21-000516BID Madison Grove, Llc And Arc 2020, Llc And New South Residential, Llc vs. Florida Housing Finance Corporation Status: Closed Recommended Order on Wednesday, April 14, 2021.

Summary: Florida Housing's determination that two applicants demonstrated committed funding from the same jurisdiction was clearly erroneous; determination that errors in another application were a minor waivable irregularity was supported by evidence.

S TATE OF F LORIDA

D IVISION OF A DMINISTRATIVE H EARINGS

F LETCHER B LACK II, LLC ,

Petitioner ,

vs. Case No. 21 - 0515BID

F LORIDA H OUSING F INANCE

C ORPORATION ,

Respondent,

and

P INNACLE A T H AMMOCK S PRINGS , LLC;

A ND A BILITY VNA,

Intervenors.

/

M ADISON G ROVE , LLC; ARC 2020, LLC;

A ND N EW S OUTH R ESIDENTIAL , LLC,

Petitioners,

vs. Case No. 21 - 0516BID

F LORIDA H OUSING F INANCE

C ORPORATION ,

Respondent.

/

M ADISON O AKS E AST , LLC; ARC 2020,

LLC; A ND N EW S OUTH R ESIDENTIAL ,

LLC,

Petitioners,

vs. Case No . 21 - 0517BID

F LORIDA H OUSING F INANCE

C ORPORATION ,

Respondent.

/

M ADISON O AKS E AST , LL C; ARC 2020.

LLC; A ND N EW S OUTH R ESIDENTIAL ,

LLC,

Petitioners,

vs. Case No. 21 - 0518BID

F LORIDA H OUSING F INANCE

C ORPORATION ,

Respondent.

/

T IMSHELL W ALTON H OUSING , LLC,

Petitioner,

vs. Case No. 21 - 0520BID

F LOR IDA H OUSING F INANCE

C ORPORATION ,

Respondent,

and

RM FL XX P RIME , LLC,

Intervenor.

/

R ECOMMENDED O RDER

On Wednesday, March 10 , 2021, Administrative Law Judge Lisa Shearer

Nelson of the Florida Division of Administrative Hearings (DOAH) conducted

a hearing pursua nt to section 120.57(3), Florida Statutes, through the use of

Zoom technology.

A PPEARANCES

For Petitioners Fletcher Black II, LLC, and Timshell Walton Housing,

LLC:

Michael P. Donaldson, Esquire aldson, Esquire

Carlton Fields , P.A.

Suite 500

215 South Monroe Street

Tallahassee, Florida 32302

For Petitioners Madison Grove, LLC, Madison Oaks East, LLC, Madison

Oaks West, LLC, ARC 2020, and New South Residential:

J. Timothy Schulte, Esquire

Zimmerman, Kiser & Sutcliffe, P.A.

315 East Robinson Str eet

Post Office Box 3000 (32802)

Orlando, Florida 32801

For Respondent Florida Housing Finance Corporation:

Betty Zachem, Esquire

Florida Housing Finance Corporation

Suite 5000

227 North Bronough Street

Tallahassee, Florida 32301 - 1329

For Interv enors Ability VNA, LLC, and Pinnacle at Hammock Springs,

LLC:

M. Christopher Bryant, Esquire

Oertel, Fernandez, Bryant & Atkinson, P.A.

Post Office Box 1110

Tallahassee, Florida 32302 - 1110

For Intervenor RM FL XX P RIME , LLC:

Lawrence E. Sellers, Jr., E squire

Tiffany A. Roddenberry, Esquire

Holland & Knight, LLP

Suite 600

315 South Calhoun Street

Tallahassee, Florida 32301

S TATEMENT OF T HE I SSUE S

The issues to be determined are whether, with respect to each application

filed, Florida Housing Finance C orporationÔs (Florida Housing) review and

decision - making process in response to the Request for Applications 2020 - 201

(RFA) was contrary to the agencyÔs governing statutes, the agencyÔs rules or

policies, or the RFA.

P RELIMINARY S TATEMENT

On August 26, 2020, Florida Housing issued an RFA through which it

expects to award over $15 million of housing credits to proposed

developments in medium - size counties, and over $1.4 million of housing

credits to proposed developments in small counties. The deadline fo r

applications was November 5, 2020, and on January 22, 2021, Florida

Housing announced its intent to award funding to 13 of the 84 applicants,

including The Villages of New Augustine (The Villages), Pinnacle at

Hammock Springs, and RM FL XX Prime, LLC (Ro semary Place).

On January 27, 2021, Petitioners , Fletcher Black II, LLC (Fletcher Black) ;

Madison Grove, LLC (Madison Grove) ; Madison Oaks East, LLC (Madison

Oaks East) ; Madison Oaks West, LLC (Madison Oaks West) ; ARC 2020 ; New

South Residential ; and Tims hell Walton Housing, LLC (Timshell)

(collectively, Petitioners) , filed Notices of Intent to Protest, and on

February 8, 2021, Petitioners filed Formal Written Protests and Petitions for

Administrative Hearing. All of the petitions were forwarded to DOAH on

February 12, 2021, docketed as Case Nos. 21 - 0515BID, 21 - 0516 BID ,

21 - 0517 BID , 21 - 0518 BID , and 21 - 0520 BID , 1 and assigned to Administrative

Law Judge Gar Chisenhall. The cases were consolidated by Order dated

February 18, 2021, and scheduled for hearing to commence March 10 and 11,

2021, by Zoom technology.

Ability VNA, LLC , and Pinnacle at Hammock Springs, LLC , filed

Petitions for Leave to Intervene with respect to the challenge filed by

Fletcher Black (docketed as Case No. 21 - 055BID) before the petitions were

transmitted to DOAH, and the Petitions for Leave to Intervene were

transmitted with the Fletcher Black Petition. Likewise, Rosemary Place filed

a Notice of Appearance as a Specifically - Named Party on February 11, 2021,

with respect to the Timshel Wal ton Housing Petition, and that Notice was

forwarded to DOAH with Case No. 21 - 0520BID.

On February 19, 2021, the cases were transferred to Administrative Law

Judge Yolonda Green. The parties engaged in significant discovery as

reflected on the docket, and on March 2, 2021, Timshell filed a Motion for

Leave to Amend Formal Written Protest and Petition for Administrative

Proceeding , which was granted by Order dated March 3, 2021. Finally, on

March 4, 2021, Panama Manor Developer, LLC (Panama Manor), entered a n

appearance as a specifically - named party, to which Pinnacle at Hammock

Springs objected.

On March 8, 2021, the cases were transferred to the undersigned, and an

Order granting Intervenor status was entered with respect to Ability VNA,

1 An additional challenge was filed by Madison Palms, Ltd., and was docketed as Case No.

21 - 0519BID. Madison Palms filed a Noti ce of Voluntary Dismissal on March 5, 2021, and

that case was severed from the rest and closed by Order dated March 8, 2021.

LLC, Pinnacle at Hammock Springs, and Panama Manor. Rosemary Place is

also recognized as an Intervenor by means of its Notice of Appearance as a

specifically named party.

On March 8, 2021, the parties filed a Joint Pre - h earing Stipulation, which

included a significant nu mber of facts to which the parties stipulated no

evidence would be needed at hearing. Those facts to which the parties

stipulated are included in the Findings of Fact below. While some stipulated

facts have been edited for the sake of clarity or style, the substance remains

the same.

The hearing commenced as scheduled and was completed in a single day.

At the beginning of the hearing, Madison Groves, Madison Oaks East,

Madison Oaks West, ARC 2020 , and New Residential, along with Florida

Housing, stipulated to a resolution of their respective challenges in Case

Nos. 21 - 0516BID, 21 - 0 517BID, and 21 - 0 517BID, which will be discussed

below.

Marissa Button testified for Florida Housing, and Joint Exhibits 1

through 10, 1 2 through 14, and 16 through 20 were admi tted into evidence.

James Boyd, Jr. , and Renee Sandell testified on behalf of Fletcher Black, and

FB Exhibits 1 and 2 were admitted into evidence. Brian Waterfield testified

for Timshell, and Timshell Ôs Exhibits 1, 2 and 4 were admitted. Stewart

Rutledge t estified for Rosemary Place, and Rosemary Place Ôs Exhibits 1 and 2

were also admitted.

