CHARLOTTE COUNTY v. SOUTHWEST FLORIDA WATER MANAGEMENT DISTRICT

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VIII. Challenges to Other Existing Rules

A. Rules Concerning Modification and/or Revocation of Permits - Rules 40D-2.331(3) and 40D-2.341

1. Modification

1112. Rule 40D-2.331(3), F.A.C. provides as follows:

The Governing Board shall order the modification of any permit if it is shown that the use or disposition of water is detrimental to other water users or to the water resources or no longer meets the conditions for issuance identified in Rule 40D-2.301.

1113. Under this rule, the District contends it can reduce or even completely eliminate the permitted water allocation of an unexpired water use permit. As of the date of the hearing, the District had never actually recalled a WUP for modification of the permitted quantity.

1114. Pinellas claims that this rule runs afoul of Section 373.239(1), F.S., which allows "a permittee" to seek modification of an existing permit.

1115. Section 373.239, F.S., provides as follows:

1116. As discussed in the Conclusions of Law, Pinellas incorrectly reads this statute as a total prohibition on the District modifying a water use permit on its own initiative.

2. Revocation

1117. Rule 40D-2.341(1) provides as follows:

1118. Subsection 2 of the rule lists five factors for determining whether a use is no longer reasonable beneficial or in the public interest. This subsection provides that the District Governing Board "shall consider": (1) any material false statement in an application or in a statement required of the user; (2) any willful violation of the terms or conditions of the permit; (3) any violation of Chapter 40D-2 which is not resolved; (4) non-use of the water for 2 years or more unless due to extreme hardship; and (5) whether the withdrawal causes "significant adverse impacts" to the water resources, environmental systems, or existing legal users, and the Permittee does not modify the activities or satisfactorily mitigate the impacts.

1119. Section 1.13 of the Basis of Review corresponds to Rule 40D-2.341 and includes similar grounds for revoking a permit. It states that a WUP may be revoked, following notice and hearing, for the following reasons: (1) non-use of the water granted in the WUP for a period of at least 2 years, unless the permittee can demonstrate extreme hardship; (2) false statements by the permittee in the WUP application or supporting materials; (3) if the withdrawal of water causes significant adverse impacts to the water resources, environmental systems, or existing legal users, and the permittee does not modify the activities or satisfactorily mitigate the impacts; and (4) if the permittee willfully violates any of the terms or conditions of the WUP or any provision of Ch. 40D-2, F.A.C.

1120. Pinellas contends that Rule 40D-2.341 and BOR Section 1.13 "exceed the District's rulemaking authority, and/or enlarge, modify, or contravene the specific provisions of law implemented." In this regard, Pinellas argues that Section 373.243, F.S., is the only specific provision in Chapter 373 that authorizes the reduction or termination of permitted water allocations before the permit expires.

1121. Section 373.243, F.S., provides as follows:

1122. Pinellas claims that the District's rules include reasons for revocation of WUPs which are not included in Section 373.243, F.S., and the statute includes reasons for revocation of WUPs which are not included in the rules. These issues are discussed in the Conclusions of Law.

1123. In evaluating the District's rules regarding modification and revocation of permits, it must be kept in mind that the District has broad authority to adopt a permitting program consistent with the public interest. Section 373.219, F.S., allows imposition of permit conditions to assure that a use is consistent with the overall objectives of the District and is not harmful to the water resources of the area. This authority must be exercised within the statutory framework, which was intended to provide users with a reasonable degree of certainty as to their rights for the specified permit term.

1124. Pinellas complains that the District's rules do not define what is meant by a "significant adverse impact" to water resources as used in Rule 40D-2.341(2)(e) and BOR Section 1.13. Pinellas points out that these provisions refer to "significant adverse impacts," whereas Rules 40D-2.301(1)(b), (c), (h), and (i) use the terms "adversely impact" or "adverse environmental impacts." These contentions are not persuasive. While reasonable hydrologists could differ as to whether a particular impact constitutes a "significant adverse impact" to water resources, the rule is not invalid simply because it provides some latitude for the exercise of professional judgment.

B. Standard permit conditions - Rule 40D-2.381(3)

1125. To implement Section 373.243, F.S., the District has adopted by rule a number of standard permit conditions. These standard permit conditions are found in Rule 40D-2.381, F.A.C. The District places these standard permit conditions on every WUP it issues. The District also has special permit conditions that it will place on a WUP depending on the particular circumstances.

1126. Rule 40D-2.381(3)(a) provides in pertinent part as follows:

1127. Pinellas contends that the standard permit conditions set forth in Rule 40D-2.381(3)(a), (b), (l) and (m) exceed the District's rulemaking authority, and/or enlarge, modify, or contravene the specific provisions of law implemented.

