CHARLOTTE COUNTY v. SOUTHWEST FLORIDA WATER MANAGEMENT DISTRICT

PREVIOUS SECTION

1176. The Division of Administrative Hearings has jurisdiction over the subject matter and the parties to this proceeding pursuant to Sections 120.54, 120.56 and 120.57, F.S. (1995).

1177. Any substantially affected person may seek an administrative determination of the invalidity of a proposed or existing rule on the grounds that the proposed or existing rule is an invalid exercise of delegated legislative authority. See, Sections 120.54(4)(a), and 120.56(1), F.S. In these consolidated cases, challenges have been brought to a number of proposed provisions in the SWUCA Rules¹⁵⁴ and to certain portions of the District's existing WUP rules.

I. Standing

1178. With the exception of Pinellas County's challenges to the SWUCA rules, the parties have stipulated to the standing of all Petitioners to challenge the proposed and existing rules on the grounds set forth in their petitions. See, Section 120.54(2)(d), F.S.; Home Builders & Contractors Association of Brevard, Inc. v. Department of Community Affairs, 585 So.2d 965 (Fla. 1st DCA 1991).

1179. The District claims Pinellas' interests are not sufficiently affected by the SWUCA Rules to confer standing. While Pinellas does not currently own a well within the proposed SWUCA boundaries and does not directly receive any water from the SWUCA, its interests are not too remote or conjectural for standing purposes. See, In the Matter of Surface Water Mgmt. Permit, 515 So.2d 1288 (Fla. 4th DCA 1987), rev. denied, 525 So.2d 876 (Fla. 1988), rev. denied, 525 So.2d 881 (Fla. 1988).

1180. By virtue of its membership in West Coast and Pinellas' resulting obligations and relationships with West Coast and its member governments, Pinellas is substantially affected by any proposed rules which influence, regulate, or restrict the amount of water available from West Coast's South Central Hillsborough Regional Wellfield which is located in the SWUCA. Under the SWUCA Rules, the permitted allocation of this facility may be reduced by the proposed per capita limits. In addition to per capita reductions, the SWUCA Rules also impose additional operational requirements, such as more frequent water audits, stricter reuse requirements, and stricter desalination requirements.

1181. Pinellas points out that the possibility of linking South Central with West Coast's Interconnected System (which does supply water directly to Pinellas) is being considered. The District claims that an interconnection of South Central with West Coast's regional system is speculative at best and if it were to occur, any interconnection would likely be for the purpose of supplying water to the South Central service area from the regional system and not vice versa. Furthermore, the District asserts that under some current projections, Pinellas will not face a deficit in meeting its water supply needs until the year 2010. However, Pinellas is substantially affected by any rules that potentially impact upon West Coast's ability to meet the demands of its members.

1182. Because of their responsibility to provide citizens with a safe and adequate water supply, the courts have recognized that counties have a substantial interest in water resources in the district in which they are located and in any proposed water management district activity which "may appear to affect" them. Osceola County v. St. Johns River Water Management District, 486 So.2d 616, 617 (Fla. 5th DCA 1986) approved, 504 So.2d 385 (Fla. 1987); See generally, Ward v. Bd. of Trustees of the Internal Improvement Trust Fund, 651 So.2d 1236 (Fla. 4th DCA 1995) (engineer was not required to prove that he had an existing client in order to obtain standing to challenge rules that would regulate design of dock.)

II. Burden of Proof

1183. Under the Florida Administrative Procedures Act (the "APA") Chapter 120, F.S., an invalid exercise of delegated authority is defined as "an action which goes beyond the powers, functions and duties delegated by the Legislature. A proposed or existing rule is an invalid exercise of delegated legislative authority if any one or more of the following apply:

Section 120.52(8), F.S.

1184. Petitioners have the burden to show by a preponderance of the evidence that the proposed and/or existing rules contravene Section 120.52(8), F.S. See, Agrico Chemical Co. v. Dept. of Environmental Regulation, 365 So.2d 759 (1st DCA 1978), cert. denied sub nom, Askew v. Agrico Chemical Co., 376 So.2d 74; Adam Smith Enterprises, Inc. v. Dept. of Environmental Regulation, 553 So.2d 1260 (Fla. 1st DCA 1989); see also, Department of Labor & Employment Security v. Bradley, 636 So.2d 802, 807 (Fla. 1st DCA 1994).