The one - volume Transcript was filed with DOAH on March 24, 2021. In

order to accommodate the partiesÔ desire to have this case placed on the

April 30, 2021 , agenda of F lorida HousingÔs Board of Directors, the deadline

for filing proposed recommended orders was set for March 31, 2021. All post -

hearing submissions were timely filed, and carefully considered in the

preparation of this Recommended Order. All quoted material in italics is

emphasized by the undersigned.

F INDINGS OF F ACT

1. Florida Housing is a public corporation created pursuant to section

420.504, Florida Statutes. Its purpose is to promote public welfare by

administering the governmental function of financin g affordable housing in

Florida. Section 420.5099 designates Florida Housing as the housing credit

agency for Florida within the meaning of section 42(h)(7)(a) of the Internal

Revenue Code and has the responsibility and authority to establish

procedures fo r allocating and distributing low - income housing tax credits.

2. The low - income housing tax credit program (commonly referred to as

Ñtax creditsÒ or Ñhousing creditsÒ) was enacted to incentivize the private

market to invest in affordable rental housing. Th ese housing credits are

awarded competitively to housing developers in Florida for rental housing

projects which qualify. The effect is to reduce the amount that the developer

must otherwise borrow. Because the total debt is lower, the housing credit

prope rty can (and must) offer lower, more affordable rents. Developers also

covenant to keep rents at affordable levels for periods of 30 to 50 years as

consideration for receipt of the housing credits.

3. The demand for housing credits provided by the federal government

exceeds supply.

The Competitive Application Process

4. Section 420.507(48) authorizes Florida Housing to allocate housing

credits and other funding through requests for proposals or other competitive

solicitations, and Florida Housing has adop ted Florida Administrative Code

Chapter 67 - 60 to prescribe the competitive solicitation process. Chapter 67 - 60

provides that Florida Housing allocate its competitive funding through the

bid protest provisions of section 120.57(3).

5. Applicants for funding request , in their applications , a specific dollar

amount of housing credits to be given to the applicant each year for a period

of ten years. Applicants normally will sell the rights to the future stream of

income housing credits (through the sale of almo st all of the ownership

interest in the applicant entity) to an investor to generate the amount of

capital needed to build the development. The amount an applicant can

receive depends on several factors, such as a certain percentage of the

projected total development cost; a maximum funding amount per

development based on the county in which the development will be located;

and whether the development is located within certain designated areas of

some counties. These are just examples of the factors conside red, and this is

by no means an exhaustive list.

6. Housing credits are made available through a competitive application

process that starts with the issuance of an RFA. An RFA is considered to be a

Ñrequest for proposalÒ as indicated in rule 67 - 60.009(4).

7. The RFA in this case was issued on August 26, 2020, and responses

were due November 5, 2020. The RFA was modified September 11, 2020 , and

October 12, 2020 , but with no change with respect to the response deadline.

8. Through the RFA, Florida Housing ex pects to award up to an estimated

$15,275,810 of housing credits to proposed developments in medium - sized

counties, and up to an estimated $1,453,730 of housing credits to proposed

developments in small counties.

9. Florida Housing received 84 applications in response to RFA 2020 - 201.

10. A Review Committee was appointed to review the applications and

make recommendations to the Florida Housing Board of Directors (Board).

The Review Committee found 79 applications eligible and five applications

ineligible f or funding. Through the ranking and selection process outlined in

the RFA, 10 applications were preliminarily recommended for funding. The

Review Committee developed charts listing its eligibility and funding

recommendations to be presented to the Board.

1 1. The federal government enacted the Consolidated Appropriations Act

(CCA) in December 2020, and as a result, an additional $3,367,501 in housing

credits became available for affordable housing for Escambia, Santa Rosa,

Okaloosa, Walton, and Bay Counties, which were impacted by Hurricane

Sally.

12. The staff at Florida Housing recommended using the CCA funding to

award housing credits to additional highest - ranking eligible applications in

qualified disaster areas, subject to the county award tally, regardl ess of the

county size in RFA 2020 - 201 and developed a chart listing its CCA funding

recommendations to be presented to the Board.

13. On January 22, 2021, the Board met and considered the

recommendations of the Review Committee and staff for RFA 2020 - 201. At

approximately 2:50 p.m. that day, all of the applicants in RFA 2020 - 201 were

provided notice that the Board determined whether applications were eligible

or ineligible for consideration of funding, and that certain eligible applicants

were preliminaril y selected for funding, subject to satisfactory completion of

the credit underwriting process. Notice was provided by posting on the

Florida Housing website two spreadsheets: one listing the Board - approved

scoring results in RFA 2020 - 201 ; and one identifyi ng the applications which

Florida Housing proposed to fund.

14. In the January 22, 2021 , posting, Florida Housing announced its

intention to award funding to 24 applicants, including The Villages, Pinnacle

at Hammock Springs, and Rosemary Place.

15. Petit ioners timely filed Notices of Protest and Petitions for Formal

Administrative Proceedings. All Intervenors have been properly recognized

as such.

16. The terms of RFA 2020 - 201 were not challenged.

RFA 2020 - 201 Ranking and Selection Process

17. The RFA contemplates a structure in which the applicant is scored on

eligibility items and obtains points for other items. A summary of the

eligibility items is listed in Section 5.A.1. of the RFA, beginning at page 71.

Only applications that meet all of the elig ibility requirements will be eligible

for funding and considered for the funding selection.

18. This challenge does not raise any issues with respect to the point

totals awarded to the applicants.

19. The RFA has four funding goals:

a. The Corporation ha s a goal to fund five Medium

County Developments that qualify for the Local

Government Areas of Opportunity Funding Goal

outlined in Section Four A.11.a of the RFA, with a

preference that three of the Applications meet the

criteria outlined in Section Four , A.11.b(1) of the

RFA to be considered submitted but not awarded in

RFA 2019 - 113, and two of the Applications meet

the criteria outlined in Section Four, A.11.b(2) of

the RFA to be considered not submitted in RFA

2019 - 113.

b. The Corporation has a goal to fund one

Development that qualifies for the Local

Revitalization Initiative Goal outlined in Section

Four A.5.i of the RFA.

c. The Corporation has a goal to fund two

Developments with a Demographic commitment of

Family that select and qualify for the g eographic

Areas of Opportunity/ SADDA Goal outlined in

Section Four A.10.a(1)(d) of the RFA.

d. The Corporation has a goal to fund one

Development that qualifies for the SunRail Goal

outlined in Section Four, A.5.e.(5) of the RFA.

*Note: During the Fundi ng Selection Process,

outlined below, Developments selected for these

goals will only count toward one goal with one

exception: If an Application that was selected to

meet the Local Government Areas of Opportunity

Goal or Local Revitalization Initiative Go al also

qualifies for the SunRail Goal, the SunRail Goal

will also be considered met. (Jt. Exh. 1, pp.75).

20. At page 76 of Joint Exhibit 1, the RFA also sets forth the sorting order

to be used when selecting applications to meet the Local Government Ar eas

of Opportunity Funding Goal:

The highest scoring applications will be determined

by first sorting together all eligible Priority I

Medium County Applications from highest score to

lowest score, with any scores that are tied

separated in the following o rder. This will then be

repeated for Priority II Applications:

(1) First, counties of the Applications that (i)

qualified for the Local Government Areas of

Opportunity Funding Goal in FRA 2019 - 113 and

(ii) were invited to enter credit underwriting will

r eceive lower preference than other Medium

Counties competing for the Local Government

Areas of Opportunity Funding Goal. This affects

the following counties: Brevard, Lee, Santa Rosa,

Sarasota, and Volusia. The remaining counties will

receive higher prefer ence.

