00-002010 Save Our Bays And Canals Association vs. Tampa Bay Water And Department Of Environmental Protection Status: Closed Recommended Order on Monday, July 24, 2000.

Summary: Tampa Bay Water is entitled to Variance; construction of surface water treatment plant responds to urgent environmental, financial, and legal factors. Protestor did not file for improper purpose.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

SAVE OUR BAYS AND CANALS, )

INC., )

)

Petitioner, )

)

vs. )

)

TAMPA BAY WATER and )

DEPARTMENT OF ENVIRONMENTAL )

PROTECTION, )

) Case No. 00-2010

Respondents, )

)

and )

)

SOUTHWEST FLORIDA WATER )

MANAGEMENT DISTRICT, )

)

Intervenor. )

______________________________)

RECOMMENDED ORDER

Robert E. Meale, Administrative Law Judge of the Division of

Administrative Hearings, conducted the final hearing in Tampa,

Florida, on July 7 and 10-12, 2000.

APPEARANCES

For Petitioner: Ralf G. Brookes, Attorney

1217 East Cape Coral Parkway

Suite 107

Cape Coral, Florida 33904

For Respondent Tampa Bay Water:

Donald D. Conn, General Counsel

Tampa Ba y Water

2535 Landmark Drive, Suite 211

Clearwater, Florida 33761

J. Frazier Carraway

Salem, Saxon & Nielson, P.A.

101 East Kennedy Boulevard

Suite 3200

Tampa, Florida 33601

For Respondent Department of Environmental Protection:

Cynthia K. Christen

Senior Assistant General Counsel

Department of Environmental Protection

3900 Commonwealth Boulevard

Mail Station 35

Tallahassee, Flori da 32399-3000

For Intervenor Southwest Florida Water Management District

William S. Bilenky

General Counsel

Jack R. Pepper, Jr.

Associate General Counsel

Southwest Florida Water

Management District

2379 Broad Street

Brooksvill e, Florida 34609-6899

STATEMENT OF THE ISSUE

The issue is whether Respondent Department of Environmental

Protection may issue to Respondent Tampa Bay Water a variance

from the requirements, in Rules 62-555.520(4)(c) and (d), Florida

Administrative Code, that an application for a permit to

construct and operate a drinking water system contain drawings of

the project with sufficient detail to describe clearly the work

to be undertaken and complete specifications of the project to

supplement the drawings.

PRELIMINARY STATEMENT

By Final Order Granting Petition for Variance From Rule

62 -555.520(4)(c) and (d), F.A.C., Respondent Department of

Environmental Protection issued Respondent Tampa Bay Water a

variance from the cited rule's requirements for the contents of

an application for a public drinking water facility construction

permit.

By petition dated May 1, 2000, Petitioner challenged the

issuance of the variance on various grounds. By Request for

Assignment of Administrative Law Judge and Notice of Preservation

of Record filed May 11, 2000, Respondent Department of

Environmental Protection requested that an Administrative Law

Judge of the Division of Administrative Hearings conduct the

final hearing and issue a recommended order. In response to the

Initial Order requesting available dates for the final hearing,

the parties filed a response on June 5, 2000, offering, as their

first available dates, July 7 and 10-13, 2000. By Notice of

Hearing entered June 12, 2000, the Administrative Law Judge set

the hearing for July 7 and 10-13, 2000.

By Order entered June 12, 2000, the Administrative Law Judge

denied a Motion to Consolidate or Hold in Abeyance filed by

Petitioner on June 8, 2000, and a Motion to Dismiss filed by

Respondent Tampa Bay Water on May 22, 2000.

On June 1, 2000, Intervenor filed a Petition for Leave to

Intervene in Formal Administrative Proceeding. By Order entered

July 3, 2000, the Administrative Law Judge granted the petition.

On June 29, 2000, Petitioner filed an amended petition

challenging the issuance of the variance. By order entered July

3, 2000, the Administrative Law Judge granted leave to Petitioner

to file the amended petition that had been filed on June 29,

2000. At the commencement of the hearing, the Administrative Law

Judge granted the request of Petitioner to file an amended

verified petition, which was identical to the amended petition,

except that it was verified by the president of Petitioner.

At the hearing, Petitioner called nine witnesses and offered

into evidence Petitioner Exhibits 1-9 and 11-14. Respondent

Tampa Bay Water called six witnesses. Respondent Department of

Environmental Protection called four witnesses. Intervenor

called one witness. One member of the public testified. The

parties jointly offered into evidence Joint Exhibits 1-12, 14-16,

20, and 22-37. All exhibits were admitted except Petitioner

Exhibits 9 and 11; as for Petitioner Exhibit 12, only the blue,

checked circled items were admitted. Petitioner proffered the

exhibits and portion of Exhibit 12 that were not admitted.

At the end of the hearing, the Administrative Law Judge gave

the parties nine days, or until Friday, July 21, 2000, within

which to file proposed recommended orders, so that the

Administrative Law Judge could issue his recommended order by the

following Monday, July 24, 2000.

The court reporter filed the Transcript on July 14, 2000.

The parties filed their proposed recommended orders on July 21,

2000. Respondents and Intervenor filed a joint proposed

recommended order.

Respondent Tampa Bay Water also filed on July 21, 2000, a

Motion for the Award of Attorney's Fees and Costs and Memorandum

of Law.

FINDINGS OF FACT

I. Inception of Tampa Bay Water, Consolidated Permit,

and Other Documentation for the Production of Drinking Water

1. Respondent Tampa Bay Water (TBW) is a wholesale public

water supply utility. TBW is governed by a nine-member board of

directors with one member each from the municipalities of Tampa,

St. Petersburg, and New Port Richey and two members each from the

counties of Hillsborough, Pinellas, and Pasco. The purpose of

TBW is to use group resources to find regional solutions to the

problems of water supply in the region. Over two million persons

in the three-county area rely on TBW for their drinking water.

2. The predecessor of TBW was the West Coast Regional Water

Supply Authority (WCRWSA), which was created in 1974. The West

Coast Regional Water Supply Authority was also a wholesale public

water supply authority. However, the authority operated as a

cooperative entity, and TBW operates as a regulatory entity.

3. In 1996, WCRWSA sought to renew its permit from

Intervenor Southwest Florida Water Management District (SWFWMD)

to allow continued withdrawals from four of its eleven major

wellfields. Concerned with the environmental impacts, such as

drawdowns of the water levels of wetlands, streams, and lakes,

from the environmental, if not regulatory, overpumping of the

wellfields, SWFWMD denied the application for the quantities

requested.

4. An Administrative Law Judge at the Division of

Administrative Hearings conducted a hearing and issued a

recommended order finding adverse environmental effects from

overpumping, but recommending that SWFWMD issue the requested

permits subject to certain conditions. Subsequent negotiations

resulted in the parties' entering into a series of agreements

covering withdrawals from the four wellfields that had been the

subject of the administrative hearing and seven more wellfields

that were approaching repermitting (11 Wellfields), as well as a

series of other matters.

