87-002621RX Economic Research Services vs. Central Florida Community College Status: Closed DOAH Final Order on Friday, October 2, 1987.

Summary: Portion of rule establishing charge of 25 cents for first nine photocopies is invalid; challenged rules otherwise not shown to be invalid.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ECONOMIC RESEARCH SERVICES , )

)

Petitioner , )

)

vs. ) CASE NOS. 87-2621RX

) 87-2623RX

CENTRAL FLORIDA COMMUNITY )

COLLEGE, )

)

Respondent. )

__________________________________)

FINAL ORDER

Pursuant to notice, a formal hearing was conducted in these consolidated

cases in Tallahassee, Florida, on July 14, 1987, before Michael M. Parrish, a

duly designated Hearing Officer of the Division of Administrative Hearings. At

the hearing the parties were represented as follows:

For Petitioner: Mr. H. C. "Hy" Jensen

Economic Research Services

2014 Northeast Ninth Street

Ocala, Florida 32670

For Respondent: Brian D. Lambert, Esquire

SAVAGE, KRIM, SIMONS,

FULLER & ACKERMAN, P.A.

121 Northwest Third Street

Ocala, Florida 32670

BACKGROUND AND ISSUES

These are two consolidated rule challenge cases in which the Petitioner has

challenged two of the Respondent's promulgated rules as being invalid exercises

of delegated legislative authority. The Petition in Case No. 87-2621RX

challenges Respondent's Rule 6Hx3:5-43, which deals with access to public

records and obtaining copies of public records. The rule is challenged on the

grounds that it has an inadequate economic impact statement, as well as on

substantive grounds. The Petition in Case No. 87-2623RX challenges Respondent's

Rule 6Hx3:7-26, which deals with competitive bidding. The rule is challenged on

the grounds that it has an inadequate economic impact statement, as well as on

other procedural grounds.

At the close of the hearing, the parties were granted ten (10) days within

which to file proposed final orders. The Petitioner waived the right to file

proposed final orders and elected to rely on documents previously filed. The

Respondent filed proposed final orders in both cases. The substance of all of

the findings of fact proposed by the Respondent has been included in the

findings of fact which follow.

FINDINGS OF FACT

Based on the stipulation of the parties, the exhibits received in evidence,

and the testimony of the witnesses at the hearing, I make the following findings

of fact.

Stipulated findings concerning

CFCC Rule 6Hx3:5-43

1. H. C. "Hy" Jensen, as the owner and operator of Economic Research

Services, licensed to do business as a research and management consultant firm,

has a substantial interest in the access to and the costs for reproduction of

public records, documents, rules, orders, and subject matter indexes in the

custody of the District Board of Trustees of Central Florida Community College.

2. The District Board of Trustees of Central Florida Community College

(the Board) is an "agency" as defined by Sections 119.011(2) and 120.52(1),

Florida Statutes, and, as such, is governed by and must comply with Chapters 119

and 120, Florida Statutes.

3. The Board initially adopted Rule 6Hx3 :1-04, November 19, 1986, and

renumbered it as Rule 6Hx3:5-43, June 10, 1987.

4. Rule 6Hx3 :5-43 is the Board's statement of policy governing access to

and fees charged for duplicating copies of public records.

5. Prior to the adoption, amendment, or repeal of any rule, the Board is

required to prepare a detailed economic impact statement, as described in

Section 120.54(2)(b), Florida Statutes.

6. The detailed economic impact statement is a public record as defined by

Section 119.011(1), Florida Statutes, and, as such, must be made available for

public inspection and examination immediately upon giving public notice of the

Board's intent to adopt, amend, or repeal a rule.

7. The economic impact statement pertaining to Rule 6Hx3:1-04 (now 6Hx3:5-

43) was not available for public inspection and examination as required by

Section 119.07(1)(a), Florida Statutes, and Rule 28-3.027, Model Rules of

Procedure, Florida Administrative Code.

8. The Board had not declared an emergency to justify its failure to

prepare the required detailed economic impact statement.

9. Prior to the adoption, amendment, or repeal of any rule, the Board is

required to give public notice of its intended action and include information

specified by Section 120.54(1), Florida Statutes. In addition to other factors,

the notice must include a summary of the estimate of economic impact on all

persons affected by the rule.

10. Although it did not prepare the required detailed economic impact

statement, the Board nevertheless published a public notice of its intent to

adopt Rule 6Hx3:5-43. The published notice included an alleged summary of the

economic impact statement.

