HB 0023 2003
1	CHAMBER ACTION
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6	The Committee on Appropriations recommends the following:
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8	Committee Substitute
9	Remove the entire bill and insert:
10	A bill to be entitled
11	An act relating to administrative procedures; amending s.
12	120.52, F.S.; revising the definition of “invalid exercise
13	of delegated legislative authority"; amending s. 120.54,
14	F.S.; revising language with respect to incorporation of
15	rules by reference and with respect to uniform rules;
16	providing requirements with respect to the application of
17	alleged facts to specific rules or statutes; amending s.
18	120.56, F.S.; providing that hearings on rule challenges
19	shall be de novo in nature; providing for burden and
20	standard of proof; changing the timeframe for publishing
21	proposed rules where agency statements are challenged to
22	moot such challenge; providing that challenges to agency
23	statements may be abated pending rulemaking; providing
24	that a determination that such rule is an invalid exercise
25	of delegated legislative authority shall prohibit the
26	agency from enforcing its statement or certain similar
27	statements; amending s. 120.569, F.S.; revising language
28	with respect to decisions which affect substantial
29	interests; providing for initial scheduling orders by the
30	administrative law judge; providing for a discovery
31	period; amending s. 120.57, F.S.; revising language with
32	respect to additional procedures applicable to hearings
33	involving disputed issues of material fact; providing that
34	an order relinquishing jurisdiction shall be rendered
35	under certain circumstances; providing circumstances which
36	excuse an agency from ruling on an exception to a
37	recommended order; limiting the authority of agencies to
38	reject or modify conclusions of law and interpretations of
39	administrative rules in recommended orders; amending s.
40	120.595, F.S.; redefining the term “improper purpose” and
41	conforming a cross reference; providing for the award of
42	reasonable attorney’s fees and costs under certain
43	circumstances; providing for nonexclusivity; amending s.
44	120.60, F.S.; revising language with respect to licensing;
45	providing that licenses considered approved as a condition
46	of time may still be subject to satisfactory completion of
47	an examination; requiring written notice of intent to rely
48	on a default license; amending s. 120.68, F.S.; revising
49	language with respect to judicial review; providing
50	additional grounds for certain petitions challenging an
51	agency rule as an invalid exercise of delegated
52	legislative authority; amending s. 57.105, F.S.; providing
53	administrative law judges authority to award attorney's
54	fees and damages in certain administrative proceedings;
55	providing for appeal; amending s. 57.111, F.S.; increasing
56	the cap on attorney’s fees in civil actions and
57	administrative proceedings initiated by state agencies;
58	providing an effective date.
59
60	Be It Enacted by the Legislature of the State of Florida:
61
62	Section 1. Paragraphs (e), (f), and (g) of subsection (8)
63	of section 120.52, Florida Statutes, are amended to read:
64	120.52 Definitions.--As used in this act:
65	(8) "Invalid exercise of delegated legislative authority"
66	means action which goes beyond the powers, functions, and duties
67	delegated by the Legislature. A proposed or existing rule is an
68	invalid exercise of delegated legislative authority if any one
69	of the following applies:
70	(e) The rule is arbitrary or capricious. A rule is
71	arbitrary if it is not supported by logic or the necessary
72	facts; a rule is capricious if it is adopted without thought or
73	reason or is irrational; or
74	(f) The rule is not supported by competent substantial
75	evidence; or
76	(f)(g)The rule imposes regulatory costs on the regulated
77	person, county, or city which could be reduced by the adoption
78	of less costly alternatives that substantially accomplish the
79	statutory objectives.
80
81	A grant of rulemaking authority is necessary but not sufficient
82	to allow an agency to adopt a rule; a specific law to be
83	implemented is also required. An agency may adopt only rules
84	that implement or interpret the specific powers and duties
85	granted by the enabling statute. No agency shall have authority
86	to adopt a rule only because it is reasonably related to the
87	purpose of the enabling legislation and is not arbitrary and
88	capricious or is within the agency's class of powers and duties,
89	nor shall an agency have the authority to implement statutory
90	provisions setting forth general legislative intent or policy.
