                                           IN THE DISTRICT COURT OF APPEAL
                                           FIRST DISTRICT, STATE OF FLORIDA
AMERISURE        MUTUAL
INSURANCE COMPANY,                         NOT FINAL UNTIL TIME EXPIRES TO
                                           FILE MOTION FOR REHEARING AND
      Appellant,                           DISPOSITION THEREOF IF FILED

v.                                         CASE NO. 1D14-0873

FLORIDA DEPARTMENT OF
FINANCIAL      SERVICES,
DIVISION  OF  WORKERS’
COMPENSATION,

      Appellee.

_____________________________/

Opinion filed January 2, 2015.

An appeal from an order of the Department of Financial Services.

Maria Elena Abate and Sharlee Hobbs Edwards of Colodny, Fass, Talenfeld,
Karlinsky, Abate & Webb, P.A., Fort Lauderdale, for Appellant.

Richard T. Donelan, Jr., Chief Counsel, Michael H. Davidson, Assistant General
Counsel, and David Hershel, Assistant General Counsel, Tallahassee, for Appellee.




BENTON, J.

      Amerisure Mutual Insurance Company (Amerisure) appeals a final order of

the Florida Department of Financial Services, Division of Workers’ Compensation

(Department). We affirm. We reject appellant’s contention that the Department
ignored the findings of fact the administrative law judge (ALJ) made and

improperly substituted its conclusions of law for those of the ALJ.               The

Department correctly applied the governing statute.

      As an insurance carrier authorized to transact a workers’ compensation line

of business in Florida, Amerisure is subject to certain assessments: Amerisure is

required to pay quarterly assessments to the Special Disability Trust Fund (SDTF)

pursuant to section 440.49(9), Florida Statutes (2008), which provides in part:

                    (9) SPECIAL DISABILITY TRUST FUND.—
                    ....
                    (b)1. The Special Disability Trust Fund shall be
             maintained by annual assessments upon the insurance
             companies writing compensation insurance in the state, . .
             . which assessments shall become due and be paid
             quarterly at the same time and in addition to the
             assessments provided in s. 440.51. . . .
                    ....
                    3. The net premiums written by the companies for
             workers’ compensation in this state . . . are the basis for
             computing the amount to be assessed as a percentage of
             net premiums. Such payments shall be made by each
             carrier and self-insurer to the department for the Special
             Disability Trust Fund in accordance with such
             regulations as the department prescribes.

Amerisure is also required to pay quarterly assessments to the Workers’

Compensation Administration Trust Fund (WCATF) pursuant to section 440.51(1),

Florida Statutes (2008), which provides in part:

             Expenses of administration.—



                                         2
                   (1) The department shall estimate annually in
            advance the amounts necessary for the administration of
            this chapter . . . .
                   (a) The department shall, by July 1 of each year,
            notify carriers and self-insurers of the assessment rate . . .
            .
                   (b) The total expenses of administration shall be
            prorated among the carriers writing compensation
            insurance in the state and self-insurers.          The net
            premiums collected by carriers and the amount of
            premiums calculated by the department for self-insured
            employers are the basis for computing the amount to be
            assessed. . . .
                   ....
                   (5) Any amount so assessed against and paid by
            an insurance carrier . . . shall be allowed as a deduction
            against the amount of any other tax levied by the state
            upon the premiums, assessments, or deposits for workers’
            compensation insurance on contracts or policies of said
            insurance carrier . . . . Because deductions under this
            subsection are available to insurance carriers, s. 624.5091
            does not limit such deductions in any manner.

(Boldface omitted.) Also applicable and pertinent to determination of a carrier’s

assessments for these trust funds is section 624.5094, Florida Statutes (2008),

which provides:

                   Casualty insurance premiums.—Notwithstanding
            any statutory provision to the contrary, for the purposes
            of calculating the annual assessments for the Special
            Disability Trust Fund under s. 440.49 and expenses of
            administration under s. 440.51, any amount paid or
            credited as dividends or premium refunds in the same
            calendar year by the insurer to its policyholders must be
            deducted from “net premium,” “net premiums written,”
            “direct premium,” and “net premium collected” for the
            calendar year. Such offset for dividends or premium
            refunds paid or credited for the current year must be
                                          3
              applied against the current year’s net premium for that
              year’s assessment regardless of the policy year for which
              the dividends or premium refunds are being reimbursed.

(Boldface omitted.) The Division of Workers’ Compensation (Division) generated

a one-page form (never promulgated as a rule) for carriers’ use in reporting net

premiums and calculating quarterly assessments for the two trust funds. The form

provided a space for the carrier to indicate whether net premium was positive or

negative for the quarter and in what amount.