1185. The burden of proof in a rule challenge proceeding has been summarized as follows:

Grove Isle, Ltd. v. Department of Environmental Regulation, 454 So.2d 571, 573 (Fla. 1st DCA 1994)(citations omitted); accord, Florida League of Cities v. Department of Environmental Regulation, 603 So.2d 1363, 1367 (Fla. 1st DCA 1992). Under the APA in existence at the time of this proceeding, the District has no burden to demonstrate anything with respect to the challenged provisions if the Petitioner's burden is not met.¹⁵⁵

1186. Since Petitioners have invoked each of the subsections of Section 120.52(8) in their various challenges, it is appropriate to summarize how certain of these provisions have been interpreted and applied.

1187. A petitioner challenging a rule as arbitrary and capricious has a difficult burden to meet. Dravo Basic Material Co., Inc. v. Department of Transportation, 602 So.2d 632, 633 (Fla. 2d DCA 1992). A capricious action is one which is taken without thought or reason, or irrationally. An arbitrary decision is one not supported by facts or logic, or despotic. Agrico, supra, 365 So.2d at 763. Whether a rule is arbitrary or capricious is a fact-intensive determination. Dravo, supra, 602 So.2d at 633.

1188. The standard for determining whether a rule is arbitrary or capricious is not whether the rule is supported by competent substantial evidence. See, Adam Smith, supra, 553 So.2d at 1274 n. 23. The hearing officer must determine whether the District; (1) has considered all the relevant factors; (2) has given actual, good faith consideration to those factors; and (3) has used reason rather than whim to progress from consideration of these factors to its final decision. Id. Rules are not arbitrary or capricious because Petitioners believe there are better ways to achieve the legislative objective, or that there are less burdensome methods, or because there are other means available to reach the objective. Id.

1189. A rule is impermissibly vague if it fails to establish adequate standards for agency decisions or is written in such a way that persons of common intelligence must necessarily guess at its meaning and differ as to its application. State v. Cumming, 365 So.2d 153 (Fla. 1978) (wildlife permit rules vague for failing to define key words).

1190. The District points out that some courts have held that "the test for vagueness is more lenient where an administrative rule, rather than a penal statute, is being examined." See, City of St. Petersburg v. Pinellas County Police Benevolent Association, 414 So.2d 293, 294 (Fla. 2d DCA 1982)(municipal disciplinary rule prohibiting "improper conduct" on or off the job which would affect relationship to job was not unconstitutionally vague or overbroad; language provided necessary flexibility). However, the principle enunciated in Cummings, supra, i.e., that a rule is impermissibly vague if it "either forbids or requires the doing of an act in terms so vague that men of common intelligence must necessarily guess at its meaning and differ as to its application," has been applied to rules in several recent decisions. See, Witmer v. Department of Business and Professional Regulation, 662 So.2d 1299, 1302 (Fla. 4th DCA 1995), quoting, Bouters v. State, 659 So.2d 235, 238 (Fla. 1995), cert.denied., -- U.S. --, 116 S.Ct. 245, 133 L.Ed.2d 171 (1995). See also, Department of Health and Rehabilitative Services v. Health Care & Ret. Corp., 593 So.2d 539 (Fla. 1st DCA 1992).

1191. An agency has the implied authority to adopt criteria necessary to implement its legislative mandates. Department of Professional Regulation, Board of Professional Engineers v. Florida Society of Professional Land Surveyors, 475 So.2d 939, 942 (Fla. 1st DCA 1985); see also, General Telephone Company of Florida v. Marks, 500 So.2d 142 (Fla. 1986) (rule determining gross profit did not exceed delegated legislative authority even though the enabling statute did not specifically authorize the method chosen; some discretion must be given to regulatory bodies to promulgate the detailed rules that expand upon and implement the legislative directives). The District contends that in determining whether a rule is unlawfully vague, the particular regulatory objectives sought to be accomplished and whether the agency can reasonably provide a greater degree of specificity without compromising its ability to effectively administer the regulation on a case-by-case basis should be taken into account. In this regard, the District notes "the provisions of statutes enacted in the public interest should be construed liberally in favor of the public." Department of Environmental Regulation v. Goldring, 477 So.2d 532, 534 (Fla. 1985); Dept. of State v. Hamilton, 388 So.2d 561 (Fla. 1980). In addition, the District emphasizes the well-established principle that an agency's interpretation of statutes which govern the agency's statutory duties and responsibilities is to be given great weight and should not be rejected unless clearly erroneous. See, Ft. Pierce Utilities v. Florida Public Service Commission, 388 So.2d 1031, 1035 (Fla. 1980); Save the St. Johns v. St. Johns River Water Management District, 623 So.2d 1193, 1202 (Fla. 1st DCA 1994). An agency's interpretation need not be the only possible interpretation of a statute, or the most desirable one, but only within the range of possible interpretations.¹⁵⁶ Moorhead v. Dept. of Professional Regulation, 503 So.2d 1318, 1320 (Fla. 1st DCA 1987); Florida Waterworks Association v. Florida Public Service Commission, 473 So.2d 237, 240 (Fla. 1st DCA 1985).