91	Statutory language granting rulemaking authority or generally
92	describing the powers and functions of an agency shall be
93	construed to extend no further than implementing or interpreting
94	the specific powers and duties conferred by the same statute.
95	Section 2. Paragraph (i) of subsection (1) and paragraph
96	(b) of subsection (5) of section 120.54, Florida Statutes, are
97	amended to read:
98	120.54 Rulemaking.--
99	(1) GENERAL PROVISIONS APPLICABLE TO ALL RULES OTHER THAN
100	EMERGENCY RULES.--
101	(i)1.A rule may incorporate material by reference but
102	only as the material exists on the date the rule is adopted. For
103	purposes of the rule, changes in the material are not effective
104	unless the rule is amended to incorporate the changes.
105	2. Notwithstanding any contrary provision in this section,
106	when an adopted rule of the Department of Environmental
107	Protection or a water management district is incorporated by
108	reference in the other agency’s rule to implement a provision of
109	chapter 373, subsequent amendments to the rule are not effective
110	as to the incorporating rule unless the agency incorporating by
111	reference notifies the committee and the Department of State of
112	its intent to adopt the subsequent amendment, publishes notice
113	of such intent in the Florida Administrative Weekly, and files
114	with the Department of State a copy of the amended rule
115	incorporated by reference. Changes in the rule incorporated by
116	reference are effective 20 days after the date of the published
117	notice and filing with the Department of State. The Department
118	of State shall amend the history note of the incorporating rule
119	to show the effective date of such change. Any substantially
120	affected person may, within 14 days after the date of
121	publication of the notice of intent in the Florida
122	Administrative Weekly, file an objection to rulemaking with the
123	agency. The objection shall specify the portions of the rule
124	incorporated by reference to which the person objects and the
125	reasons for the objection. The agency shall not have the
126	authority under this subparagraph to adopt those portions of the
127	rule specified in such objection. Objections which are frivolous
128	or which duplicate those previously filed during the initial
129	adoption of the rule incorporated by reference shall not be
130	considered sufficient to prohibit the agency from adopting rules
131	under this subparagraph. The agency shall publish notice of the
132	objection, and its action in response, in the next available
133	issue.
134	3.A rule may not be amended by reference only. Amendments
135	must set out the amended rule in full in the same manner as
136	required by the State Constitution for laws. The Department of
137	State may prescribe by rule requirements for incorporating
138	materials by reference pursuant to this paragraph.
139	(5) UNIFORM RULES.--
140	(b) The uniform rules of procedure adopted by the
141	commission pursuant to this subsection shall include, but are
142	not belimited to:
143	1. Uniform rules for the scheduling of public meetings,
144	hearings, and workshops.
145	2. Uniform rules for use by each state agency that provide
146	procedures for conducting public meetings, hearings, and
147	workshops, and for taking evidence, testimony, and argument at
148	such public meetings, hearings, and workshops, in person and by
149	means of communications media technology. The rules shall
150	provide that all evidence, testimony, and argument presented
151	shall be afforded equal consideration, regardless of the method
152	of communication. If a public meeting, hearing, or workshop is
153	to be conducted by means of communications media technology, or
154	if attendance may be provided by such means, the notice shall so
155	state. The notice for public meetings, hearings, and workshops
156	utilizing communications media technology shall state how
157	persons interested in attending may do so and shall name
158	locations, if any, where communications media technology
159	facilities will be available. Nothing in this paragraph shall be
160	construed to diminish the right to inspect public records under
161	chapter 119. Limiting points of access to public meetings,
162	hearings, and workshops subject to the provisions of s. 286.011
163	to places not normally open to the public shall be presumed to
164	violate the right of access of the public, and any official
165	action taken under such circumstances is void and of no effect.
166	Other laws relating to public meetings, hearings, and workshops,
167	including penal and remedial provisions, shall apply to public
168	meetings, hearings, and workshops conducted by means of
169	communications media technology, and shall be liberally
170	construed in their application to such public meetings,
171	hearings, and workshops. As used in this subparagraph,
172	"communications media technology" means the electronic
173	transmission of printed matter, audio, full-motion video,
174	freeze-frame video, compressed video, and digital video by any
175	method available.
176	3. Uniform rules of procedure for the filing of notice of
177	protests and formal written protests.