(2) Next, by the ApplicationÔs eligibility for the Per

Unit Construction Funding Preference which is

outlined in Section Four A.10.e. of the RFA (with

Applications that qualify for the preference listed

above Applications that do not qualify for the

preference);

(3) Next, by the ApplicationÔs eligibility for the Per

Unit Construction Funding Preference which is

outlined in Section Four A.10.e of the RFA (with

Applications that qualify for the preference listed

above Applications that do not qualify for the

preference);

(4) Next, by the ApplicationÔs Leveraging

Classification, applying the multipliers outlined in

Item 3 of Exhibit C of the RFA (with Applications

having the Classification of A listed above

Applications having the Classification of B );

(5) Next, by the ApplicationÔs eligibility for the

Florida Job Creation Funding Preference which is

outlined in Item 4 of Exhibit C of the RFA (with

Applications that qualify for the preference listed

above Applications that do not qualify for the

pref erence);

(6) And finally, by lottery number, resulting in the

lowest lottery number receiving preference.

21. Next, the RFA sets forth the sorting order for selecting applications to

meet the Local Revitalization Initiative Goal. It then sets for the s orting

order after selecting applications to meet the Local Government Areas of

Opportunity Funding Goal (LGAO Designation) and Local Revitalization

Initiative Goal.

22. The RFA includes a funding test where a) small county applications

will be selected f or funding only if there is enough small county funding

($1,453,730) available to fully fund the Eligible Housing Credit Request

Amount, and b) medium county applications will be selected for funding only

if there is enough medium county funding ($15,275,8 10) available to fully

fund the Eligible Housing Credit Request Amount.

23. The RFA outlines a specific County Award Tally based on Priority

Levels as follows:

a. Priority I County Award Tally

As each Priority I Application is selected for

tentative fu nding, the county where the

Development is located will have one Application

credited towards the County Award Tally. The

Corporation will prioritize eligible unfunded

Priority I Applications that meet the Funding Test

and are located within counties that have the

lowest County Award Tally above other eligible

unfunded Priority I Applications with a higher

County Award Tally that also meet the Funding

Test, even if the Priority I Applications with a

higher County Award Tally are higher ranked.

b. Priority II County Award Tally

As each Priority II Application is selected for

tentative funding, the county where the proposed

Development is located will have one Application

credited towards the County Award Tally. The

Corporation will prioritize eligible unfu nded

Priority II Applications that meet the Funding Test

and are located within counties that have the

lowest County Award Tally above other eligible

unfunded Priority II Applications with a higher

County Award Tally that also meet the Funding

Test, even i f the Priority II Applications with a

higher County Award Tally are higher ranked. (Jt.

Exh. 1, pp. 78 - 79)

24. The RFA outlines the selection process at pages 79 - 81 as follows:

a. Five Applications that qualify for the Local

Government Areas of Opportu nity Funding Goal

(1) Applications that were submitted in RFA 2019 -

113 but not Awarded

The first three Applications that will be considered

for funding will be the highest ranking eligible

Medium County Priority I Applications that qualify

for the Local Government Areas of Opportunity

Funding Goal that were submitted in RFA 2019 -

113 but not awarded, subject to the Funding Test

and County Award Tally.

Priority I Applications will continue to be selected

until this preference is met. If there are no

remain ing eligible unfunded Priority I Applications

that qualify for this preference, then the process

will continue using Priority II Applications until

this preference is met.

(2) Applications that were not submitted in RFA

2019 - 113

The next Applications that will be considered for

funding will be the highest ranking eligible

Medium County Priority I Applications that qualify

for the Local Government Areas of Opportunity

Funding Goal that were not submitted in 2019 - 113,

subject to the Funding Test and the Coun ty Award

Tally.

Priority I Applications will continue to be selected

until this Goal is met. If there are no remaining

eligible unfunded Priority I Applications that

qualify for this Goal, then the process will continue

using Priority II Applications unti l this Goal is met

or until it is determined that there are not eligible

unfunded Applications that can meet this Goal.

b. One Application that qualifies for the Local

Revitalization Initiative Goal

The next Application selected for funding will be

the h ighest ranking eligible unfunded Priority I

Application that qualifies for the Local

Revitalization Initiative Goal, subject to the

Funding Te s t and the County Award Tally.

If there are no eligible unfunded Priority I

Applications that qualify for this Go al, then the

highest ranking eligible unfunded Priority II

Application that qualifies for the Local

Revitalization Initiative Goal will be selected,

subject to the Funding Test and the County Award

Tally.

c. Two Family Applications that qualify for the

Ge ographic Areas of Opportunity/ HUD - designated

SADDA Goal

The next two Applications select [ sic ] for funding

will be the highest ranking eligible unfunded

Priority I Family Applications that qualify for the

Geographic Areas of Opportunity/ HUD - designated

S ADDA Goal, subject to the Funding Test and the

County Award Tally.

Priority I Applications will continue to be selected

until this goal is met. If there are no remaining

eligible unfunded Priority I Applications that

qualify for this Goal, then the proces s will continue

using Priority II Applications until this Goal is met

or until it is determined that there are no eligible

unfunded Applications that can meet this goal.

d. One Application that Qualifies for the SunRail

Goal

If an Application that was s elected to meet the

Local Government Areas of Opportunity Goal

described in a. above or Local Revitalization

Initiative Goal described in b. above also qualifies

for the SunRail Goal, this Goal will be considered

met without selecting an additional Applica tion.

If none of the Applications selected to meet the

Local Government Areas of Opportunity Goal or

Local Revitalization also qualify for the SunRail

Goal, the next Application selected f or funding will

be the highest ranking eligible unfunded Priority I

Application that qualifies for the SunRail Goal,

subject to the Funding Test and the County Award

Tally.

If there are no eligible unfunded Priority I

Applications that qualify for this Goal, then the

highest ranking eligible unfunded Priority II

Applica tion that qualifies for the SunRail Goal will

be selected, subject to the Funding Test and the

County Award Tally.

e. The next Applications selected for funding will be

the highest ranking eligible unfunded Priority I

Small County Applications that (i) ca n meet the

Small County Funding Test and (ii) have a County

Award Tally that is less than or equal to any other

eligible unfunded Small County Priority I

Applications. If Small County funding remains and

no unfunded eligible Small County Priority I

Applica tion can meet the Small County Funding

Test, then the process will continue using Priority

II Applications until this Goal is met or until no

unfunded Small County Priority II Application can

meet the Small County Funding Test.

If Small County funding rem ains and no unfunded

eligible Small County Applications can meet the

Small County Funding Test, no further Small

County Applications will be selected, and the

remaining Small County Funding will be added to

the Medium County funding amount.

f. The next Ap plications selected for funding will be

the highest ranking eligible unfunded Priority I

Medium County Applications that ( i ) can meet the

Medium County Funding Test and (ii) have a

County Award Tally that is less than or equal to

any other eligible unfunde d Medium County

Priority I Applications. If Medium County funding

remains and no unfunded eligible Medium County

Priority I Applications can meet the Medium

County Funding Test, then the process will

continue using Priority II Applications until this

Goal is met or until no unfunded eligible Medium

County Priority II Applications can meet the Small

County Funding Test.

If Medium County Funding remains and no

unfunded eligible Medium County Application can

meet the Medium County Funding Test, no further

App lications will be selected and the remaining

funding will be distributed as approved by the

Board.

25. After the description of the sorting process, the RFA specifies:

Funding that becomes available after the Board

takes action on the CommitteeÔs

recom mendation(s), due to an Applicant

withdrawing, an Applicant declining its invitation

to enter credit underwriting or the ApplicantÔs

inability to satisfy a requirement outlined in this

RFA, and/or provisions outlined in Rule Chapter

67 - 48, F.A.C., will be distributed as approved by

the Board.

26. All 84 applications for RFA 2020 - 201 were received, processed, deemed

eligible or ineligible, scored, and ranked, pursuant to the terms of the RFA,

Florida Administrative Code Chapters 67 - 48 and 67 - 60, and applica ble

federal regulations.

The Fletcher Black Application

27. During the scoring process, Florida Housing determined that the

Fletcher Black application was eligible for funding, but ineligible for the

LGAO Designation. Fletcher Black was not selected for preliminary funding.