1192. Nonetheless, even a broad grant of rulemaking authority does not insulate from challenge an agency's rules that confer unbridled discretion. "An agency rule which creates discretion not articulated in the statute it implements must specify the basis on which the discretion is to be exercised. Otherwise, the "lack of...standards...for the exercise of discretion vested under the...rule renders it incapable of understanding...and incapable of application in a manner susceptible of review'...an agency rule that confers standardless discretion improperly insulates agency action from judicial scrutiny." Cortes v. State Bd. of Regents, 655 So.2d 132, 138 (Fla. 1st DCA 1995) citing Staten v. Couch, 507 So.2d 702 (Fla. 1st DCA 1987). Section 120.52(8)(d) requires an agency to establish adequate standards for decisions in its rule; failure to do so renders the rule invalid. Id.

1193. In Merritt v. Dept. of Business and Professional Regulation, 654 So.2d 1051 (Fla. 1st DCA 1995) the court determined that a Board of Chiropractic rule purporting to elaborate on statutory criteria by deferring all judgment to the discretion of peer review committee members was vague as well as arbitrary and capricious. The court noted as follows:

Merritt, supra, 654 So.2d at 1054

1194. In its proposed final order, the District substantially relies on Hasper v. Department of Administration, 459 So.2d 398 (Fla. 1st DCA 1984). The District claims that Hasper stands for the proposition that "a rule can only be found to be arbitrary and capricious...if its basic structure ensures that it will be applied in this manner" and "the mere potential for arbitrary and capricious application is not a basis for invalidating a rule." District's proposed Conclusions of Law, p. 17 n. 15. In Hasper, a rule involving termination of senior management employees from state employment was upheld where it did not conflict with the enabling legislation.

Hasper, supra, 459 So.2d at 400

1195. The Hasper decision was rendered before the legislature enacted the definition of "invalid exercise of delegated authority" in Section 120.52(8). In addition to the arbitrary and capricious standard discussed in Hasper, the statutory definition now provides for invalidation of a rule if it is "vague, fails to establish adequate standards for agency decisions or vests unbridled discretion in the agency". See, Section 120.52(8)(d), F.S. When placed in the proper context, Hasper establishes that a rule is not automatically invalid simply because it could be improperly applied in a manner inconsistent with the statutory authority. However, this principle presupposes that the rule is not vague and does not otherwise contravene Section 120.52(8). Cf., Cortes, supra, 655 So.2d 132; Health Care and Retirement Corp. of America, supra, 593 So.2d 539.

1196. At an evidentiary hearing pursuant to Section 120.54 or 120.56, a petitioner can challenge an agency's scientific or technical conclusions, but an agency's choice of a particular regulatory standard should not be invalidated simply because there are other choices that would have been consistent with the legislative goals. The burden is on the petitioner to establish that the agency's choice was arbitrary or otherwise unlawful. See, Board of Trustees of Internal Improvement Trust Fund v. Levy, 656 So.2d 1359 (Fla. 1st DCA 1995).

Id. at 1363.

1197. The District argues that when a challenge is aimed at the details of a regulation rather than its purpose and principle, the challenger assumes a particularly heavy burden in its attack upon the rule. See, Jax Liquors, Inc. v. Division of Alcoholic Beverages and Tobacco, Department of Business Regulation, 388 So.2d 1306, 1307 (Fla. 1st DCA 1980).¹⁵⁷ It is not clear how or whether this principle actually changes a petitioner's burden. Arguably, it simply reflects that deference should be accorded to an agency in the exercise of its lawful rulemaking authority clearly conferred or fairly implied and consistent with its general statutory duties. See, Dept. of Professional Regulation v. Durrani, 455 So.2d 515, 517 (Fla. 1st DCA 1984); See also, Florida League of Cities, supra, 603 So.2d at 1368-1369.

