ALJDEC

01-11199-AFR · Office of Alternative Fuel Recovery · 2001-06-19

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: June 1, 2001 APPEARANCES: David E. White on his own behalf; Assistant Attorney General Sara D. Branscum on behalf of the Office of Alternative Fuel Recovery ADMINISTRATIVE LAW JUDGE: Lewis D. Kowal _____________________________________________________________________

FINDINGS OF FACT 1. This is an appeal of a determination made by the Office of Alternative Fuel Recovery (the “Office”) to deny Donna J. and David E. White’s (“Appellants”) Alternative Fuel Loss Reimbursement Application (the “Application”). 3. On or about, Appellants filed the Application with the Office, requesting reimbursement in the sum of $6,557.13. 4. On March 23, 2001, the Office issued a letter denying the Application. The denial letter did not provide any information as to the reason why the Office denied the Application. 5. In a letter directed to David White (“Mr. White”) dated April 17, 2001, the Office acknowledged receiving Mr. And Mrs. White’s request for a hearing regarding the denial of the Application. 6. At this hearing, the Appellants have the burden of proving that the Application was improperly denied. 7. During the hearing, Mr. White testified as to the facts leading up to the submission of the Application to the Office. 8. The following salient facts were adduced during the hearing from Mr. White’s credible testimony and exhibits: a) On August 20, 2000, Mr. White visited Sanderson Ford dealership in Glendale, Arizona (“Sanderson”) intending to purchase two trucks. This hearing only involves Mr. White’s transaction with respect to one truck. At that time, Mr. White owned a 1996 one ton Chevrolet dually truck (the “1996 truck”) which he used for his business. b) Based on the State’s Alternative Fuel Program that existed at that time, Mr. White was interested in trading in the 1996 truck for a new truck converted to use propane. c) Mr. White entered into a transaction with Sanderson wherein he traded in the 1996 truck and obtained $7,442.13 as the trade-in value, of which $4,000.00 was used to pay off the amount Mr. White owed to the finance company on the 1996 truck. The remaining $4,000.00 was used as a down payment on a new 2000 F450 propane converted truck he was purchasing from Sanderson for $35,986.85. d) Mr. White was willing to accept from Sanderson the trade-in value of $7,442.13 for the 1996 truck even though he believed the fair market value for it was approximately $14,000.00. e) At the time when Mr. White purchased the 2000 F450 truck, he was informed that there was a production backlog. After the above- mentioned transaction, the State of Arizona changed the Alternative Fuel Program and set specific requirements in order to receive certain benefits from the program. f) Mr. White was notified by the Office of the change in the State’s Alternative Fuel Program, and determined that he would not qualify to receive the economic benefit of the program regarding the purchase of the 2000 F450 truck. Consequently, Mr. White canceled his contract with Sanderson for the purchase of the new truck and received from Sanderson the $3,442.87down payment. Mr. White requested that Sanderson return to him his 1996 truck back but it was no longer available. . . . g) Mr. White claims that he traded in his 1996 truck, valued at approximately $14,0000.00, and received $7,442.87, of which $4,0000.00 went towards paying off the financing on the 1996 truck. That left Mr. White with $3,442.87 to apply to a new truck without obtaining any benefit from the State’s Alternative Fuel Program. Consequently, though he intended to drive a propane converted truck rather than the 1996 truck which he testified easily passed emission, he could only afford to buy an older used truck that is not as environmentally friendly as the1996 truck. h) In support of the $14,000.00 valuation of the 1996 truck, Mr. White presented four different classified advertisements in the Arizona Truck Trader listing trucks for sale comparable to his 1996 truck (Exhibit 2). i) Mr. White submitted the Application to recoup $6,557.13, the amount he claims he lost as a result of the above-mentioned transaction with Sanderson. j) During the hearing, Mr. White conceded that the State of Arizona was not a party to the above-mentioned transaction and did not, either prior to or at the time of the transaction, provide Mr. White with an opinion as to the fair market value of his 1996 truck or the amount he should receive from Sanderson as a the trade in value of his 1996 truck. k) Mr. White testified that the $6,557.13 figure was arrived at by utilizing $14,0000.00 as the fair market value of his 1996 truck less $7,442,87, Sanderson’s trade in value of the 1996 truck. 9. Appellants contend that the State of Arizona has changed the Alternative Fuel Program mid-stream and that, because of such change in the law, Appellants have incurred expenses in the sum of $6,557.13 which they seek to recover from the Office. APPLICABLE LAW 1. A.R.S. §43-1086(E) was amended by the passage of Senate Bill 1004 (Laws 2000, 7th S.S., Ch. 1) of which Section 31 in relevant part provides:

