Opinion
No. CX-01-1767
Filed June 11, 2002.
Appeal from Washington County
Carol M. Grant, (for relator)
Michael O'Keefe, Minnesota Department of Human Services, and Douglas H. Johnson, Washington County Attorney, Nancy C. Nelson, Assistant Washington County Attorney, (for respondent)
This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2000).
UNPUBLISHED OPINION
Sharon and Thomas Glewwe appeal from the Commissioner of Human Services' order revoking their child-care license for chronically violating capacity regulations and for failing to supervise the children in their care. Because the commissioner did not abuse his statutory authority or his discretion in revoking the Glewwes' license, we affirm.
FACTS
Sharon and Thomas Glewwe operate a daycare center from their home under a child-care license issued by the Minnesota Department of Human Services. The Glewwes provide child-care services seven days a week, 24 hours a day.
Sharon Glewwe (Glewwe) was first licensed in 1979. Her license initially allowed her to care for five children, only three of whom could be under the age of two and one-half. Glewwe later qualified for a group license. Since first receiving her license in 1979, Glewwe has exceeded capacity limitations on 12 different occasions.
In 1981, Washington County Community Services discovered that Glewwe had one more child and three more toddlers in her care than her license allowed. In March 1982, a meal-reimbursement worksheet showed that Glewwe had 14 children for lunch and 15 children for dinner, and that eight of those children were under the age of two. Glewwe agreed to reduce the number of children; but an April 15 inspection revealed that Glewwe continued to be over capacity, this time by two children. Glewwe was warned that she would be subjected to disciplinary action unless she complied with the capacity and age-distribution limitations her license imposed.
This warning notwithstanding, during a September 1982 visit Glewwe had three more toddlers than her license allowed. And a September 1984 visit revealed that Glewwe was over capacity by seven children between the morning and afternoon shifts. To eliminate overcapacity problems between shifts, the county issued Glewwe a license that allowed her to care for additional children during shift changes.
Following another overcapacity violation in September 1984, however, the county asked the Glewwes to obtain a group license. The Glewwes then qualified for a C(3) license, which allowed them to care for 14 children as long as two adults were present. Of the 14 children, only three could be infants and only four could be under the age of two.
Even with the new group license, however, Glewwe continued to exceed capacity limitations. In February 1987, a licensing worker found 15 children in the care of only one adult. The worker "stressed the seriousness of [the] situation in relation to emergencies and liability." In a letter dated February 26, she reiterated that "[t]he situation on Tuesday was a serious rule violation in that the safety of the children in [Glewwe's] care was at risk." She further noted that "[i]f an emergency occurred under those circumstances, the consequences could be extremely serious!" The licensing worker warned Glewwe that failure to comply with capacity regulations could lead to negative licensing action.
This warning notwithstanding, Glewwe was once again found to be over capacity by one child during a March 1990 inspection. In a letter dated April 10, the licensing worker expressed concern about Glewwe's repeated disregard of the licensing requirements and stressed that "[e]xceeding the allowed numbers is a health and safety risk that is not acceptable." As a result of the March 1990 violation, the county placed Glewwe's license on probation for one year.
Approximately five years later, the county found 17 children in Glewwe's care. Glewwe did not seem concerned about the capacity violation and explained that one child was just visiting and one child was not supposed to be there. She also stated that parents were often late to pick up their children. The county issued a correction order.
Another correction order was issued in November 1995 after a toddler climbed into a crib and bit an infant who was sleeping unsupervised in a lower-level room. Although the Glewwes complied with the correction order by removing bedroom-door locks and purchasing monitors and gates, in January 1996 the county placed the Glewwes' license on probation once again, this time for failing to supervise, for placing a child in a locked room, and for failing to report the occurrence of a serious injury.
Only one month after the probationary period ended, Glewwe was again found to be over capacity by one child. A month later, a licensing worker found a child locked in a downstairs bedroom. The child was crying and asking to be let out of the room, and the monitors were not in use. The county issued a correction order.
