01-003217 Swire Properties, Inc., And City Of Miami vs. Board Of Trustees Of The Internal Improvement Trust Fund And Department Of Environmental Protection Status: Closed Recommended Order on Thursday, October 24, 2002.

Summary: Swire and City of Miami were co-applicants to construct a marina at Brickell Key. Sovereign submerged lands lease in Biscayne Bay Aquatic Preserve was required, and co-applicants did not prove "extreme hardship" or "public interest."

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

SWIRE PROPERTIES, INC. and )

CITY OF MIAMI, )

)

Petitioners, )

)

vs. ) Case No. 01 - 3217

)

BOARD OF TRUSTEES OF THE )

INTERNAL IMPROVEMENT TRUST )

FUND and DEPARTMENT OF )

ENVIRONMENTAL PROTECTION, )

)

Respondents, )

)

and )

)

SAVE THE MA NATEE CLUB, INC., )

and FRIENDS OF THE )

EVERGLADES, INC., )

)

Intervenors. )

)

RECOMMENDED ORDER

On September 4 - 5, 2002, final administrative hearing was

held in this case in Tallahassee, Florida, before J. Lawrence

Johnston, Administrative Law Judge, Division of Administrative

Hearings.

APPEARANCES

For Petitioners, Swire Properties, Inc. and City of

Miami:

Frank E. Matthews, Esquire

Kyle V. Mitchell , Esquire

Hopping Green & Sams, P.A.

123 South Calhoun Street

Post Office Box 6526

Tallahassee, Florida 32314 - 6526

For Respondents, Board of Trustees of the Internal

Improvement Trust Fund and Department of Environmental

Protection:

William P. Bowen, Es quire

Doreen J. Irwin, Esquire

Lucinda R. Roberts, Esquire

L. Kathryn Funchess, Esquire

Office of General Counsel

Department of Environmental Protection

3900 Commonwealth Boulevard

Mail Station 35

Tallahassee, Florida 32399 - 3000

For Intervenor, Save the Mantatee Club, Inc.:

Martha M. Collins, Esquire

Law Offices of Bavol, Bush & Sisco, P.A.

100 South Ashley Drive

Tampa, Florida 33601 - 3424

For Intervenor, Friends of the Everglades, Inc.:

Nancy Carroll Brown

6408 Stone Street Trail

Tallahassee , Florida 32309 - 2326

STATEMENT OF THE ISSUE

The issue in this case is whether the Joint Application

for Environmental Resource Permit/Authorization to Use State -

owned Submerged Lands/Federal Dredge and Fill Permit

(SLERP/ERP), File No. 13 - 0132744 - 001, as amended, for

construction of a marina on Brickell Key, an island in the

Biscayne Bay Aquatic Preserve (BBAP), should be granted.

PRELIMINARY STATEMENT

On November 14, 1997, Swire Properties, Inc. (Swire

Properties) filed a joint SLERP/ERP application for a 135 - slip

multi - use marina facility on the western shoreline of Brickell

Key. Under this proposal six slips would be dedicated to law

enforcement use, 15 would be allocated to a hotel planned for

the south end of the island, 46 would be for month - to - mon th

use available on a first - come, first - serve basis to residents

and businesses on the island, and the remaining 68 slips would

be available to the public on a first - come, first - serve basis.

The original proposal stated that Swire Properties and related

e ntities would be deeding approximately 3.5 acres of riparian

upland adjacent to the proposed marina to the City of Miami

(City) for use as a public park in accordance with contracts

between Swire Properties and the City, as well as a 1975

Development Order (DO) requiring such a dedication upon

completion of development on Brickell Key; Swire Properties

would continue to be responsible for maintenance and operation

of the park, including the seawall and marina. Swire

Properties took the position that, in li ght of these

commitments, its application was effectively a joint

application with the City.

The 1997 application was amended to provide for a 112 -

slip multi - use marina facility, with a combination of long -

term and short - term slip rentals open to the pub lic and

available on a first - come first - serve basis, with six slips

dedicated to law enforcement use. Under the amended proposal,

powerboat use would be limited to 46 of the 106 private slips;

sailboats would use the other 60 slips. Under this proposal,

a 204,861 square - foot lease would be required, to be divided

into three separate parcels -- two north of the bridge

connecting Brickell Key to the mainland, and one south of the

bridge. In addition, by this time, a conveyance to the City

was pending. Under the pending conveyance, Swire Properties

and its related entities would retain a two - foot wide strip of

riparian shoreline along the top of the seawall surrounding

the island and deed a 20 - 30 foot wide strip of adjacent upland

to the City for use as a 3.5 - acre public park under the 1975

DO. Swire Properties took the position that the pending

conveyance made the City a co - applicant.

