The Florida Senate

651.022  Provisional certificate of authority; application.--

(1)  Each applicant for a certificate of authority shall first apply for and obtain a provisional certificate of authority pursuant to this section.

(2)  The application for a provisional certificate of authority shall be on a form prescribed by the department and shall contain the following information:

(a)  If the applicant or provider is a corporation, a copy of the articles of incorporation and bylaws; if the applicant or provider is a partnership or other unincorporated association, a copy of the partnership agreement, articles of association, or other membership agreement; and, if the applicant or provider is a trust, a copy of the trust agreement or instrument.

(b)  The full names, residences, and business addresses of:

1.  The proprietor, if the applicant or provider is an individual.

2.  Every partner or member, if the applicant or provider is a partnership or other unincorporated association, however organized, having fewer than 50 partners or members, together with the business name and address of the partnership or other organization.

3.  The principal partners or members, if the applicant or provider is a partnership or other unincorporated association, however organized, having 50 or more partners or members, together with the business name and business address of the partnership or other organization. If such unincorporated organization has officers and a board of directors, the full name and business address of each officer and director may be set forth in lieu of the full name and business address of its principal members.

4.  The corporation and each officer and director thereof, if the applicant or provider is a corporation.

5.  Every trustee and officer, if the applicant or provider is a trust.

6.  The manager, whether an individual, corporation, partnership, or association.

7.  Any stockholder holding at least a 10-percent interest in the operations of the facility in which the care is to be offered.

8.  Any person whose name is required to be provided in the application under the provisions of this paragraph and who owns any interest in or receives any remuneration from, either directly or indirectly, any professional service firm, association, trust, partnership, or corporation providing goods, leases, or services to the facility for which the application is made, with a real or anticipated value of $500 or more, and the name and address of the professional service firm, association, trust, partnership, or corporation in which such interest is held. The applicant shall describe such goods, leases, or services and the probable cost to the facility or provider and shall describe why such goods, leases, or services should not be purchased from an independent entity.

9.  Any person, corporation, partnership, association, or trust owning land or property leased to the facility, along with a copy of the lease agreement.

10.  Any affiliated parent or subsidiary corporation or partnership.

(c)1.  Evidence that the applicant is reputable and of responsible character. If the applicant is a firm, association, organization, partnership, business trust, corporation, or company, the form shall require evidence that the members or shareholders are reputable and of responsible character, and the person in charge of providing care under a certificate of authority shall likewise be required to produce evidence of being reputable and of responsible character.

2.  Evidence satisfactory to the department of the ability of the applicant to comply with the provisions of this chapter and with rules adopted by the department pursuant to this chapter.

3.  A statement of whether a person identified in the application for a provisional certificate of authority or the administrator or manager of the facility, if such person has been designated, or any such person living in the same location:

a.  Has been convicted of a felony or has pleaded nolo contendere to a felony charge, or has been held liable or has been enjoined in a civil action by final judgment, if the felony or civil action involved fraud, embezzlement, fraudulent conversion, or misappropriation of property.

b.  Is subject to a currently effective injunctive or restrictive order or federal or state administrative order relating to business activity or health care as a result of an action brought by a public agency or department, including, without limitation, an action affecting a license under chapter 400.

The statement shall set forth the court or agency, the date of conviction or judgment, and the penalty imposed or damages assessed, or the date, nature, and issuer of the order. Before determining whether a provisional certificate of authority is to be issued, the department may make an inquiry to determine the accuracy of the information submitted pursuant to subparagraphs 1. and 2.

(d)  The agreements for continuing care to be entered into between the provider and residents which meet the minimum requirements of s. 651.055 and which include a statement describing the procedures required by law relating to the release of escrowed entrance fees. Such statement may be furnished through an addendum.

(e)  Any advertisement or other written material proposed to be used in the solicitation of residents.

(f)  Such other reasonable data, financial statements, and pertinent information as the department may reasonably require with respect to the provider or the facility, including the most recent audited financial statements of comparable facilities currently or previously owned, managed, or developed by the applicant or its principal, to assist in determining the financial viability of the project and the management capabilities of its managers and owners.

