STATE OF FLORIDA IN THE DISTRICT COURT OF APPEAL FIRST DISTRICT. Appellants, v. Case No. 1D

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1 STATE OF FLORIDA IN THE DISTRICT COURT OF APPEAL FIRST DISTRICT RECEIVED, 10/31/2017 4:36 PM, Jon S. Wheeler, First District Court of Appeal AGENCY FOR HEALTH CARE ADMINISTRATION, AND DEPARTMENT OF ELDER AFFAIRS, Appellants, v. Case No. 1D FLORIDA ASSOCIATION OF HOMES AND SERVICES FOR THE AGING, INC., d/b/a LEADINGAGE FLORIDA and FLORIDA ARGENTUM, L.T. No RE Appellees. FL ARGENTUM AND LEADINGAGE FLORIDA'S EMERGENCY JOINT MOTION TO VACATE STAY CLAIMED BY APPELLANTS Florida Argentum, Inc. ("FL Argentum") and Florida Association of Homes and Services for the Aging, Inc., d/b/a LeadingAge Florida ("LeadingAge") pursuant to Rule 9.310(b(2), Florida Rules of Appellate Procedure, move for relief from an automatic stay Appellants claim is in effect and allege: On October 27, 2017, a final order was issued by the Division of Administrative Hearings determining that Emergency Rules 58AER17-1 and 59AER17-1 (collectively, the "Emergency Rules"), are invalid exercises of

2 delegated legislative authority, and further determining there was no demonstrated emergency justifying adoption of the Emergency Rules. In essence, the Emergency Rules required that all nursing homes and assisted living facilities install commercial generators with sufficient fuel for 96-hours of power, within a very short window of time. Stringent penalties were imposed for failure to comply by November 15, 2017, despite the impossibility of performance within that timeframe as presented through testimony to the administrative law judge ("ALJ"). Appellants, Florida Agency for Health Care Administration ("AHCA") and Florida Department of Elder Affairs ("DOEA") (collectively, "Appellants" or "Agencies"), assert that the Emergency Rules remain in effect despite the final order. Indeed, the Agencies have publicly stated that compliance with the Emergency Rules during the appeal is required. Appellees disagree with the Agencies' position. However, because the Agencies have taken the position that the Emergency Rules remain in effect despite the final order declaring their invalidity, all nursing homes and assisted living facilities are at risk of daily fines of $1,000 per day, and potential license revocation for failure to install commercial generators and provide sufficient fuel for 96-hours of power. 2

3 Appellees request an emergency order vacating any applicable stay of the final order to ensure their members are not subject to onerous fines or license revocation for failure to comply with the Emergency Rules by November 15, JURISDICTION This Court has jurisdiction to consider motions to vacate stay pursuant to Rule 9.310(b(2), Florida Rules of Appellate Procedure. See Tampa Sports Auth. v. Johnston, 914 So. 2d 1076, 1079 (Fla. 2d DCA 2005). The lower court refused to consider the issues raised in this motion, and there is good cause for seeking a determination regarding stay from the Court. REVIEW OF EMERGENCY RULES 58AER17-1 AND 58AER-2 In the proceeding below, Appellees challenged Emergency Rules 58AER17-1 and 59AER17-2, issued on September 16, 2017 by DOEA and AHCA. Copies of the Emergency Rules are included as Appendix I, Tab "A." The Emergency Rules imposed the following requirements on both nursing homes and assisted living facilities: 1) development of a plan to provide emergency environmental control within 45 days [by October 31, 2017]; 2) acquisition of a generator within 60 days [by November 15, 2017]; and 3) acquisition of sufficient fuel by November 15, 2017 to power the generator for at least 96 hours. A copy of the Final Order in Consolidated DOAH Case No RE, issued on October 27, 2017 is included as Appendix I, Tab "B." See Appendix Tab B at