Three years later, on August 2, 2000, a mid-morning visit disclosed 22 children in the Glewwes' home. Glewwe explained that she was providing a needed service and appeared unconcerned about the seriousness of exceeding capacity limitations. On August 4, the county issued a correction order.
On August 14, the county recommended that the Glewwes' license be revoked for failure to supervise and repeated incidents of overcapacity. On September 15, the commissioner revoked the Glewwes' license.
On appeal from the commissioner's revocation order, the Glewwes conceded that they were operating over capacity on August 2, but claimed that revocation was too severe a penalty. The Glewwes argued that overcapacity problems are inherent in a 24-hour-per-day service and occurred mostly during shift changes. They noted that they had instituted a penalty for late pick-ups.
Following a hearing, an administrative law judge recommended that "sanctions be taken" against the Glewwes. The judge reasoned that the severity of the failure-to-supervise violation and the chronicity and severity of the overcapacity violations justified the imposition of sanctions.
In September 2001, the Commissioner of Human Services accepted the administrative law judge's recommendation and revoked the Glewwes' license for repeatedly operating overcapacity and for failing to supervise the children in their care. The commissioner subsequently denied the Glewwes' request for reconsideration this certiorari appeal followed.
DECISION
Administrative-agency decisions enjoy a presumption of correctness and may be reversed only when they exceed the agency's jurisdiction or statutory authority, are made upon unlawful procedure, reflect an error of law, or are unsupported by substantial evidence in view of the entire record. Minn. Stat. § 14.69 (2000); Dep't of Human Services v. Muriel Humphrey Residences, 436 N.W.2d 110, 117 (Minn.App. 1989), review denied (Minn. Apr. 26, 1989). In reviewing quasi-judicial agency decisions not subject to the Administrative Procedure Act, a reviewing court is not bound by the agency's determination on purely legal issues. Muriel Humphrey Residences, 436 N.W.2d at 117. But a reviewing court must defer to the agency's fact-finding process and be careful not to substitute its findings for those of the agency. Dokmo v. Indep. Sch. Dist. No. 11, 459 N.W.2d 671, 674-75 (Minn. 1990). Absent a clear abuse of discretion, a reviewing court must also defer to an agency's choice of sanction. In Re Insurance Agents' Licenses of Kane, 473 N.W.2d 869, 877 (Minn.App. 1991) (citing In re Real Estate Salesperson's License of Haugen, 278 N.W.2d 75, 80 n. 10 (Minn. 1979)), review denied (Minn. Sept. 25, 1991).
I.
The Glewwes first argue that the issuance of the August 2000 correction order precludes revocation as a matter of law absent evidence that they failed to comply. We disagree.
Minnesota law authorizes the Commissioner of Human Services to suspend or revoke a child-care license when a licensee fails to comply fully with applicable laws or rules. Minn. Stat. § 245A.07, subds. 1, 3 (2000). The commissioner may also revoke a license when a licensee fails to correct violations specified in a correction order. Minn. Stat. § 245A.06, subd. 3 (2000). When suspending or revoking a license, the commissioner must consider "the nature, chronicity, or severity of the violation of law or rule and the effect of the violation on the health, safety, or rights of persons served by the program." Minn. Stat. § 245A.07, subd. 1.
Nothing in the statutory scheme precludes the commissioner from revoking a license after a correction order has been issued. Correction orders are the appropriate response to isolated violations that do not imminently endanger the health, safety, or rights of people served by a licensed program. See Minn. Stat. § 245A.06, subd. 1 (2000). An isolated violation for which a correction order has been issued, however, may be the catalyst for the commissioner's subsequent determination that a licensee's chronic violation of licensing requirements warrants revocation. See Minn. Stat. § 245A.07, subd. 1 (requiring commissioner to consider chronicity of violation in imposing statutory sanctions including revocation).