1198. Determining the degree of deference to be accorded an agency in highly complex scientific areas can be problematic. Appellate courts have recognized that "considerable - if not extraordinary - deference" should be given to an agency's exercise of delegated discretion in respect to technical and scientific matters. See, Island Harbor Beach Club, Ltd. v. Department of Natural Resources, 495 So.2d 209, 223-224 (Fla. 1st DCA 1986), rev. denied, 503 So.2d 327 (1987). In affirming a hearing officer's decision upholding the Department of Natural Resources' coastal construction control line rule for Charlotte County, the Island Harbor court observed:

Id. at 223-224

1199. Similarly, in St. Joseph Land and Development Co. v. Florida Department of Natural Resources, 596 So.2d 137 (Fla. 1st DCA 1992), rev. denied, 604 So.2d 487 (Fla. 1992), the court affirmed a hearing officer's ruling that the complex computer modeling methodology employed by the agency in establishing a coastal construction control line was not arbitrary or capricious. The hearing officer found that:

Id. at 139.

1200. Both of these cases involved appeals after an extensive administrative proceeding in which the agency's position was upheld. The standard of review on appeal is different than the standard to be applied at the hearing level. At the administrative hearing level, the standard to be applied is whether a preponderance of the evidence establishes that the rule constitutes an invalid exercise of authority as that term is defined in Section 120.52(8), F.S. See, Adam Smith, supra, 553 So.2d at 1274 n.23.

1201. In connection with water regulation in particular, the District cites Harloff v. City of Sarasota, 575 So.2d 1324 (Fla. 2d DCA 1991) rev. denied 583 So.2d 1035, where the court determined that the District was entitled to restrict a requested water allocation for agricultural irrigation based upon potential adverse impact to the City of Sarasota's Verna wellfield, which was a prior existing permitted use. The court determined that there were important policy matters and conclusions of law that were best left to the agency.

Id. at 1327-1328.

1202. The District also cites to several cases for the proposition that special considerations arise when the matter under review is highly infused with policy considerations. See, McDonald v. Department of Banking and Finance, 346 So.2d 569, 584 (Fla. 1st DCA 1977), app. after remand, 361 So.2d 199 (Fla. 1st DCA 1978) cert. denied, 368 So.2d 1370 (1979) (findings of fact by the hearing officer which were charged with policy considerations for which the agency was responsible were accorded comparatively little weight in determining whether competent substantial evidence supported the substituted findings of the agency); Hammond v. Department of Transportation, 493 So.2d 33, 35 (Fla. 1st DCA 1986) (findings of fact by the hearing officer were entitled to less deference insofar as they address issues which are not susceptible of ordinary proof or which are dependent upon matters of opinion infused by policy considerations within the ambit of the agency's expertise); Baptist Hospital, Inc. v. State, Department of Health & Rehabilitative Services, 500 So.2d 620, 623 (Fla. 1st DCA 1986) ("[M]atters infused with overriding policy considerations are left to agency discretion"); cf., Peoples Bank of Indian River County v. State, Department of Banking & Finance, 395 So.2d 521, 524 (Fla. 1981) (agency accorded wide discretion in determining whether statutory criteria which involved policy considerations within the special expertise of the agency were satisfied).

1203. Again, these cases involved appellate review of agency action following Section 120.57 proceedings and do not address the unique factors involved in a rule challenge proceeding and/or the deference that should be accorded the agency by a hearing officer at a proceeding under Section 120.54 or 120.56. See, Fernandez and Bryant, McDonald Revisited: The Development of the Deference Doctrine in Florida Administrative Law, Fla. Bar Jour., Dec. 1992, p.70.

1204. While it is difficult to reconcile the various holdings of the appellate decisions discussed above, the concerns addressed in these decisions are resolved when the nature and purpose of this proceeding is kept in proper focus. The role of an administrative law judge in a rule challenge proceeding is not to substitute his judgment for that of the agency. As noted in Harloff, if the policy perspectives of individual judges or hearing officers are allowed to unduly intrude into the establishment of minimum flows and levels for hundreds of lakes and streams throughout the District, it would be impossible to achieve consistency. Nonetheless, Chapter 120 imposes requirements on an agency's rulemaking which are properly the focus of this proceeding.