      The form also had a space for carrying forward “debits” or “credits” from

prior quarters and aggregating them with the current quarter’s net premium and

assessment due. The initial premium for a workers’ compensation policy is based

on an estimate of what the insured’s payroll and the classification of its employees

will be during the coverage period, typically a year. Because assessments for the

two trust funds must be paid quarterly, an insurer may overpay an annual

assessment when positive net premiums in one or more early quarters are exceeded

by negative net premium in subsequent quarter(s) in the same calendar year.

                          Amerisure’s SDTF Assessments

      In 2008, Amerisure reported positive net premium totaling $32,934,173 for

the first two quarters of the calendar year and paid SDTF assessments totaling

$1,488,624.    For the third quarter of 2008, Amerisure reported negative net

premium (<$923,750>), and paid no assessment. Based on Amerisure’s reported

                                         4
negative net premium for the third quarter, the Division’s form for the fourth

quarter of 2008 indicated Amerisure had a “credit” of $41,745.36 for SDTF

assessment purposes (determined by multiplying the reported negative net

premium for the third quarter by the assessment rate of 0.0452). For the fourth

quarter of 2008, Amerisure reported negative net premium (<$1,269,343>) and

again paid no assessment. An additional credit of $57,374.30 was calculated for

the fourth quarter (the fourth-quarter negative net premium multiplied by the

assessment rate of 0.0452).

      In this way, Amerisure paid $99,119.66 more in estimated payments (for the

first two quarters of 2008) than it owed for its 2008 SDTF annual assessment, and

ended the year with a credit reflecting the overpayment. In 2009, Amerisure

reported negative net premiums all four quarters and paid no SDTF assessments

for any quarter.1 The form the Division provided Amerisure with which to report



      1
          On each quarterly form for 2009, the Division indicated increasing
“credit” amounts for Amerisure’s SDTF assessment. On the form provided
Amerisure for the first quarter of 2009, the Division indicated Amerisure had a
credit of $99,119.66 (the combined credit for the third and fourth quarters, which
equaled the actual amount overpaid during 2008). The form for the second quarter
of 2009 indicated Amerisure had a credit for SDTF purposes of $163,401.20. The
form for the third quarter of 2009 indicated Amerisure had a credit of $271,089.48.
The form for the fourth quarter of 2009 indicated Amerisure had a credit of
$379,235.27 (the sum of the $99,119.66 credit based on the 2008 overpayment and
the total negative net premium reported for 2009 multiplied by the assessment rate
of 0.0452). Amerisure reported negative net premium of $3,237,419 for the fourth
quarter of 2009, and takes the position that its “credit” balance should be increased
                                          5
its SDTF assessment for the first quarter of 2010, reflected a credit of $99,119.66,

based on Amerisure’s actual overpayment of the 2008 annual assessment, but

carried forward nothing for 2009 in which no assessments had been paid.

      In 2010, Amerisure reported positive net premium of $828,566 for the first

quarter of 2010, resulting in an SDTF assessment of $37,451.18 for the quarter.

The Division reduced the $99,119.66 credit by that amount, so that the Division’s

form for the second quarter of 2010 indicated Amerisure had a credit of

$61,668.48. Amerisure reported a positive net premium of $1,282,179 for the

second quarter of 2010, resulting in an assessment of $57,954.49 for that quarter.

The Division again reduced the (remaining) credit by the amount of the

assessment, so the Division’s form for the third quarter of 2010 reflected a “Prior

Balance Carried Forward” of $3,713.99.        Amerisure reported a positive net

premium of $937,504.00 for the third quarter, resulting in an assessment of

$13,688.00 for the third quarter. Reducing this by the “prior balance carried

forward” resulted in an amount due of $9,974.01.2

                        Amerisure’s WCATF Assessments

      Similarly, in 2008, Amerisure reported positive net premiums for the first

three quarters of the calendar year totaling $37,925,003 and paid WCATF

by $146,331, for a total “credit” of $525,566 in 2009, even though it paid no
assessments that year.
      2
        Amerisure continued to report positive net premiums for purposes of the
SDTF assessment through June 30, 2012.
                                       6
assessments totaling $94,813. For the fourth quarter of 2008, Amerisure reported a

negative net premium of $1,271,387, and paid no assessment.            In this way,

Amerisure paid $3,178.47 more (in estimated payments during the first three

quarters of 2008) than it owed for its 2008 WCATF annual assessment. In 2009,

Amerisure reported negative net premiums in each quarter and paid no WCATF

assessments.3

      On the form provided for Amerisure to report net premium and the

assessment for the first quarter of 2010, the Division indicated Amerisure had a

credit of $3,178.47 for WCATF purposes—the amount actually overpaid in 2008.