Contrary to the Glewwes' argument, there is no inconsistency between the issuance of a correction order for a violation that does not endanger the health or safety of children served by a licensed program and a subsequent determination that the chronic violation of licensing requirements endangers the health or safety of children a licensed program serves and warrants revocation. The Glewwes' claim that revocation is conditioned on proof that a licensee failed to comply with a correction order is equally without merit. Failure to comply with a correction order is merely one of several grounds for revocation, not a prerequisite. See Minn. Stat. §§ 245A.06, subd. 3 (authorizing revocation for failure to comply with a correction order); .07, subd. 3 (authorizing revocation for failure to comply fully with applicable laws or rules).
Accordingly, the commissioner did not exceed his statutory authority by revoking the Glewwes' license after a correction order had been issued for the violation that triggered the revocation order.
II.
The Glewwes next argue that the licensing scheme is unconstitutional because it lacks a rational basis. We do not agree.
An administrative rule violates substantive due process if it is not rationally related to the objective the legislature seeks to achieve. Mammenga v. State Dept. of Human Servs., 442 N.W.2d 786, 789-90 (Minn. 1989). In enacting the Human Services Licensing Act, the legislature presumably sought to ensure the health and safety of children in licensed programs. See Minn. Stat. §§ 245A.01-.65 (2000); cf. Minn. Stat. § 245.461, subd. 2(2) (defining commissioner's mission under Adult Mental Health Act as promoting the safety of adults with mental illness). Because capacity and age-distribution regulations ensure that a licensed program has no more children than a licensee can safely supervise, they are rationally related to the legislature's goal of promoting the safety of children in licensed programs.
The Glewwes alternatively claim that the regulations lack a rational basis as applied to them because overcapacity is an inherent byproduct of a 24-hour-a-day operation. See In re Lawful Gambling License of Thief River Falls Amateur Hockey Ass'n. 515 N.W.2d 604, 607 (Minn.App. 1994) (stating rule will sometimes lack rational relation to legislative objective when applied to new situation). But overcapacity endangers the safety of children no matter what the cause. Accordingly, the solution to the allegedly inevitable overcapacity problems generated by a 24-hour-a-day program is to obtain a variance, not to declare the licensing scheme unconstitutional as applied.
III.
Next, the Glewwes argue that revocation is too severe a sanction for several reasons. First, the Glewwes claim that the record contains no evidence that the overcapacity violations that led to revocation endangered the health or safety of the children they served. The Glewwes' argument misconstrues the statutory scheme.
Neither the relevant statute nor the relevant administrative rules condition revocation on proof that isolated overcapacity violations actually endangered the health or safety of children served by a licensed program. Instead, the commissioner need only consider the effect of a violation on the health or safety of children in a licensed program before sanctioning a licensee. See Minn. Stat. § 245A.07, subd. 1 (listing factors commissioner must consider before imposing sanction); Minn. R. 9543.1060, subp. 2 (2001) (requiring commissioner to consider, before imposing sanction, risk of harm posed by licensee's failure to comply with license requirements). The commissioner must also consider the chronicity and severity of a violation. Id. And Minn. R. 9543.0100, subp. 3 (2001), expressly lists the "severe or recurring failure to comply with capacity limits" as one of the violations that are grounds for recommending revocation. Here, the commissioner properly considered the effect of the overcapacity violations and the Glewwes' recurring failure to comply with capacity limits and determined that revocation was the appropriate sanction.
Second, the Glewwes claim that in balancing the relevant statutory factors, the commissioner failed to consider positive comments parents made about the Glewwes' child-care program. The record shows otherwise, however. The administrative law judge recognized that the Glewwes provide a needed service and that "[t]he quality of their service, with a few notable exceptions, has been very good." The judge further recognized that the Glewwes have provided "a variety of experiences to the children placed in their care." After balancing the positive aspects of the program against the Glewwes' chronic violation of capacity limitations, their inability to enforce a late-pick-up policy, and the history of warnings, correction orders, and probation, the judge concluded "there is nothing to suggest that things will be any different in the future than they have been in the past" and recommended sanctions. The commissioner considered the administrative law judge's findings and recommendation and made a reasoned determination that revocation was the appropriate sanction.