5. On May 20, 1998, WCRWSA, the three member counties, the

three member municipalities, and SWFWMD entered into the Northern

Tampa Bay New Water Supply and Ground Water Withdrawal Reduction

Agreement (Partnership Agreement).

6. The Partnership Agreement requires WCRWSA to bring one

or more projects online, by December 31, 2002, to produce at

least 38 million gallons per day (MGD) and, by December 31, 2007,

to produce at least 85 MGD of new water supply. The Partnership

Agreement requires SWFWMD to provide WCRWSA with $183 million

toward eligible water supply projects.

7. The Partnership Agreement notes that the then-current

Master Water Plan of WCRWSA recognizes that "an aggressive

conservation and demand management program is an integral

component of a sustainable water supply." (Joint Exhibit 3, p.

31.) The Partnership Agreement notes that the then-current

Master Water Plan states that the conservation program was

expected to reduce use by 10 MGD per day by 2000 and 17 MGD by

2005.

8. From the effective date of the agreement through

December 31, 2002, the Partnership Agreement requires a reduction

in pumping of the 11 Wellfields to 158 MGD, based on a rolling

36-month average. For the next five years, the Partnership

Agreement requires a reduction in pumping of the 11 Wellfields to

121 MGD, based on an annual average. After that, effective

December 31, 2007, the Partnership Agreement requires a reduction

in pumping of the 11 Wellfields to 90 MGD, also based on an

annual average.

9. Three weeks after the execution of the Partnership

Agreement, WCRWSA was reorganized into TBW in June 1998 through

the execution of two documents: an Amended and Restated

Interlocal Agreement dated June 10, 1998 (Interlocal Agreement),

and a Master Water Supply Contract dated June 10, 1998. TBW

assumed WCRWSA's rights and responsibilities under the

Partnership Agreement.

10. The Interlocal Agreement empowers TBW to produce and

supply drinking water "in such manner as will give priority to

reducing adverse environmental effects of excessive or improper

withdrawals of Water from concentrated areas." (Joint Exhibit 1,

pp. 20-21.)

11. The Interlocal Agreement incorporates the phased-in

reductions in withdrawals from the 11 Wellfields that are set

forth in the Partnership Agreement. The Interlocal Agreement

notes that, if the Partnership Agreement provides for extensions

of the deadlines, the deadlines contained in the Interlocal

Agreement shall likewise be subject to extension.

12. Applying to the 11 Wellfields, SWFWMD issued TBW a

Consolidated Permit, which was issued on December 15, 1998, and

became effective on January 1, 1999. Complementing the

Partnership Agreement, which reflects SWFWMD's resource-

development role, is the Consolidated Permit, which reflects

SWFWMD's regulatory role.

13. The Consolidated Permit incorporates the phased-in

reductions of withdrawals, as set forth above, for the 11

Wellfields. Although the deadlines for phased-in reductions are

conditioned on the funding to be provided by SWFWMD, pursuant to

the Partnership Agreement, these deadlines are otherwise

unconditional and firm. The Consolidated Permit expressly

provides for extensions of deadlines, except the deadlines set

for the phased-in reductions of withdrawals from the 11

Wellfields.

14. The Consolidated Permit imposes upon TBW extensive

responsibilities regarding environmental monitoring, reporting,

and mitigation. These responsibilities extend to groundwater,

wetlands, and surface waters, as TBW must, among other things,

monitor and report levels in the surficial and Floridan aquifers

and potentiometric surfaces in the Floridan aquifer in the

vicinity of the 11 Wellfields, as well as in the vicinity of

selected wetlands and surface waters. The Consolidated Permit

sets specific "regulatory levels" for these resources.

II. Present and Future Tampa Bay Water Facilities,

Including the Surface Water Treatment Plant

15. A majority of TBW's production facilit ies consists of

the 11 Wellfields. In an effort to supplement these production

sources so as to comply with the phased-in reduction deadlines

set forth in the Consolidated Permit and other documents, TBW

annually adopts a New Water Plan, which describes capital

planning for drinking water production facilities.

16. The June 2000 New Water Plan summarizes the

requirements of the Partnership Agreement. The June 2000 New

Water Plan notes that TBW reaffirmed its Master Water Plan and

New Water Plan projects in April 2000. These projects include

the Enhanced Surface Water System, which includes the Tampa Bay

Regional Surface Water Treatment Plant (SWTP), Tampa Bay

Reservoir Project (Reservoir), and projects obtaining water from

the Alafia River, Hillsborough River, and Tampa Bypass Canal.

Other projects, besides the Enhanced Surface Water System,

include Seawater Desalination (Desal Plant).

17. The June 2000 New Water Plan states that the Enhanced

Surface Water System is eligible for a maximum of $120 million

from SWFWMD, pursuant to its funding obligation under the

Partnership Agreement.

18. This case involves the means by which the SWTP will be

permitted, and, in consideration of the manner of permitting,

this case involves the means by which the SWTP will be designed

and constructed. The June 2000 New Water Plan notes that TBW and

USFilter Operating Services, Inc. (USFilter) have entered into a

contract for the latter to design, build, and operate (DBO) the

SWTP (DBO Contract). The June 2000 New Water Plan reports that

USFilter is currently constructing an access road to the site.

19. Among current issues, the June 2000 New Water Plan

describes this case, noting that TBW obtained a variance from

Respondent Department of Environmental Protection (DEP) allowing

a design, build (DB) approach to permitting the SWTP. The June

2000 Water Plan states that the present challenge "has the

potential to delay the completion of the [SWTP] by an estimated

8 months, subsequently delaying delivery of the initial 22 mgd

(dry weather conditions) of new surface water to the regional

system until May 2003 and more likely final acceptance of the

[SWTP] to September 2003." (Joint Exhibit 5, p. 4.) (The

accuracy of this statement is open to debate because SWFWMD

granted an environmental resource permit for the SWTP project

only on June 27, 2000--before which no significant alteration of

the land could have taken place.)

20. In the meantime, the June 2000 New Water Plan predicts

a water supply shortfall of 100,000 to 2 million gallons per day

in the South-Central service area of Hillsborough County.

21. Addressing the SWTP, the June 2000 New Water Plan

states that TBW purchased the site in October 1999 and released a

Request for Proposals on July 19, 1999. Four pre-qualified DBO

teams responded on October 18, 1999.

22. The June 2000 New Water Plan erroneously states that

TBW applied for a public drinking water facility construction

permit (Water Treatment Permit) in October 1999. Actually, in

September or October, TBW prefiled with the Hillsborough County

Health Department (Health Department) its application for a Water

Treatment Permit and paid the $7500 filing fee. The purpose of

this courtesy filing or prefiling was to allow Health Department

representatives to examine the application, including drawings

and specifications for the SWTP, and perhaps expedite the

approval process, once TBW filed a formal application.

