CHARLOTTE COUNTY v. SOUTHWEST FLORIDA WATER MANAGEMENT DISTRICT

The procedural history of the consolidated rule challenges is extensive and complicated. The following orders provide details of important substantive and procedural developments that occurred during the proceedings: Orders dated February 1, February 10, and February 21, 1995 (the "February 1 Order," "February 10 Order," and "February 21 Order," respectively); Order Closing Files Due to Voluntary Dismissal of Petitions and/or Mootness, Consolidating New Cases and Granting Requests to Amend Certain Petitions entered on September 8, 1995 (the "Voluntary Dismissal Order"); and Order Denying Motions For Summary Final Order, Filed By DeSoto and Hardee Counties, Polk County and Citrus Growers Associates, Inc. also entered on September 8, 1995 (the "Order Denying SFO").

The rule controversies began when the District published notice of rulemaking in the August 26, 1994, issue of the Florida Administrative Weekly ("F.A.W.") (Volume 20, Number 34, Pages 4020-4143). The notice stated that the District intended to adopt a set of rules establishing a Southern Water Use Caution Area ("SWUCA") with specific regulatory guidelines governing water use permitting to "prevent further adverse effects resulting from excessive withdrawals" within the proposed SWUCA. The notice also indicated that the District was promulgating a number of "amendments to enhance [existing] water use permitting rules and the Basis [of Review]..." (This portion of the proposals will be referred to as the "District-Wide Enhancements."

During its meeting on August 31, 1994, the District Governing Board solicited written comments from interested parties concerning the proposed rules and instructed District staff to review and consider all written comments. To allow time for interested persons to prepare and submit written comments, the Governing Board agreed to withdraw the proposed rules and republish the notice with any changes made by District staff after reviewing submitted written comments. On September 14, 1994, Pinellas submitted detailed written comments to the District.

On September 23, 1994, the District published a new notice of rulemaking in the F.A.W. (Volume 20, Number 38, Pages 6908-7033); the text of the proposed rules in the September 23 notice was identical to that published in the F.A.W. notice of August 26, 1994. The proposed rules published on September 23, 1994, collectively referred to as the "Initial Proposed Rules," were timely challenged by several Petitioners pursuant to Section 120.54(4), F.S.

On October 25, 1994, the District moved for a 30-day abatement of the rule challenge proceedings to allow the Governing Board additional time to consider modification of the proposed rules. Several Petitioners opposed the District's motion to abate and filed motions to consolidate all pending cases for administrative hearing. After several telephone conference hearings, an Order was entered November 15, 1994, consolidating the pending cases and scheduling commencement of the final administrative hearing for February 1995.

On November 15, 1994, the District Governing Board voted in a special meeting to withdraw the proposed District-Wide Enhancements and to proceed with rulemaking on proposals directly related solely to the SWUCA. The District published the proposals relating to the SWUCA in the December 2, 1994, issue of the F.A.W. (Volume 20, Number 48, Pages 8905-8954). The December 2 publication has been referred to as the "Revised Rules" in the earlier orders entered in these consolidated cases. Most but not all of the Petitioners that challenged the Initial Proposed Rules also filed timely petitions under Section 120.54(4), F.S., challenging the Revised Rules published on December 2, 1994. Some Petitioners filed contemporaneous challenges under Section 120.56 and 120.535 to certain existing rules and unpromulgated policies applied by the District in its review of water use permit applications. All of the issues raised in the various petitions were substantially related to the District's implementation of consumptive use regulation and water resource protection under Chapter 373, F.S. (1993 and 1994 Supp.).²

As discussed in more detail below, certain portions of the Revised Rules were withdrawn and/or modified by the District after the December 2 publication, and some of the changes were sources of controversy during these proceedings. For purposes of this Final Order, the various changes will be referred to by their respective dates of publication in the F.A.W. unless otherwise noted. The "SWUCA Rules" will refer generally to the final proposals offered by the District, which include the December 2 Revised Rules with subsequent deletions and modifications.

On December 3, 1994, the District published certain corrections to the Revised Rules in the F.A.W. (the "December 30 Corrections"). On February 10, 1995, the District also published what it has termed "clarifications" to the Revised Rules in the F.A.W. (the "February 10 Clarifications"). The latter clarifications -- which resulted from a settlement between the District and several original Petitioners -- modified the Revised Rules and elucidated the District's intent regarding the manner in which the proposed minimum aquifer level for the SWUCA would be applied to certain classes of existing permittees. As discussed in Section III E below, the District later published changes to the February 10 Clarifications in the F.A.W. on November 3, 1995.