Amerisure reported positive net premium of $225,027 for the first quarter of 2010,

resulting in an assessment of $1,800 for the first quarter.        Accordingly, the


      3
        On each quarterly form for 2009, the Division indicated increasing “credit”
amounts. On the form provided for reporting the first quarter of 2009, the Division
indicated Amerisure had a credit of $3,178.47 for WCATF purposes (the amount
actually overpaid in 2008 based on annual net premium), and Amerisure reported
negative net premium (<$1,321,194>). The Division’s form for the second quarter
of 2009 indicated Amerisure had a “credit” of $6,481.46. Amerisure reported
negative net premium for the second quarter of 2009 (<$2,990,876>). The
Division’s form for the third quarter of 2009 indicated Amerisure had a “credit” of
$13,958.65. Amerisure reported negative net premium for the third quarter of
2009 (<$2,176,521>). The Division’s form for the fourth quarter of 2009 indicated
Amerisure had a “credit” of $19,399.95 (the sum of the $3,178.47 2008
overpayment and the total negative net premium reported for the first three
quarters of 2009 multiplied by the WCATF assessment rate). Amerisure again
reported a negative net premium for the fourth quarter of 2009 (<$3,549,615>),
and takes the position that its “credit” balance should be increased by $8,874, for a
total “credit” balance of $28,273.95, even though Amerisure paid no WCATF
assessments for the 2009 calendar year.
                                           7
Division reduced the $3,178.47 credit by $1,800.22, so that the Division’s form for

the second quarter of 2010 indicated Amerisure had a credit of $1,378.25. For the

second quarter of 2010, Amerisure reported positive net premium of $2,011,533,

and a corresponding quarterly WCATF assessment of $16,092.26. Amerisure

made no payment to the Division with this report, and the Division’s form for the

third quarter of 2010 indicated Amerisure had a “Prior Balance Carried Forward”

of $14,714.01 (the $16,092.26 second-quarter assessment reduced by the

remaining credit of $1,378.25). 4

                                    Procedural History

      On September 16, 2012, Amerisure submitted an application for refunds of

monies paid to the SDTF and the WCATF from October 26, 2010 through July 26,

2012. 5,6 On January 28, 2013, the Department issued a Notice of Intent to Deny

Applications for Refund, saying that “Amerisure received credit totaling


      4
         Amerisure continued to report positive net premiums for purposes of the
WCATF assessments each quarter through June 30, 2012.
       5
          Amerisure asserted that as of December 31, 2009, it had $525,566 in
“credits” due from the SDTF. Amerisure asserted it was only allowed to apply
$99,119.66 of its “credit,” and had subsequently paid $236,663.25 “in assessments
to the SDTF that the company should not have been required to pay since it had
credits that should have been applied against its assessment liability.” Amerisure
also asserted the “right to apply” $189,783.75 of remaining SDTF “credits” against
future assessment liability.
       6
         Amerisure alleged it should not have been required to pay the assessments
in light of the amount of “credit” it had accrued in 2008 and 2009. Amerisure
asserted that as of December 31, 2009, it had $28,273.95 in “credits” due from the
WCATF, which “should have been applied against its assessment liability.”
                                          8
$99,119.66 for its overpayments to the SDTF in year 2008. Amerisure to date has

received, and has been allowed to apply to its subsequent payment obligations, full

credit for all overpayments made by it to the SDTF;” and that “Amerisure received

credit totaling $3,178.47 for its overpayments to the WCATF in year 2008.

Amerisure to date has received, and has been allowed to apply to its subsequent

payment obligations, full credit for all overpayments made by it to the WCATF.”

      The Department took the position that to allow Amerisure to obtain in

addition the cash refunds Amerisure requested “would be inconsistent with the

provisions” of Sections 440.49(9)(b) and 440.51(1), Florida Statutes.             The

Department concluded Amerisure was not entitled to any money from the State

Treasury or to any “credits” based on the negative net premiums reported during

2009 because it paid no assessments into either the WCATF or the SDTF in 2009.

      Amerisure then filed a petition for a formal administrative hearing,

challenging the notice of intent to deny its applications for refund, and alleging that

unadopted rules were the basis of the notice of intent to deny.            Amerisure

contended the Department treated “credit balances” accrued in 2009 as “excess

credits,” which had to be forfeited at the end of the calendar year, and argued

section 624.5094 did “not authorize the Department to eliminate accrued credits”

or “support the Department’s interpretation that no credit can be accrued during a

year when no monies are due and paid into the fund(s).”

                                          9
                              Recommended Order

      The administrative law judge (ALJ) rejected the Department’s position that

“credits” based on negative net premiums in 2009 never actually assumed any

legal significance.   The ALJ cited the entries on the reporting forms sent to

Amerisure each quarter and reasoned in her recommended order that the forms

indicated “credits” had accrued in 2009. The recommended order recited that

Department staff acknowledged “eliminating” the 2009 “credits” when the 2010

quarterly reporting forms were sent to Amerisure.