23. The June 2000 New Water Plan reports that the SWTP will

have a peak day, surface water treatment capacity of 60 MGD and

will be located on a 433-acre site near U.S. Route 301 and

Broadway Avenue in central Hillsborough County. The June 2000

New Water Plan states that the SWTP project schedule calls for

completion of construction by March 2003 with plant startup and

testing in May 2003 and final acceptance testing in September

2003. The June 2000 New Water Plan estimates that detailed

design, site permitting, and construction of the SWTP will cost

$84.3 million, and the annual operation and maintenance expenses

will be $7.9 million.

24. As for the Desal Plant, the June 2000 New Water Plan

reports that TBW will pursue a design, build, own, operate, and

transfer (DBOOT) approach to acquire a plant to produce,

initially, 25 MGD and capable of expansion by an additional 10

MGD. The June 2000 New Water Plan states that this plant will

cost a total of about $96 million in capital expenses and about

$19 million annually to operate.

III. Procurement of the Surface Water Treatment Plant

A. Design, Build, Operate Contract and Basis of Design

25. TBW issued a Request for Proposals (RFP) that invited

base and alternative proposals for the SWTP. TBW hired Parsons

Engineering Sciences to prepare a preliminary design of the SWTP,

so as to assist in the preparation of the proposals; although

offerors could use alternative designs to the Parsons base

design, all proposals had to meet the performance standards

specified in the RFP.

26. After publishing the RFP in papers and technical

journals and on the Internet, TBW was able to prequalify five

teams of offerors. Four of the five prequalified offerors

submitted proposals. TBW received a total of nine proposals

because each offeror submitted a base proposal and one

alternative proposal, and one offeror submitted a second

alternative proposal.

27. At its January board meeting, TBW selected the USFilter

proposal. No party filed a bid protest to the specifications of

the RFP or the selection of USFilter and its team. After the

selection of USFilter, TBW entered into negotiations with

USFilter. During this process, USFilter agreed, at its expense,

to add sand to the granulated activated carbon filters to remove

fine particles more efficiently, even though it cannot recover

the resulting cost of $1.5 million before or after the

commencement of operations.

28. TBW and USFilter entered into the DBO Contract on April

10, 2000 (DBO Contract). The DBO Contract identifies "Design

Requirements" that "are intended to include the basic design

principles, concepts and requirements for the [c]onstruction . .

but do not include the detailed design or indicate or describe

each and every item required for full performance of the physical

[c]onstruction . . .." (Joint Exhibit 23, Section 1.2.6.)

29. The "Design Requirement s" are Schedule 6 to the DBO

Contract. Schedule 6 contains all of the individual, technical

specifications for the SWTP. Schedule 6 occupies two of the four

volumes of large, three-ringed binders forming the DBO Contract.

30. The DBO Contract identifie s USFilter, Clark, and Camp

Dresser & McKee, Inc. (Camp Dresser) as the DBO team for the SWTP

project. Camp Dresser is providing design services, Clark is

performing the construction, and USFilter is providing the

operation and maintenance services for at least 15 years, as well

as the financial guarantee, through its corporate parent.

31. The DBO Contract provides TBW with a fixed construction

cost, fixed operating costs, and guaranteed finished water

quality. Schedule 8 assures that finished water quality will

meet all applicable state and federal drinking water quality

standards. Two witnesses at the hearing testified that TBW

exacted from USFilter assurances of water quality that, as to

certain parameters, will exceed applicable state and federal

drinking water quality standards.

32. The DBO Contract provides TBW with a firm completion

date, subject to design modifications requested by TBW and

uncontrollable circumstances, such as acts of God, raw water

whose quality exceeds the maximum limits, or the delay caused by

this case.

33. A key document in this case is the Basis of Design

Report (Basis of Design), which was prepared by the DBO team in

April 2000. Acknowledging the phased-in withdrawal limitations

and potential for fines for not meeting the deadlines set forth

in the Consolidated Permit, the Basis of Design describes the

purpose of the DBO process as follows:

By utilizing the [DBO] approach for the

[SWTP], [TBW] expects to secure substantial

benefits . . .[,] includ[ing] costs savings,

innovative design, reduced risk of schedule

and cost excesses, long-term contracted

facility operations, and maintenance

efficiencies and guaranties.

(Joint Exhibit 8, pp. 1-2.)

34. The Basis of Design reports that the SWTP will be

located on a 100-acre parcel within a 435-acre tract that will

also accommodate facilities for groundwater treatment and storage

of the treated groundwater, treated surface water from the SWTP,

and treated saline water from the Desal Plant.

35. The Basis of Design identifies t he sources of raw water

for the SWTF as the Tampa Bypass Canal, Hillsborough River, and

Alafia River. Once online, the reservoir will help normalize

quantities of available raw water throughout the dry season.

36. The Basis of Design describes the main treatment

process as pretreatment, including pH adjustment with sulfuric

acid or caustic soda, powdered activated car feed, and ferric

sulfate coagulant addition; coagulation, flocculation, and

sedimentation using a high-rate ballasted sedimentation process

known by its tradename as ACTIFLO; ozonoation for primary

disinfection, taste and odor control, and partial conversion of

dissolved organic carbon to an assimilable or biodegradable form;

biologically active filtration for turbidity reduction, taste and

odor control; reduction of biodegradable organic carbon; and

post-treatment, including secondary disinfection using

chloramines. The finished water will then be pumped into tanks

for storage and blending before release into the distribution

facilities.

3 7. Distinguishing the DB process from the typical design,

bid, build (DBB) process, the Basis of Design states:

a very significant amount of process studies

and pre-engineering was performed by the

Project Team in support of its [DBO

p]roposal. This work included a set of

drawings covering all disciplines and

developed to the 25 to 30 percent completion

stage at a minimum with some drawings

developed to a greater degree. This stage of

drawing development is significantly beyond

the sketches and diagrams usually provided in

Basis of Design or Preliminary Design

Reports. For this [Basis of Design,] the

referenced drawings are attached and should

be examined when reviewing this [Basis of

Design]. As such, a relatively small number

of figures are contained within this [Basis

of Design].

(Joint Exhibit 8, pp. 1-4.)

38. The Basis of Design notes that the Project Team

conducted "pilot-scale" studies of the chosen treatment processes

using Lake Manatee raw water. The purpose of these studies was

to validate the selected treatment processes, provide water

quality data, and establish appropriate operating criteria, such

as coagulant dosages.

39. The Basis of Design addresses raw water quality issues.

One table sets out values for 30 different water quality

parameters for each of the three raw water sources. The Basis of

Design discloses expected water quality data for 11 water quality

parameters.

40. Of particular interest are total nitrogen and total

phosphorus because, as noted in the Basis of Design, the algal

life-cycle increases dissolved organic carbon and nutrient

concentrations in reservoir water, and the "severity of this

problem is impossible to predict." (Joint Exhibit 8, pp. 2-4.)