(3)  In addition to the information required in subsection (2), an applicant for a provisional certificate of authority shall submit a market feasibility study. The market feasibility study shall include at least the following information:

(a)  A description of the proposed facility, including the location, size, anticipated completion date, and the proposed construction program.

(b)  An identification and evaluation of the primary and secondary market areas of the facility and the projected unit sales per month.

(c)  Projected revenues, including anticipated entrance fees; monthly service fees; nursing care rates, if applicable; and all other sources of revenue, including the total amount of debt financing required.

(d)  Projected expenses, including staffing requirements and salaries; cost of property, plant, and equipment, including depreciation expense; interest expense; marketing expense; and other operating expenses.

(e)  Current assets and liabilities of the applicant.

(f)  Expectations of the financial condition of the project, including the projected cash flow and a projected balance sheet and an estimate of the funds anticipated to be necessary to cover startup losses.

(g)  The inflation factor, if any, assumed in the study for the proposed facility and how and where it is applied.

(h)  Project costs, marketing projections, resident fees and charges, the competition, resident contract provisions, and other factors which affect the feasibility of the facility.

(i)  The application for a provisional certificate of authority shall be accompanied by the forms of the continuing care residency and reservation contracts and escrow agreements proposed to be used by the provider in the furnishing of care. If the department finds that the continuing care contracts and escrow agreements comply with ss. 651.023(1)(c), 651.033, and 651.055, it shall approve them. Thereafter, no other form of contract or agreement may be used by the provider until it has been submitted to the department and approved.

(j)  The name of the person who prepared the feasibility study and the experience of such person in preparing similar studies or otherwise consulting in the field of continuing care.

(4)  If an applicant has or proposes to have more than one facility offering continuing care, a separate provisional certificate of authority and a separate certificate of authority shall be obtained for each facility.

(5)(a)  Within 30 days after receipt of an application for a provisional certificate of authority, the department shall examine the application and shall notify the applicant in writing, specifically setting forth and specifically requesting any additional information the department is permitted by law to require. If the application submitted is determined by the department to be substantially incomplete so as to require substantial additional information, including biographical information, the department may return the application to the applicant with a written notice that the application as received is substantially incomplete and, therefore, unacceptable for filing without further action required by the department. Any filing fee received shall be refunded to the applicant.

(b)  Within 15 days after receipt of all of the requested additional information, the department shall notify the applicant in writing that all of the requested information has been received and the application is deemed to be complete as of the date of the notice. Failure to so notify the applicant in writing within the 15-day period shall constitute acknowledgment by the department that it has received all requested additional information, and the application shall be deemed to be complete for purposes of review upon the date of the filing of all of the requested additional information.

(6)  Within 45 days from the date an application is deemed to be complete, as set forth in paragraph (5)(b), the department shall complete its review and shall issue a provisional certificate of authority to the applicant based upon its review and a determination that the application meets all requirements of law and that the feasibility study was based on sufficient data and reasonable assumptions and that the applicant will be able to provide continuing care as proposed and meet all financial obligations related to its operations, including the financial requirements of this chapter to provide continuing care as proposed. If the application is denied, the department shall notify the applicant in writing, citing the specific failures to meet the provisions of this chapter. Such denial shall entitle the applicant to a hearing pursuant to the provisions of chapter 120.

(7)  The issuance of a provisional certificate of authority entitles the applicant to collect entrance fees and reservation deposits from prospective residents. All or any part of an entrance fee or deposit collected shall be placed in an escrow account or on deposit with the department, pursuant to s. 651.033, until a certificate of authority is issued by the department.

(8)  The department shall not approve any application which includes in the plan of financing any encumbrance of the operating reserves required by this chapter.

History.--ss. 4, 33, ch. 83-328; s. 35, ch. 85-62; s. 42, ch. 85-321; s. 2, ch. 87-136; s. 2, ch. 89-363; s. 2, ch. 92-56; s. 12, ch. 93-22; s. 4, ch. 97-229.