178	4. Uniform rules of procedure for the filing of petitions
179	for administrative hearings pursuant to s. 120.569 or s. 120.57.
180	Such rules shall require the petition toinclude:
181	a. The identification of the petitioner.
182	b. A statement of when and how the petitioner received
183	notice of the agency's action or proposed action.
184	c. An explanation of how the petitioner's substantial
185	interests are or will be affected by the action or proposed
186	action.
187	d. A statement of all material facts disputed by the
188	petitioner or a statement that there are no disputed facts.
189	e. A statement of the ultimate facts alleged, including a
190	statement of the specific facts the petitioner contends warrant
191	reversal or modification of the agency's proposed action.
192	f. A statement of the specific rules or statutes thatthe
193	petitioner contends require reversal or modification of the
194	agency's proposed action and an explanation of how the alleged
195	facts relate to the specific rules or statutes.
196	g. A statement of the relief sought by the petitioner,
197	stating precisely the action petitioner wishes the agency to
198	take with respect to the proposed action.
199	5. Uniform rules of procedure for the filing and prompt
200	disposition of petitions for declaratory statements.
201	6. Provision of a method by which each agency head shall
202	provide a description of the agency's organization and general
203	course of its operations.
204	7. Uniform rules establishing procedures for granting or
205	denying petitions for variances and waivers pursuant to s.
206	120.542.
207	Section 3. Paragraph (e) of subsection (1), paragraph (a)
208	of subsection (3), and paragraph (e) of subsection (4) of
209	section 120.56, Florida Statutes, are amended to read:
210	120.56 Challenges to rules.--
211	(1) GENERAL PROCEDURES FOR CHALLENGING THE VALIDITY OF A
212	RULE OR A PROPOSED RULE.--
213	(e) Hearings held under this section shall be de novo in
214	nature. The standard of proof shall be the preponderance of the
215	evidence. Hearings shall beconducted in the same manner as
216	provided by ss. 120.569 and 120.57, except that the
217	administrative law judge's order shall be final agency action.
218	The petitioner and the agency whose rule is challenged shall be
219	adverse parties. Other substantially affected persons may join
220	the proceedings as intervenors on appropriate terms which shall
221	not unduly delay the proceedings. Failure to proceed under this
222	section shall not constitute failure to exhaust administrative
223	remedies.
224	(3) CHALLENGING EXISTING RULES; SPECIAL PROVISIONS.--
225	(a) A substantially affected person may seek an
226	administrative determination of the invalidity of an existing
227	rule at any time during the existence of the rule. The
228	petitioner has a burden of proving by a preponderance of the
229	evidence that the existing rule is an invalid exercise of
230	delegated legislative authority as to the objections raised.
231	(4) CHALLENGING AGENCY STATEMENTS DEFINED AS RULES;
232	SPECIAL PROVISIONS.--
233	(e)1. If, prior to a final hearing to determine whether
234	all or part of any agency statement violates s. 120.54(1)(a), an
235	agency publishes, pursuant to s. 120.54(3)(a), proposed rules
236	that address the statement, then, for purposes of this section,
237	a presumption is created that the agency is acting expeditiously
238	and in good faith to adopt rules that address the statement, and
239	the agency shall be permitted to rely upon the statement or a
240	substantially similar statement as a basis for agency action if
241	the statement meets the requirements of s. 120.57(1)(e).
242	2. If, prior to the final hearing to determine whether all
243	or part of an agency statement violates s. 120.54(1)(a), an
244	agency publishes a notice of rule development that addresses the
245	statement, pursuant to s. 120.54(2), or certifies that such a
246	notice has been transmitted to the Florida Administrative Weekly
247	for publication, then such publication shall constitute good
248	cause for the granting of a stay of the proceedings and a
249	continuance of the final hearing for 30 days. If the agency
250	publishes proposed rules within this 30-day period or any
251	extension of that period granted by an administrative law judge
252	upon showing of good cause, then the administrative law judge
253	shall place the case in abeyance pending the outcome of
254	rulemaking and any proceedings involving challenges to proposed
255	rules pursuant to subsection (2).