The expected water quality values for total nitrogen and total

phosphorus, respectively, are, on average, 0.8 and 0.55 mg/L and,

at maximum, 1.6 and 2.1 mg/L.

41. Each of the three surface waters approaches the average

values, but none approaches the maximum values, for total

nitrogen. The same is true for total phosphorus for the Tampa

Bypass Canal and Hillsborough River. However, for the Alafia

River, total phosphorus is 2.09 mg/L, so the raw water from the

Alafia River may present a substantial treatment challenge, as it

exceeds even the maximum expected value for total phosphorus.

42. An error in Table 2-4 in reporting the maximum and

average values of manganese (either the maximum value should be

0.02 mg/L or the average value should be 0.001 mg/L) and the

omission of a turbidity parameter expressed in NTUs precludes

analysis of these water quality parameters. However, the other

expected parameters appear to reflect the actual water quality of

these three surface waters.

43. Section 4 of the Basis of Design describes the

facilities and design criteria for the SWTP. This section begins

with site grading, roadways, yardpiping, and stormwater

management and extends to detailed discussions of the

pretreatment and treatment processes, including the ACTIFLO,

ozone contactor, and biologically active filtration.

B . Urgency of New Means of Producing Drinking Water

44. The SWTP is the hub of a network of production,

storage, transmission, and distribution facilities that TBW plans

to bring online in order to meet the requirements and deadlines

set forth in the Consolidated Permit and other documents. The

urgency for bringing this component of these new facilities

online as soon as possible is due to environmental reasons, as

well as the financial and legal reasons set forth above.

45. Overpumping of existing wellfields has drawn down water

levels in surface waters and wetlands, to the detriment of the

overall level of biodiversity supported by these natural

resources. Some lakes have been down 10 years, and a few have

been down 40 or 50 years. During the recent drought, the City of

Tampa, which obtains water from the Hillsborough River, lacked

adequate volumes of surface water from which to produce

sufficient finished water to meet the demand of its customers.

46. Not surprisingly, these supply problems are ac companied

by record withdrawals from the 11 Wellfields. Withdrawals in May

and June of this year were the highest monthly withdrawals on

record--208 MGD and 175 MGD, respectively. If the drought

continues and TBW continues to meet the demands of its customers,

TBW's withdrawals from the 11 Wellfields will exceed the

permitted 158 MGD, on a rolling 36-month average, by April 2001.

47. Wellfield overpumping has stressed the groundwaters.

Although surface waters respond to substantial rains in as little

as a day or two, groundwater takes significantly longer to

respond. The surficial water table is as much as 20 feet below

ground level, and the Floridan Aquifer is even deeper. The

surficial aquifer does not begin to respond to substantial rains

for one week, and the Floridan Aquifer begins to respond in two

to four weeks.

48. The condition of the surficial and Floridan aquifers

affects the Hillsborough River and Tampa Bypass Canal, which are

significantly recharged by the surficial and, sometimes, the

Floridan Aquifer. The Floridan Aquifer is especially important

to the Tampa Bypass Canal, whose rock bed has been breached.

During dry periods, the two aquifers are the primary sources of

recharge for these two surface waters. The Alafia River is more

confined, but gets water from the Floridan Aquifer through two

springs at the head of the river.

49. TBW has already made substantial gains through

conservation and has met the goal of nearly 10 MGD for 2000.

Over the next 20 years, maximum potential gains are expected to

be no more than 74-94 MGD. Conservation will continue to play an

important role in securing adequate drinking water supplies in

the Tampa Bay area, but conservation, even in conjunction with

reclaimed water, will not suffice, especially when future

population growth in the area is considered.

50. TBW also manages wellfield production efficiently.

Under its Optimized Regulatory Operations Plan, TBW collects and

analyzes wellfield data to determine which wellfield to tap,

notwithstanding specific limits set by wellfield, in order to

minimize environmental damage. The consumptive use permits

issued to TBW for the surface waters that will provide raw water

to the SWTP restrict the amounts and timing of the removals.

Additionally, a hydrobiological monitoring program requires the

collection and analysis of data to safeguard against adverse

effects in the rivers and, downstream, in the estuary.

51. The contractual deadline for delivery of the SWTP is

September 30, 2002. The timeframe for bringing online the SWTP

necessarily relies on acceptance testing in the wet season,

during which 60-65 percent of the annual rain occurs. The wet

season extends from mid June to the end of September. Acceptance

testing of the SWTP is imperative toward the end of this period

because this is when the water quality of the surface waters

bears the highest levels of the contaminants. Thus, if delays

postpone beyond the wet season the point at which acceptance

testing can take place, the postponement will effectively be

until the next wet season and, possibly, the end of the next wet

season.

IV. Permitting the Design, Build Process

for the Surface Water Treatment Plant

A. General

52. The DB process envisioned by TBW would essentially

break into phases the process by which TBW would obtain the

necessary Public Drinking Water Treatment Construction Permit

(Permit). The Permit initially would be based on "30 percent

plans," which reflect about a 30 percent level of effort toward

the overall design work or 30 percent completion of all of the

design work (30 Percent Plans).

53. Generally, 30 Percent Plans mark the end of the

preliminary design phase. Plans reflecting 30, 60 and 90 percent

levels of effort are customary in DBB processes, as these are the

stages at which owners typically review design work. In 30

Percent Plans, some items are designed to 100 percent and other

items are not designed at all. However, 30 Percent Plans provide

reasonable assurance that the designed system is constructable.

54. In essence, the Permit initially would be a conceptual

permit for the entire SWTP coupled with a construction permit for

those components for which the design is already complete on the

30 Percent Plans. Construction of each remaining component of

the SWTP would await subsequent permit modifications authorizing

construction of that component. As noted above, the May 18,

2000, cover letter anticipates another interim permit, or permit

modification, covering specific components, and then the final

permit, or permit modification, covering the entire SWTP.

55. The DEP district office in Orlando has substantial

experience with permitting DB water treatment projects. From

1996-98, the DEP Orlando office has permitted four such projects

for the Orlando Utilities Commission and one such project for the

City of Kissimmee. One of the Orlando Utilities Commission

projects was to construct a completely new water treatment plant.

56. Based on the experience of the DEP Orlando office, DB

permitting, when based initially on 30 Percent Plans, shortens

and simplifies the permitting process. DB permitting eliminates,

or at least postpones, the presentation of elements, such as

electrical and HVAC, that are irrelevant to the permitting

process; the elimination of elements irrelevant to permitting

from the initial designs helps the regulator find the elements

that are relevant to the permitting process. Also, the

experience of the DEP Orlando office is that the DB process

results in no more permit modifications for change orders than

are typical of a conventional DBB process.

57. The DB-approval process used by the DEP Orlando office

is modeled after the DEP-permitting process for wastewater

treatment plants. DEP rules allow DB permitting of these plants,

which are similar in construction to water treatment plants. In

fact, DEP is preparing to adopt rules to allow DB permitting of

water treatment plants.