The amended application was presented to the Governor and

Cabinet, sitting as the Board of Trustees of the Internal

Improve ment Trust Fund (BOT), for a determination whether to

issue such a lease for the proposed marina. The Department of

Environmental Protection (DEP), acting as BOT's staff,

recommended denial. BOT deferred consideration of the item on

July 25, September 12 , September 26, and November 29, 2000.

On January 10, 2001, Swire Properties and related entities

conveyed to the City a 12 - foot wide strip of riparian upland

adjacent to the proposed marina, with certain reservations and

restrictions. With this addition al information, the proposal

was again presented and deferred on February 6, 2001. On

March 13, 2001, BOT considered the application, as amended,

and voted to deny the lease. DEP issued a consolidated notice

of intent to deny both the lease and the ERP. Swire

Properties and the City filed their Petition for

Administrative Hearing on April 6, 2001, but the matter was

not referred to the Division of Administrative Hearings (DOAH)

until August 15, 2001. The referral included a Petition for

Leave to Interve ne filed by Save the Manatee Club, Inc. (SMC),

which was granted.

The Joint Response to Initial Order indicated that

settlement negotiations were being conducted, and the parties

anticipated presenting yet another amended application to BOT

by mid - Octobe r 2001 for possible resolution of the matter.

This latest amended application was filed on June 27, 2001,

and was for a 68 - slip marina, including 27 powerboat slips (20

for multi - family residential use and 7 reserved for

transient/courtesy usage), 35 sail boat slips, and 6 slips for

law enforcement. In light of possible settlement based on

this amended application, and the parties' indicated

availability, final hearing was scheduled initially for

December 13 - 14, 2001, in Tallahassee.

On November 6, 2001, Swire Properties and the City

(Petitioners) filed an unopposed Motion to Continue

Administrative Hearing because BOT consideration of the

amended application was not scheduled until November 27, 2001;

and final hearing was continued to March 4 - 5, 2002.

On November 27, 2001, Petitioners presented an amended

application to BOT, which considered the item and again voted

to deny the lease.

On February 12, 2002, Friends of the Everglades, Inc.

(FOE), filed a Petition to Intervene; and BOT and DEP

(Responden ts) and SMC filed an unopposed Joint Motion to

Continue Administrative Hearing in anticipation of the

additional intervention and issuance of a Notice of Agency

Position on the amended application, as well as because of a

change in counsel for Respondents, witness schedule conflicts,

and the need for additional consideration of and preparation

for hearing on the amended application. Both the intervention

and the continuance were granted, and final hearing was

rescheduled for June 5 - 7, 2002.

The Notice of Agency Position filed by DEP on May 3,

2002, recognized the action taken by BOT on November 27, 2001,

and stated: "Although the changes [in the amended application

filed on June 27, 2001] resulted in a project that could meet

the criteria for a regulator y permit, they did not meet the

more restrictive requirements for obtaining a Lease of

Sovereign Submerged Lands in the Biscayne Bay Aquatic

Preserve." However, SMC and FOE (Intervenors) did not abandon

their position that Petitioner still did not meet th e criteria

for a regulatory permit.

On May 17, 2002, Respondents filed another unopposed

Motion to Continue Administrative Hearing based on illness of

counsel for Respondents and the need to obtain an expert

witness after the person expected to testify f or Respondents

was retained by Petitioners. Final hearing was rescheduled

for September 4 - 6, 2002.

On August 20, 2002, Respondents filed a Motion to

Relinquish Jurisdiction on the ground that Petitioners could

not demonstrate the upland interest necessa ry to obtain a

lease of state - owned submerged land. On August 23, 2002,

Respondents moved to extend the time for filing the required

prehearing stipulation in light of the pending Motion to

Relinquish Jurisdiction. Petitioners responded in opposition

to the Motion to Relinquish Jurisdiction, and a telephone

hearing was held on August 28, 2002. The Motion to Relinquish

Jurisdiction was denied, and the parties were given through

August 30, 2002, to file their prehearing stipulation.