256	3. If, following the commencement of the final hearing and
257	prior to entry of a final order that all or part of an agency
258	statement violates s. 120.54(1)(a), ifan agency publishes,
259	pursuant to s. 120.54(3)(a), proposed rules thatwhichaddress
260	the statement and proceeds expeditiously and in good faith to
261	adopt rules thatwhichaddress the statement, the agency shall
262	be permitted to rely upon the statement or a substantially
263	similar statement as a basis for agency action if the statement
264	meets the requirements of s. 120.57(1)(e).
265	4. If an agency fails to adopt rules thatwhichaddress
266	the statement within 180 days after publishing proposed rules,
267	for purposes of this subsection, a presumption is created that
268	the agency is not acting expeditiously and in good faith to
269	adopt rules. If the agency's proposed rules are challenged
270	pursuant to subsection (2), the 180-day period for adoption of
271	rules is tolled until a final order is entered in that
272	proceeding.
273	5. If the proposed rules addressing the challenged
274	statement are determined to be an invalid exercise of delegated
275	legislative authority as defined in s. 120.52(8)(b)-(g), the
276	agency must immediately discontinue reliance on the statement
277	and any substantially similar statement until the rules
278	addressing the subject are properly adopted.
279	Section 4. Paragraph (o) is added to subsection (2) of
280	section 120.569, Florida Statutes, to read:
281	120.569 Decisions which affect substantial interests.--
282	(2)
283	(o) On the request of any party, the administrative law
284	judge shall enter an initial scheduling order to facilitate the
285	just, speedy, and inexpensive determination of the proceeding.
286	The initial scheduling order shall establish a discovery period,
287	including a deadline by which all discovery shall be completed,
288	and the date by which the parties shall identify expert
289	witnesses and their opinions. The initial scheduling order also
290	may require the parties to meet and file a joint report by a
291	date certain.
292	Section 5. Paragraphs (e), (i), and (k) of subsection (1)
293	of section 120.57, Florida Statutes, are amended to read:
294	120.57 Additional procedures for particular cases.--
295	(1) ADDITIONAL PROCEDURES APPLICABLE TO HEARINGS INVOLVING
296	DISPUTED ISSUES OF MATERIAL FACT.--
297	(e)1. Any agency action that determines the substantial
298	interests of a party and that is based on an unadopted rule is
299	subject to de novo review by an administrative law judge.
300	2. The agency action shall not be presumed valid or
301	invalid. The agency must demonstrate that the unadopted rule:
302	a. Is within the powers, functions, and duties delegated
303	by the Legislature or, if the agency is operating pursuant to
304	authority derived from the State Constitution, is within that
305	authority;
306	b. Does not enlarge, modify, or contravene the specific
307	provisions of law implemented;
308	c. Is not vague, establishes adequate standards for agency
309	decisions, or does not vest unbridled discretion in the agency;
310	d. Is not arbitrary or capricious. A rule is arbitrary if
311	it is not supported by logic or the necessary facts; a rule is
312	capricious if it is adopted without thought or reason or is
313	irrational;
314	e. Is not being applied to the substantially affected
315	party without due notice; and
316	f. Is supported by competent and substantial evidence; and
317	f.g.Does not impose excessive regulatory costs on the
318	regulated person, county, or city.
319	3. The recommended and final orders in any proceeding
320	shall be governed by the provisions of paragraphs (k) and (l),
321	except that the administrative law judge's determination
322	regarding the unadopted rule shall not be rejected by the agency
323	unless the agency first determines from a review of the complete
324	record, and states with particularity in the order, that such
325	determination is clearly erroneous or does not comply with
326	essential requirements of law. In any proceeding for review
327	under s. 120.68, if the court finds that the agency's rejection
328	of the determination regarding the unadopted rule does not
329	comport with the provisions of this subparagraph, the agency
330	action shall be set aside and the court shall award to the
331	prevailing party the reasonable costs and a reasonable
332	attorney's fee for the initial proceeding and the proceeding for
333	review.