11. The Board's public notice asserted the rule: "Will provide a nominal

income to the college to help offset cost incurred in reproducing or collecting

information for individuals or companies."

12. The Board's unnumbered second paragraph of Rule 6Hx3:5-43 exempts from

public access all documents within employee personnel records by stating:

"The provisions of the above paragraph shall

not apply to such matters as student records,

personnel records and other matters exempt

from the definition of public records or

otherwise confidential under Florida Law."

Other findings concerning CFCC

Rule 6Hx3: 5-43

13. On or about July 28, 1986, the Petitioner sent a letter to Mr. Max O.

Curry, Dean of Administration for the Respondent, in reference to the

Petitioner's computations as to the cost for reproduction of certain copies of

records. The purpose of the letter was to assist the Respondent in formulating

a rule as to the cost to charge the public for reproduction of records. Max O.

Curry and Jan Harris considered the information in Petitioner's letter of July

28, 1986, prior to the promulgation of the challenged rule.

14. Prior to the adoption of the challenged rule, the Respondent did not

technically comply with Section 120.54(2)(b), Florida Statutes, in that it did

not prepare a detailed economic impact statement, although it did consider the

economic impact of adopting this rule prior to the actual adoption and stated an

estimate of that economic impact in the notice of meeting published on November

6, 1986.

15. The opening paragraph of Rule 6Hx3:5-43 states, in essence, that

records of the Respondent are open to the public. Tne second paragraph of the

rule reads as follows:

The provisions of the above paragraph shall

not apply to such matters as student records,

personnel records and other matters exempt

from the definition of public records or

otherwise confidential under Florida Law.

16. The fourth paragraph of Rule 6Hx3:5-43 reads as follows:

In the event that the College is required to

provide a photographic copy, the person

desiring the same shall pay to the College a

charge for making such copy or copies, the

amounts prescribed as follows:

1. 25 cents per page for nine (9) pages

(copies) or less.

2. 10 cents per page for all pages (copies)

beyond nine (9).

3. If the nature or volume of public

records requested to be inspected,

examined or copies (sic) pursuant to

the Rule, is such as to require

extensive use of information technology

resources or extensive clerical or

supervisory assistance by College

personnel, or both, the College shall

charge an additional special service

charge based upon the cost incurred

for such extensive use of information

technology resources and/or the labor

cost of the personnel providing

the service.

Stipulated findings concerning CFCC

Rule 6Hx3:7-26

17. H. C. "Hy" Jensen, as owner and operator of Economic Research Services,

licensed to do business as a research and management consultant firm, is a

provider of contractual services as defined in Section 287.012(4)(a), Florida

Statutes, and, as such, has substantial interest in the procurement policies of

the District Board of Trustees of Central Florida Community College.

18. The District Board of Trustees of Central Florida Community College

(the Board) is an "agency" as defined by Sections 119.011(2) and 120.52(1),

Florida Statutes, and as such, is governed by and must comply with Chapters 119

and 120, Florida Statutes.

19. Rule 6Hx3 :7-26 is the Board's statement of policy governing

procurement of contractual services.

20. The Board amended rule 6Hx3 :7-26 on June 10, 1987. Prior to this

amendment, Rule 6Hx3:7-26, revised February 1, 1984, required a minimum of three

formal written bids for any procurement of contractual services exceeding

$3,000.

21. During its meeting of June 10, 1987, the Board amended its proposed

revision by inserting a provision into the rule which excludes all providers of

contractual services from the competitive bidding process.

22. Prior to the adoption, amendment, or repeal of any rule, the Board is

required to prepare detailed economic impact statement, as described in Section

120.54(2)(b), Florida Statutes.

23. The detailed economic impact statement is a public record as defined

by Section 119.011(1), Florida Statutes, and, as such, must be made available

for public inspection and examination immediately upon giving public notice of

the Board's intent to adopt, amend, or repeal a rule.

24. Prior to its amendment of Rule 6Hx3:7-26 on June 10, 1987, the Board

failed to prepare the detailed economic impact statement required by Section

120.54(2)(b), Florida Statutes.

25. Consequently, the economic impact statement pertaining to Rule 6Hx3:7-

26 was not available for public inspection and examination as required by

Section 119.07(1)(a), Florida Statutes, and Rule 28-3.027, Model Rules of

Procedure, Florida Administrative Code.

26. The Board had not declared an emergency to justify its failure to

prepare the required detailed economic impact statement.