The Pre - Hearing Stipu lation was filed on August 30, 2002,

and final hearing was held on September 4 - 5, 2002.

Petitioners called the following witnesses: J. Megan

Kelly, Senior Vice President for Swire Properties, and a

corporate officer for Swire Pacific Holdings, Inc., Swi re

Brickell Three, Inc., and Swire Brickell Key Hotel, Limited,

who was qualified as an expert in the areas of real estate and

urban development; Carlos A. Gimenez, Jr., City Manager, City

of Miami; Captain Dave Miller, Managing Director of the Miami

River Commission; Captain John Patrick Riley, who was

qualified as an expert in water access, development, and

operation and boating; Sergeant Art Serig, City of Miami

Police Department Marine Patrol, who was qualified as an

expert in law enforcement and public safety; and Leonard L.

Nero, who was qualified as an expert in the processing of

submerged land lease applications in the BBAP.

Petitioners also had Petitioners' Exhibits 1 - 17, 19 - 23,

25, 29, and 30a - g admitted in evidence. Respondents and

Intervenors objected to Petitioners' Exhibit 28, and ruling

was reserved; although the exhibit appears to be hearsay, the

objections to its admissibility are now overruled, and the

exhibit is admitted in evidence.

Respondents called the following witnesses: Melissa

Meeker, Director of District Management for the Southeast

District office of the DEP, who was qualified as an expert in

aquatic preserve management and regulation; Mary Cynthia

Murphy, Special Projects Coordinator for the DEP, who was

qualified as an expe rt in sovereign submerged lands

authorizations and the environmental resource permitting

program; Gary Heiser, Office of the General Counsel of the

DEP, who was qualified as an expert in the real property

aspects of submerged land leases; David Patrick May er, Manager

of the BBAP for the DEP; and Donald Keirn, Environmental

Specialist II with the DEP, who was qualified as an expert in

sovereign submerged land leases in the BBAP. Respondents,

along with SMC, also called Carol Knox, an Environmental

Specialis t III with the Fish and Wildlife Conservation

Commission, who was qualified as an expert in reviewing

coastal permits for the impacts upon manatees. Respondents

also had Respondents' Exhibits 1 - 8, 10 - 14, and 18a - b admitted

in evidence.

SMC also called C raig K. Grossenbacher, Special Projects

Administrator with the Miami - Dade County Department of

Environmental Resources, who was qualified as an expert in

compliance with the Dade County Manatee Protection Plan, and

had SMC Exhibits 1 - 4 admitted in evidence . FOE relied on the

evidence presented by Respondents and SMC.

Petitioners recalled J. Megan Kelly in rebuttal.

After presentation of the evidence, Petitioners ordered a

transcript of the hearing, and the parties were given ten days

from the filing of the transcript in which to file proposed

recommended orders (PROs). The Transcript (in two volumes)

was filed on September 20, 2002. Petitioners and Respondents

each filed a PRO on September 30, 2002. SMC adopted

Respondents' PRO; FOE did not file post - hearing.

FINDINGS OF FACT

Application at Issue

1. The application at issue is the amended application

submitted by Swire Properties and the City as co - applicants on

June 27, 2001. ( See Preliminary Statement for original 1997

application and earlier a mendments.) Under this application,

Petitioners seek a SLERP for a 68 - slip marina, including 27

powerboat slips, 35 sailboat slips, and 6 slips for use by the

City of Miami Marine Patrol. As modified, the proposed marina

would preempt 49,100 square feet of sovereign submerged land.

(Actual footprint of construction would cover 16,600 square

feet.) The proposed marina would be constructed by Swire

Properties and would be operated by a third party, not by the

City.

2. Twenty of the proposed powerboat s lips would be for

multi - family residential use, and seven are reserved for

transient/courtesy use as defined by the Miami - Dade County

Manatee Protection Plan. The sailboat slips would be

available on a first - come, first - serve basis. Forty - two of

the prop osed slips would be south of the bridge, adjacent to

the Mandarin Orient Hotel built by Swire Brickell Key Hotel in

recent years. The six law enforcement slips would be north of

the other slips, near the northwest corner of the island.