28. If Fletcher BlackÔs application was eligible for the LGAO Designation,

it would have been selected for funding. It would have been selected as the

second of the three developments selected for the LGAO Priority I

applications that qualified for the preference for those development

applications submitted in RFA 2019 - 113, but not awarded as outlined on

pages 69 - 70 of the RFA. Additionally, if Fletcher Black is eligible for the

LGAO Designation, then The Villages and Pinnacle at Hammo ck Springs will

be displaced from funding.

29. In order to qualify for the LGAO Designation and Goal, applicants

must Ñ demonstrate a high level of Local Government interest in the project

via an increased amount of Local Government contributions in the fo rm of

cash loans and/or cash grants.Ò

30. The RFA outlines the types and amounts of contributions from Local

Governments that will be accepted to meet the LGAO Designation.

31. Fletcher BlackÔs proposed development is in Bay County. Therefore,

Fletcher Black would be required to demonstrate a contribution of at least

$340,000 to be considered for the LGAO Designation.

32. The RFA at page 67 expressly limits the number of applications from

the same government jurisdiction as follows:

Limit on the number of Applications within the

same jurisdiction

A proposed Development may only qualify where a

jurisdiction (i.e., the county or a municipality) has

contributed cash loans and/or cash grants for any

proposed Development applying for this RFA in an

amount s ufficient to qualify for the Local

Government Areas of Opportunity Designation. A

Local Government can only contribute to one

Application that qualifies for the Local Government

Area of Opportunity Designation, regardless of how

the contribution is charact erized. Any single

jurisdiction may not contribute cash loans and/or

cash grants to more than one proposed

Development applying for the Local Government

Areas of Opportunity Designation. If multiple

Applications demonstrate Local Government Areas

of Opport unity Funding from the same jurisdiction

and those Applications qualify for the Local

Government Areas of Opportunity Designation,

then all such Applications will be deemed ineligible

for the Local Government Areas of Opportunity

Designation, regardless of the amount of Local

Government Areas of Opportunity Funding or how

the contribution is characterized. However, Local

Governments may pool contributions to support one

Application (i.e., the county and the city may

provide contribution to the same Developm ent and

each Local Government will submit its own form as

an Attachment to the Application ) .

33. Page 68 of the RFA describes the requirements for demonstrating

LGAO funding:

In order to be eligible to be considered Local

Government Areas of Opportunity Funding, the

cash loans and/or cash grants must be

demonstrated via one or both of the Florida

Housing Local Government Verification of

Contribution Forms (Form Rev. 07 - 2019), called

ÑLocal Government Verification of Contribution Ï

LoanÒ form and/or the ÑL ocal Government

Verification of Contribution -- GrantÒ form. The

forms must meet the Non - Corporation Funding

Proposal Requirements outlined in 10.b.(2)(a)

above, the qualifying funding must be reflected as a

source on the Development Cost Pro Forma, and

th e applicable form(s) must be provided as

Attachment 16 to the Application. Applications are

not required to reflect the value (difference between

the face amount and the net present value of the

payment streams) on any Local Government

Verification Forms.

Similarly, Section 10.b.(2)(a) of the RFA specifies that,

Note: Eligible Local Government financial

commitments (i.e., grants and loans) can be

considered a source of financing without meeting

the requirements above if the Applicant provides a

properly c ompleted and executed Local Government

Verification of Contribution Ï Grant Form (Form

0702019) and/or the Local Government Verification

of Contribution Ï Loan Form (Form 07 - 2019).

34. Fletcher Black submitted a Local Government Verification of

Contribu tion Ï Grant Form (Grant Form) from the City of Panama City in

the amount of $340,000. Fletcher BlackÔs Grant Form was executed by Greg

Bridnicki, as the Mayor of Panama City and ÑApproved as to Form and

CorrectnessÒ by Nevin Zimmerman, City Attorney. Flet cher BlackÔs request

for funding from Panama City was placed on the agenda for the City of

Panama City City CommissionÔs August 25, 2020, meeting, and approved by

the City Commission, which authorized Mr. Bridnicki to sign the Grant

Form. Fletcher Black ha d obtained a similar LGAO Form in the previous

year using the same established process.

35. Fletcher Black did not submit any documentation in the RFA

Application regarding the process used to gain approval of the grant.

However, no party identified any r equirement in the RFA that such a

description must be included in the Application. Fletcher Black cannot be

faulted for not supplying something that is not required.

36. Another Applicant, Panama Manor App. No. 2021 - 074C, submitted a

Grant Form from the C ity of Panama City in the amount of $340,000

executed by Michael Johnson. Mr. JohnsonÔs title is listed as the Director of

Community Development/CRA/CDBG/SHIP. During the scoring process,

Florida HousingÔs scorer found that since both Fletcher Black and Pa nama

Manor submitted documentation for the LGAO Designation from the same

jurisdiction, the City of Panama City, according to the terms of the RFA, both

applications were deemed ineligible for the LGAO Designation.

37. The Grant Form submitted by both Fle tcher Black and Panama Manor

contains the following instruction regarding who is authorized to sign the

form on behalf of the local government:

This certification must be signed by the chief

appointed official (staff) responsible for such

approvals, Mayor , City Manager, County Manager/

Administrator/ Coordinator, Chairperson of the

City Council/Commission or Chairperson of the

Board of County Commissioners. È One of the

authorized persons named above may sign this

form for certification of state, federal o r Local

Government funds initially obtained or derived

from a Local Government that is directly

administered by an intermediary such as a housing

finance authority, a community reinvestment

corporation, or a state - certified Community

Housing Development Or ganization (CHDO). Other

signatories are not acceptable. The Applicant will

not receive credit for this contribution if the

certification is improperly signed. To be considered

for points, the amount of the contribution stated on

this form must be a precis e dollar amount and

cannot include words such as estimated, up to,

maximum, not to exceed, etc.

38. Michael Johnson was not authorized by the City of Panama City to

sign the Grant Form. Greg Br i dnicki, as Mayor of Panama City, is an

authorized signatory. Panama ManorÔs request was not submitted to the City

Commission for approval. Because the Grant Form was improperly signed,

Panama Manor should not, by the terms of the RFA, receive credit for the

LGAO Designation.

39. Had Panama ManorÔs application rece ived the LGAO Designation, it

would not have been selected for funding because its lottery number was too

high.

40. Michael Johnson is the Director of Community Development for the

City of Panama City. While he is an employee for the City of Panama City, he

also performs duties for Bay County through an interlocal agreement

between the city and the county. The Grant Form submitted for Panama

Manor stated on its face that it was signed on behalf of the City of Panama

City, but Mr. Johnson testified that the form was supposed to reflect that it

was for Bay County.

41. Mr. Johnson testified that over the last 17 years, he has executed

approximately 40 forms for applications for funding from Florida Housing. He

acknowledged that there are multiple types of form s that may need

signatures from city or county officials to complete a Florida Housing

application, such as zoning forms and infrastructure - verification forms, as

well as local government contribution forms. Since Florida Housing changed

its process to use RFAs in 2013, Mr. Johnson could not recall if he signed the

Grant Forms or whether the city manager did. He could not confirm signing a

single Grant Form for either the city or the county since 2013. Mr. Johnson

believed that he had the authority to sign Grant Forms on behalf of both the

city and the county. Mark McQueen, the City of Panama City city manager

and Mr. JohnsonÔs boss, does not share his belief. According to Mr. McQueen,

whose testimony is credited, Panama City committed only to the Fletcher

B lack property, took no official action with respect to Panama ManorÔs

application, and Mr. Johnson was not authorized to sign the Grant Form

committing funds on behalf of the City.

42. When Mr. Johnson realized that the Panama Manor Grant Form

stated that it was signed on behalf of Panama City as opposed to Bay County,

he called the legal department for Florida Housing to explain the error. He

testified that he spoke with several people at Florida Housing, including Jean

Salmonson, David Weston, and someone in the multi - family development

section. Mr. Johnson was not sure of the dates when these telephone calls

were made, but it appears that th e telephone calls were after the submission

of the applications but before the posting of funding selections.