27. Prior to the adoption, amendment, or repeal of any rule, the Board is

required to give public notice of its intended action and include information

specified by Section 120.54(1), Florida SLatutes. In addition to other factors,

the notice must include a summary of the estimate of economic impact on all

persons affected by the rule.

28. Although it did not prepare the required detailed economic impact

statement, the Board nevertheless published a public notice to amend Rule

6Hx3 :7-26. The published notice included an alleged summary of the detailed

economic impact statement asserting that the Board anticipated no economic

impact by its amendment of this rule.

29. Additionally, the Board's published notice did not inform the public

of its intent to amend the rule to exclude all providers of contractual services

from the competitive bidding process.

Other findings concerning CFCC

Rule 6Hx3 :7-26

30. Rule 6Hx3:7-26 requires, among other things that the Respondent obtain

a minimum of three written bids for purchases from $3,501 to $5,000, and that

Respondent publicly advertise all purchases exceeding $5,000, as well as obtain

a minimum of three formal, written bids for such purchases. The rule also

contains several specific exceptions to the three-bid requirement. The

exception challenged by the Petitioner reads as follows:

Professional services, including, but not

limited to, attorneys, auditors, management

consultants, architects, engineers, and land

surveyors. Services of architects,

engineers, and land surveyors shall be

selected and negotiated according to Section

287.055, Florida Statutes.

31. The exception quoted immediately above was added to the language of

rule during the course of the public hearing on the rule amendments, which

hearing was conducted by Respondent's District Board of Trustees on June 10,

1987. The addition of the language quoted immediately above was made on the

advice of the Respondent's legal counsel, Gary C. Simons, which advice was

communicated to the Trustees during the course of the public meeting on June 10,

1987.

32. Although the original proposed amendments to Rule 6Hx3 :7-26 did not

include the above-quoted exception challenged by Petitioner, the proposed rules

of the college are subject to being changed or further amended as a result of

input at public meetings and hearings, as the purpose of public meetings and

hearings on proposed rules is to receive input prior to the final adoption of a

rule. The public meeting on the subject rule was properly noticed in a local

newspaper and the Petitioner attended and participated in the meeting. The

published notice stated that the purpose and effect of the revised Rule 6Hx3 :7-

26 was to update the rule to include the latest limitations in bidding

requirements found in State Board of Education rules.

33. Rule 6Hx3:7-26, as finally adopted by the Respondent, including the

above-quoted exception language challenged by the Petitioner, is substantially

similar to the State Board of Community College Rule 6A-14.0734 regarding

bidding requirements imposed on community colleges, and the specific complained

of language quoted above is identical to State Board of Community College Rule

6A-14.0734(2)(g).

CONCLUSIONS OF LAW

34. Based on the foregoing findings of fact and on the applicable legal

principles, I make the following conclusions of law.

35. The Division of Administrative Hearings has jurisdiction over the

parties to and the subject matter of these consolidated cases. Sec. 120.56,

Fla. Stat.

36. The parties have stipulated that the Petitioner's substantial

interests are affected by both of the challenged rules and that he has standing

to challenge the rules.

37. Section 119.07(1)(a), Florida Statutes, reads as follows in pertinent

part:

The custodian shall furnish a copy or a

certified copy of the record upon payment of

the fee prescribed by law or, if a fee is not

prescribed by law, upon payment of the actual

cost of duplication of the record. The

phrase "actual cost of duplication" means the

cost of the material and supplies used to

duplicate the record, but it does not include

the labor cost or overhead cost associated

with such duplication.

38. Section 119.07(1)(b), Florida Statutes, reads as follows, in pertinent

part:

If the nature or volume of public records

requested to be inspected, examined, or

copied pursuant to this subsection is such as

to require extensive use of information

technology resources or extensive clerical or

supervisory assistance by personnel of the

agency involved, or both, the agency may

charge, in addition to the actual cost of

duplication, a special service charge, which

shall be reasonable and shall be based on the

cost incurred for such extensive use of

information technology resources or the labor

cost of the personnel providing the service

that is actually incurred by the agency or

attributable to the agency for the clerical

and supervisory assistance required, or both.

39. The portion of Rule 6Hx3:5-43 which addresses extensive use of

information technology resources or extensive clerical or supervisory assistance

in providing records is, in essence, a paraphrase of the statutory provision

quoted immediately above. It contains no provisions inconsistent with the

statutory provision. Accordingly, there is no basis upon which to conclude that

that portion of the rule is invalid.