334	(i) When, in any proceeding conducted pursuant to this
335	subsection, a dispute of material fact no longer exists, any
336	party may move the administrative law judge to relinquish
337	jurisdiction to the agency. An order relinquishing jurisdiction
338	shall be rendered if the administrative law judge determines
339	fromIn ruling on such a motion, the administrative law judge
340	may considerthe pleadings, depositions, answers to
341	interrogatories, and admissions on file, together with
342	supporting and opposing affidavits, if any, that no genuine
343	issue as to any material fact exists. If the administrative law
344	judge enters an order relinquishing jurisdiction, the agency may
345	promptly conduct a proceeding pursuant to subsection (2), if
346	appropriate, but the parties may not raise any issues of
347	disputed fact that could have been raised before the
348	administrative law judge. An order entered by an administrative
349	law judge relinquishing jurisdiction to the agency based upon a
350	determination that no genuine dispute of material fact exists,
351	need not contain findings of fact, conclusions of law, or a
352	recommended disposition or penalty.
353	(k) The presiding officer shall complete and submit to the
354	agency and all parties a recommended order consisting of
355	findings of fact, conclusions of law, and recommended
356	disposition or penalty, if applicable, and any other information
357	required by law to be contained in the final order. All
358	proceedings conducted pursuant to this subsection shall be de
359	novo. The agency shall allow each party 15 days in which to
360	submit written exceptions to the recommended order. An agency
361	need not rule on an exception that does not clearly identify the
362	disputed portion of the recommended order by page number or
363	paragraph, that does not identify the legal basis for the
364	exception, or that does not include appropriate and specific
365	citations to the record.
366	Section 6. Paragraphs (c) and (e) of subsection (1) of
367	section 120.595, Florida Statutes, are amended, and subsection
368	(6) is added to said section, to read:
369	120.595 Attorney's fees.--
370	(1) CHALLENGES TO AGENCY ACTION PURSUANT TO SECTION
371	120.57(1).--
372	(c) In proceedings pursuant to s. 120.57(1), and upon
373	motion, the administrative law judge shall determine whether any
374	party participated in the proceeding for an improper purpose as
375	defined by this subsection and s. 120.569(2)(e). In making such
376	determination, the administrative law judge shall consider
377	whether the nonprevailing adverse party has participated in two
378	or more other such proceedings involving the same prevailing
379	party and the same project as an adverse party and in which such
380	two or more proceedings the nonprevailing adverse party did not
381	establish either the factual or legal merits of its position,
382	and shall consider whether the factual or legal position
383	asserted in the instant proceeding would have been cognizable in
384	the previous proceedings. In such event, it shall be rebuttably
385	presumed that the nonprevailing adverse party participated in
386	the pending proceeding for an improper purpose.
387	(e) For the purpose of this subsection:
388	1. "Improper purpose" means participation in a proceeding
389	pursuant to s. 120.57(1) primarily to harass or to cause
390	unnecessary delay or for frivolous purpose or to needlessly
391	increase the cost of litigation, licensing,or securing the
392	approval of an activity.
393	2. "Costs" has the same meaning as the costs allowed in
394	civil actions in this state as provided in chapter 57.
395	3. "Nonprevailing adverse party" means a party that has
396	failed to have substantially changed the outcome of the proposed
397	or final agency action which is the subject of a proceeding. In
398	the event that a proceeding results in any substantial
399	modification or condition intended to resolve the matters raised
400	in a party's petition, it shall be determined that the party
401	having raised the issue addressed is not a nonprevailing adverse
402	party. The recommended order shall state whether the change is
403	substantial for purposes of this subsection. In no event shall
404	the term "nonprevailing party" or "prevailing party" be deemed
405	to include any party that has intervened in a previously
406	existing proceeding to support the position of an agency.
407	(6) OTHER SECTIONS NOT AFFECTED.--Other provisions,
408	including ss. 57.105 and 57.111, authorize the award of
409	attorney’s fees and costs in administrative proceedings. Nothing
410	in this section shall affect the availability of attorney’s fees
411	and costs as provided in those sections.