1128. The standard permit conditions challenged by Pinellas can be divided into two categories. First, subsections (a) and (b) are challenged on the grounds that they impermissibly add new grounds to those listed in the statute for revoking a water use permit and improperly authorize the District to modify a water use permit on its own initiative.

1129. Rule 40D-2.381(3)(a) purports to authorize the District to impose a standard permit condition authorizing the District to revoke a WUP if it later finds that a statement in the application or supporting data is untrue and inaccurate or if the permittee fails to comply with Chapter 373, Chapter 40D, or a permit condition. This subsection is essentially just a reiteration of the authority granted in Section 373.243(1), F.S. While the rule does not specifically require a demonstration that a violation of permit conditions was willful, as does the statute, the rule can and should be read in pari materia with the statute. Similarly, the rule does not include the one-year revocation time limit in Section 373.243(3) for violating a provision in Chapter 373. The rule can and should be applied consistent with that limitation.

1130. Subsection (b) of the Rule purports to authorize the District to impose a standard permit condition that the District can modify or revoke a permit if it can demonstrate that the use is no longer a reasonable beneficial use, is no longer in the public interest or impacts an existing legal use of water. While this authority is not directly spelled out in the statute, the District claims it is consistent with the broad authority granted to it to regulate the resource in the "public interest" and to ensure the viability of the resource. Authority for this condition can also be found in Section 373.171, F.S., which authorizes the District to prevent uses which have ceased to be reasonable-beneficial. However, this authority is limited by subsection (3) of the statute which provides that no modification of an existing use can be required unless it is shown that the use to be modified is detrimental to other water uses or to the water resources of the state.

1131. Section 373.175(2), F.S., authorizes the District to declare water shortage areas and impose restrictions on "one or more uses of the water resource as may be necessary to protect the water resources of the area from serious harm." When the District utilizes this statute and declares a water shortage area, the District's decision to revoke or modify a permit must be reviewed in the context of the regional regulatory decisions. As discussed in more detail in the Conclusions of Law, it is sometimes difficult to reconcile the various statutory provisions while also recognizing the broad grant of rulemaking authority to the District. To the extent possible, the statutory provisions should be construed in a manner that gives meaning to each provision.

1132. Second, with respect to subsections (l) and (m) of Rule 40D-2.381(3), as set forth in Sections VI H and I and in the Conclusion of Law, these provisions grant unbridled discretion to the District because they purport to require a permittee to mitigate certain impacts "to the satisfaction of the District" without any basis for meaningful review. The District contends that, because the exercise of its discretion is subject to the Administrative Procedures Act, Chapter 120, F.S., it is acceptable. However, without a delineation of the factors that will be considered and the standards that will be utilized, there is no basis to evaluate the exercise of that discretion. In view of this conclusion, the other challenges to these provisions are moot and merit only brief discussion.

1133. Pinellas contends that the permit conditions contained in subsections (l) and (m) are invalid because they require a permittee to mitigate withdrawal impacts that are not directly the result of interference with existing legal uses of water, and/or are not based upon a minimum level or flow established pursuant to Section 373.042 or the reservation of a quantity of water pursuant to Section 373.223(3). Pinellas also contends that these conditions elevate property boundaries and land ownership to a level not permitted by Chapter 373. These contentions are not persuasive for the reasons set forth in Sections VI-B, VI-E and in the Conclusions of Law of this Final Order.

1134. Rule 40D-2.381(3)(b) appears to give the District the authority to revoke any permit for impacting a legal use of water. However, the testimony indicated that, under the District's interpretation of the three prong test, permits for existing uses of water that predated the advent of the water use permitting program are deemed to automatically meet the provision regarding interference with legal uses. Assuming that this interpretation is valid, Rule 40D-2.381(3)(b) creates an ambiguous situation where the permit condition could require mitigation even when the permittee, under the District's statutory interpretation, would not have to be concerned about its impacts on other uses. Such a scenario is unacceptably vague and ambiguous.

C. Modification of Existing Permits in the NTB - Rule 40D-2.801(3)(c)3

1135. Rule 40D-2.801(3)(c)3 provides as follows:

1136. In BOR Section 7.3, the District set forth special water use permitting rules for the NTB WUCA. This section provides, in part, as follows:

1137. These provisions were implemented by written notice to all permittees within the NTB WUCA that their permits were being modified and that they would be subject to the NTB WUCA rules. The notice included a Notice of Rights advising the permittee of the right to request an individual hearing to contest these modifications. No such requests were filed.