4 After a two-day evidentiary hearing, and upon consideration of proposed orders submitted by all parties, the administrative law judge ("ALJ") issued a 66- page final order on October 27, 2017 setting forth findings of fact and conclusion of law and ruling that the Emergency Rules were invalid exercises of delegated legislative authority, as defined in section (8), Florida Statutes. See id. at 57. Specifically, the Final Order sets forth the following findings of fact 1 that are pertinent to consideration of Appellees' motion to vacate any applicable stay: "Before adoption of Emergency Rule 59AER17-1, AHCA did not investigate whether requirements imposed by the Emergency Rules were a workable solution that could address the alleged emergency described in the preamble to the Emergency Rules." Id. at 19 "Before adoption of Emergency Rule 58AER17-1, DOEA did not consider whether it was realistic to expect that ALFs could comply with the Emergency Rules' requirements by November 15, 2017." Id. Electrical engineer, Michael Dodane, provided credible expert testimony that "it is physically impossible for a facility to have a new generator installed within the 60-day timeline set forth in the Emergency Rules." Id. at Great weight is given to an administrative law judge's findings of facts relying upon competent substantial evidence or involving the credibility of evidence. See Gross v. Dep't of Health, 819 So. 2d 997 (Fla. 5th DCA 2002); Stinson v. Winn, 983 So. 2d 554 (Fla. 1st DCA 2006). 4

5 "Mr. James R. 'Skip' Gregory, a former Chief of AHCA's Office of Plans and Construction also credibly and persuasively testified that it is impossible for a generator to be installed within the 60-day timeframe set forth in the Emergency Rules." Id. at 23. Despite the publication of questions and answers by AHCA and DOEA on three separate dates, "there are still unanswered questions regarding compliance with the Emergency Rules." Id. at 29. There is not "'an immediate danger to the public health, safety or welfare' to constitute an emergency." Id. at 36. "The Agencies' position that an emergency exists is undermined by: (a) the fact that the Secretary of AHCA invited facilities to consider applying for a variance almost immediately after adoption of the Emergency Rules; and by (b) the Agencies' adoption of the Emergency Variance Rules." Id. at 37. "There was no evidence at the final hearing indicating that the tragic situation at Hollywood Hills was representative of the situation at any other facilities. The fact that there were no similar incidents at any of the multitude of other nursing homes and ALFs affected by Hurricane Irma suggests that it was not." Id. "However, even if one were to conclude that a lack of self-sufficiency for nursing homes and ALFs requires prompt action, the greater weight of the 5

6 evidence demonstrates that it is not an 'emergency' that can be resolved by November 15, 2017." Id. at 39. "As demonstrated from the findings of fact above, the greater weight of the evidence demonstrates that it is impossible for the vast majority of nursing homes and ALFs currently noncompliant with the Emergency Rules to achieve compliance by November 15, 2017." Id. Despite the findings in the Final Order that there was not in fact an "emergency" justifying adoption of the Emergency Rules and that compliance is "impossible" for a "vast majority" of nursing homes and assisted living facilities, AHCA and DOEA have determined that they will continue to require compliance with the Emergency Rules during the pendency of their Appeal, notice of which was filed with the Court on October 27, A copy of AHCA Deputy Secretary, Molly McKinstry's confirming AHCA's interpretation that "the rule remains in effect during the Department's challenge," dated October 30, 2017, is included as Appendix I, Tab "C." The Appellants' position that the Emergency Rules remain in effect despite being invalidated has also confused local emergency management agencies that are directed by the Emergency Rules to approve facility plans to implement Emergency Rule requirements. A copy of correspondence from Lake County's 6