58. Because the DEP Orlando office did not issue variances

from the rules that arguably preclude DB construction of water

treatment plants, there is no precedent for the issuance of the

variance sought in this case. However, the experience of the DEP

Orlando office is that applicants do not present basic design

changes after the initial submission, and DB permitting does not

mean that regulatory objectives are sacrificed to the expediency

sought by the applicant.

B. The Present Case

59. On April 11, 2000, Camp Dresser, on behalf of TBW,

filed with the Health Department an Application for a Public

Drinking Water Facility Construction Permit. The April 2000

drawings that accompanied the April 11, 2000, application are

described above. The cover letter to the Health Department notes

that, "upon conceptual approval of the project, individual

components will be permitted through permit modifications based

on submittals of complete drawings and specifications for each

component."

60. In this case, the availability of the Basis of Design

meant that the 30 Percent Plans reflected more than a 30 percent

level of effort or completion of the five-stage process of

pretreatment, pH adjustment, ozone contactors, filtration, and

storage in tanks. The engineer had already sized the facilities

and defined all of the processes and elements of the SWTP. The

April 2000 drawings, as supplemented by the Basis of Design,

therefore presented a relatively detailed description of the

scope, elements, and processes of the project.

61. On May 18, 2000, Camp Dresser submitted to the Health

Department more advanced drawings, which are dated May 18, 2000.

The cover letter explains that the drawings are a complete set of

Phase I drawings and specifications. The letter states that Camp

Dresser intends to file complete drawings and specifications in

three phases. Phase I, which is completed with the May 2000

drawings, consists of sitework, high rate flocculation and

sedimentation, and ozone contact tanks. Phase II consists of

biologically active granulated active carbon filters, clearwell,

and gravity thickeners. Phase III consists of the remainder of

the project.

62. As of July 3, 2000, prior to the final hearing, the

design for the SWTP had reached the 60 percent level of effort or

completion.

63. Although the SWTP described in the DBO Contract, Basis

of Design, and May drawings is a relatively large, complex

facility, it does not employ unproven technology. The

standardization of design and regulatory review is facilitated by

the use of the so-called Ten States' Standards, which are

standards commonly used by the permitting authorities of numerous

states, including Florida, to determine the capabilities of

specified treatment processes in achieving specific water quality

levels.

64. Although the ACTIFLO technology is relatively new, it

has been in use for at least five years. A pretreatment

sedimentation barrier that reduces treatment time and thus

tankage volume requirements, ACTIFLO is in use in a water

treatment plant with a capacity of 60 MGD in Canada, which TBW's

selection team members visited. ACTIFLO presently is being

incorporated into a surface water treatment plant in Melbourne,

Florida, where it must treat the nutrient-rich water of Lake

Washington and the St. Johns River. The City of Tampa is adding

ACTIFLO basins to its facilities. Also significant is the fact

that ACTIFLO easily passed the pilot test on Lake Manatee. At

present, 25 facilities using ACTIFLO are under design or

construction in North America.

65. As is consistent with the theory, the DBO process for

designing, building, and operating the SWTP has demanded greater

cooperation among the three entities that operate relatively

independently in the DBB process. Pursuant to their obligations

under the DBO Contract, Camp Dresser, Clark, and USFilter have

coordinated, and likely will continue to coordinate, their

efforts closely from design and construction, up to operation, to

save time and money from the traditional DBB process, in which

the design phase, construction phase, and operation phase are

relatively independent of each other.

C. The Variance

66. In general, DEP has the authority to issue public

drinking water treatment construction permits. The successful

applicant obtains one permit--for construction and operation.

There are no conceptual permits or separate operating permits.

67. In Hillsborough County, as well as 10 other counties,

DEP has delegated its responsibilities for issuing public

drinking water treatment construction permits. In Hillsborough

County, DEP has delegated this responsibility by an interagency

agreement to the Health Department. Applying DEP rules to

determine whether to issue a public drinking water construction

permit, the Health Department defers to DEP for the issuance of

variances from DEP rules.

68. In typical permitting cases, the Health Department u ses

its own staff in processing the application and reaching a

permitting decision. In a large case, such as this, the Health

Department's lone professional engineer, who was hired in

September 1999, can obtain considerable assistance from

professional engineers within the Tampa Bay area and professional

engineers employed by DEP.

69. Perceiving a possible incompatibility between the DB

process and the rules from which the variance is sought in this

case, TBW initially filed a request for a variance with the

Health Department. However, the Health Department declined to

issue a variance to DEP rules and informed TBW that it had to

file its request with DEP. Thus, on January 10, 2000, TBW filed

a petition for a variance with DEP.

70. On March 28, 2000, DEP issued a final order, pursuant

to Section 120.542, Florida Statutes, granting the requested

variance from Rule 62-555.520(4)(c) and (d), Florida

Administrative Code (Variance). The Variance finds that the

purpose of the underlying statutes would be met "because no

component of the project would be permitted or constructed

without review by the permitting authority of the complete plans

and specifications for that portion of the project." The

Variance finds that the DB approach will protect the public

health, safety, and welfare in providing safe drinking water

without exacerbating possible negative environmental impacts from

the overuse of groundwater.

71. The Variance relieves TBW of the necessity of complying

with two subsections of the rule governing the contents of

applications for a public drinking water construction permit.

Rule 62-555.520(4)(c) and (d), Florida Administrative Code,

provides:

The permit application form sets forth the

minimum information which is to be supplied

to the Department or the Approved County

Health Department. Additional information

may be required by the Department to clarify

information submitted in the permit

application or to demonstrate that the

proposed level of treatment will effectively

treat the contaminants present in the raw

water. The information required by the

application is as follows:

* * *

(c) Prints of drawings of the work project

which contain sufficient detail to clearly

apprise the Department of the work to be

undertaken. All prints shall be minimum of

18 x 24 inches and a maximum size of 36 x 42

inches. The scale of details contained shall

be satisfactory for microfilm reproduction.

(Reduced size photographic reproduction of

drawings for submission may be authorized.)

(d) Complete specifications of the project

necessary to supplement the prints submitted.

72. The issuance of the Variance by DEP has met with

approval, albeit cautious approval, by the Health Department.

One Health Department witness was an Engineer III, who is 19-year

employee of the Health Department and supervisor of four

Environmental Specialists charged with reviewing construction

plans for drinking water plants. He testified that he agreed

with DEP's final order granting the Variance. The Engineer III

and the other Health Department witness, its professional

engineer, testified that the issuance of the initial permit would

not influence the Health Department in deciding whether to issue

permit modifications, except to ensure compatibility.

73. Allo wing TBW not to comply with Rule 62 -555.520(4)(c)

and (d), Florida Administrative Code, the Variance provides that

the initial permit shall not authorize the construction of any

component of the SWTP; each component may be constructed only

after the submission of complete plans and specifications for

that component and the issuance of a permit modification based on

those complete plans and specifications. The Variance also

provides that the permitting authority shall publish a notice of

intent to issue a permit modification "if the permitting

authority believes that the modifications are of a controversial

nature, or that there is heightened public awareness of the

project."