The SWUCA Rules include proposed amendments and additions to the District's existing water use permitting rules found in Chapter 40D-2, F.A.C., as well as modifications to Part B of the District's Water Use Permit Information Manual (the "Permit Manual"). Part B is titled the "Basis of Review for Water Use Permit Applications" (the "B.O.R." or "Basis of Review") and was incorporated into Chapter 40D-2 by Rule 40D-2.091, F.A.C. The SWUCA Rules also proposed a new Rule 40D-8.628, which would establish minimum aquifer levels within the SWUCA.

While the SWUCA Rules include many unique provisions tailored to the particular problems of the southern portion of the District, there are also certain aspects of the proposals that are similar to the District's existing regulations adopted for other water use caution areas. Because some Petitioners challenged a number of provisions in the SWUCA Rules similar to those in existing rules, it was anticipated that there would be some duplication in witnesses and evidence presented in connection with the challenges. At the request of several parties and by Order dated February 1, 1995, all of the pending challenges were consolidated into this proceeding for purposes of final hearing.³ It was concluded that an integrated proceeding would provide the most cost-effective and time-efficient mechanism for proper consideration of the various cases. Accordingly, the pending consolidated cases include challenges to the proposed SWUCA Rules under Section 120.54, challenges to certain existing rules of the District under Section 120.56, and challenges to certain alleged unpromulgated rules of the District under Section 120.535, F.S.

In early February 1995, motions for summary final order were filed by several Petitioners. The motions included the following: (1) Pinellas filed a motion claiming that the proposed rules were invalid, because the District failed to follow applicable rulemaking procedures required by Section 120.54 and Section 286.011, F.S., the latter commonly known as the "Sunshine Law" (the "Sunshine Law Motion"); (2) Pinellas filed a separate motion asserting that certain non-rule policies and/or statements of the District violated Section 120.535(1), F.S. (the "120.535 Motion"); (3) Pinellas and Charlotte filed a joint motion alleging that the District had exceeded its statutory authority by establishing and applying presumptions in its existing water use permitting rules, in the proposed SWUCA Rules and in certain non-rule policies (the "Presumptions Motion"); and (4) Pinellas challenged a number of existing and proposed rules on the grounds that they exceeded the District's grant of rulemaking authority and/or enlarged, modified, or contravened specific provisions of law (the "Rulemaking Authority Motion").

ECOSWF filed a memorandum in opposition to Pinellas' Rulemaking Authority Motion. In addition, ECOSWF filed its own motion for summary final order arguing that certain portions of the SWUCA rules exceeded the District's rulemaking authority (the "ECOSWF Motion"). The District filed a response to each of the four categories of motions. The District's response to the Rulemaking Authority Motion and Presumptions Motion addressed the arguments raised in the ECOSWF Motion.

To facilitate the orderly presentation of evidence and argument in the consolidated cases, the final hearing was divided into "phases." Although it was originally anticipated that the hearing would be conducted in five phases, all challenges to the Economic Impact Statement prepared by the District for the SWUCA Rules were withdrawn. Consequently, the need for Phase Five of the hearing - limited to issues involving the Economic Impact Statement - was eliminated, and the final hearing was completed in four phases. The parameters for each of the four phases were discussed at length during many hearings and case management conferences and were addressed in various orders entered in the consolidated cases.

Phase I of the final administrative hearing was conducted February 27 through March 8, 1995. The testimony and evidence presented in Phase I were intended to familiarize the undersigned with the District's water use permitting program, to summarize anticipated integration of the SWUCA Rules into that program, and to provide an overview of the objections filed by the various Petitioners. In addition, the parties presented evidence during Phase I in support of the Motions for Summary Final Order filed in early February 1995. At the conclusion of Phase I on March 8, 1995, the parties were afforded an opportunity to present legal argument on the motions.