43. Ma rissa Button is Florida HousingÔs Director of Multifamily Programs.

She testified that Florida Housing is aware of the contention that the form

submitted by Panama Manor was signed in error and should have reflected

that it was signed on behalf of Bay Coun ty. She was also aware that

according to Mr. McQueen, Mr. Johnson did not have the authority to sign a

Grant Form on behalf of the City of Panama City . She stated:

Q. How does that information impact Florida

HousingÔs scoring decision?

A. This -- at this juncture it does not impact Florida

HousingÔs scoring determination as to the Panama

Manor or Fletcher Black being designated as LGAO

goal. È We take the requirement of the RFA

specifically references the Ï the submission of what

Ï when thereÔs a submissio n of multiple

applications from the same jurisdiction, and so we,

Florida Housing, consider that as of Ï as of the

application deadline what this applicant has

submitted is a form executed on behalf of the City

of Panama City.

To change the designation, w hich I understand

from Mr. JohnsonÔs testimony it was a mistake, he

intended to issue on behalf of Bay County and

reflect that, we interpret that to be a Ï an improper

amendment or modification to the application after

the application submission. So we do not consider it

to change the scoring designation of the Ï of either

the Panama Manor application or the resulting

consequence to the Fletcher Black application.

* * *

Q. Now, Fletcher Black may argue that itÔs unfair

to treat its application as ineligib le for the LGAO

designation and goals when the Fletcher Black

[application] did not contain an error. What would

your response be to that?

A. You know, my response is, we score the

application in accordance with the terms of the

RFA. The applications are responsible for all parts

of that Ï that RFA with regard to their application

submission. ItÔs clear in this RFA that there would

be a consequence if other applications were

submitted from the same jurisdiction for an LGAO

designation. And, unfortunately, thatÔs the mistake

that happened, but the fairness Ï it is a fair process

because we are Ï we are administering the RFA as

it has been, you know Ï as the terms exist to the

public and to the fellow applications that came in

for funding. So, I Ï I do believ e itÔs unfortunate that

that consequence impacts their application;

however, it is Ï it is fair because thatÔs the

consequence if it happens. (T - 39 - 40, 45 - 46).

44. Panama ManorÔs application did not demonstrate local government

funding because the Grant F orm was not signed by someone with authority

to do so. The RFA specifically states that Ñ[o]ther signatories are not

acceptable. The Applicant will not receive credit for this contribution if the

certification is improperly signed.Ò

45. Where forms signe d by local government officials are challenged,

Ms. Button indicated that Florida Housing has in the past relied upon or

deferred to local government officials to address the propriety of the forms

signed. The issue usually arises with forms related to zon ing or other facets

encompassed in the Ability to Proceed forms. Here, the credible testimony of

local officials is that the Grant Form for Panama Manor was intended to

reflect a funding commitment from Bay County and the signator on Panama

ManorÔs Grant F orm was not authorized to sign on behalf of the City of

Panama City.

46. It would be contrary to competition if Panama Manor w ere allowed to

amend its application to correct the Grant Form. It is appropriate to

disregard Panama ManorÔs Grant Form, given t he inaccuracies contained

therein. If Panama ManorÔs application is not selected for the LGAO

Designation because of its failure to demonstrate that the City of Panama

City is providing local support for Panama ManorÔs project, then there is only

one appli cation with a valid Grant Form from the City of Panama City, and

that is Fletcher Black.

47. Ms. Button testified that it would provide a competitive advantage to

Fletcher Black if Fletcher Black were considered for the LGAO Designation.

However, she stat ed that applicants are responsible for all parts of their

application submission. Fletcher Black did not make an error in its

application and is not requesting that it be amended in any way. It is asking

that the application be considered as submitted, jus t as other applications are

considered.

48. Florida HousingÔs decision to find Fletcher Black ineligible for the

LGAO Designation is clearly erroneous, in light of the clear demonstration

that Panama Manor did not demonstrate a local funding commitment f rom

the City of Panama City, and Fletcher Black is the only entity that did so.

The Rosemary Place Application

49. Florida Housing deemed the Rosemary Place application to be eligible

and, pursuant to the terms of the RFA, preliminarily selected Rosemar y

Place for funding.

50. One of the requirements for eligibility under the RFA is that

applicants demonstrate Site Control by providing a properly completed and

executed Florida Housing Finance Corporation Site Control Certification

form (Site Control For m). For the Site Control Form to be considered

complete, the applicant must attach documentation demonstrating that it is a

party to an eligible contract or lease or is the owner of the subject property.

51. Applicants can demonstrate Site Control by pro viding documentation

that meets the requirements in the RFA for an eligible contract, deed or

certificate of title, or a lease.

52. The RFA specifies at pages 39 - 40 that an eligible contract must meet

the following conditions:

(a) It must have a term th at does not expire before

May 31, 2021 or that contains extension options

exercisable by the purchaser and conditioned solely

upon payment of additional monies which, if

exercised, would extend the term to a date that is

not earlier than May 31, 2021;

(b) It must specifically state that the buyerÔs

remedy for default on the part of the seller includes

or is specific performance;

(c) The Applicant must be the buyer unless there is

an assignment of the eligible contract, signed by

the assignor and the ass ignee, which assigns all of

the buyerÔs rights, title and interests in the eligible

contract to the Applicant: and

(d) The owner of the subject property must be the

seller, or is a party to one or more intermediate

contracts, agreements, assignments, opti ons, or

conveyances between or among the owner, the

Applicant, or other parties, that have the effect of

assigning the ownerÔs right to sell the property to

the seller. Any intermediate contract must meet

the criteria for an eligible contract in (a) and (b )

above.

53. The RFA notifies applicants that Florida HousingÔs review of the Site

Control documents is limited. At page 40, the RFA states:

Note: The Corporation will not review the site

control documentation that is submitted with the

Site Control Cer tification form during the scoring

process unless there is a reason to believe that the

form has been improperly executed, nor will it in

any case evaluate the validity or enforceability of

any such documentation. During scoring, the

Corporation will rely on the properly executed Site

Control Certification form to determine whether an

Applicant has met the requirement of this RFA to

demonstrate site control. The Corporation has no

authority to, and will not, evaluate the validity or

enforceability of any el igible site control

documentation that is attached to the Site Control

Certification form during the scoring process.

During credit underwriting, if it is determined that

the site control documents do not meet the above

requirements, the Corporation may re scind the

award.

54. The RFA also requires that, for the purpose of demonstrating Site

Control, Ñdocumentation must include all relevant intermediate contracts,

agreements, assignments, options, conveyances, intermediate leases and

subleases. If the propo sed Development consists of Scattered Sites, site

control must be demonstrated for all of the Scattered Sites. Ò

55. A Ñscattered siteÒ is defined in Florida Administrative Code Rule 67 -

48.002(106) as Ña Development site that, when taken as a whole, is com prised

of real property that is not contiguous (each such non - contiguous site within a

Scattered Site Development, is considered to be a ÑScattered SiteÒ). For

purposes of this definition Ó contiguous Ô means to uc hing at a point or along a

boundary. ÈÒ

56. Rosemary Place submitted a properly completed and executed Site

Control Form which was accepted by Florida Housing during its review,

scoring, and ranking process.

57. As an attachment to its Site Control Form, Rosemary Place attached a

Purchase and Sale Agreement (Rosemary Place Agreement) between Kyle

McDorman as the Seller and RM FL XX Prime, LL C (the applicant entity for

Rosemary Place) as the Purchaser.

58. The Rosemary Place Agreement has a term that does not expire before

May 31, 2021, and states t hat the buyerÔs remedy for default on the part of

the seller includes or is specific performance.

59. The Rosemary Place Application identified the address of the proposed

development as Ñ690Ô N of intsctn of 331 - Bus & Azalea Dr on W side of 331 -

Bus; withi n city limits of Freeport, FL (Walton County).Ò (J - 16, page 5).

60. The Development Location Point, consisting of latitude and longitude

coordinates was correctly identified, and the Rosemary Place Application

stated that the proposed development did not consist of scattered sites.