      In the recommended order, the ALJ attributed the Department’s denial of

refunds to the first of two putative, unadopted rules. The recommended order

identified two statements as agency policies that met the definition of a rule but

had not been adopted through the rulemaking process: (1) any credits accruing in a

calendar year in which net premiums are negative for each quarter are excess

credits that are eliminated at year end and cannot be carried over to the next

calendar year; and (2) credits can be carried forward for a three-year period from

one calendar year to the next as long as the insurer had at least one quarter per

calendar year with positive net premium; although after three years the credits are

eliminated unless the insurer requests a refund. Finding the Department had not

demonstrated circumstances excusing a lack of rulemaking as contemplated by




                                        10
section 120.57(1)(e), the ALJ determined Amerisure was entitled to recover fees

and costs pursuant to section 120.595(4)(a), Florida Statutes.

      The ALJ determined that a “credit” was created “by Amerisure paying more

out in refunds and dividends than it wrote or collected in premium. . . . The

Department implicitly acknowledged that reality when it calculated a credit for

each quarter in 2009 and included that credit on the forms it forwarded to

Amerisure for its quarterly reports.” The ALJ recommended that the “Department

enter a final order . . . reinstating Amerisure’s 2009 credits as credits toward future

assessments due to the Trust Funds.”           But, as the recommended order itself

acknowledges, the governing statutes say nothing whatsoever about credits for

“paying more out in refunds and dividends” than premiums received in a calendar

year or carrying any such putative credits forward.

      The ALJ determined the Department’s position was “not a simple

application of the law to the information provided, because no statute referenced

by the Department makes any mention of excess credits and how they are to be

treated.” The statute makes no mention of “credits,” excess or otherwise. Indeed,

the ALJ concluded that the Department’s elimination of the 2009 “credits” was

based on an erroneous interpretation of section 624.5094 on grounds that the

provision “does not address credits in any way, and certainly does not mandate that

credits be eliminated should a carrier have four quarters in a year where negative

                                          11
premiums were reported.” That the statute does not “address credits in any way”

led the Department to different conclusions.

                                    Final Order

      The Department rejected the ALJ’s view that Amerisure accrued credits that

could be applied against subsequent years’ SDTF and WCATF assessments as a

result of negative net premium in the year 2009. Focusing on the statutes, not the

forms, the final order ruled the ALJ had attached “undue significance to the fact

that for the 2009 assessment year only, Division employees, acting without

statutory authority . . . , supplied Amerisure with a quarterly assessment form that

was never promulgated as a rule and that purported to identify ‘credits’ to which

the carrier was entitled. Thus, the ALJ in her Recommended Order makes findings

of fact that are technically accurate, but then draws legally erroneous legal

conclusions from those facts.”

      The Department’s final order stated the ALJ’s legal conclusions were in

error because “there is neither statutory nor constitutional authority for the

Division to create free-standing tax credits redeemable from the State Treasury for

the benefit of a private insurance carrier that paid nothing [for the year 2009] in

assessments to the Division.” The final order concluded instead:

            Section 624.5094 makes clear that, for annual assessment
            purposes, all statutory deductions from a carrier’s “net”
            premium base must be taken in the assessment year in
            which they occur “regardless of the policy year” to which
                                        12
             the deductions relate. . . . If . . . a carrier must return
             more premiums than remain in force during an
             assessment year, it is entirely foreseeable that a carrier, as
             did Amerisure in 2009, will have no positive cash flow
             from which an annual assessment can be paid. The only
             logical resolution of this situation is for the regulator, as
             the statute clearly authorizes, to excuse the carrier from
             its obligation to pay an assessment for the assessment
             year in question. That is exactly what happened here.
             The reason it happened was not based upon so-called
             “credits” issued by the Department, however. The
             assessment was not imposed because Amerisure had no
             “net premium” for 2009 that could be assessed.
                 . . . No action by the Department “eliminates” a
             carrier’s “credits” against its assessment liability for
             dividends paid and premiums returned when its annual
             assessment is finalized at [or below] zero. Section
             624.5094, Florida Statutes, by operation of law,
             forecloses a carrier’s ability to apply its “excess credits”
             – that is, the carrier’s having made more expenditures for
             dividends and return premium than were needed to offset
             the carrier’s entire assessment obligations for that year –
             to reduce a future year’s tax liability. This statute simply
             does not grant the Department independent, extra-
             statutory discretion to devise and declare additional
             deductions from a carrier’s current or future annual
             assessment bases, and thereby reduce the amount of tax it
             owes to the State.