3. Except for th e law enforcement component, the

proposed Brickell Key project would serve large vessels

ranging from 35 feet to 55 feet in length with anticipated

trips going north into the Government Cut and the Atlantic

Ocean for the power boats and half of the sail bo ats. In

contrast, 85 percent of the registered boats in Dade County

are below 26 feet in length.

4. In addition to the six law enforcement slips, Swire

also is providing 2,000 square feet of office and storage

space to the marine patrol unit. Boat tr affic in and out of

the Miami River could be observed from the vantage point of

the new office.

History of Development of Brickell Key

5. Brickell Key is a 44 - acre island located just

southeast of the mouth of the Miami River and east of downtown

Miami . It was created by spoil from channel dredging of the

Intracoastal Waterway and is surrounded by seawall. It is

triangular in shape, with angles in the south, northeast and

northwest. At its northwest corner, it is just 175 - 200 feet

east of the mainlan d. It is connected to the mainland by a

four - lane bridge.

6. In 1975, the owner of Brickell Key obtained a

development order from the City of Miami for mixed - use

development of the island (the 1975 DO). The DO included

approval of a marina on the west ern shoreline island.

7. In 1979, Swire Properties became involved in a joint

venture to develop the northern 33 acres of Brickell Key under

the 1975 DO. Subsequently, Swire Properties or related

entities acquired almost all of the island for developme nt.

8. Brickell Key has been densely developed. It has

approximately 330,000 square feet of commercial office space,

20,000 square feet of retail shops, and 2,500 dwelling units.

A 329 - room hotel opened in November 2000. Complete

development of the i sland is planned.

Application History

9. In 1983, Swire Properties obtained a dredge - and - fill

permit from the Florida Department of Environmental

Regulation, a predecessor of DEP, for a 53 - slip marina. Swire

Properties also submitted an application to the Florida

Department of Natural Resources (DNR), another predecessor of

DEP, for a sovereign submerged land lease for the marina.

When DNR, as staff for BOT, recommended denial, Swire

Properties withdrew the application before final action was

taken. T he dredge - and - fill permit expired in 1988.

10. In 1989, Swire Properties requested reactivation of

its prior application. But when BOT's staff again recommended

denial, Swire Properties withdrew the application and decided

not to seek additional approv als because it did not think it

could demonstrate that the marina project, as proposed, was in

the public interest, as required for a sovereign submerged

land lease in the BBAP.

11. The current application was filed in its original

form on November 14, 1997, when Swire was proceeding with

plans for the hotel on the island. Swire viewed a marina as a

"competitive amenity" for the hotel that they simply "had to

have." Not only would the marina be an amenity for hotel

guests, transient marina use would be a source of patronage

for the hotel's dining facilities.

12. As indicated in the Preliminary Statement, the

original current application was for a 135 - slip multi - use

marina facility, with six slips dedicated to law enforcement

use, 15 allocated to a ho tel planned for south end of the

island, 46 slips for month - to - month available on a first - come,

first - serve basis to residents and businesses on the island,

and the remaining 68 slips available to the public on a first -

come, first - serve basis. Subsequent modifications reduced the

size of the proposed marina to 112 slips with a combination of

long - term and short - term slip rentals, open to the public and

available on a first - come, first - serve basis, with six slips

dedicated to law enforcement use. Powerboat usage was limited

to 46 of the 106 private slips; sailboats would use the other

60 slips. Additional modifications resulted in the

application at issue. See Findings 1 - 4, supra .

Riparian Upland Interest of Co - Applicants

13. During this administrative proceeding, Respondents

raised an issue as to the sufficiency of the riparian upland

interest held by the co - applicants, Swire Properties and the

City.

14. The City is a political subdivision of the State and

is the local jurisdiction where the propose d project will be

located.

15. Swire Properties was a corporation organized under

the laws of the State of Florida on February 8, 1965. On

September 10, 1986, it merged into its parent, a Delaware

corporation named Swire Pacific Holdings, Inc. (Swire

P acific), which has been authorized to transact business in

the State of Florida since August 13, 1986.

16. On November 14, 1997, when Swire Properties filed

the original version of the SLERP/ERP application at issue in

this case (File No. 13 - 0132744 - 001 ) as a subsidiary of the

Swire Group, Swire Properties was duly registered as the

fictitious name for Swire Pacific for purposes of transacting

business in the State of Florida. The application fee was

paid by check drawn on the account of Swire Propertie s, a

division of Swire Pacific.