After considering the oral and written legal arguments submitted, the undersigned conducted a telephone conference hearing on March 27, 1995, during which the parties were advised that none of the motions for summary final order would be granted. More specifically, the following rulings were made:

(1) The Sunshine Law Motion was denied. Pinellas provided no persuasive authority for its contention that the District's failure to comply with the Sunshine Law (Section 286.011, F.S.) was a violation of the rulemaking procedures of the Administrative Procedure Act (the "APA" or "Chapter 120"). The Sunshine Law sets forth two mechanisms for adjudicating alleged violations of the statute, neither of which falls within the purview of the APA. The first mechanism authorizes circuit court issuance of an injunction to enforce the law upon application by any citizen of the state; the second remedy is State Attorney enforcement through prosecution of the alleged violators. See Section 286.011(3), F.S. In either case, only a circuit court has jurisdiction to determine whether a Sunshine Law violation has occurred. An Administrative Law Judge has no jurisdiction to determine whether the Florida Sunshine Law has been violated.

(2) Final ruling on the 120.535 Motion was deferred until disputed factual issues regarding the District's alleged utilization of non-rule policies could be resolved. In addition, the 1995 Florida Legislature was contemporaneously considering substantive modifications to Section 120.535, F.S., which could have resolved the issues raised in the motion. Although the 1995 Legislature passed revisions to Section 120.535 in Committee Substitute for Committee Substitute for Senate Bill 536, the legislation was vetoed by Governor Chiles on July 12, 1995. Accordingly, the issues raised in the 120.535 Motion are addressed in this Final Order's Conclusions of Law.

(3) To the extent that the Presumptions Motion sought a conclusive determination at the outset of the case that the District's use of presumptions in its water use permitting process exceeded the District's statutory authority, the motion was denied. The need for additional factual information and legal clarification precluded summary disposition and the parties were advised that they would be afforded an opportunity during the final hearing to present evidence and argument on the scientific bases for the presumptions and the manner in which the District applied the presumptions in the water use permitting process.

(4) Similarly, to the extent that the ECOSWF Motion and the Rulemaking Authority Motion sought a determination that the challenged rules were facially invalid because they went beyond the scope of delegated legislative authority, the motions were denied. Disputed material facts made the ECOSWF and Rulemaking Authority Motions inappropriate for summary disposition. The parties were advised that they would be given an opportunity during the final hearing to present evidence and argument regarding the factual predicate and scientific bases for the rules and the manner in which the District applied the rules. This Final Order addresses and resolves the issues and other matters raised in the motions for summary final order.

Following the conclusion of Phase I, District staff recommended to the District Governing Board at its meeting on March 22 and 23, 1995, certain changes to the proposed methodology for calculating and applying the minimum aquifer level in the SWUCA. The Governing Board accepted the staff recommendations and approved substantive revisions to Section 4.3 of the Basis of Review and proposed Rule 40D-8.628. Although the proposed changes were originally published on March 31, 1995, this version was later withdrawn, as discussed below.

The impact of the proposed revisions on the pending rule challenges was discussed during telephone conference hearings on March 27 and April 3, 1995. After considering the memoranda and argument submitted by the parties, the undersigned concluded that the proposed changes to Section 4.3 of the Basis of Review and proposed Rule 40D-8.628 were not "technical changes" as contemplated and authorized by Section 120.54(13)(b), F.S. Consequently, the District was advised that it could either proceed with the final hearing on the SWUCA Rules as published on December 2, 1994 (and clarified on December 30, 1994, and February 10, 1995), or it could withdraw the relevant portions of the SWUCA Rules (i.e., the proposed amendments to Section 4.3 of the Basis of Review and proposed Rule 40D-8.628) and re-initiate the rulemaking process on those proposals. In other words, the District was not permitted to add to the pending rule challenge proceedings the changes approved by the Governing Board at its meeting on March 22-23, 1995, without providing a new point of entry to substantially affected persons.

On April 14, 1995, the District published notice in the F.A.W. of its withdrawal of proposed Rule 40D-8.628 and the proposed amendments to Section 4.3 of the Basis of Review. In the same F.A.W. issue, the District published notice of its intention to adopt a new proposed Rule 40D-8.628 entitled "Minimum Aquifer Levels."⁴ The District's withdrawal and new proposed rule will be collectively referred to as the "April 14 Modifications."

As more particularly described in the Order Denying SFO, some parties filed new petitions under Section 120.54(4), F.S., contesting the District's actions in withdrawing portions of the SWUCA Rules and adopting the April 14 Modifications. Ultimately, the challenges to the April 14 Modifications were incorporated into the ongoing rule challenge proceedings and all parties were afforded a fair opportunity to conduct discovery and present evidence and argument on the changes embodied in the April 14 Modifications.