Regarding the purportedly dispositive, unadopted rule, the Department again

emphasized that there was no statutory authority for calculating “credits” on the

basis asserted by Amerisure, given the plain meaning of section 624.5094:

“Simply put, an insurer that has not paid an assessment is not entitled to a refund of

a portion of that ‘non-assessment’ just because it has experienced a ‘negative net

premium’ for an entire assessment year. . . . What the Recommended Order brands
                                          13
as an illicit non-rule policy of ‘eliminating’ the ‘excess credits’ ignores that the

supposed ‘policy’ is merely . . . the plain meaning of the applicable statutes.”

                                        Analysis

      In rejecting the ALJ’s conclusions of law, the final order did not ignore or

reject any finding of fact the ALJ made. An agency may not reject an ALJ’s

findings of fact “without first finding, after a review of the entire record, that the

ALJ’s factual findings were not supported by competent, substantial evidence.”

Viering v. Fla. Comm’n on Human Relations ex rel. Watson, 109 So. 3d 296, 298

(Fla. 1st DCA 2013). Nor may an agency avoid the obligation “‘to honor the

[ALJ’s] findings of fact . . . by categorizing a contrary finding as a conclusion of

law.’” Id. (quoting Pillsbury v. State, Dep’t of Health & Rehabilitative Servs., 744

So. 2d 1040, 1041 (Fla. 2d DCA 1999)). But the record in the present case reveals

no violation of this “cardinal tenet of administrative law.” Id.

       The final order discussed the various forms filled out by Amerisure and the

Department in the present case in some detail. The fact that the credit based on

reported negative net premium in 2008 was carried forward while the “credit”

based on 2009 reported negative net premium was not carried forward was

addressed head on in the final order:

             Because Amerisure had already paid its 1Q and 2Q 2008
             estimated assessments, its total 2008 assessment
             payments exceeded the revised final assessments for that
             year, resulting in Department recognition of a $99,119.66
                                          14
             overpayment to the SDTF by Amerisure and a $3,178.47
             overpayment to the WCATF. Amerisure could have
             elected to obtain a cash refund of its 2008 overpayment,
             but elected instead to apply the balance to reduce a future
             assessment liability, which it ultimately did, by applying
             its 2008 overpayment to its 2010 assessment.
                 Amerisure, however, had no assessment liability for
             2009 against which Amerisure’s overpayment “credit
             balance” could apply, and no assessment was levied. Put
             another way, Amerisure had no tax obligation for
             calendar [year] 2009 that could be offset, in part, by
             means of its overpayment balance. The record shows
             that the balance was applied and extinguished the next
             time Amerisure did have a tax liability to the
             Department: its calendar [year] 2010 assessments. Thus,
             Amerisure’s actual 2008 tax overpayment was refunded
             in 2010 in the form of cash equivalent credits redeemable
             against its pending assessment obligations for 2010. This
             refund transaction falls squarely within the ambit of
             Section 215.26, Florida Statutes.

(Internal citations omitted.) That the quarterly forms indicated increasing “credits”

during 2009 based on the quarterly reports of negative net premium is not disputed

by the Department. The ALJ’s statement that the forms “clearly indicated accrued

credits,” to the extent this references the increasing amount of the “credit”

indicated in each succeeding quarter, is a factual finding supported by competent,

substantial evidence, a factual finding the Department accepted.

      To the extent the ALJ determined Amerisure had “accrued credits” that had

“come into existence as an enforceable claim or right” under any set of facts,




                                         15
however, such a determination must necessarily have been a legal conclusion.7

See Black’s Law Dictionary 21 (7th ed. 1999) (defining “accrue”). At issue here is

not what Amerisure reported each quarter in 2009. Instead, as the Department

maintains, at issue is the legal significance of Amerisure’s negative net premiums

in all four quarters of the 2009 calendar year, and its consequent failure to pay

assessments that year.

      At issue finally is a question of statutory interpretation, as to which the

standard of review is de novo. An agency

             “is afforded wide discretion in the interpretation of a
             statute which it is given the power and duty to
             administer,” Office of Fire Code Official of Collier
             County Fire Control & Rescue Dists. v. Fla. Dep’t of Fin.
             Servs., 869 So. 2d 1233, 1237 (Fla. 2d DCA 2004)
             (citation omitted), but nothing requires “that we defer to
             an implausible and unreasonable statutory interpretation
             adopted by an administrative agency.” Id. “If the
             agency’s interpretation is within the range of possible
             and reasonable interpretations, it is not clearly erroneous
             and should be affirmed,” Fla. Dep’t of Educ. v. Cooper,
             858 So. 2d 394, 396 (Fla. 1st DCA 2003), but “judicial
             adherence to the agency’s view is not demanded when it
             is contrary to the statute’s plain meaning.” Werner v.
             Dep’t of Ins. & Treasurer, 689 So. 2d 1211, 1214 (Fla.