7 Office of Emergency Management expressing uncertainty with how to proceed is included as Appendix I, Tab "D." Compliance with requirements under the Emergency Rules to install a commercial generator and on-site fuel supply are onerous, and as determined in the Final Order, "impossible" under the current November 15, 2017 deadline. See Tab B at (describing the myriad of requirements for installation of a commercial generator and fuel tank; including design, approval, and installation). As determined in the Final Order, the following timeframes apply for installation of a commercial generator: contracting with an electrical engineer can take 1-2 weeks, an initial site visit typically takes 3-4 days, the design phase to prepare plans typically takes 60 days, AHCA's review of plans for nursing home construction usually takes 60 days, weeks for delivery of a custom generator, and an additional 1-2 weeks for installation. See Appendix I, Tab "B" at This typical timeframe is well beyond the 60 days permitted under the Emergency Rules. Further, as determined in the Final Order, there are also still many unanswered questions regarding how facilities are supposed to comply with the Emergency Rules, i.e.; how much space within the facility must be cooled and lack of specificity regarding electrical load requirements, which make compliance impossible. See Appendix Tab B at

8 Appellees' members are currently struggling with attempting to meet an impossible deadline and most likely facing $1,000 per day mandatory fines and possible revocation. Appellees are uncertain as to the source of Appellants' claimed authority to enforce Emergency Rules that were deemed invalid under the Final Order. Appellees assert that they are not aware of any authority for an automatic stay of the Final Order, given that it invalidates emergency rules challenged under section (5), Florida Statutes, that are not entitled to any presumption of correctness. However, given the position of Appellants that a stay applies to allow continued enforcement of the Emergency Rules through the duration of this appeal, Appellees respectfully request that any such stay be vacated or that the Court issue a ruling confirming that no stay applies. ARGUMENT An imminent deadline of November 15, a mere two weeks away, looms over all assisted living facilities and nursing homes. If the Emergency Rules are indeed still in effect, then those facilities must install compliant generators and fuel tanks, or face severe penalties including $1,000 per day fines and the threat of license revocation. Appellees, therefore appropriately seek emergency relief from the Court to either vacate any applicable stay that would otherwise make the Emergency Rules effective for the duration of this appeal or to rule that no stay is 8

9 currently in effect, and that Appellees' members can choose not to comply with the Emergency Rules without fear of reprisal by Appellants. In ruling on a motion to vacate stay, the Court must consider: 1) the likelihood of success of the party advocating for the stay; and 2) the likelihood of irreparable harm if the stay is vacated. See Mitchell v. State, 911 So. 2d 1211, 1219 (Fla. 2009); and Tampa Sports Auth. v. Johnston, 914 So. 2d 1076 (Fla. 2d DCA 2005). I. Appellants Have Little Likelihood of Success As set forth above, the Final Order invalidated the Emergency Rules on a number of bases, including the factual determination that there was no "emergency" to support the Appellants' use of emergency rulemaking instead of procedures which provide due process and public participation under section , Florida Statutes. When deciding the issue of whether to grant or vacate a stay, the appellate court's "understanding of the facts is grounded in the traditional appellate principle that must apply throughout the appeal--that is, the order on appeal is presumed correct unless or until the appellant demonstrates otherwise." Tampa Sports Auth., 914 So. 2d at 1077 (internal citations omitted). In order to prevail in this appeal, not only would Appellants need to overcome findings that no emergency existed that would allow for avoidance of rulemaking procedures required under section , they would also need to 9

10 overcome factual and legal determinations that the Emergency Rules are invalid exercises of delegated legislative authority by virtue of imposing arbitrary and capricious standards (App.I, Tab B at 45-47); vesting unbridled discretion in the agencies to determine noncompliance with the Emergency Rules (id. at 47-49); and contravening laws the Emergency Rules purport to implement (id. at 49-56). Refuting all of these findings would be a herculean, if not impossible, task given the detailed specific factual findings supporting the determinations in the Final Order. Further, given that emergency rules only have a duration of 90 days, Appellants have little to no incentive to prevail on the merits of this appeal. As of the filing date of this motion (October 31, 2017), there are only 45 days remaining for Appellants to enforce the Emergency Rules. This timeframe well exceeds the time for briefing applicable to an appeal before this Court. Thus, failure to grant Appellees the requested relief of vacating any applicable stay of the Emergency Rules will effectively result in a ruling on the appeal as a whole in favor of Appellants. II. Appellants Have No Likelihood of Irreparable Harm Unlike the nursing homes and assisted living facilities subject to the Emergency Rules, Appellants would suffer no harm by entry of an order revoking any stay applicable to this proceeding. As set forth above, there is no emergency 10