17. The registration of Swire Properties as the

fictitious name for Swire Pacific to transact business in

Florida expired but was reinstated just before final hearing

in this case when the Swire entities learned of the

ex piration.

18. Swire Brickell Key Three, Inc. (Swire Brickell Key

Three), and Swire Brickell Key Hotel, Limited (Swire Brickell

Key Hotel), are single - purpose entities that were established

to complete projects on Brickell Key; both are wholly - owned or

c ontrolled by Swire Pacific.

19. The Swire entities have requested that the sovereign

submerged lands lease to be entered into with BOT be drawn in

the name of Swire Pacific as lessee and that bills for lease

payment be directed to Swire Pacific with pay ment to be made

by Swire Pacific.

20. Title to riparian upland property adjacent to the

proposed property was held by Swire Pacific, Swire Brickell

Key Three, and Swire Brickell Key Hotel. On January 10, 2001,

these corporate entities conveyed a 12 - foo t wide, linear strip

of these riparian uplands -- specifically, those specifically

described in the "Legal Description of the Twelve - Foot

Baywalk" -- to the City by Warranty Deed. The Warranty Deed

included a declaration of covenants, as well as some

reservat ions and restrictions. These covenants, reservations,

and restrictions allow for planned construction and operation

of a marina on the property; they provide for the property to

be open to the public during normal City park hours of

operation (essentially , from dawn to dusk.)

21. It is the desire and intention of the Swire entities

to do whatever is necessary to cure any possible technical

defect in the identity of the co - applicant(s) with the City or

in the conveyance to the City. Specifically, they a re willing

to add Swire Pacific, Swire Brickell Key Three, and Swire

Brickell Key Hotel as co - applicants; they also are willing to

have Swire Brickell Key Three and Swire Brickell Key Hotel

quitclaim their interest to Swire Pacific. It is undisputed

that these actions would cure any possible technical defect.

If the sovereign submerged land lease is issued after these

actions are taken, Once the actions deemed necessary are

taken, it should issue to Swire Pacific, as parent company for

all of the Swire en tities, along with the City.

Extreme Hardship

22. T o obtain a sovereign submerged land lease in the

BBAP , an extreme hardship ( i.e. , significant burden, unique to

the applicant, not self - imposed) must exist for Petitioners at

the time of application for the lease. See Conclusions of Law

67 - 68, infra , for requirement and definition of extreme

hardship.

23. Petitioners suggest that not having the proposed

marina creates a significant burden unique to the residents of

Brickell Key because they do not ha ve a marina on or boat

access to the island. Their expert also suggested that

proximity to the mouth of a river somehow made this

application unique and its burden significant.

24. Proximity to the mouth of the Miami River adds

nothing to Petitioners' case. In addition, this application

is not made by the residents of Brickell Key but by the City

of Miami and the developer of the island. Even if made on

behalf of the residents, there is bridge access to and from

the island. As for lack of access to a marina within walking

distance of island residences, there was no evidence to

suggest much less prove that this alleged burden is not shared

by other residents of Miami - Dade County. Finally, although a

marina may have been contemplated for the island as long ago

as 1975, there has been no reasonable prospect for one for a

number of years -- until the Swire/City "joint application" and

law enforcement component were conceived. If the developer

and residents are burdened by lack of a marina and boat

access, the burden has been created by the developer when it

chose to develop without these amenities and by the residents

when they chose to reside on the island without these

amenities.

25. Petitioners also contend that Swire's inability to

construct a marina constitutes a significant burden unique to

Swire because a marina would enable Swire to be more

competitive in the hotel market. The Mandarin Orient

commenced operations in November 2000, and current occupancy

is about 30 percent, compared to projections of 65 percent.

But other hotels in the vicinity also are experiencing low

occupancy rates, in part impacted by repercussions of

September 11 terrorist attacks. In addition, other hotels in

the vicinity -- including the Hyatt Regency and the Sheraton --

also are located on the waterfront but do not have a marina.