61. Exhibit A of the Rosemary Place Purchase and Sale Agreement

identifies the property as follows:

That Thirteen (13.0) Acres situated in the City of Freeport, FL

(Distrct 2); Section 10, Township 1S, Range 19, and which is

part of Walton County, FL Parcel 10 - 1S - 19 - 23000 - 009 - 0020

which is further described in the land records of Walton County,

FL as 210FT SQ FT IN THE SE/C OF THE W1/2 OF THE

NE1/4 OF SW1/4 IN SEC 10 - 1S - 19W, 204 - 184, 1204 - 279, 2660 -

2976, 3084 - 4417 and which is recorded in that Warranty Deed

from Grantor Aaron M and Rachel N Sloan Elkins to Grantee

Kyle J. McDorman which Warranty Deed is recorded in the land

records of Walton County, FL at Book 3084 and Page Number

4417. The Property is further described and ide ntified as the

shaded area denoted with an X in the image below.

62. Based on the Walton County Property Appraiser map, the shaded area

denoted with an X is contained within Parcel No. 10 - 1S - 19 - 23000 - 009 - 0000,

which is owned by the Seller, Kyle McDorm an, as opposed to Parcel No. 10 -

1S - 19 - 23000 - 009 - 0020. Timshell contends that the shaded area denoted with

an X overlaps parcels outside of Parcel No. 10 - 1S - 19 - 23000 - 009 - 0000.

63. Timshell contends that the submitted Site C ontrol documentation

submitted by Rosemary Place is not consistent with the requirements of the

RFA because of the uncertainty of the property that is actually being

purchased and where the proposed Development site is actually located.

64. Timshell also contends that the Rosemary Place Purchase and Sale

Agreement , as written and submitted to Florida Housing , denotes scattered

sites which were not disclosed by Rosemary Place in its application.

65. Rosemary Place contends , and Florida Housing agrees , that the

shaded area denoted with an X on Exhibit A to the Rosemary Place

Agreement sufficiently identifies the property being purchased through the

agreement as the Development site.

66. Moreover, the visual depiction of the property is consistent with the

written description of the develo pment location in the Rosemary Place

Application at J - 16, page 5.

67. The Rosemary Place Application does not depict scattered sites. Even

assuming that the parcel number included in Exhibit A were part of the

purchase reflected in the Sale and Purchase A greement, an eligible contract

may involve the purchase of multiple properties or a larger parcel of property

than will be developed. What is most important is that the documents show

where the development will be located, which Rosemary PlaceÔs applicatio n

demonstrates, and that the applicant will have control over the location.

68. Ms. Button testified that Florida Housing did not consider the

Rosemary Place Application to be proposing a scattered sites development.

Rosemary Place affirmatively stated tha t it was not proposing a scattered

sites development; did not list coordinates for scattered sites; and did not

identify the location of scattered sites on other forms required by the RFA.

69. Exhibit A to the Purchase and Sale Agreement contains typograp hical

errors in the written description of the property being sold. Stewart Rutledge,

who prepared the Purchase and Sale Agreement, testified credibly that parcel

numbers are listed on the Walton County Property Appraiser website, and

that to see a particu lar parcel description, the user clicks on the parcel

number he or she wants to see. When preparing the Purchase and Sale

Agreement, Mr. Rutledge mistakenly clicked on the parcel number

immediately above the parcel number he wanted, and he did not notice t he

error. The parcel number reflected in the Purchase and Sale Agreement

references another parcel owned by the seller, Kyle McDorman.

70. Florida Housing considered the typographical error within Exhibit A

that results in the listing of the wrong parcel number and property

description to be a waivable minor irregularity because the error did not

result in the omission of any material information; did not create uncertainty

that a term of the RFA was met; and did not adversely impact Florida

Housing or the public. The same could be said for other typographical error in

the Purchase and Sale Agreement, such as capitalizing the word ÑpropertyÒ

when it should not have been. Ms. Button also noted that the RFA does not

require applicants to submit a land survey of the proposed development site

with its application.

71. The RFA states that Florida Housing reserves the right to waive

minor irregularities. A minor irregularity is defined in r ule 67 - 60.008 as:

those irregularities in an Application, such as

computat ion, typographical, or other errors, that do

not result in the omission of any material

information; do not create any uncertainty that the

terms and requirements of the competitive

solicitation have been met; do not provide a

competitive advantage or bene fit not enjoyed by

other Applicants; and do not adversely impact the

interests of the Corporation or the public. Minor

irregularities may be waived or corrected by the

Corporation.

72. Timshell presented the testimony of Stephen Rutan, a professional

la nd surveyor. Mr. Rutan believed that, based on the property description in

the Purchase and Sale Agreement, the proposed development site overlapped

with another parcel not owned by the seller. Mr. Rutan did not perform a

professional land survey and admit ted that the boundary lines in his

informational Exhibit (Timshell Exhibit 4) were not completely accurate.

Given that the measurements that Mr. Rutan provided were estimates and

not the result of a survey, and the testimony by Mr. Rutledge that the parcel

identification was the result of a clerical error, Mr. RutanÔs testimony is given

little weight, and does not demonstrate that the error in the Purchase and

Sale Agreement included in Rosemary PlaceÔs application created any real

uncertainty that the term s and requirements of the competitive solicitation

have been met.

73. Florida HousingÔs determination that the error in Rosemary PlaceÔs

application was a waivable minor irregularity is not clearly erroneous.

Madison Oaks East, Madison Oaks West, and Ma dison Grove

74. Florida Housing determined that the Madison Oaks West, Madison

Oaks East, and Madison Grove Applications were eligible for funding but

ineligible for the Ñsubmitted but not awarded in RFA 2019 - 113 Preference.Ò

Madison Oaks West, Madison Oa ks East, and Madison Grove were not

selected for preliminary funding.

75. Within the LGAO Designation and Goal, the RFA contained

preferences for funding. One of those preferences was for developments that

were submitted but not awarded in RFA 2019 - 113 ( the 2019 - 113 Preference).

76. In order to qualify for the 2019 - 113 Preference, an Applicant must

meet the following requirements:

• The question at 11.b.(1) of Exhibit A must

reflect confirmation that the Development was

submitted but not awarded in RFA 20 19 - 113;

• The Application in RFA 2019 - 113 must have

provided a Local Government Verification of

Contribution Ï Loan or Grant form

demonstrating the minimum Local Government

Areas of Opportunity Funding Amount outlined

in RFA 2019 - 113;

• The Development Loca tion Point and latitude

and longitude coordinates for all scattered sites

stated at question 5. of Exhibit A for the

proposed Development must be located on the

same site(s) as the Application submitted in

RFA 2019 - 113. These coordinates do not need to

be identical to the Application submitted in RFA

2019 - 113.

• All entities that are Principals for the Applicant

and Developer(s) disclosed on the Principal

Disclosure Form submitted for the proposed

Development and the Application submitted in

RFA 2019 - 113 mus t be identical; and

• The Application submitted in RFA 2019 - 113

was not invited to enter credit underwriting.

77. Florida Housing scored Madison Oaks East, Madison Oaks West, and

Madison Grove as qualifying for all requirements of the 2019 - 113 Preference

except for the requirement that Ñ[a]ll entities that are Principals for the

Applicant and Developer(s) disclosed on the Principal Disclosure Form

submitted for the proposed Development and the Application submitted in

RFA 2019 - 113 must be identical.Ò (Iden tical Principals Requirement).

78. The Principals disclosed on the Principals Disclosure Form for

Madison Oaks West, Madison Oaks East, and Madison Grove in RFA 2019 -

113 were identical to the Principals disclosed in the applications submitted

for RFA 2020 - 201.

79. The plain language of the RFA only requires that the Ñentities that are

Principals for the Applicant and Developer(s) be identical. Ò The plain

language of the RFA does not require that the Applicant and Developer

entities be identical to those lis ted in the 2019 - 113 application.

80. Madison Oaks West, Madison Oaks East, and Madison Grove met the

requirements for the 2019 - 113 preference. However, even though Madison

Oaks East, Madison Oaks West, and Madison Grove are eligible for the

2019 - 113 Pref erence, they would not be selected for funding under the terms

of the RFA.