      7
        The Department argues that the “credits” indicated on the quarterly forms
for 2009 (in excess of the credits based on actual overpayments of assessments in
2008) were simply staff “notations, for bookkeeping purposes . . . to recognize
‘potential credits’ that could be applied as tax assessment offsets in the event
[Amerisure] resumed reporting taxable positive net premiums in 2009. Because, in
2009, Amerisure had no positive earnings and therefore no tax liability from which
‘potential credits’ could be deducted, the ‘potential credits’ indicated on the forms
had no purpose and were not applied.”
                                         16
             1st DCA 1997) (quoting PAC for Equal. v. Dep’t of
             State, Fla. Elections Comm’n, 542 So. 2d 459, 460 (Fla.
             2d DCA 1989)).

Sullivan v. Fla. Dep’t of Envtl. Prot., 890 So. 2d 417, 420 (Fla. 1st DCA 2004).

      Amerisure’s contention that a carryforward of a “credit” from a year in

which it paid no assessment is necessary in order for it to be made “whole”

overlooks the basic fact that the governing statutes levy an assessment on

carriers—not on policyholders. See §§ 440.49(9)(b)1., Fla. Stat. (2008) (“The

Special Disability Trust Fund shall be maintained by annual assessments upon the

insurance companies writing compensation insurance in the state. . . .”) (emphasis

supplied); 440.51(1)(b), Fla. Stat. (2008) (“The total expenses of administration

shall be prorated among the carriers writing compensation insurance in the state

and self-insurers. The net premiums collected by carriers . . . are the basis for

computing the amount to be assessed.”) (emphasis supplied); 440.51(5), Fla. Stat.

(2008) (“Any amount so assessed against and paid by an insurance carrier . . . shall

be allowed as a deduction against the amount of any other tax levied by the state

upon the premiums, assessments, or deposits for workers’ compensation insurance

on contracts or policies of said insurance carrier . . . .”) (emphasis supplied).

      The insurance carrier does not act as an agent of the state to collect and remit

assessments levied on the employers it insures in the way retailers collect sales




                                           17
taxes their customers owe.8     The carrier is itself liable for the assessments.

Amerisure contends it has been “unjustly divested” of “over $400,000” that the

state had “no legal right to claim,” and that the issuance of a legally enforceable

“credit” is “necessary to make the carrier whole for having returned the assessment

amounts that the carrier paid into the Trust Funds to policyholders.” But, even

assuming Amerisure paid assessments based on premiums which were

subsequently returned to policyholders, Amerisure has not demonstrated that it

paid more in assessments than the law requires.

      The applicable statutory provisions call for calculating assessments one year

at a time. Section 624.5094 only authorizes deductions or offsets “against the

current year’s net premium” for dividends or premium refunds “in the same

calendar year” or “current year” in calculating “that year’s assessment” –

“regardless of the policy year for which the dividends or premium refunds are

being reimbursed.” There is no statutory authority for carrying one year’s negative

net premium forward as an offset against a subsequent year’s positive net




      8
         See, e.g., § 212.12(1)(a)1., Fla. Stat. (2014) (“[F]or the purpose of
compensating remitters of any taxes or fees reported on the same documents
utilized for the sales and use tax, as compensation for the keeping of prescribed
records, filing timely tax returns, and the proper accounting and remitting of taxes
by them, such seller, person, lessor, dealer, owner, and remitter . . . shall be
allowed 2.5 percent of the amount of the tax due . . . .”).

                                        18
premium. 9   There is no statutory authority for “credits” against future years’

assessments simply because no assessment was paid during a prior year in which


      9
         Other statutory schemes take different approaches. See, for example,
section 624.5105, Florida Statutes (2014):
             Community contribution tax credit . . .
                     (1) AUTHORIZATION TO GRANT TAX
             CREDITS; LIMITATIONS.—
                     (a) There shall be allowed a credit of 50 percent
             of a community contribution against any tax due for a
             calendar year under s. 624.509 or s. 624.510.
                     (b) No insurer shall receive more than $200,000
             in annual tax credits for all approved community
             contributions made in any one year.
                     ....
                     (e) If the credit granted pursuant to this section is
             not fully used in any one year because of insufficient tax
             liability on the part of the insurer, the unused amount
             may be carried forward for a period not to exceed 5
             years. The carryover credit may be used in a subsequent
             year when the tax imposed by s. 624.509 or s. 624.510
             for such year exceeds the credit under this section for
             such year.
(Boldface omitted.) See also § 212.17, Florida Statutes (2014):
             [Sales] Tax credits or refunds.—
                (1)(a) If purchases are returned to a dealer by the
             purchaser or consumer after the tax imposed by this
             chapter has been collected from or charged to the account
             of the consumer or user, the dealer is entitled to
             reimbursement of the amount of tax collected or charged
             by the dealer, in the manner prescribed by the
             department.
                ....
                (c) If the tax has not been remitted by a dealer to the
             department, the dealer may deduct the same in submitting
             his or her return upon receipt of a signed statement by the
             dealer as to the gross amount of such refunds during the
             period covered by the signed statement, which may not
                                          19
net premium was negative. Absent statutory authority, the Department has no

discretion to allow a reduction in the annual total subject to the assessments.