412	Section 7. Subsection (1) of section 120.60, Florida
413	Statutes, is amended to read:
414	120.60 Licensing.--
415	(1) Upon receipt of an application for a license, an
416	agency shall examine the application and, within 30 days after
417	such receipt, notify the applicant of any apparent errors or
418	omissions and request any additional information the agency is
419	permitted by law to require. An agency shall not deny a license
420	for failure to correct an error or omission or to supply
421	additional information unless the agency timely notified the
422	applicant within this 30-day period. An application shall be
423	considered complete upon receipt of all requested information
424	and correction of any error or omission for which the applicant
425	was timely notified or when the time for such notification has
426	expired. Every application for a license shall be approved or
427	denied within 90 days after receipt of a completed application
428	unless a shorter period of time for agency action is provided by
429	law. The 90-day time period shall be tolled by the initiation of
430	a proceeding under ss. 120.569 and 120.57. AnyAnapplication
431	for a license that is notmust beapproved or denied within the
432	90-day or shorter time period, within 15 days after the
433	conclusion of a public hearing held on the application, or
434	within 45 days after a recommended order is submitted to the
435	agency and the parties, whichever action or timeframe is latest
436	and applicable, is considered approved unless the recommended
437	order recommends that the agency deny the license. Subject to
438	the satisfactory completion of an examination if required as a
439	prerequisite to licensure, any license that is considered
440	approved shall be issued and may include such reasonable
441	conditions as are authorized by law. Any applicant for licensure
442	seeking to claim licensure by default under this subsection
443	shall notify the agency clerk of the licensing agency, in
444	writing, of the intent to rely upon the default license
445	provision of this subsection, and shall not take any action
446	based upon the default license until after receipt of such
447	notice by the agency clerklater. The agency must approve any
448	application for a license or for an examination required for
449	licensure if the agency has not approved or denied the
450	application within the time periods prescribed by this
451	subsection.
452	Section 8. Subsection (9) of section 120.68, Florida
453	Statutes, is amended to read:
454	120.68 Judicial review.--
455	(9) No petition challenging an agency rule as an invalid
456	exercise of delegated legislative authority shall be instituted
457	pursuant to this section, except to review an order entered
458	pursuant to a proceeding under s. 120.56 or an agency’s findings
459	of immediate danger, necessity, and procedural fairness
460	prerequisite to the adoption of an emergency rule pursuant to s.
461	120.54(4), unless the sole issue presented by the petition is
462	the constitutionality of a rule and there are no disputed issues
463	of fact.
464	Section 9. Subsections (5) and (6) of section 57.105,
465	Florida Statutes, are renumbered as subsections (6) and (7),
466	respectively, and a new subsection (5) is added to said section
467	to read:
468	57.105 Attorney's fee; sanctions for raising unsupported
469	claims or defenses; service of motions; damages for delay of
470	litigation.--
471	(5) In administrative proceedings under chapter 120, an
472	administrative law judge shall award a reasonable attorney’s fee
473	and damages to the prevailing party to be paid to the prevailing
474	party in equal amounts by the losing party and the losing
475	party’s attorney or qualified representative in the same manner
476	and upon the same basis as provided in subsections (1)-(4). Such
477	award shall be a final order subject to judicial review pursuant
478	to s. 120.68. If the losing party is an agency as defined in s.
479	120.52(1), the award to the prevailing party shall be against
480	and paid by the agency. A voluntary dismissal by a nonprevailing
481	party does not divest the administrative law judge of
482	jurisdiction to make the award described in this subsection.
483	Section 10. Paragraph (d) of subsection (4) of section
484	57.111, Florida Statutes, is amended to read:
485	57.111 Civil actions and administrative proceedings
486	initiated by state agencies; attorneys' fees and costs.--
487	(4)
488	(d) The court, or the administrative law judge in the case
489	of a proceeding under chapter 120, shall promptly conduct an
490	evidentiary hearing on the application for an award of
491	attorney's fees and shall issue a judgment, or a final order in
492	the case of an administrative law judge. The final order of an
493	administrative law judge is reviewable in accordance with the
494	provisions of s. 120.68. If the court affirms the award of
495	attorney's fees and costs in whole or in part, it may, in its
496	discretion, award additional attorney's fees and costs for the
497	appeal.
498	1. No award of attorney's fees and costs shall be made in
499	any case in which the state agency was a nominal party.
500	2. No award of attorney's fees and costs for an action
501	initiated by a state agency shall exceed $50,000$15,000.
502	Section 11. This act shall take effect upon becoming a
503	law.