40. The portion of Rule 6Hx3:5-43 which sets charges of 25 cents and 10

cents for the making of copies of public records in quite another matter. There

is no persuasive competent substantial evidence in the record to support a

conclusion that the rule-established charges of 25 cents for each of the first

nine copies and 10 cents for each additional copy bears any rational

relationship to the Respondent's "actual cost of duplication." Similarly, the

evidence fails to show that the Respondent conducted any reliable study or

inquiry to determine its "actual cost of duplication." Rather, the charges

established in the rule appear to be arbitrary and capricious, and thus invalid.

41. The Petitioner has also challenged Rule 6Hx3 :5-43 on the grounds that

the second paragraph of the rule impermissibly limits access to all personnel

files. Petitioner's contentions in this regard are not persuasive. While the

second paragraph of the subject rule is not a model of clarity, in view of the

provisions of Section 240.337, Florida Statutes, the language of the second

paragraph of the rule is susceptible of interpretation and application in a

manner consistent with the provisions of both Chapter 119, Florida Statutes,

which allows access to most records, and Section 240.337, Florida Statutes,

which limits access to certain personnel records. Thus, while the second

paragraph would benefit from some further editorial revision, it cannot be said

that it is invalid in its present form.

42. Because of the invalidity of the portion of Rule 6Hx3: 5-43 which

sets charges for copies, there is no need to dwell upon the Petitioner's

challenge to the rule's economic impact statement. Suffice it to say that a

reliable study or inquiry to determine the Respondent's "actual cost of

duplication" will in all probability generate the type of information from which

an adequate economic impact statement can be formulated.

43. Turning now to the Petitioner's challenge to Rule 6HX3 :7-26, a major

basis for challenge to the rule is that language was added to it during the

rule-making hearing, which language did not appear in the version of the

proposed rule which was published prior to the rule-making hearing. In this

regard, attention must be directed to Section l20.54(l3)(b), Florida Statutes,

which provides in pertinent part: "After the notice required in subsection (1)

and prior to adoption, the agency may withdraw the rule in whole or in part or

may make such changes in the rule as are supported by the record of public

hearings held on the rule. . . . " The quoted language clearly contemplates the

making of changes on the basis of matters presented at the public hearing on the

rule; the very purpose of the rule-making hearings being to afford the

interested public an opportunity to try to persuade the agency to change the

proposed rule. The challenged change being one which is supported by the record

of the public hearing on the rule, there is no basis upon which to find that

portion of the rule invalid.

44. The Petitioner also challenges Rule 6Hx3:7-26 on the grounds that it

fails to contain a legally sufficient economic impact statement. There is no

doubt that the economic impact statement of Rule 6Hx3:7-26 falls far short of

the specific statutory requirements of Section 120.54(2)(b), Florida Statutes.

But those deficiencies are not necessarily fatal to the validity of the rule.

The consequences of a deficient economic impact statement were addressed as

follows in Department of Health and Rehabilitative Services v. Wright, 439 So.2d

937 (Fla. 1st DCA 1983):

[T]he Florida Supreme Court has observed that

"[t]he procedure envisioned by section

120.54(2)(a) does not . . . command

adherence to form over substance." Id.

Moreover, although section 120.54(2) Thas

amended in 1978 to provide that an agency's

failure to include within its rule an

"adequate" statement of economic impact is

grounds for invalidation of the rule, that

provision does not require perfection but

only "substantial compliance" with section

120.54(2)(a). Id. As the preparation of a

statement of economic impact "is a

procedural aspect of an agency's

rulemaking authority," it is subject to the

"statutory harmless error rule" of section

120.68(8), Florida Statutes, which provides

for remand only where a material error in

procedure in an administrative proceeding

impairs the fairness of the proceedings or

the correctness of the action taken. Polk v.

School Board of Polk County, 373 So.2d 960,

962 (Fla. 2d DCA 1979); School Board of

Broward County v. Gramith, 375 So.2d 340

(Fla. 1st DCA 1979); Plantation Residents'

Association, Inc. v. School Board of Broward

County, 424 So.2d 879, 881 (Fla. 1st DCA

1982). Thus, the absence or insufficiency of

an economic impact statement is harmless

error if it is established that the proposed

action will have no economic impact, i.e. by

its merely implementing already established

procedures, or if it is shown that the agency

fully considered the asserted economic

factors and impact. Division of Workers'

Compensation v. McKee, 413 So.2d 805, 806

(Fla. 1st DCA 1982); Florida-Texas Freight,

Inc. v. Hawkins; Polk v. School Board of Polk

County.