Some of the parties sought a public hearing before the District Governing Board to present evidence and argument on the April 14 Modifications pursuant to Section 120.54(3)(a), F.S. The District indicated that it would not provide a public hearing before the Governing Board on the newly-proposed Rule 40D-8.628 until after completion or resolution of all challenges to the SWUCA Rules as amended by the April 14 Modifications. As reflected in the Order Denying SFO, the undersigned denied the request of certain parties to compel such a hearing.

Phase II of the final hearing which was limited to issues relating to public water supply utilities, was conducted on May 1-5, reconvened May 24-31, and concluded on June 6, 1995.

Prior to the commencement of Phase III of the final hearing on June 7, 1995, DeSoto, Hardee, GBS, and Citrus Growers filed objections and/or motions for summary final order seeking to preclude continuation of the hearing. Essentially, the objections and motions alleged that the District materially failed to follow the rulemaking requirements of Section 120.54, F.S., because: (1) the Governing Board did not publish notice of its intention to adopt the April 14 Modifications (which included the withdrawal of the December 2 version of proposed amendments to Section 4.3 of the Basis of Review and proposed Rule 40D-8.628) at least 28 days prior to its meeting of March 22-23, 1995, as required by Section 120.54(1)(b); and (2) the District did not convene the public hearing requested by several parties under the provisions of Section 120.54(3)(a). Furthermore, in oral arguments on the objections and motions, some Petitioners maintained that the "fundamental fairness" of the rulemaking process had been undermined by the District's failure to follow proper rulemaking procedures in its adoption of the April 14 Modifications. See, Sections 120.52(8)(a) and 120.68(8), F.S. As set forth in the Order Denying SFO and the Conclusions of Law below, those objections and arguments were denied.

Phase III of the final hearing was conducted on June 7-9, July 6-7, July 10-11, July 17-21, July 24-27, September 11-14, and September 18, 1995. The issues in Phase III were confined to the boundaries of the SWUCA and the District's establishment and application of minimum aquifer levels therein.

Phase IV of the final hearing was conducted on September 19-22, September 25-29, October 10-12, October 16-20, October 30-November 2, and November 13-17, 1995. Phase IV addressed reallocation issues, presumptions contained in the proposed and existing rules and the validity of certain existing rules.

During Phase IV, the District announced that it intended to withdraw certain portions of the proposed SWUCA Rules, including the February 10 Clarifications which had been published as part of a settlement with a group of petitioners who subsequently withdrew from the rule challenge proceedings.⁵ At the hearing on October 30, 1995, the District advised that the Governing Board had, upon further consideration, decided to withdraw the proposed changes to Section 4.5 of the Basis of Review and proposed Rule 40D-2.801(3)(b)8 (both published on December 2, 1994) and to modify the February 10 Clarifications. To provide a point of entry for persons substantially affected by the Governing Board's alteration of the February 10 Clarifications, the District published notices of the withdrawals and modifications in the F.A.W. of November 3, 1995 (the "November 3 Modifications"). The existing parties were afforded an opportunity to modify their petitions, conduct discovery, and present evidence with regard to the November 3 Modifications. No new rule challenge petitions were filed to the November 3 Modifications within the 21-day window required by Section 120.54(4)(b), F.S. (1995).

Attached to this Final Order as Exhibit A is a list of all witnesses who testified during the course of the proceedings and the area of expertise for which each expert witness was qualified. A list of all exhibits offered into evidence during the course of the proceedings and the ultimate disposition of those exhibits is attached to this Final Order as Exhibit B. In addition to the exhibits, several motions for official recognition were submitted by the parties and granted during the course of the hearing.

On November 14, 1995 (near the end of Phase IV), the District filed a Motion for Official Recognition of two Executive Orders issued by Governor Lawton Chiles relating to agency rulemaking, a report by the Senate Committee on Governmental Reform and Oversight and an unreleased report of the Water Management District Review Commission.⁶ Over the objections of several Petitioners, the Motion was granted with respect to the two Executive Orders, but denied with regard to the Senate Committee report and the unreleased report of the Water Management District Review Commission.