A. A person is eligible to present a claim for reimbursement to the department of administration if the person might have been eligible for a tax credit under section 43-1086, 43-1086.01, 43-1086.02, 43- 1174, 43-1174.01 or 43-1174.02, Arizona Revised Statutes, before the applicable section was amended by this act but does not meet the requirements imposed by this act and both of the following apply:

1. The person cancelled a contract or purchase order to purchase or lease a vehicle or to convert a vehicle to operate on alternative fuel, or to purchase, install, or construct a vehicle refueling apparatus or an alternative fuel delivery system.

2. The person suffered actual monetary loss directly related to the purchase or lease of a vehicle, to the conversion of a vehicle to operate on alternative fuel or to the purchase, installation or construction of a vehicle refueling apparatus or an alternative fuel delivery system.

2. Section 32 of SB 1004 provides, in relevant part:

A. Only the following actual monetary losses directly related to the purchase or lease of a vehicle or to the conversion of a vehicle to operate on alternative fuel shall be reimbursed by the state:

1. Any forfeited down payment or deposit paid by the claimant to a motor vehicle dealer or a conversion company, or both.

2. The fair market value of a vehicle traded to a motor vehicle dealer in lieu of a down payment or deposit.

3. Any financial penalty imposed by a motor vehicle dealer, conversion company or lender because of cancellation of a contract, if the original terms of the contract signed on the date of the purchase or order require that such a penalty be paid.

B. The following actual monetary losses directly related to the purchase, installation or construction of a vehicle refueling apparatus or an alternative fuel delivery system shall be reimbursed:

1. Any forfeited down payment or deposit paid for equipment or installation, or both, of the vehicle refueling apparatus or alternative fuel delivery system.

2. The cost of a vehicle refueling apparatus or alternative fuel delivery system equipment if purchased but not installed, if the apparatus or equipment is transferred to this state.

3. Any financial penalty imposed by an installer of a vehicle refueling apparatus or alternative fuel delivery system because of cancellation of contract, if the original terms of the contract signed on the date of the installation agreement require that such a penalty be paid.

C. Except as provided in subsection D of this section, in no event shall the reimbursement paid under this section exceed, as applicable, the amount of the credit that would have been allowed under section 43- 1086, 43-1086.01, 43-1086.02, 43-1174, 43-1174.01 or 43-1174.02, Arizona Revised Statutes, as amended by this act.

D. The amount of reimbursement may exceed the limit prescribed in subsection C of this section only if the director of the department of administration or the director’s designee determines that both of the following apply:

1. On or before December 1, 2000, the claimant actually paid amounts directly related to the purchase, lease or conversion of a vehicle greater than the limit prescribed in subsection C of this section.

2. The claimant acted in good faith to minimize the actual monetary losses directly related to the purchase, lease or conversion of the vehicle. CONCLUSIONS OF LAW Section 32(A) of SB 1004 contemplates that reimbursement of a monetary loss of the fair market value of a vehicle traded to a motor vehicle dealer in lieu of a down payment or deposit be reimbursable when the dealer does not refund the down payment or deposit. In the instant matter, Mr. White received from Sanderson the sum of $3,442.13, the amount of the down payment on the 2000 truck he intended to purchased. Appellants failed to establish by a preponderance of the evidence that their loss reimbursement claim qualifies for reimbursement under Senate Bill 1004, Sections 31 and 32, which are applicable to the instant matter. Appellants failed to meet their burden of establishing by a preponderance of the evidence that the Office’s denial of the Application was somehow improper and should be reversed. . . . . . .

RECOMMENDED ORDER Based on the above, it is recommended that the Office’s denial of the Application be upheld. Done this day, June 19, 2001.

______________________________________ Lewis D. Kowal Administrative Law Judge

Original transmitted by mail this ____ day of ____________, 2001, to:

Office of Alternative Fuel Recovery Kathy Peckardt 1700 W. Washington, Suite 103 Phoenix, AZ 85007 ATTN: Lorinda Goodman

By ___________________________

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Office of Administrative Hearings 1400 West Washington, Suite 101 Phoenix, Arizona 85007 (602) 542-9826