V. Save Our Bays and Canals, Inc.

A. The Verified Amended Petition

74. On May 1, 2000, Petitioner filed a petition challenging

the Variance. On June 29, 2000, Petitioner filed an amended

petition challenging the Variance, and the Administrative Law

Judge granted Petitioner leave to file an amended petition on

July 3, 2000. At the start of the hearing, on July 7, 2000,

Petitioner filed a verified amended petition, which was identical

to the amended petition, except that, on July 6, 2000,

Petitioner's president had verified the pleading "to the best of

[his] knowledge, information and belief."

75. The verified amended petition states that Petitioner

has over 400 members. The verified amended petition alleges that

a substantial number of Petitioner's members will consume the

finished water produced by the SWTP and will use the surface

waters supplying the SWTP for recreation.

76. The verified amended petition states that the purpose

of Petitioner is to save the bays, canals, and waterways of the

Tampa Bay area and to ensure safe drinking water for its members

and residents of the Tampa Bay area.

77. The verified amended petition states that the Variance

affects Petitioner because it would allow the issuance of the

Permit and construction of initial phases of the SWTP prior to

submittal, review, and approval of complete plans for the next

and subsequent phases. The verified amended petition alleges

that Petitioner incorporated to pool its resources to review

applications, so as to ensure safe drinking water. The verified

amended petition states that submittal and review of a complete

set of drawings and specifications is necessary prior to

construction of the SWTP to ensure the ability of the facility to

comply with state drinking water standards. The verified amended

petition states that review of all individual components of the

SWTP is necessary to assure the protection of the public health,

safety, and welfare and the compliance with all applicable state

and federal laws.

78. Addressing specifically the 30 Percent Plans, the

verified amended petition objects to the absence of a list of

items to be included in the 30 Percent Plans. The verified

amended petition alleges that this piecemeal approach to

permitting will require Petitioner to request administrative

hearings on each phase of permitting. The verified amended

petition states that the Variance may have adverse environmental

and safety impacts that cannot be evaluated fully without a

submittal and review of the complete drawings and specifications.

79. The verified amended petition states that the DBO

approach is "self-created." The verified amended petition

objects to the failure of TBW to obtain the Variance before

issuing the RFP and instead using the DBO Contract as a basis for

claiming hardship so as to qualify for the Variance.

80. The verified amended petiti on states that the number of

variances issued for similar 30 Percent Plans threatens to create

a situation in which the variance subsumes the rule requiring

complete drawings and specifications. The verified amended

petition objects to this form of unwritten policy that has not

been published as a rule.

81. The verified amended petition states that the phased

permitting of the SWTP may create permitting momentum that

discourages a rigorous application of the rules at a later stage.

82. The verified ame nded petition states that the request

for a variance is improper because it is for a variance from

statutes, not rules. The verified amended petition states that

Section 403.861(10), Florida Statutes, requires DEP or Health

Department approval of "complete plans and specifications prior

to the installation, operation, alteration, or extension of any

public water system." The verified amended petition states that

"installation" means construction.

83. The verified amended petition states that Section

403.861(5), Florida Statutes, prohibits the issuance of a public

drinking water treatment construction permit "until the water

system has been determined to have the required capabilities

. . .." The verified amended petition states that the assurances

of USFilter are insufficient to satisfy this requirement.

84. The verified amended petition states that Section

120.542, Florida Statutes, which authorizes the variance

procedure used in this case, does not authorize variances for

compliance with federal law. The verified amended petition

states that TBW must obtain a federal variance in order to obtain

the Variance.

85. The verified amended petition states that the 30

Percent Plans omit information required for permitting, such as

the listing of a certified operator, monitoring and recordkeeping

programs, and various financial elements, such as the posting of

a bond and creation of reserves to demonstrate financial

soundness.

86. The verified amended petition states that TBW's

substantial hardship is based on contract deadlines that are

entirely self-created and, thus, insufficient to warrant a

variance. The verified amended petition notes that the

environmental damage cited as a basis for granting the Variance

"was caused by years of overpumping by . . . TBW . . .." Also,

the verified amended petition states that member governments of

TBW continue to approve new development, which increases the

demand for drinking water, because TBW and its member governments

have failed to exploit fully the potential for conservation and

reclaimed water. Similarly, the verified amended petition states

that SWFWMD helped create the hardship by renewing the permits

for additional withdrawals from the 11 Wellfields.

87. The verified amended petition states that the DBO

process will not necessarily save time and money and is not a

recognized exception to the general requirement that an applicant

must submit complete drawings and specifications prior to

permitting. The verified amended petition states that 30 Percent

Plans do not provide sufficient detail to know what the

contractor is promising to build, and it would be faster to

correct any mistakes prior to the start of construction, rather

than after the start of construction.

B. Standing

88. Petitioner was an unin corporated association from its

formation in early October 1999 through February 3, 2000, when it

was incorporated as a Florida not-for-profit corporation.

Originally named Save Our Bays and Canals Association, the

unincorporated association was formed by members of the Apollo

Beach Civic Association who were concerned about the

environmental impact upon their bays and canals of intensive

utility and industrial land uses in close proximity to their

homes. Apollo Beach is an unincorporated area along the

southeast shore of Tampa Bay, just south of the mouth of the

Alafia River.

89. The land uses with which the unincorporated association

has been concerned in its brief existence include a sulfur plant,

the TECO Big Bend plant, a proposed National Gypsum plant, a

proposed concrete plant, the proposed Desal Plant, and, now the

proposed SWTP. The Apollo Beach area is very close to the

proposed site of the Desal Plant, but is about 17 miles south

southeast from the proposed site of the SWTP.

90. Petitioner a nd its members are primarily concerned with

the Desal Plant, not the SWTP. However, Petitioner and its

members express concern with the SWTP. The concerns are that DB

permitting of the SWTP will jeopardize the production of safe

drinking water and will result in greater costs to TBW customers,

who will eventually bear the financial burden of costly reworking

of a hastily designed and constructed project.

91. Standing analysis is simplified by the elimination of

the issue of whether the verification of the amended petition

confers standing. The claims of Petitioner in this case do not

rise to the level of an attempt to prevent an activity, conduct,

or product to be permitted from impairing, polluting, or

otherwise injuring the air, water, or other natural resources of

the State.

92. First, finished drinking water is not a natural

resource of the State. Although a resource, finished drinking

water is not natural. Although of lower water quality, raw water

is a natural resource. The potable water leaving the SWTP is a

manufactured resource.

93. Second, even if finished drinking water were a natural

resource, the issuance of the Variance does not have the effect

of impairing, polluting, or otherwise injuring a natural

resource. The Variance excuses compliance with two rules

requiring complete drawings and specifications. Even assuming

that the SWTP would impair, pollute, or otherwise injure natural

resources, the Variance would not have such an effect because the

act of granting the Variance is distinct from the act of granting

the Permit itself.

