SWUCA Court Opinion
Second District Court of Appeal
Rules In Favor Of District On All Points

Background

The Southern Water Use Caution Area (SWUCA) encompasses eight counties - DeSoto, Hardee, Manatee, Sarasota, southern Hillsborough county, and portions of Polk, Highlands and Charlotte counties within the District. Water withdrawals in the SWUCA have caused regional movement of the salt water interface and lowering of lakes in Highlands and Polk Counties. In November 1994, the Governing Board proposed a comprehensive set of rules to significantly halt salt water intrusion, to stabilize lake levels and limit the regulatory impact on the region's economy and existing legal users.

Challenges to the Rules

Upon approval of the proposed rules by the Governing Board, 25 petitions were filed challenging them and many of the fundamental rules defining the water use permitting program District-wide. Discussions between the District and the petitioners resulted in 17 of the challenges being dropped. 

More than 70 issues were covered in the Final Order of the Administrative Law Judge (the "ALJ"), with the District prevailing on a significant majority. However, the Order invalidated several important proposed SWUCA rules and existing water use permitting rules, prompting the District to file an appeal.

Opinion of the Second District Court of Appeal

The Court ruled in favor of the District on all 13 points on appeal. The issues on appeal and the Court's findings are described below. These findings are supportive of the District's strategy not only for management of the water resources in the SWUCA, but also District-wide. The Court found certain issues: 1) whether socio-economic factors in addition to science may be taken into account in setting a minimum level or flow; 2) whether existing users can be preferred over new users; and 3) whether Hardee and DeSoto Counties had a right to additional hearings before the Governing Board, were moot, as argued by the District; therefore they are not included in this discussion. The Court's Opinion can be found at jud10.flcourts.org/2ndDCA/sept00/2d97-1626.htm.

1. Three Prong Test To Obtain Permit Affirmed - Chapter 373, Florida Statutes states that in order to obtain a water use permit an applicant must satisfy a "three prong test". The three prong test requires that the proposed use of water must be (i) reasonable-beneficial, (2) not interfere with an existing legal use of water and (3) be consistent with the public interest. The counties argued that the District had to apply the two prong test (reasonable-beneficial and allowable under common law) to uses preexisting Chapter 373 and not the three prong test. The court ruled that the two prong test in the statutes was not intended to last forever but was a transitional procedure when converting from the common law use to a permitted use. 

2. Water Use Permitting Criteria Affirmed - The District's water use permitting rules require applicants to meet 14 criteria (known as "conditions for issuance") in order to demonstrate that the three prong test has been satisfied. These conditions were challenged on several bases including:
   
   a) The Administrative Law Judge (ALJ) held that the District cannot require that all fourteen conditions be met, rather there had to be a balance test applied. The Court reversed the ALJ so that the District can require that all 14 conditions be met. The Court stated that only the DEP had the authority to invalidate the requirement as part of its review of existing rules after they are adopted for consistency with the Water Policy Rules.
   
   b) The Court reversed the ALJ's finding that allowing an applicant to mitigate any of the conditions that must be met to obtain a permit "to the satisfaction of the District" was an unbridled exercise of discretion and that therefore the way the District applied the 14 conditions was invalid. The Court found that "to the satisfaction of the District" did not even appear in the rules setting forth those conditions and how to meet them. Rather the applicant may elect to mitigate the adverse impacts its proposed withdrawal may otherwise have had on the environment, water resource or existing legal use. The form of mitigation cannot be prescribed in a rule as it only can be determined on a case by case, site specific basis.
   
   c) The Court ruled that the terms such as "unacceptable" or "adverse" or "significant" as used in the 14 conditions for issuance did not render the conditions invalid due to vagueness. Use of such subjective terms did not render the rules invalid. The Court found that it is acceptable for the rules to allow for the exercise of professional judgment because whether or not an adverse impact will occur is essentially a scientific determination.
   
   d) The Court affirmed the ALJ's determination that the District's Basis of Review (which contains the bulk of the permitting requirements) is valid in that the District may apply the Basis of Review criteria to flesh out the conditions for issuance even though it is adopted by incorporation by reference through 40D-2.091 and not set forth within Rule Chapter 40D-2, Consumptive Use Permitting, Florida Administrative Code.

3. District Has Authority To Require Reuse Feasibility Investigation - The ALJ invalidated part of the rules that required a permit applicant to investigate the feasibility of the use of reclaimed water in lieu of ground water and to use reclaimed water if the District determined that it was feasible. The Court reversed the finding that requiring a permit applicant to investigate the use of reuse was within the statutory authority of the three prong test. It found that the requirements that it be "economically, environmentally and technically feasible," while broad, were site-specific and subject to scientific and technical determinations and were within the definition of reasonable-beneficial.

4. The District Has Authority To Require Desalination Feasibility Investigation - The ALJ invalidated the District's requirement that an applicant consider the economic, environmental and technical feasibility of desalination in lieu of ground water in granting a permit, holding that it was an invalid delegation of legislative authority. The Court reversed, finding that to require applicants with a demand for more than 100,000 gallons per day to undertake the investigation and use of desalination was within the three prong test and was an element of reasonable-beneficial use.

5. The District Has Authority To Require Wholesale Customers To Obtain Permit -The ALJ invalidated the District's requirement that wholesale customers of a public supply permittee obtain a permit so that the per capita water use rate could be enforced. The Court accepted the District's logic that by permitting wholesale public supply customers to evade the permit requirement shifted water conservation to the other customers. The Court found that the definition of consumptive use of water gave the District the authority to require wholesale public supply customers to obtain a permit. It held it was not an unlawful impairment of contract but was balanced against the public interest to conserve water.

6. The District Has Authority To Require Water Conserving Rate Structures - The Court also ruled that the District could require water supply utilities to adopt "water conservation rate structures. The Court found that in any conflicts in section II Consumptive Uses of Water of Chapter 373, Florida Statutes, with other state laws regarding local governments' authority, Chapter 373, Florida Statutes controls. It found no conflict though, holding that requiring a water supply utility to adopt a water conservation rate structure is valid.

7. No Attorneys Fees Due To Challenger - The Court also rejected both of Pinellas' claims for an entitlement to attorney's fees.

Motion For Rehearing, Rehearing En Banc, Clarification And/Or Certification

Pinellas County has filed a Motion for Rehearing, Clarification And/Or Certification arguing that the Court has overlooked or misapprehended points of law and fact. The Motion sets forth about 27 mistakes supposedly made by the Court in considering the 11 issues on appeal (not including the two attorneys' fees issues).

Pinellas County has also requested that the Court certify the following questions as matters of great public importance:

1. What is the limit of a water management district's power to require local governments and utilities to implement reuse projects, desalination projects, and water rate structures?

2. Does the two-prong test of Section 373.226(2), Florida Statutes, govern applications to renew initial permits issued pursuant to section 373.226(3), Florida Statutes?

3. What is the limit of a water management district's power to require water use permits from water users who do not withdraw the water from its natural state in the environment?

The District has filed its Motion in Opposition to Pinellas' Motion on the grounds, among others, that the alleged errors are purely misstatements of the Court's Opinion and that Pinellas's unhappiness with the Court's Opinion is simply not a basis for Pinellas to reargue the case. In addition the questions requested to be certified are open-ended questions seeking advisory opinions or affect only a few, if any, members of the public.