ALJDEC

01-12444-AFR · Office of Alternative Fuel Recovery · 2001-07-10

IN THE OFFICE OF ADMINISTRATIVE HEARINGS

HEARING: June 26, 2001. APPEARANCES: Appellant Larry Watkins appeared personally. No appearance was made by the Office of Alternative Fuel Recovery. ADMINISTRATIVE LAW JUDGE: Brian Brendan Tully _____________________________________________________________________ The commencement of the scheduled hearing was delayed for 15 to allow for the late arrival of an attorney authorized to represent the Office of Alternative Fuel Recovery. Evidence and testimony were presented and, based upon the entire record, the following Findings of Fact, Conclusions of Law and Recommended Order are made:

FINDINGS OF FACT

1. Pursuant to the notice of hearing dated May 3, 2001 issued by the Office of Alternative Fuel Recovery, this matter came on for hearing the Appellants’ appeal of the denial of their Alternative Fuel Loss Reimbursement Application by the Office of Alternative Fuel Recovery. 2. In June of 2000, Mr. and Mrs. Watkins placed an order with the Five Star Ford dealership for a new F-150 pickup truck with a factory-installed propane fuel system. The Watkins desired a factory-installed propane fuel system rather than an after-market conversion in order to maintain the new truck warranty. 3. At the time of ordering the truck, the Watkins paid the dealership a ten per cent down payment of $3,350.00. They were told by dealership employees that their factory-installed propane fuel system truck would be delivered in October. 4. When the Watkins ordered their new truck, they did so in reliance on the State of Arizona’s then-existing alternative fuel vehicle subsidy program. This program offered grants or tax credits to persons who purchased alternative fuel vehicles or who converted vehicles to run on alternative fuel. See Laws 2000, Ch. 405. 5. The Watkins’ new truck was not delivered to them in October of 2000 as expected. 6. Before the Watkins took delivery of their new vehicle, the Arizona Legislature modified the parameters of the alternative fuel vehicle program such that the Watkins no longer qualified for an alternative fuel vehicle subsidy. The Watkins thereafter canceled their order with Five Star Ford, and Five Star Ford returned the Watkins’ down payment less the sum of $195.00 for processing fees. 7. The Watkins subsequently filed an Alternative Fuel Loss Reimbursement Application with the Office of Alternative Fuel Recovery, which later denied the application. 8. The Watkins timely requested an appeal of the denial of their Alternative Fuel Loss Reimbursement Application. 9. The Watkins seek reimbursement for the following expenses:

a) $195.00 for the processing fees retained by Five Star Ford from their initial down payment. b) $300.00, which represents the penalty for early withdrawal assessed the Watkins when they cashed an Individual Retirement Account (“IRA”) for use as the down payment for the truck. c) $400.00 for lost mutual fund investment income resulting from accessing their IRA for use as a down payment.

CONCLUSIONS OF LAW

1. In this proceeding, the Watkins bear the burden to prove, by a preponderance of the evidence, that the Office of Alternative Fuel Recovery improperly denied their application for alternative fuel loss reimbursement. A.A.C. R2-19-119. A preponderance of the evidence is “such proof as convinces the trier of fact that the contention is more probably true than not.” Morris K. Udall, Arizona Law of Evidence § 5 (1960). 2. SB 1004 sets forth the law governing the Watkins’ claim for reimbursement. Section 31 of SB 1004 provides, in relevant part: 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 canceled 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.

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.

3. The Watkins did establish an actual monetary loss in the amount of $195.00 which was a portion of their original down payment retained by Five Star Ford after they canceled their order. That loss is reimbursable pursuant to the provisions of SB 1004, Sections 31 and 32. 4. Because the Watkins did establish that their claim for the $195.00 retained by Five Star Ford was eligible for reimbursement under SB 1004, the Office of Alternative Fuel Recovery improperly denied that portion of the Watkins’ application. 5. The Watkins failed to establish that their losses in the amount of $300.00 resulting from cashing their IRA and $400.00 for loss of investment income were eligible for reimbursement under SB 1004. 6. Because the Watkins failed to establish that their claims described in Conclusion of Law No. 5 above were eligible for reimbursement under SB 1004, they did not establish that the Office of Alternative Fuel Recovery improperly denied their application for alternative fuel loss reimbursement applicable to those losses.

RECOMMENDED ORDER

In view of the foregoing, it is recommended that the Watkins’ claim for reimbursement in the amount of $195.00 for the funds retained by Five Star Ford after they canceled their order be approved, and that procedures be commenced and finalized to reimburse them that amount pursuant to the provisions of SB 1004. It is further recommended that the denial of the balance of the Watkins’ reimbursement application be upheld and affirmed. … … Done this day, July 11, 2001

______________________________________ Brian Brendan Tully Administrative Law Judge

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

Department of Administration Office of Alternative Fuel Recovery Elliott Hibbs, Director 1700 W. Washington, Suite 103 Phoenix, AZ 85007 ATTN: Michael Murphy

By ___________________________

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