11 requiring Appellee's members to install generators and fuel tanks by the arbitrary date of November 15, Appellants are further working toward the goal of ensuring emergency power is available in nursing homes and assisted living facilities through the normal rulemaking procedures under section , and issued notice of rulemaking covering emergency power requirements on October 11, Copies of the Notices of Development of Rulemaking issued by AHCA and DOEA are included as Appendix I, Tab "E." Failure to revoke any applicable stay, however, would most certainly cause irreparable harm to Appellees' members that are currently devoting extreme amounts of time and resources in an attempt to come into compliance with Emergency Rule requirements that have been deemed "impossible" by experts in the field. This is harm that cannot be remedied after the fact as many facilities will have already made permanent changes to their buildings to accommodate installation of custom generators and fuel tanks. Facilities that cannot comply, as few will be able to do, will be subject to high fines and potential license revocation should the Emergency Rules remain effective. The irreparable harm that is ongoing, due to Appellants' interpretation that the Emergency Rules are still in effect, and that will continue to occur under a stay of the Final Order, should be addressed through an order vacating any applicable stay. 11

12 III. No Automatic Stay Applies to Appeals of Emergency Rule Decisions Although Appellants assert that a stay is applicable to allow the Emergency Rules to remain in effect for the duration of this appeal, Appellees are unaware of any authority for such a stay as detailed below. A. No Automatic Stay is Available under the Florida Rules of Appellate Procedure. For many years, governmental agencies were entitled to an automatic stay of adverse administrative orders pursuant to Florida Rule of Appellate Procedure In 2008, the Florida Supreme Court amended appellate rules so that automatic stays would not be available "in administrative actions under the Administrative Procedure Act, or as otherwise provided by chapter 120, Florida Statutes." 2 Prior to the effective date of that change, a public agency could obtain an automatic stay simply by filing a notice of appeal. That is no longer the case. Since 2009, Florida Rule of Appellate Procedure specifically exempts 2 See In re Amendments to the Florida Rules of Appellate Procedure, 3 So. 3d 89, 2008 WL , * 2 (Mem)(Fla. 2008). The amendment added the following, underlined language, making administrative actions exempt from automatic stays: (2) Public Bodies; Public Officers. The timely filing of a notice shall automatically operate as a stay pending review, except in criminal cases, in administrative actions under the Administrative Procedure Act, or as otherwise provided by chapter 120, Florida Statutes, when the state, any public officer in an official capacity, board, commission, or other public body seeks review; provided that an automatic stay shall exist for 48 hours after the filing of the notice of appeal for public records and public meeting cases. On motion, the lower tribunal or the court may extend a stay, impose any lawful conditions, or vacate the stay. 12

13 appeals from administrative decisions, like the rule challenge decision made in this case, from automatic stays. Florida Rule of Appellate Procedure was amended at the same time, making it clear that the filing of a notice does not invoke an automatic stay except in limited circumstances: (e) Stays Pending Review. (1) Effect of Initiating Review. The filing of a notice of administrative appeal or a petition seeking review of administrative action shall not operate as a stay, except that such filing shall give rise to an automatic stay as provided in rule 9.310(b)(2) or chapter 120, Florida Statutes, or when timely review is sought of an award by an administrative law judge on a claim for birth related neurological injuries. As mentioned above, proceedings under the Administrative Procedure Act are exempt from the automatic stay available in Rule 9.310(b)(2). Thus, the filing of a notice of appeal by the Agencies did not create an automatic stay pursuant to either Rule or A stay is only available if a provision of chapter 120 specifically provides for such a stay. As explained below, no automatic stay is available under Chapter 120 in this proceeding. 13