1138. As part of its challenges in this proceeding, Pinellas has alleged that the District lacks authority to adopt a rule modifying permits in this manner. Pinellas argues that such modifications cannot be made absent a request from the permittee or a demonstration that the water use is detrimental to other water users or to water resources. The District argues it must have the ability to modify permits without the permittee's consent in order to correct unanticipated problems. Without such authority, the District says it would be unable to address potentially serious impacts that may arise when, for example, the computer modeling done during the permit review process proves to have been inadequate to predict actual impacts. As discussed above and in the Conclusions of Law below, Pinellas' interpretation of the statutes is overly restrictive. The District clearly has authority as part of a declaration of a water resource caution area to modify classes and/or individual permits.¹⁴⁷

D. Water Shortage Declarations - Rule 40D-2.511

1. In general

1139. Pinellas has challenged the District's rules regarding the establishment of water use caution areas.

1140. Rule 40D-2.511, F.A.C., provides as follows:

1141. The District has adopted additional water shortage regulations in Chapter 40D-21, F.A.C. Rules 40D-21.531, 40D-21.541 and 40D-21.571 designate classes or classifications of water sources and water use that can be used to implement water shortage restrictions under Rule 40D-2.511. Chapter 40D-21 does not provide for regulation or restriction of individual permits or permittees. However, the District interprets Rule 40D-2.511 as including such authority.

1142. There are different sections in Chapter 373 that provide authority to the districts to declare water shortages and/or issue emergency orders. Rule 40D-2.511 cites only Section 373.246, F.S., as the law being implemented. In challenging this rule, Pinellas argues that the cited statute only authorizes the District to impose restrictions on one or more "classes of water uses". See, Section 373.246(3), F.S. Pinellas argues that the District must adopt and utilize a classification of water uses in order to impose any restrictions under this statute.

1143. In support of its rule, the District points to, among other things, its authority under Section 373.175(2), F.S., which authorizes the governing board to impose restrictions "on one or more users of the water resource as may be necessary to protect the water resources of the area from serious harm." The District argues that this statutory provision should also be considered in evaluating the challenged rule.¹⁴⁸

1144. It is not clear why two separate statutory sections exist regarding the authority of the District to declare water shortages and/or emergency orders. To the extent possible, the statutes should be interpreted consistently. While Section 373.246(3) references "classes" of water use and Section 373.175(2) authorizes the imposition of restrictions on one or more individual uses, there appear to be no other pertinent substantive differences between the two statutory provisions. Pinellas' interpretation that the District cannot impose restrictions on individual users would create an inconsistency.

1145. Pinellas' also contends that Rule 40D-2.511 contravenes Section 373.171(2), which Pinellas argues creates a prioritization that requires the District to impose restrictions on more recent uses of water before any restrictions can be imposed on long-standing uses. Section 373.171(2) requires the District's rules to "act with a view to full protection of the existing rights of water in this state insofar as is consistent with the purpose of this law." [emphasis supplied]. The purpose of the law clearly includes the protection of the water resources. (See e.g., Section 373.171(3) which prohibits "any modification of existing use or disposition of water in the district unless it is shown that the use or disposition proposed to be modified is detrimental to other water users or to the water resources of the state.")

1146. Moreover, as discussed in more detail in the Conclusions of Law below, the Legislature in adopting the Water Resources Act in 1972, mandated that all uses of water be regulated through a permitting scheme. While Section 373.171 predates the adoption of the Water Resources Act, it must be interpreted consistently with that statute. A prioritization of users based upon the date a use began is not clearly evident in the statute and, in fact, would be contrary to the legislative scheme to regulate uses based upon permits of specific duration with a goal towards allocating water to those uses most in the public interest.

2. Rules 40D-2.801(2)(e) and (f)

1147. Pinellas has also challenged some of the factors that the existing rules direct the Governing Board to consider in declaring a water shortage and/or establishing a water use caution area.

1148. Rule 40D-2.801(2)(e) provides as follows:

1149. Pinellas contends that subsection (e) of the rule exceeds the District's grant of rulemaking authority in Section 373.171 by authorizing the District to consider offsite land uses in deciding whether to establish a water use caution area. Pinellas has not proven that this rule elevates property boundaries and land ownership to a level not permitted by Chapter 373. In order to fully assess the nature and extent of a water crisis, its likely impact and duration, and possible ways to resolve it, the District must have the authority to consider land uses in the area.

1150. Pinellas contends that subsection (f) of this rule is unduly vague and would authorize the Board to consider non-water related resources. This provision was intended to provide the Board with flexibility since it is impossible to fully anticipate all of the factors that may be involved in a water shortage. This provision ensures that the Board's consideration of a factor that is not specifically delineated in the rule will not serve as a basis for invalidating the Board's action. The Board's action is subject to review pursuant to Section 373.175(4) and 373.246(8). Pinellas has not carried its burden of showing that this provision is vague, arbitrary or otherwise invalid.

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