94. Thus, facts regarding the circumstances under which

Petitioner's president verified the amended petition are

irrelevant for the purpose of determining standing.

95. Petitioner's standing is a function of the

characteristics of the corporation and its members.

96. At the corporate level, the articles of incorporation

state that the "specific and primary purposes for which this

corporation is formed are to operate for the public education and

advancement of the water quality of Tampa Bay, its tributaries,

its estuaries and its canals and for other charitable purposes,

by the distribution of its funds for such purposes."

97. There is some indication in the record of an attempt,

after filing the petition commencing this proceeding, to amend

the articles of incorporation to state, among Petitioner's

purposes, the protection of drinking water. The record does not

contain the written articles of incorporation, as amended, or

amended articles of incorporation after February 3, 2000.

However, for the purpose of this recommended order, the

Administrative Law Judge shall assume that such an amendment was

made at some point after the filing of the petition and before

the final hearing.

98. At the membership le vel, the water to be produced by

the SWTP will be distributed primarily to customers in Pasco and

Pinellas counties, St. Petersburg, and the Northwest Service Area

of Hillsborough County, not to Apollo Beach, which is in southern

Hillsborough County. Nearly all of Petitioner's members reside

in Apollo Beach or other nearby communities, which also will not

be served by the SWTP.

99. Although an insubstantial number of Petitioner's

members will consume finished water from the SWTP in their homes,

a substantial number will consume finished water from the SWTP at

their places of work or schools and where they shop or dine out.

Drinking water is ubiquitous, and the mixture of functional land

uses in Apollo Beach is not, so it is highly probable that

members of Petitioner will travel the three-county area in

connection with their employment, education, and recreation.

100. Close analysis of the characteristics of Petitioner

and its members reveals no basis for finding standing to

challenge the Variance.

101. Nothing in the record suggests that Petitioner or any

of its members have devoted themselves to the arcane task of

resisting a perceived trend of state and local agencies to issue

series of permits in response to DB proposals--or, more

colorfully, to engage in "piecemeal permitting."

102. About the only interest that Petitioner can

legitimately claim in DB permitting is that multiple points of

entry, at each permit and permit modification, will result in

additional expense. If Petitioner has standing to contest even

the permitting of the SWTP, Petitioner must petition each time

for an administrative hearing, conduct discovery, and participate

in the final hearing. However, this seems, at most, like a

tenuous interest, which suffers also from the speculation that

later stages of the DB permitting process will continue to

present new issues not raised in the challenge of the Permit

initially approved.

103. Turning to the members themselves, their consumption

of drinking water produced by the SWTP is no basis for standing

either because the attenuated relationship between the Variance,

which excuses compliance with two rules concerning the contents

of applications, and the safety of drinking water or the

additional costs that could arise from hasty designing,

constructing, or permitting. Although it is conceivable that a

record could have been made that the DB permitting proposed in

this case would likely result in incomplete, incompetent

permitting review, so as to jeopardize the public health if the

permit were to issue, the record in this case does not support

such a contention. To the contrary, the record establishes that

the DB permitting is at least as likely as DBB permitting to

provide the regulatory oversight necessary to assure the design

and construction of a successful public drinking water treatment

plant

104. Lacking a substantial nexus in the record between the

DB permitting authorized by the Variance and the quality of the

drinking water that, if the Health Department issues the Permit,

would likely be produced by the SWTP and likelihood of success of

the overall construction project, the members of Petitioner

likewise lack standing to challenge the Variance.

VI. Ultimate Findings of Fact

105. Petitioner and its members lack standing to challenge

the Variance.

106. TBW faces a substantial hardship if not given the

Variance. The legal and financial consequences of a failure to

meet the phased-in withdrawal reductions are real and

substantial. The environmental damage caused by overpumping the

11 Wellfields underscores the urgency of developing alternative

sources of raw water for production into finished drinking water.

107. The rule from which TBW seeks the Variance is derived

from the statute discussed in the Conclusions of Law. The

underlying purpose of this statute is the protection of the

public health, safety, and welfare. The Variance serves the

underlying purposes in two respects. First, the 30 Percent Plans

contain sufficient detail to allow permitting to proceed without

jeopardizing the objective of the rules to ensure that the

USFilter team designs and constructs a water treatment plant that

is in full compliance with all federal and state law. Second,

the Variance provides that the USFilter team shall construct no

component of the SWTP until it has been permitted, either

initially or by a permit modification.

VII. Petitioner's Liability for Attorneys' Fees and Costs

108. Petitioner has a Technical Committee on which

Petitioner relies for examination of technical aspects of matters

that are of general concern to Petitioner. This committee

obtained a copy of the Variance and, after examination and

discussion, developed a position in opposition to DEP's stated

intent to grant the Variance.

109. The Chair of Petitioner 's Technical Committee, who has

a bachelor of science degree in chemistry and is an industrial

hygienist, drafted a letter reflecting the opinion of the

committee in opposition to the Variance. Petitioner's attorney

then converted this letter into the petition that commenced this

proceeding.

110. At all times, the Board of Directors of Petitioner

approved the actions of the Technical Committee and Petitioner's

attorney, including the filing of the petition.

111. When Petitioner's president verified the amended

petition, he reasonably relied on the advice of counsel

concerning the substance of the assertions, and the advice of

counsel was based on the work of the Technical Committee.

Petitioner's president also reasonably relied on the work of the

Technical Committee when he verified the amended petition.

112. Although DB permitting has been available for the

design and construction of wastewater treatment plants for an

undetermined period of time, DB permitting for the design and

construction of public drinking water plants is a new concept.

The concept is so new that the DEP Orlando office mistakenly

issued at least 2 DB permits for public drinking water plants

without requiring the applicant to obtain a variance from the two

rules that prevent DB permitting for such facilities. The

concept is so new that the key Health Department employees have

expressed concern over personnel demands from this new means of

permitting, although they have also expressed at least lukewarm

support for the Variance.

11 3. The record portrays the employees of the Health

Department as hard-working and competent, but over-burdened. The

DB permitting obviously places significant responsibilities upon

the Health Department, especially as it familiarizes itself with

DP permitting. Although the availability of professional support

from other sources, including DEP, ultimately resolves this

issue, the situation of the Health Department also is relevant in

assessing Petitioner's liability for attorneys' fees and costs.

114. T wo or three aspects of the drawings were deficient,

according to Petitioner's professional engineer, whose testimony

has been admitted despite the unreasonably restricted opportunity

presented for cross-examination by his contractually driven

refusal to identify past clients or jobs. Although none of these

items seems likely to jeopardize a successful construction

project, these were design points on which well-informed

professionals could reasonably differ.