The Villages

81. Florida Housing determined that The Villages Application is eligible

and, pursuant to the terms of the RFA, The Villages has been preliminarily

selected for fundin g.

82. During scoring, Florida Housing reviewed the VillagesÔ Zoning Form

and determined that it met the requirements of the RFA to demonstrate

appropriate zoning.

83. Madison Oaks East, Madison Oaks West, and Madison Grove alleged

in their Petitions that The Villages failed to demonstrate Ability to Proceed

and appropriate zoning as required by the terms of the RFA. Prior to hearing,

Madison Oaks West, Madison Oaks East, and Madison Grove withdrew their

challenge to The VillagesÔ eligibility for funding.

84. However, should Florida Housing determine, as recommended, that

Panama ManorÔs Grant Form did not demonstrate a funding commitment

from Panama City, then Fletcher Black would receive funding as opposed to

The Villages and Pinnacle at Hammock Springs.

C ONCLUSIONS OF L AW

85. DOAH has jurisdiction over the parties and the subject matter of this

proceeding pursuant to sections 120.569 and 120.57(3).

86. Section 420.507 authorizes Florida Housing to allocate low - income

housing tax credits by competitive so licitation, stating:

The corporation shall have all the powers necessary

or convenient to carry out and effectuate the

purposes and provisions of this part, including the

following powers which are in addition to all other

powers granted by other provisio ns of this part:

* * *

(49) To award its annual allocation of low - income

housing tax credits, nontaxable revenue bonds, and

State Apartment Incentive Loan Programs

appropriated by the Legislature and available to

allocate by request for proposals or oth er

competitive solicitation.

87. Protests to competitive contract solicitations or awards are governed

by section 120.57(3)(f), which provides in part:

(f) In a protest to an invitation to bid or request

for proposals procurement, no submissions made

aft er the bid or proposal opening which amend or

supplement the bid or proposal shall be considered.

In a protest to an invitation to negotiate

procurement, no submissions made after the

agency announces its intent to award a contract,

reject all replies, or withdraw the solicitation which

amend or supplement the reply shall be considered.

Unless otherwise provided by statute, the burden of

proof shall rest with the party protesting the

proposed agency action. In a competitive -

procurement protest, other than a rejection of all

bids, proposals, or replies, the administrative law

judge shall conduct a de novo proceeding to

determine whether the agencyÔs proposed action is

contrary to the agencyÔs governing statutes, the

agencyÔs rules or policies, or the solicita tion

specifications. The standard of proof for such

proceedings shall be whether the proposed agency

action was clearly erroneous, contrary to

competition, arbitrary, or capricious.

88. As parties challenging Florida HousingÔs proposed awards, Petitioner s

Fletcher Black, Madison Oaks East, Madison Oaks West, Madison Grove,

and Timshell bear the burden of proof with respect to their individual

challenges.

89. All Petitioners have standing. All have established that their

substantial interests are affected by proposed agency action, whether or not

they would be chosen for funding during this award cycle.

90. Although chapter 120 uses the term Ñde novoÒ to describe competitive

solicitation proceedings, courts have recognized that a different kind of Ñde

nov oÒ is contemplated for this particular type of agency action. Unlike truly

d e novo proceedings, bid disputes are a form of intra - agency review in which

the purpose of the proceeding is to evaluate the action taken by the agency.

State Contracting and EngÔg Corp. v. DepÔt of Transp. , 709 So. 2d 607, 609

(Fla. 1st DCA 1998).

91. However, proceedings to challenge a competitive award are not simply

a record review of the information that was before the agency. The

proceedings remain Ñde novoÒ in that the evide nce presented at hearing is not

restricted to what was before the agency when it made its preliminary

decision. A new evidentiary record based upon the historical, objective facts is

developed. Asphalt Pavers, Inc. v. DepÔt of Transp., 602 So. 2d 558, 560 - 61

(Fla. 1st DCA 1992). The new findings of fact must support the final order to

be issued by the agency. Gtech Corp. v. DepÔt of Lottery , 737 So. 2d 615, 619

(Fla. 1st DCA 1999).

92. Facts are determined based upon the evidence presented at hearing.

Howe ver, applicants are not permitted to submit information that should

have been, but was not, included in the application submitted in response to

the RFA. Section 120.57(3) expressly prohibits this type of evidence, stating,

Ñno submissions made after the b id or proposal opening which amend or

supplement the bid or proposal shall be considered.Ò The application must

stand on its own, as originally submitted, in light of determined facts.

§ 120.57(3), Fla. Stat.

93. After the administrative law judge determi nes the relevant facts based

upon the evidence presented at hearing, the agencyÔs intended action must be

considered in light of those facts, and the agencyÔs determinations must

remain undisturbed unless they are clearly erroneous, contrary to

competition , arbitrary, or capricious. A proposed award will be upheld unless

it is contrary to governing statutes, the agencyÔs rules, or the terms of the

RFA.

94. A decision is considered to be clearly erroneous when, although there

is evidence to support it, afte r review of the entire record, the tribunal is left

with the definite and firm conviction that a mistake has been committed.

U.S. v. U.S. Gypsum Co. , 333 U.S. 364, 395 (1948); Tropical Jewelers, Inc. v.

Bank of Am., N.A., 19 So. 3d 424, 426 (Fla. 3d DCA 20 09). With respect to

conclusions of law, the First District has held that the clearly erroneous

standard requires that an agencyÔs legal interpretation will be upheld if the

agencyÔs construction falls within the permissible range of interpretations,

Colbe rt v. Dep artmen t of Health , 890 So. 2d 1165, 1166 (Fla. 1st DCA 2004),

unless the agency Ôs interpretation conflicts with the plain and ordinary

meaning of the law. Fla. Hosp. v. Ag. for Health Care Admin. , 823 So. 2d 844,

848 (Fla. 1st DCA 2002).

95. An a gency Ôs decision is contrary to competition if it unreasonably

interferes with the purposes of competitive procurement, which the Supreme

Court of Florida describes as protecting the public against collusive contracts

and securing fair competition upon equ al terms to all bidders. Wester v.

Belote , 103 Fla. 976, 981 - 982, 138 So. 721, 723 - 724 (Fla. 1931); see also Harry

Pepper & Assoc. v. City of Cape Coral , 352 So. 2d 1190, 1192 (Fla. 2d DCA

1977).

96. Finally, an action is arbitrary if it is not supported by logic or the

necessary facts and is capricious if it is adopted without thought or reason, or

if it is irrational. Hadi v. Liberty Behavioral Health Corp. , 927 So. 2d 34, 38 -

39 (Fla. 1st DCA 2006); Agrico Chem. Co. v. DepÔt of EnvtÔl Reg. , 365 So. 759,

763 (Fla. 1st DCA 1978). To determine whether an agency acted in an

arbitrary or capricious manner, it must be determined whether the agency

has considered all of the relevant factors; has given actual, good faith

consideration to those factors; and has us ed reason rather than whim to

progress from considering those factors to reaching a final decision. Adam

Smith Enter. v. DepÔt of Envtl. Reg. , 553 So. 2d 1260, 1273 (Fla. 1st DCA

198 9 ). However, if a decision is justifiable under any analysis that a

reason able person might use to reach a decision of similar importance, the

decision is not arbitrary or capricious. Dravo Basic Materials Co. v. DepÔt of

Transp. , 602 So. 2d 632 , 635 n.3 (Fla. 2d DCA 1992).

Fletcher Black

97. With this framework in mind, base d on the evidentiary record

presented at hearing, it must be determined whether the decision not to

award an LGAO Designation and Goal to either Fletcher Black or Panama

Manor is clearly erroneous, contrary to competition, arbitrary, or capricious.

98. Fl orida Housing did not award the LGAO Designation and Goal to

either applicant because both had Grant Forms that indicated that they had

committed funding from the City of Panama City. The question, however, is

not whether both applicants submitted Grant Fo rms from the same

governmental entity. The express terms of the RFA state:

If multiple Applications demonstrate Local

Government Areas of Opportunity Funding from

the same jurisdiction and those Applications

qualify for the Local Government Areas of

Oppor tunity Designation, then all such

Applications will be deemed ineligible for the Local

Government Areas of Opportunity Designation.