14 B. No Automatic Stay is Available under Chapter 120, Florida Statutes. 1. Section (3) does not impose an automatic stay The Administrative Procedure Act makes it clear that an automatic stay is not available. Section , Florida Statutes governs appellate review of administrative decisions. It provides: (3) The filing of the petition does not itself stay enforcement of the agency decision, but if the agency decision has the effect of suspending or revoking a license, supersedeas shall be granted as a matter of right upon such conditions as are reasonable, unless the court, upon petition of the agency, determines that a supersedeas would constitute a probable danger to the health, safety, or welfare of the state. The agency also may grant a stay upon appropriate terms, but, whether or not the action has the effect of suspending or revoking a license, a petition to the agency for a stay is not a prerequisite to a petition to the court for supersedeas. In any event the court shall specify the conditions, if any, upon which the stay or supersedeas is granted (3), Fla. Stat. (2017) (emphasis added). 2. Section (3)(b), does not impose an automatic stay Section , Florida Statutes governs challenges to agency rules, including proposed, effective and emergency rules. Section (3) governs challenges to "rules in effect." That subsection provides: (3) (b) The administrative law judge may declare all or part of a rule invalid. The rule or part thereof declared invalid shall become void when the time for filing an appeal expires. The agency whose rule has been declared invalid in whole or part shall give notice of the decision in the Florida Administrative Register in the first available issue after the rule has become void. 14

15 Subsection (3) of Section declares that invalidated rules "in effect" become void only when the time for appeal has expired. An appellate opinion has interpreted this statute to mean that appeals of determinations that existing rules are invalid do not render the existing rule void until the time for an entire appeal has expired. See Abbott Laboratories. v. Mylan Pharm., Inc., 15 So. 3d 642, 653 (Fla. 1st DCA 2009). Although Abbott Laboratories suggests that invalidated rules may continue to be relied upon during the pendency of an appeal, Abbott Laboratories does not control when the invalidated rules are emergency rules. Subsection (3) makes sense for non-emergency rules that have been in effect for years, and therefore have been entitled to a similarly long period of assumed validity. Emergency rules have not been in effect for years, and therefore, do not have a similar long period of assumed validity, as emergency rules are only valid for 90 days. Rather, emergency rules fall under the Division's jurisdiction pursuant subsection (5) rather than subsection (3) of Section , and pursuant Section (4) for purposes of reviewing the agencies' findings of immediate danger, necessity and procedural fairness. See JAMES NEWBERRY, JR., Petitioner v. BOARD OF ORTHOTISTS AND PROSTHETISTS, 1998 WL at 6, 56, (Fla. DOAH May 28, 1998)("Newberry I"). When an administrative law judge declares an emergency rule invalid, such emergency rule is also determined to be void ab initio. See JAMES NEWBERRY, 15

16 JR., Petitioner v. BOARD OF ORTHOTISTS AND PROSTHETISTS, 1998 WL (Fla. DOAH May 28, 1998)("Newberry I"); JAMES NEWBERRY, JR., Petitioner v. BOARD OF ORTHOTISTS AND PROSTHETISTS, Respondent, 1998 WL (Fla. DOAH September, 1998)("Newberry II"). In Newberry I, an Administrative Law Judge determined that emergency rules adopted by the Board of Orthotists and Prosthetists, were invalid and void ab initio. The ALJ reasoned as follows: Based on its statement of reasons for finding an immediate danger to the public health, safety, and welfare, the Board exceeded its authority under Section (4) when it promulgated an emergency rule establishing fees for provisional licensure and licensure by endorsement, and these portions of the emergency rule are invalid and void. Given that there was no emergency justifying the adoption of fees for provisional licensure and licensure by endorsement, the Board acted without authority or power and its emergency rule should be ruled void ab initio. If an emergency rule exceeds the legislative authority of an Agency, then no portion of the rule should be salvaged. Newberry I at 11. Newberry II involved a motion for attorney's fees related to Newberry I. In Newberry II, the Division characterized its holding in Newberry I as a "rejection of the Agency's assertion that Section (3), governing existing rules, was applicable to the underlying challenge of an emergency rule..." Newberry II at 4. Therefore, the invalid Emergency Rules are void ab initio and no longer in effect. This is further consistent with the fact that emergency rules require 16