      For all the same reasons, the Department did not err in rejecting the ALJ’s

conclusion that the Department improperly applied unadopted rules to “eliminate”

Amerisure’s 2009 “excess credits.” An “unadopted rule” is “an agency statement

that meets the definition of the term ‘rule,’ but that has not been adopted pursuant

to the requirements of” section 120.54, Florida Statutes. § 120.52(20), Fla. Stat.

(2014).   “Rule” means “each agency statement of general applicability that


            be longer than 90 days. The department shall issue to the
            dealer an official credit memorandum equal to the net
            amount remitted by the dealer for such tax collected or
            paid. Such memorandum shall be accepted by the
            department at full face value from the dealer to whom it
            is issued upon the remittance of subsequent taxes accrued
            under this chapter. If a dealer has retired from business
            and filed a final return, a refund of tax may be made if it
            can be established to the satisfaction of the department
            that the tax was not due.
                (2) A dealer who has paid the tax imposed by this
            chapter on tangible personal property sold under a
            retained title, conditional sale, or similar contract, or
            under a contract in which the dealer retains a security
            interest in the property pursuant to chapter 679, may take
            credit or obtain a refund for the tax paid by the dealer on
            the unpaid balance due him or her when he or she
            repossesses the property, with or without judicial process,
            within 12 months after the month in which the property
            was repossessed. If such repossessed property is resold,
            the sale is subject in all respects to the tax imposed by
            this chapter.
(Boldface omitted.)
                                          20
implements, interprets, or prescribes law or policy or describes the procedure or

practice requirements of an agency and includes any form which imposes any

requirement or solicits any information not specifically required by statute or by an

existing rule.” § 120.52(16), Fla. Stat. (2014). The term “rule” does not include

“[i]nternal management memoranda which do not affect either the private interests

of any person or any plan or procedure important to the public and which have no

application outside the agency issuing the memorandum.” § 120.52(16), (16)(a).

See State Bd. of Admin. v. Huberty, 46 So. 3d 1144, 1147 (Fla. 1st DCA 2010)

(“We have held that “‘[a]n agency statement that either requires compliance,

creates certain rights while adversely affecting others, or otherwise has the direct

and consistent effect of law is a rule.’” (quoting Fla. Dep’t of Fin. Servs. v. Capital

Collateral Reg’l Counsel-Middle Region, 969 So. 2d 527, 530 (Fla. 1st DCA

2007))).

      “An agency . . . may not base agency action that determines the substantial

interests of a party on an unadopted rule.” § 120.57(1)(e)1., Fla. Stat. (2014). The

Department did not do so here.10 The Department simply applied the governing


      10
         We note, however, the Department’s subsequent adoption of Rule 69L-
4.002, Florida Administrative Code, during the pendency of the appeal, which
provides:
                  (1) For purposes of its quarterly WCATF
            assessments under this rule, a carrier or self-insurance
            fund may offset from its total of premiums collected
            during the quarter all amounts actually paid or credited to
                                       21
statute to the information Amerisure reported. As the Department said in its final

order, pursuant to section 624.5094, “annual assessments are, indeed, annual and

are the product of a carrier’s premium experience for that year, and that year only.

The ALJ fails to accord any meaning to the statutory phrase ‘against the current

year’s net premium for that year’s assessment’ . . . . No action by the Department

‘eliminates’ a carrier’s ‘credits’ against its assessment liability for dividends paid

and premiums returned when its annual assessment is finalized at zero. Section

624.5094, Florida Statutes, by operation of law, forecloses a carrier’s ability to




             policyholders for dividends and returned premiums
             during the quarter regardless of the calendar year the
             policies incepted for which the dividends or returned
             premiums apply. For purposes of its quarterly SDTF
             assessments under this rule, a carrier or self-insurance
             fund may offset from its total amount of premiums
             written during the quarter, all amounts actually paid or
             credited to policyholders for dividends and returned
             premiums during the quarter regardless of the calendar
             year the policies incepted for which the dividends or
             premiums apply.
                     (2) In the event a carrier or self-insurance fund is
             determined by the division to have overpaid its annual
             WCATF or SDTF assessment, the amount of any actual
             overpayment deposited into the State Treasury may, at
             the option of the carrier or fund, be carried forward as a
             dollar-for-dollar credit against future assessment
             liabilities; or be refunded by the division. No carrier or
             self-insurance fund shall be entitled to credits that exceed
             the assessment amounts actually paid for the specific
             calendar year to which the assessments apply.
                                          22
apply its ‘excess credits’ . . . to reduce a future year’s tax liability.” 11