99. The Grant Form itself, identified in the RFA as required, includes the

following requirement:

This certification must be signed by the chief

appoint ed official (staff) responsible for such

approvals, Mayor, City Manager, County Manager/

Administrator/ Coordinator, Chairperson of the

City Council/Commission or Chairperson of the

Board of County Commissioners. È One of the

authorized persons named above may sign this

form for certification of state, federal or Local

Government funds initially obtained or derived

from a Local Government that is directly

administered by an intermediary such as a housing

finance authority, a co mmunity reinvestment

corporation, or a state - certified Community

Housing Development Organization (CHDO). Other

signatories are not acceptable. The Applicant will

not receive credit for this contribution if the

certification is improperly signed.

Similarl y, Section 10.b.(2)(a) of the RFA requires the Grant Form to be

properly completed and executed.

100. Taken together, these instructions in the RFA and in the Grant Form

referenced in the RFA require that an Applicant submit a Grant Form as

attachment 16 to its application that is signed by one of the named officials

with authority to sign on behalf of the governmental entity committed to

funding. No one other than those named officials is authorized to sign on

behalf of a governmental entity, and accordin g to the express terms of the

Grant Form, an applicant will not receive credit for the contribution if the

certification is improperly signed.

101. In this case, the Grant Form submitted with the Panama Manor

application is not properly signed. Mr. Johnso n testified that, while he

believed he had the authority to sign the Grant Form, he intended it to

commit funds from Bay County as opposed to the City of Panama City. His

boss, Mark McQueen, testified that while Mr. JohnsonÔs office processes these

request s, Mr. Johnson did not have the authority to sign on behalf of the city.

Mr. McQueenÔs testimony is consistent with how Fletcher BlackÔs request was

processed, with presentation of the request to the city council and a vote to

authorize the Mayor to sign o n the cityÔs behalf.

102. Panama ManorÔs Grant Form could not be amended, because

allowing an amendment is expressly prohibited in the FRA and in section

120.57(3)(f). Under these circumstances, Panama Manor did not demonstrate

entitlement to the LGAO Des ignation. Because Panama Manor did not

demonstrate entitlement to the LGAO Designation based on a commitment

from the City of Panama City, it was not entitled to the LGAO Designation.

103. It was not necessary, however, for Florida Housing to determine th at

Fletcher Black was also ineligible, and to do so was clearly erroneous. The

RFA only requires that both applications be deemed ineligible for the LGAO

Designation if multiple applications demonstrate funding from the same

jurisdiction. Here, the more pe rsuasive and compelling evidence is that the

City of Panama City only committed to funding for one applicant, Fletcher

Black, as opposed to two applicants.

104. Ms. Button acknowledged that the Panama Manor Grant Form had

designated Panama City in error, but believed that to allow Fletcher Black to

receive the LGAO Designation and Goal would somehow be contrary to

competition. Her explanation is confusing, because her answer focused on the

requirement that an applicant be fully responsible for all aspects of its

application, even those portions completed by others. However, there is no

dispute that Fletcher Black completed all portions of the application as

directed, and the error was in Panama ManorÔs application, not Fletcher

BlackÔs. On the contrary, it seems that determining that Fletcher Black is

ineligible for the LGAO Designation because of an error in another

application when that error could be addressed by striking the improperly

executed Grant Form, would be contrary to competition. Fletcher Blac k

submitted its application in good faith, and the application did not contain

any error that would make it ineligible for the LGAO Designation. The

application demonstrated committed funding from a local government entity,

i.e., Panama City, and its Grant Form was signed by a local official expressly

authorized to do so. It should have been considered eligible for the LGAO

Designation, and it should have been recommended for funding.

105. In summary, because only Fletcher Black demonstrated committed

fund ing from the City of Panama City, and Panama ManorÔs application

contained an error that resulted in Panama Manor not being eligible for

consideration, the terms of the RFA do not require that Fletcher Black be

ineligible for the LGAO Designation, and to c onsider them ineligible was

clearly erroneous and contrary to the RFA specifications.

Rosemary Place

106. Timshell has challenged the selection of Rosemary Place for funding

because it believes that the Rosemary Place application does not demonstrate

S i te C ontrol. Timshell bases its argument on errors in the Purchase and Sale

Agreement attached to the application.

107. The more persuasive evidence supports Florida HousingÔs

determination that the errors in the Purchase and Sale Agreement were

waivable m inor irregularities as that term is defined in rule 67 - 60.008. The

Rosemary Place Application did not indicate that it was planning on

developing on scattered sites, and Mr. Rutledge credibly testified that

scattered sites were not intended. The evidence i ndicates that the Rosemary

Place application sufficiently identified the suggested location for

development, notwithstanding the errors in the Purchase and Sale

Agreement. Florida HousingÔs decision to consider the errors as waivable,

minor irregularities is not clearly erroneous, and is not contrary to governing

statutes, rules, or the terms of the RFA.

Madison Oaks East, Madison Oaks West, and Madison Grove

108. As noted in the Findings of Fact, Florida Housing, The Villages, and

Pinnacle agree that M adison Oaks West, Madison Oaks East, and Madison

Grove met the requirements for the 2019 - 113 P reference. Given this

agreement, which was reached before hearing, no further conclusions of law

are required with respect to the issues presented by these petiti oners.

However, even though Madison Oaks East, Madison Oaks West, and Madison

Grove are eligible for the 2019 - 113 Preference, they would not be selected for

funding under the terms of the RFA.

R ECOMMENDATION

Based on the foregoing Findings of Fact and Con clusions of Law, it is

R ECOMMENDED that the Florida Housing Finance Corporation enter a final

order as to Case No. 21 - 0515BID, finding that Fletcher Black is eligible for

the LGAO Designation, and awarding funding to Fletcher Black, subject to

the successf ul completion of credit underwriting; that with respect to Case

Nos. 21 - 0516BID, 21 - 0517BID, and 21 - 0518BID, finding that Madison Oaks

East, Madison Oaks West, and Madison Grove are eligible for the 20 19 - 113

P reference , but are not selected for funding; an d with respect to Case

No. 21 - 0520BID, finding that the decision to award funding to Rosemary

Place was not clearly erroneous, and the error in its application was a minor

waivable irregularity.

D ONE A ND E NTERED this 14th day of April , 2021 , in Tallaha ssee, Leon

County, Florida.

S

L ISA S HEARER N ELSON

Administrative Law Judge

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrativ e Hearings

this 14th day of April , 2021 .

C OPIES F URNISHED :

J. Timothy Schulte, Esquire M. Christopher Bryant, Esquire

Zimmerman, Kiser & Sutcliffe, P.A. Oertel, Fernandez, Bryant & Atkinson,

315 East Robinson Street P.A.

Post Office Box 3000 (32802) Post Office Box 1110

Orlando, Florida 32801 Tallahassee, Florida 32302 - 1110

Lawrence E. Sellers, Jr., Esquire Hugh R. Brown, General Counsel

Holland & Knight, LL P Florida Housing Finance Corporation

Suite 600 Suite 5000

315 South Calhoun Street 2 27 North Bronough Street

Tallahassee, Florida 32301 Tallahassee, Florida 32301 - 1329

Michael P. Donaldson, Esquire Betty Zachem, Esquire

Carlton Fields , P.A. Florida Housing Finance Corporation

Suite 500 Suite 5000

215 South Monroe Street 227 North Bronough Street

Tallahassee, Florida 32302 Tallahassee, Florida 32301

Corporation Clerk Tiffany A. Roddenberry, Esquire

Florida Housing Finance Corporation Holland & Knight, LLP

Suite 5000 Suite 600

227 North B ronough Street 315 South Calhoun Street

Tallahassee, Florida 32301 - 1329 Tallahassee, Florida 32301

N OTICE OF R IGHT T O S UBMIT E XCEPTIONS

All parties have the right to submit written exceptions within 1 0 days from

the date of this Recommended Order. Any exceptions to this Recommended

Order should be filed wit h the agency that will issue the Final Order in this

case.