115. Although the issue of "improper purpose" presents a

closer question than the substantive issues discussed above,

there is inadequate subjective or objective evidence in the

record supporting TBW's claim for attorneys' fees and costs on

this ground. Ultimately, the novelty of DB permitting of

drinking water treatment plants precludes a finding of improper

purpose. All available facts drive this determination, and, at

this point in time, the relative uniqueness of DB permitting of

drinking water treatment plants to DEP, the Health Department,

and Petitioner and its members provides the necessary margin to

preclude a finding of improper purpose.

CONCLUSIONS OF LAW

116. The Division of Administrative Hearings has

jurisdiction over the subject matter. Section 120.57(1), Florida

Statutes. (All references to Sections are to Florida Statutes.

All references to Rules are to the Florida Administrative Code.)

117. Seeking the Variance, the burden of proof is on TBW.

Department of Transportation v. J. W. C. Company, Inc. , 396 So.

2d 778 (Fla. 1st DCA 1981). See also Section 120.542(2).

118. Section 120.542(1) recognizes that "[s]trict

application of uniformly applicable rule requirements can lead to

unreasonable, unfair, and unintended results in particular

instances." Consequently, Section 120.542(2) provides that

variances and waiver shall be granted when the applicant

"demonstrates that the purpose of the underlying statute will be

or has been achieved by other means by the person and when

application of a rule would create a substantial hardship or

would violate principles of fairness."

119. TBW chose not to proceed under the fairness prong.

Section 120.542(2) defines a "substantial hardship" as a

"demonstrated economic, technological, legal, or other type of

hardship to the person requesting the variance or waiver."

120. As noted above, TBW proved the substantial hardship.

The need for the SWTP is urgent--environmentally, legally, and

financially.

121. Petitioner did not rely on Section 403.810(5) in its

proposed recommended order. (An examination of that subsection

suggests that it may have been miscited.) The statute underlying

Rule 62 -555.520(4)(c) and (d) is Section 403.861(10), which

empowers DEP to:

Require department or county health

department review and approval of complete

plans and specifications prior to the

installation, operation, alteration, or

extension of any public water system.

122. "Installation" is construction. The Variance does not

permit construction of any component of the SWTP prior to its

permitting.

123. In general, the purpose of Section 403.861 is to

assure the public health, safety, and welfare. As noted above,

the Variance serves the underlying purpose of the statute.

124. Section 403.412(5) addresses "any administrative,

licensing, or other proceedings authorized by law for the

protection of the air, water, or other natural resources of the

state from pollution, impairment, or destruction . . .." In such

proceedings, Section 403.412(5) provides that a citizen of

Florida "shall have standing to intervene as a party on the

filing of a verified pleading asserting that the activity,

conduct, or product to be licensed or permitted has or will have

the effect of impairing, polluting, or otherwise injuring the

air, water, or other natural resources of the state."

125. As noted above, Petitioner may not obtain standing

under Section 403.412(5).

126. Also as noted above, Petitioner and its members are

not otherwise persons whose substantial interests are affected by

the issuance of the Variance. Petitioner lacks standing.

127. In Agrico Chemical Company v. Department of

Environmental Regulation , 406 So. 2d 478, 482 (Fla. 2d DCA 1981),

rev. denied , 415 So. 2d 1359 (Fla. 1982), the court stated:

"before one can be considered to have a substantial interest in

the outcome of the proceeding he must show 1) that he will suffer

injury in fact which is of sufficient immediacy to entitle him to

a section 120.57 hearing, and 2) that his substantial injury is

of a type or nature which the proceeding is designed to protect."

128. As noted above, neither Petitioner nor its members

have made the required showing under either of the two prongs set

forth in Agrico .

129. Section 120.569(2)(e) provides that the signing of all

pleadings constitutes a "certification that the person has read

the pleading, motion, or other paper and that, based upon

reasonably inquiry, it is not interposed for any improper

purpose, such as to harass or to cause unnecessary delay, or for

frivolous purpose or needless increase in the cost of

litigation." A violation of these requirement requires the

imposition of attorneys' fees and costs.

130. Section 120.595(1)(c) requires the Administrative Law

Judge to

determine whether any party participated in

the proceeding for an improper purpose as

defined by this subsection and

s.120.569(2)(e). In making such

determination, the administrative law judge

shall consider whether the nonprevailing

adverse party has participated in two or more

other such proceedings involving the same

prevailing party and the same project as an

adverse party and in which such two or more

proceedings the nonprevailing adverse party

did not establish either the factual or legal

merits of its position, and shall consider

whether the factual or legal position

asserted in the instant proceeding would have

been cognizable in the previous proceedings.

In such event, it shall be rebuttably

presumed that the nonprevailing adverse party

participated in the pending proceeding for an

improper purpose.

131. The determination of a violation of Section

120.595(1)(c) requires that the recommended order determine the

amount of attorneys' fees and costs.

132. The inquiry concerning improper purpose is objective,

not subjective. In other words, "if reasonably clear legal

justification can be shown for the filing of the paper in

question, improper purpose cannot be found and sanctions are

inappropriate." Friends of Nassau County, Inc. v. Nassau County ,

752 So. 2d 42, 50 (Fla. 1st DCA 2000)(construing predecessor to

Section 120.569(2)(e)).

133. For the reasons noted above, TBW has failed to prove

any improper purpose by Petitioner associated with the filing of

any pleading or participation in this case.

RECOMMENDATION

It is

RECOMMENDED that the Department of Environmental Protect ion

enter a final order granting the Variance and denying the request

of Tampa Bay Water for attorneys' fees and costs.

DONE AND ENTERED this 24th day of July, 2000, in

Tallahassee, Leon County, Florida.

___________________________________

ROBERT E. MEALE

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399-3060

[phone] SUNCOM 278-9675

Fax Filing [phone]

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 24th day of July, 2000.

COPIES FURNISHED:

Kathy C. Carter, Agency Clerk

Office of General Counsel

Department of Environmental

Protection

3900 Commonwealth Boulevard

Mail Station 35

Tallahassee, Florida 32399-3000

Teri L. Donaldson, General Counsel

Department of Environmental

Protection

3900 Commonwealth Boulevard

Mail Station 35

Tallahassee, Florida 32399-3000

Ralf G. Brookes, Attorney

1217 East Cape Coral Parkway

Suite 107

Cape Coral, Florida 33904

Donald D. Conn, General Counsel

Tampa Bay Water

2535 Landmark Drive, Suite 211

Clearwater, Florida 33761

J. Frazier Carraway

Thomas A. Lash

Salem, Saxon & Nielson, P.A.

101 East Kennedy Boulevard

Suite 3200

Tampa, Florida 33601

Cynthia K. Christen

Senior Assistant General Counsel

Department of Environmental

Protection

3900 Commonwealth Boulevard

Mail Station 35

Tallahassee, Florida 32399-3000

William S. Bilenky

General Counsel

Jack R. Pepper, Jr.

Associate General Counsel

Southwest Florida Water

Management District

2379 Broad Street

Brooksville, Florida 34609-6899

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within 15

days from the date of this recommended order. Any exceptions to

this recommended order must be filed with the agency that will

issue the final order in this case.