Third, the Glewwes claim that revocation is too severe a sanction because the administrative law judge did not expressly recommend revocation. That the administrative law judge did not expressly recommend revocation is irrelevant, however. The legislature conferred on the agency, not the administrative law judge, the discretion to determine the appropriate sanction. See Minn. Stat. § 245A.07, subd. 1 (2000) (listing factors commissioner must consider in determining appropriate sanction); Padilla v. Minn. State Bd. of Medical Examiners, 382 N.W.2d 876, 887 (Minn.App. 1986) (stating that "[t]o hold that the ALJ should make a recommendation as to the type of discipline would be to usurp the power delegated to the [agency]"), review denied (Minn. Apr. 24, 1986). In any event, by agreeing with the county that the capacity violations were likely to recur, the administrative law judge implicitly recommended revocation.
Fourth, the Glewwes claim that revocation is unwarranted because some of the capacity violations that led to revocation were based on meal-reimbursement worksheets, which do not accurately reflect the number of children present in a home at any given time. Even if some violations were based on these worksheets, however, two probation orders and nine capacity violations not based on meal-reimbursement worksheets remain and reasonably support the commissioner's determination that revocation was the appropriate sanction. That the remaining capacity violations resulted from parents' failure to pick up their children on time does not render the commissioner's revocation order arbitrary or capricious.
Fifth, the Glewwes argue that license revocation is not the least-restrictive sanction and that "there is no reason to believe that a solution short of license revocation would have been ineffective." But the statute does not require that revocation be the least-restrictive sanction; it merely requires that it be fair in light of the severity and chronic nature of the violations and their effect on the health, safety, and rights of the children served by a licensed program. See Minn. Stat. § 245A.07, subd. 1. The commissioner's revocation order is fair in light of the Glewwes' failure to appreciate the importance of complying with licensing requirements and their continued violation of the rules despite numerous correction orders and two probationary periods. Significantly, the record contains no indication that a fine, suspension, further education, or withholding state funds, although permitted, would have ensured future compliance.
Finally, the Glewwes argue that the revocation of their license offends principles of equal protection and fundamental fairness because they were treated more harshly than other similarly situated licensees. The record contains no evidentiary support for the Glewwes' disparate-treatment claim, however. There is no indication that the cases on which the Glewwes rely to support their disparate-treatment claim involved chronic violations of licensing requirements or licensees whose licenses had been placed on probation twice before.
While we might have imposed a different sanction, we cannot conclude, on this record, that the commissioner clearly abused his discretion in revoking the Glewwes' license. In re Insurance Agent License of Casey, 543 N.W.2d 96 (Minn. 1996) (reinstating commissioner's license-revocation order on grounds that record did not support conclusion that commissioner abused his discretion). The record shows that the Glewwes violated capacity rules on 12 different occasions and had their license placed on probation twice. Cf. License of Haugen, 278 N.W.2d at 80-81 (reversing Commissioner of Securities' order revoking real-estate broker's license on finding that broker had not in fact violated trust-fund standards, procedure commissioner followed was unfair because it deprived broker of opportunity to present argument, and revocation was too harsh because broker had been minimally involved with alleged trust-fund violations and had followed his attorney's advice in good faith); Licenses of Kane, 473 N.W.2d at 877 (reversing Commissioner of Commerce's revocation of insurance licenses on grounds that record contained no evidence of prior questionable conduct by agents, victims did not rely on agents' alleged violations and were ultimatelycompensated for their losses, and company received "little more than a slap on the wrist, while its agents in the field [were] expected to suffer the loss of their licenses"). And, significantly, the administrative law judge found no indication that the Glewwes would comply with capacity rules in the future. Under the circumstances, therefore, we conclude that whether revocation is too severe a penalty — i.e., whether it exceeds what is necessary to protect the public and deter future violations — is a matter of judgment, about which the commissioner reasonably exercised his discretion.
IV.
The Glewwes last claim that the commissioner is estopped from revoking their license because licensing workers misled them as to the seriousness of the capacity violations that led to revocation. We disagree. The record contains abundant evidence that licensing workers repeatedly emphasized the seriousness of capacity violations and warned the Glewwes that additional violations would lead to negative licensing action.