ORDERS:
FINAL ORDER AND DECISION
STATEMENT OF THE CASE
These cases come before this tribunal pursuant to S.C. Code Ann. §§ 1-23-600 et seq. and S.C. Code Ann. § 12-4-30 (Supp.
1998). Respondents were cited for violating S.C. Code Ann. § 12-12 -4270 (Supp. 1998) of the Bingo Tax Act of 1996(1)
on December 1, 1998 and January 4, 1999, respectively. The South Carolina Department of Revenue (Department) assessed
a $5,000 penalty against Respondents and revoked their licenses in each of these cases because of their failure to remit timely
sixteen and one-half percent of the total face value of bingo cards for which Respondents made application. Respondent
Senior Citizens Association (Respondent) admits that it remitted the amount owed in an untimely manner, but contends that
the penalty of revocation is excessive given the extenuating circumstances in these cases. After timely notice to the parties, a
hearing was conducted on October 15, 1999, at the Administrative Law Judge Division in Columbia, South Carolina. Based
on the testimony and evidence presented, I find that $5,000 is an appropriate penalty in each of these cases for the respective
violations.
FINDINGS OF FACT
Having carefully considered all testimony, exhibits, and arguments presented at the hearing of these cases, and taking into
account the credibility and accuracy of the evidence, I make the following Findings of Fact by a preponderance of the
evidence.
At the hearing, counsel for the parties present stipulated to consolidating the cases and making a single record of the
proceedings.(2) Respondent Senior Citizens Association stipulated that the violations occurred as alleged by the Department.
Although Respondent does not challenge the monetary penalty imposed by the Department, it does challenge the revocation
of its license.
Dr. Kaye Stevenson is a current member of the Board of the Senior Citizens Association, and she served as president in
1998. She, along with the other members of the Board, learned of problems with its organization's untimely remittance of
taxes on the purchase of bingo paper for the first time in February of 1999. At that time, the executive director was asked to
resign. Dr. Stevenson then assumed the role of executive director. To further ensure compliance with the bingo laws, the
Board revised its contract with the promoter in March of 1999 so that the payment of taxes took priority over the payment
of expenses. On May 31, 1999, the Board terminated its contract with the promoter and began looking for a new promoter.
Respondent receives local, state, and federal funding. Also, Respondent depends on private donations and revenue from its
bingo operations to complete funding for its service programs. The Senior Citizens Association provides a meals on wheels
program, which feeds approximately 150 seniors five days per week. Respondent also provides, among other services, home
care, transportation, and respite services.
CONCLUSIONS OF LAW
Section 12-21-4270 pertains to applications to obtain bingo cards and provides:
Each licensed nonprofit organization or promoter, in the name of a licensed organization, may obtain bingo cards approved
by the department by making application and remitting sixteen and one-half percent of the total face value of the cards to be
purchased. Payment to the State for the issuance of bingo cards must be made by certified check within fifteen days of
receipt of the application.
In the cases at bar, Respondent concedes that it failed to remit sixteen and one-half percent of the total face value of the
bingo cards within fifteen days of its applications of November 12, 1998 and December 11, 1998. Accordingly, Respondent
is subject to a penalty of up to $5,000 and revocation of its license. S.C. Code Ann. § 12-21-4140 (Supp. 1998). Further,
Respondent and its promoter are jointly and severally liable for any penalty imposed. S.C. Code Ann. § 12-21-3960 (Supp.
1998).
Nevertheless, Respondent contends that the penalty of revocation is excessive under the circumstances. Inherent in and
fundamental to the quasi-judicial powers of this tribunal, as the trier of fact in contested cases under the Administrative
Procedures Act, S.C. Code Ann. §§ 1-23-310 et seq. (1986 & Supp. 1998), is the power to determine the appropriate
penalty under the facts presented. Walker v. South Carolina ABC Comm'n, 305 S.C. 209, 407 S.E.2d 633 (1991).(3)
Importantly, this tribunal notes that Respondent has taken substantial remedial measures to ensure future compliance with
the law, thereby warranting a less severe penalty.
The penalty provision provides that "[a] penalty of up to five thousand dollars and revocation of the license at the discretion
of the department may be imposed for a violation of this article. Each violation and each day in violation of a provision of
this article constitutes a separate offense." S.C. Code Ann. § 12-21-4140 (emphasis added). It is evident from § 12-21-4140 that the legislature made a range of penalties permissible under the law, and, in doing so, the legislature implicitly made
the imposition of the penalty dependent upon the circumstances of each case. Hence, any penalty so imposed within the
established range is statutorily appropriate. Since Respondent has taken substantial remedial measures to ensure future
compliance with the law, revocation is not warranted in this case. Accordingly, under these circumstances, the Department
may impose the monetary fine of $10,000 against Respondent but may not revoke Respondent's license.
ORDER
Based upon the foregoing Findings of Fact and Conclusions of Law, IT IS HEREBY ORDERED that the Department shall
impose a total penalty in the amount of $10,000 against Respondent.
AND IT IS SO ORDERED.
______________________________ JOHN D. GEATHERS
Administrative Law Judge
Post Office Box 11667
Columbia, South Carolina 29211-1667
October 20, 1999
Columbia, South Carolina
1. See S.C. Code Ann. §§ 12-21-3910 et seq. (Supp. 1998).
2. Respondent Thomas W. Northern, the promotor, did not appear at the hearing, and he has taken no poistion in this matter.
3. It is a generally recognized principle of administrative law that the fact finder has the authority to impose an administrative penalty after the
parties have had an opportunity to be heard on the issues. See Ohio Real Estate Comm'n v. Aqua Sun Investments, 655 N.E.2d 266 (Ohio App. 2d
Dist. 1995); Shadow Lake of Noel, Inc. v. Supervisor of Liquor Control, 893 S.W.2d 835 (Mo.App. S.D. 1995); Matter of Henry Youth Hockey
Ass'n, 511 N.W.2d 452 (Minn.App. 1994); State Police v. Cantina Gloria's, 639 A.2d 14 (Pa. 1994); Vermont Agency of Natural Resources v.
Duranleau, 617 A.2d 143 (Vt. 1992); City of Louisville v. Milligan, 798 S.W.2d 454 (Ky. 1990); Com., Department. of Transp. v. Slipp, 550
A.2d 838 (Pa.Cmwlth. 1988); Department. of Transp. v. Miller, 528 A.2d 1030 (Pa.Cmwlth. 1987).
Prior to governmental restructuring (i.e., 1993 Act No. 181, eff. July 1, 1994), a commission sitting in its adjudicatory capacity imposed penalties
for violations of statutory provisions its agency administered. Acting as fact-finder, it was the commission's prerogative "to impose the appropriate
penalty based on the facts presented." Walker v. South Carolina ABC Comm'n, 305 S.C. 209, 407 S.E.2d 633, 634 (1991). It is uncontroverted
that the former Tax Commission exercised that authority in bingo cases. The ALJ, as the current fact-finder, must also impose a penalty based on
the facts presented at the contested case hearing. As parties are entitled to present evidence on all issues arising out of the contested agency
action, it follows logically that the tribunal responsible for conducting the proceedings must have the authority to decide those issues. |