1205. While construction of a statute by an agency charged with its administration is entitled to great weight and should not be rejected unless clearly erroneous, Florida Hospital Association v. Health Care Cost Containment Board, 593 So.2d 1137 (Fla. 1st DCA 1992), that does not mean that an agency's construction of a statute is exempt from challenge.

State Bd. of Optometry v. Florida Soc'y of Opthalmology, 538 So.2d 878, 885 (Fla. 1st DCA 1988), rev. denied, 542 So.2d 1333 (Fla. 1989).

1206. The deference granted an agency's interpretation is not absolute.

Dept. of Natural Resources v. Wingfield Dev. Co., 581 So.2d 193, at 197-98 (Fla. 1st DCA 1991).

1207. An agency cannot determine its own jurisdiction. See, Saddlebrook Resorts, Inc. v. Wiregrass Ranch, Inc., 630 So.2d 1123 (Fla. 2d DCA 1993). Any attempt to extend or enlarge an agency's jurisdiction beyond its statutory authority is invalid. See e.g., Cataract Surgery Center v. Health Care Cost Containment Board, 581 So.2d 1359 (Fla. 1st DCA 1991).

1208. An agency's rule cannot be contrary to or enlarge a provision of a statute, particularly the statute cited as the law implemented, "no matter how admirable the goal may be. Capeletti Bros. v Department of Transportation, 499 So.2d 855, 857 (Fla. 1st DCA 1986) rev. denied, 509 So.2d 1117 (Fla. 1987)(agency rule containing procedures which facilitated participation of women in agency contracts was invalid because implementing rule specifically stated "disadvantaged groups" as defined by federal law which did not include women). See also, Department of Health and Rehabilitative Services v. Florida Psychiatric Society, Inc., 382 So.2d 1280 (Fla. 1st DCA 1980). An agency rule which attempts to enlarge, modify, or contravene the provisions of a statute is invalid. Booker Creek Preservation, Inc. v. Southwest Florida Water Management District, 534 So.2d 419 (Fla. 5th DCA 1988) rev. denied. 542 So.2d 1334 (Fla. 1989)(rule which established permitting criteria for isolated wetlands was invalid because it included certain exemptions not authorized by the statute); see also, Department of Business Regulation v. Salvation Ltd., Inc., 452 So.2d 65 (Fla. 1st DCA 1984)(agency rule regulating beverage licenses was invalid where it imposed additional criteria not found in statute.)

1209. A rule must actually implement at least some of the particular statutes cited by the agency in the "Law Implemented" portion of the rule. See, Department of Professional Regulation v. Manasota-88, Inc., 584 So.2d 133 (Fla. 1st DCA 1991). When determining whether an agency has exceeded the "Statutory Authority" cited, the agency's entire statutory framework may be considered. Cataract Surgery Center, supra, 581 So.2d at 1361.

1210. Pinellas argues that the District "is not a constitutional body but, rather, a mere creature of statute". See, City of Cape Coral v. GAC Utilities, 281 So.2d 493, 495 (Fla. 1973); Gulfstream v. Department of Business Regulation, 443 So.2d 113, 117-118 (Fla. 3d DCA 1983) approved 441 So.2d 627 (Fla. 1983). Thus, Pinellas claims the District's powers, duties and authorities are those, and only those, that are conferred expressly or implied by statute and any reasonable doubt as to the lawful existence of a particular power that is being exercised by an agency must be resolved against the agency, see, Southern Armored Car Services, Inc. v. Mason, 167 So.2d 848 (Fla. 1964), and the further exercise of the power should be arrested. See, State ex rel. Burr v. Jacksonville Terminal Co., 71 Fla. 295, 71 So. 474 (1916); State ex rel. Greenburg v. Florida State Board of Dentistry, 297 So.2d 628, 636 (Fla. 1st DCA 1974). Most of the decisions cited by Pinellas predate the enactment of a comprehensive APA and provide little guidance in a rule challenged proceeding such as this. See, Chapters 74-191, and 91-30, Laws of Florida. Moreover, the principles cited by Pinellas must be balanced against the broad authority delegated to the water management districts in Chapter 373 and the well-established principle that an agency interpretation of a statute it administers need only be within the range of possible interpretations and not necessarily the sole permissible one or even the most desirable. See, Stuart Yacht Club and Marina v. State, Department of Natural Resources, 625 So.2d 1263, 1267 (Fla. 4th DCA 1993); Florida League of Cities, supra, 603 So.2d at 1369.

NEXT SECTION