       Statements in the proposed draft rules and draft policy and procedures

manual 12 do not require compliance by anybody outside the agency, do not create


       11
          The Department’s position is also consistent with the plain language of
section 215.26, Florida Statutes (2008), regulating refunds. Section 215.26
provides, in part:
                      (1) The Chief Financial Officer may refund . . .
               any moneys paid into the State Treasury which
               constitute:
                      (a) An overpayment of any tax, license, or account
               due;
                      (b) A payment where no tax, license, or account is
               due; and
                      (c) Any payment made into the State Treasury in
               error . . . .
                      (2) Application for refunds as provided by this
               section must be filed with the Chief Financial Officer,
               except as otherwise provided in this subsection, within 3
               years after the right to the refund has accrued or else the
               right is barred. . . .
       12
            A Division employee drafted proposed rules for the Division’s
Assessment Unit, which addressed “excess credits” based on negative net
premium. One draft of the proposed rules provided that if a carrier owes no
assessment for a quarter as a result of offsets for dividends paid and premium
refunds, the carrier will be able to apply the “unused premium offset to reduce
assessments owed in any of the other three quarters of the same calendar year,” but
after the last quarterly report is filed for a calendar year the Division would “adjust
the Carrier’s records to remove any credits due to these premium offsets that were
not used in that year” and the credit pre-printed on the quarterly report for the first
quarter of the following year would “reflect only overpayment of assessment(s).”
This draft of the proposed rules also provided that when an assessment for either
the WCATF or SDTF was overpaid, the carrier could elect either to apply the
overpayment against future assessments owed to the same fund or submit a refund
request under section 215.26, Florida Statutes, within three years of the date the
alleged overpaid amount was initially deposited into the State Treasury; after the
end of the three-year window, any unused portion of an overpayment would no
                                             23
certain rights while adversely affecting others, or otherwise have the direct and

consistent effect of law, or add anything whatsoever to the plain meaning of

section 624.5094. Similarly, the Division’s forms, which indicated increasing

“credits” throughout the year 2009, also did not “adversely affect any . . .

substantive rights; [did] not constitute a denial or withdrawal of a right an

[insurance carrier] might have; [did] not impose any new or additional

requirements on an [insurance carrier]; and [did] not have ‘the direct and consistent

effect of law.’” Huberty, 46 So. 3d at 1147. “‘[A]n agency interpretation of a

statute which simply reiterates the legislature’s statutory mandate and does not

longer be available as an offset against future assessments or for the issuance of a
refund.
       In explanation of the conclusion that these findings established statements of
policy that constituted unadopted rules, the ALJ stated only that the Department
had held the stated position “at least since 2004” and “the Department’s position is
not a simple application of the law to the information provided, because no statute
referenced by the Department makes any mention of excess credits and how they
are to be treated.” The fundamental problem with the ALJ’s conclusion is that
section 624.5094 precludes carrying forward negative net premium from one
calendar year to a subsequent calendar year, thereby precluding the “credits” at
issue in the first place.
       The fact that “credit” calculations based on Amerisure’s 2009 quarterly
reports of negative net premium appeared on the quarterly assessment forms was
not sufficient to establish that Amerisure had a statutorily authorized entitlement to
such “credits” so that the Department was required to establish authority (by
statute or rule) to “eliminate” the credits. The notation of credits (or debits) on the
Division’s pre-printed forms appears to be a bookkeeping device to carry forward
information from one quarter to the next, a result of the fact that the assessments at
issue are actually annual assessments even though the statutes set forth quarterly
reporting requirements.         It is therefore both irrelevant and completely
understandable that nothing in section 624.5094 “mandates that credits be
eliminated under any circumstances.”
                                           24
place upon the statute an interpretation that is not readily apparent from its literal

reading, nor in and of itself purport to create certain rights, or require compliance,

or to otherwise have the direct and consistent effect of the law, is not an

unpromulgated rule, and actions based upon such an interpretation are permissible

without requiring an agency to go through rulemaking.’” Id. (quoting St. Francis

Hosp., Inc. v. Dep’t of Health & Rehabilitative Servs., 553 So. 2d 1351, 1354 (Fla.

1st DCA 1989)).

      The Department’s construction and application of section 624.5094 in the

present case is consistent with and required by the statute. No unadopted rule need

be conjured up to explain the Department’s denial of refunds to Amerisure, and the

final order did not err in concluding as much.

      Affirmed.

LEWIS, C.J. and RAY, J., CONCUR.




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