Union. The August 20th notice in the Tallahassee Democrat announced that a hearing would be held on September 3, 1975, and set forth for each rule the purpose and effect of the rule, a summary of the rule, general authority for the rule and the law implemented. The challenged College of Law Rules numbered, as 6J-5.56, were included in this legal ad and were in substantially the same form as that previously adopted by the law school faculty. By letter dated August 13, 1975, Mr. Mike Beaudoin, respondent's Director of Informational Services, notified respondent's three foreign branches in Florence, Italy, London, England and the Canal Zone of the proposed rules. Gail Shumann, a staff assistant to respondent's Vice President for Academic Relations, assisted in the rule promulgation process. Utilizing a list furnished her by the Coordinator of Student Organizations, Shumann sent by campus mail a "notice of intent to file rules" to all listed registered student organizations existing on January 17, 1975. Such notice was also posted in the personnel office. This notice announced that the rules would be adopted on September 10, 1975, that a copy of the notice of the proposed rules was available in the Office of Student Government, that a copy of the rules was available at the information desk in the Strozier Library and could be obtained at cost from the Division of University Relations and that a hearing on the proposed rules would be held on September 3-5, 1975. The notice was dated August 18, 1975. The list of registered student organizations furnished Ms. Shumann by the Coordinator of Student Organizations did not contain the name of the student body president and listed the former president of the student bar association. A secretary for the student body president was unable at the time of the hearing to find or to recall whether she had received copies of the notice of intent to adopt rules. She testified that she did not have the opportunity to go through all of her files and that it was possible she received such notice. The president of the student bar association, who was not on campus during the summer quarter, could not recall having seen the notice of intent, but testified that it was possible that it came through his office while he was off campus. At least fourteen days prior to the scheduled hearing, Informational Services Director Beaudoin directed a reliable employee to post the notice of intent upon respondent's fifteen official bulletin boards. On August 20, 1975, respondent's rules were filed with the Joint Administrative Procedures Committee. Public hearings were held on September 3, 4, and 5, 1975, on the FSU campus for the purpose of hearing comments concerning the proposed rules. Few persons attended these hearings. The rules were filed with the Secretary of State on September 10, 1975, and became effective on September 30, 1975.