17 emergency action on the part of those regulated, thus if an emergency rule could remain in effect during the pendency of an appeal absent a stay, any relief granted by the Division invalidating an emergency rule would necessarily be nullified. RELIEF SOUGHT Based on the foregoing, Appellees respectfully request that the Court vacate any stay of the Final Order under appeal in this proceeding to relieve Appellees' members from compliance with the imminent November 15, 2017 deadline under the Emergency Rules. CERTIFICATE OF COMPLIANCE I hereby certify that the foregoing document complies with the font requirements of Fla. R. App. P (a)(2). Respectfully Submitted, /s/amy W. Schrader AMY W. SCHRADER Florida Bar No Primary aschrader@bakerdonelson.com Secondary lterry@bakerdonelson.com KELLY OVERSTREET JOHNSON Florida Bar No Primary kjohnson@bakerdonelson.com Secondary calford@bakerdonelson.com BAKER, DONELSON, BEARMAN, CALDWELL & BERKOWITZ, PC Monroe Park Tower 101 North Monroe Street, Suite

18 Tallahassee, FL Telephone: (850) Fax: (850) Attorneys for FL Argentum and SEANN M. FRAZIER Florida Bar No MARC ITO Florida Bar No PARKER, HUDSON, RAINER & DOBBS 215 South Monroe Street, Suite 750 Tallahassee, Florida Telephone: (850) Attorneys for Leadingage Florida 18

19 CERTIFICATE OF FILING AND SERVICE I hereby certify that on October 31, 2017, the foregoing was electronically filed with: Clerk of the Court First District Court of Appeal 2000 Drayton Drive Tallahassee, FL And that a copy was delivered by electronic mail to the following: Frank Rainer, Esquire Broad and Cassel 215 South Monroe Street, Suite 400 Tallahassee, Florida frainer@broadandcassel.com (Counsel for Florida Assisted Living Association, Inc.) M. Stephen Turner, Esquire Broad and Cassel 215 South Monroe Street, Suite 400 Tallahassee, Florida sturner@broadandcassel.com (Counsel for Florida Assisted Living Association, Inc.) John P. Loar, Esquire Broad and Cassel 215 South Monroe Street, Suite 400 Tallahassee, Florida jloar@broadandcassel.com (Counsel for Florida Assisted Living Association, Inc.) Frances Carbone, Agency Clerk Office of the General Counsel Department of Elder Affairs 4040 Esplanade Way, Suite 315 Tallahassee, Florida carbonef@elderaffairs.org Stefan R. Grow, General Counsel Office of General Counsel Department of Elder Affairs 4040 Esplanade Way, Suite 315 Tallahassee, Florida grows@elderaffairs.org William Roberts, Acting General Counsel Agency for Health Care Administration 2727 Mahan Drive Tallahassee, Florida William.roberts@ahca.myflorida.com 19

20 Richard Shoop, Agency Clerk Agency for Health Care Administration 2727 Mahan Drive, Tallahassee, Florida Craig D. Miller, Esquire Rutledge Ecenia, P.A. 119 South Monroe Street, Suite 202 Tallahassee, Florida (Counsel for AHCA and Department of Elder Affairs) Tana D. Storey, Esquire Rutledge Ecenia, P.A. 119 South Monroe Street, Suite 202 Tallahassee, Florida (Counsel for AHCA and Department of Elder Affairs) Stephen A. Ecenia, Esquire Rutledge, Ecenia, & Purnell, P.A. 119 South Monroe Street, Suite 202 Tallahassee, Florida (Counsel for AHCA and Department of Elder Affairs) J. Stephen Menton, Esquire Rutledge Ecenia, P.A. 119 South Monroe Street, Suite 202 Post Office Box 551 (32302) Tallahassee, Florida (Counsel for AHCA and Department of Elder Affairs) /s/ Amy W. Schrader Amy W. Schrader 20