45. As noted in the stipulated facts, the published notice regarding Rule

6Hx3:7-26, which not containing the details required by the statute, did contain

a statement asserting that Respondent anticipated no economic impact by its

amendment of this rule. Accordingly, the situation here is similar to that in

Florid-Texas Freight, Inc. v. Hawkins, 379 So.2d 944 (Fla. 1979), where the

court stated:

The record in this cause does not require a

remand to the Commission to file a detailed

formal statement simply negating each of the

seven factors outlined in section

120.54(2)(a) when a finding of no impact has

been made. We find that petitioners were not

denied a fair hearing in this cause, and

certiorari therefore is denied.

46. And in Cortese v. School Board of Palm Beach County, 425 So.2d 554

(Fla. 4th DCA 1982), a case in which there was no economic impact statement at

all, the court noted in a closing footnote:

We consider the absence of an economic impact

statement to be harmless error. School Board

of Broward County v. Gramith, 375 So.2d 340

(Fla. 1st DCA 1979); Polk v. School Board of

Polk County, 373 So.2d 960 (Fla. 2d DCA

1979). There has been no showing that its

absence either harmed the board1s decision-

making process or adversely affected its

decision.

47. Applying the principles of the foregoing cases to the facts in this

case leads to the conclusion that Rule 6Hx3:7-26 is not invalid by reason of the

shortcomings in its economic impact statement. Those shortcomings did not

impair the fairness of the proceedings or the correctness of the action taken.

Upon consideration of all of the foregoing, it is ORDERED:

1. That the portions of the fourth paragraph of Rule 6Hx3:5-43 which

establish a charge of 25 cents each for the first nine copies and 10 cents each

for additional copies are an invalid exercise of delegated legislative

authority.

2. That the Petitioner has failed to establish the invalidity of any other

portion of Rule 6Hx3:5-43 and, therefore, the remainder of the petition in Case

No. 87-262IR is dismissed.

3. That the Petitioner has failed to establish the invalidity of Rule

6Hx3:7-26 and, therefore, the petition in Case No. 87-2623RX is dismissed in its

entirety.

DONE AND ORDERED this 2nd day of October, 1987, at Tallahassee, Florida.

_________________________________

MICHAEL M. PARRISH, Hearing Officer

Division of Administrative Hearings

The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32399-1550

[phone]

Filed with the Clerk of the

Division of Administrative Hearings

this 2nd day of October, 1987.

COPIES FURNISHED:

Mr. H. C. " Hy" Jensen

Economic Research Services

2014 Northeast Street

Ocala, Florida 32670

Brian D. Lambert, Esquire

SAVAGE, CRIM, SIMONS,

FULLER AND ACKERMAN, P.A.

121 Northwest Third Street

Ocala, Florida 32670

Mrs. Sandra McKoy, Chairman

District Board of Trustees

Central Florida Community

College

Post Office Box 177

Bronson, Florida 32621

Liz Cloud, Chief

Bureau of Administrative Code

1802, The Capitol

Tallahassee, Florida 32301

Carroll Webb, Executive Director

Administrative Procedure Committee

120 Holland Building

Tallahassee, Florida 32399-1300

NOTICE OF RIGHT TO JUDICIAL REVIEW

A PARTY WHO IS ADVERSELY AFFECTED BY THIS FINAL ORDER IS ENTITLED TO JUDICIAL

REVIEW PURSUANT TO SECTION 120.68, FLORIDA STATUTES. REVIEW PROCEEDINGS ARE

GOVERNED BY THE FLORIDA RULES OF APPELLATE PROCEDURE. SUCH PROCEEDINGS ARE

COMMENCED BY FILING ONE COPY OF A NOTICE OF APPEAL WITH THE AGENCY CLERK OF THE

DIVISION OF ADMINISTRATIVE HEARINGS AND A SECOND COPY, ACCOMPANIED BY FILING

FEES PRESCRIBED BY LAW, WITH THE DISTRICT COURT OF APPEAL, FIRST DISTRICT, OR

WITH THE DISTRICT COURT OF APPEAL IN THE APPELLATE DISTRICT WHERE THE PARTY

RESIDES. THE NOTICE OF APPEAL MUST BE FILED WITHIN 30 DAYS OF RENDITION OF THE

ORDER TO BE REVIEWED.