Also, during Phase IV Pinellas' Amended Fourth and Fifth Motions for Official Recognition⁷ were filed, seeking to enter into the record the testimony of District employees and witnesses given in other administrative cases that dealt with the District's application of its existing rules and agency statements in certain water use permitting cases. Included in the motions were proposed recommended orders and final orders rendered in some of the cases. Both of Pinellas' motions were granted over the District's objections. Because certain of the documents were not available at the hearing, Pinellas was granted leave to file them after the hearing concluded; the documents were submitted in a post-hearing filing dated December 7, 1995. In accordance with discussions at the hearing and in post-hearing telephone conferences, the District was granted leave to file a written response to Pinellas' motions including additional citations to the documents officially recognized. The District's response was filed on December 27, 1995.

On February 15, 1996, the District filed a Motion for Official Recognition of a revised official version of Rule 40D-2.511, F.A.C. ("Declaration of Water Shortage"), that had been published in October 1995 by the Secretary of State's Bureau of Administrative Code. The rule had been challenged by some of the Petitioners in this case. Revision of the rule was apparently accomplished when the District contacted the Secretary of State and requested that another statutory citation (Section 373.175) be added to the "Law Implemented" portion of Rule 40D-2.511, F.A.C. The District had not notified any of the parties involved in the ongoing proceedings of the request made to the Secretary of State prior to filing the motion on February 15, 1996. The District contended that the change was only technical in nature.

Certain parties including DeSoto and Hardee (which had not challenged Rule 40D-2.511 during the course of the proceedings), objected to the District's Motion for Official Recognition on grounds that the District failed to notify the parties of its action and failed to follow appropriate rulemaking procedures. Without reaching the issues of whether the change was "technical" or properly accomplished, the undersigned concluded that Section 120.55(1)(a)1., F.S. (1995), compelled recognition of the reality created by the Secretary of State's published revision. Accordingly, on February 23, 1996, the Hearing Officer granted the District's Motion, but further ruled that all portions of the consolidated cases that concerned Rule 40D-2.511 would be severed and the parties would be allowed to present additional evidence and argument on the severed issues at a time to be determined after the post-hearing submittals were filed on or about March 25, 1996.

On March 10 and 11, 1996, the District notified all parties that it had requested the Secretary of State to publish notice of a revision of Rule 40D-2.511 to delete the citation of Section 373.175 that had been inserted in the "Law Implemented" portion of Rule 40D-2.511, F.A.C. The District indicated that the deletion would be effective immediately, thereby restoring the rule to the same wording it contained during the hearing and prior to the Secretary of State's revision. The District advised the undersigned of the new developments in a telephone conference hearing on March 12, 1996, during which the parties stipulated that the undersigned would rule on the validity of Rule 40D-2.511 as it existed prior to the Secretary of State's initial revision, i.e., with only the citation of Section 373.246, F.S., in the rule's "Law Implemented" section.

On October 4, 1996, ECOSWF filed a Motion for Official Recognition of Executive Order 96-297 signed by Governor Lawton Chiles on September 30, 1996 (dealing with establishment of minimum flows and levels, water supply planning, development and funding, and other budgetary and operational activities of water management districts). Even though the parties had been instructed at the close of the hearing that notices of supplemental authority should not include legal argument, the motion included argument as to the relevancy of the Executive Order. The District filed an Opposition to and Motion to Strike ECOSWF's motion on October 7, 1996.

Executive Order 96-297 is appropriate for official recognition; accordingly, ECOSWF's motion is granted. See, Johns v. State, 197 So. 791, 794 (Fla. 1940) and Rule 60Q-2.030, F.A.C. The legal argument submitted with the motion is stricken from the record and the District's request to submit argument regarding the relevancy of the Executive Order is denied.

The parties were granted until March 25, 1996, to submit proposed final orders and memoranda of law. The page limit set forth in Rule 60Q-2.031(3), F.A.C., was waived.

Upon conclusion of the final hearing, several conferences were held to develop a suggested outline for proposed final orders. Most of the parties attempted to follow the proposed format in their post-hearing submittals. To the extent deemed appropriate for the logical disposition of the issues, this Final Order generally follows that format.

Complete transcripts of the final administrative hearing and the telephone conference hearings of March 27 and April 3, 1995, and February 20, 21 and 23, 1996 were prepared and filed. The parties submitted proposed findings of fact and conclusions of law in accordance with the schedule established at the conclusion of the final hearing.