26. Petitioners also contend that they are under a

significant, unique burden because they own or control 5,551

feet of linear shoreline on Brickell Key yet would be unable

to develop a marina or have boat access if the sovereign

submerged lands lease is denied. Petitioners (meaning the

City of Miami and Swire - owned entities) have direct ownership

of 4,592 linear feet of shoreline. Another 959 linear feet is

owned by the Brickell Key Master Assoc iation. Under the 1982

Declaration of Covenants, Restrictions, and Easements, voting

control of the organization that maintains Brickell Key's

common properties vests with the developer until such time as

development is completed.

27. It does not appea r from the evidence that there is

another single venture in the area that owns or controls that

much shoreline without having a marina or boat access. But as

to the significance of the burden, there was evidence that

there are approximately ten waterfront residential

developments without water access within five miles of

Brickell Key. In addition, at least two other area hotels

located on the waterfront do not have a marina or boat access.

See Finding 25, supra .

28. Petitioners also cite their dedicat ion of a

conservation easement (with alleged concomitant loss of

riparian interest of the 5,551 foot linear shoreline) as part

of their showing of extreme hardship. But the conservation

easement was partial quid pro quo for the proposed lease; in

addition , foregoing additional docks along the shoreline would

be required for compliance with the Miami - Dade County Manatee

Protection Plan. See Finding 48, infra . Finally, issuance of

significant additional sovereign submerged land leases and

regulatory permit s around the perimeter of Brickell Key would

be unlikely.

29. Apparently acknowledging that the 1975 DO gave the

developers of Brickell Key no right to a sovereign submerged

lands lease for a marina, Petitioners' expert testified that

it was a significa nt and unique burden for Petitioners to be

required to wait five years after the 1975 DO for the BBAP

rules to be promulgated because, he claimed, Swire gave up the

right to "down - zone" to single - family to apply for exempt

single - family docks. But the evi dence was that Swire did not

have any ownership interest until 1979. In addition, it is

pure speculation at best to assume that Swire would have

forsaken its DO to "down - zone" to single - family. Finally, if

this argument had merit, it is doubtful that Swi re would have

waited almost twenty - five years to make it.

30. Petitioners' expert went from detecting no

significant, unique burden as of April 2002, to having no

opinion in August 2002, to testifying at final hearing to a

significant, unique burden. H e testified that his view

changed when he "took off the blinder of rule" and reviewed

past BOT decisions on submerged land lease applications.

However, all of those decisions were decided under the same

rule, and none support a finding of significant, uni que burden

in this case.

31. Most of the precedents cited by Petitioners' expert

and argued by Petitioners were existing structures built

before 1970 that were "grandfathered" either as commercial

marinas built before 1970 or as multi - slip residential d ocks

built before 1982. In those cases, "grandfathering" amounted

to an exemption that recognized the self - evidence of extreme

hardship. Several other precedents cited were duplicates or

were temporary leases for boat shows. In the case of the boat

show s, no alternative protected sites existed, dry storage

display was infeasible due to size of the shows, and denial of

the temporary leases would have meant cancellation of the

shows.

32. One lease for a permanent, new structure was for

docking space for operation of a ferry service to provide

water access to Fisher Island, an unbridged island in the

BBAP. Based on the evidence, inaccessibility of the island by

road seems to have been the basis for deciding that the

applicant met the definition of extrem e hardship when the

lease was approved in 1984. The lease was renewed for another

25 years in 1991. There were changes after the original

lease -- most significantly, the County decided not to operate

the ferry service as originally planned but preferred t o leave

operation of the ferry to a special taxing district or the

island master association. But Fisher Island still was an

unbridged island, and the evidence did not indicate any change

in staff or BOT analysis of the extreme hardship requirement.

33. The other lease for a permanent, new structure was

for a 130 foot by 10 foot marginal dock to provide both upland

and water access, temporary mooring, and an access point for

emergency services at the City of Miami's Fort Dallas Park.

While the staff re port questioned whether the project fully

met the definition of extreme hardship, it noted that the City

considered the project to be a "public necessity" because

public parking was "minimal," access from the water was

difficult because of riprap along the existing bulkhead, and

there was no point of access to the water or to the upland -

based support services for law enforcement, emergency medical,

and public safety personnel. Extreme hardship may be inherent

in a public project which is shown to be a "pub lic necessity."

See Conclusion of Law 67, infra , for definition of "public

necessity" and its relation to the definition of "extreme

hardship."

34. Petitioners' expert also cited

"contractual/financial obligations" and "emergency evacuation

assistance" as elements of extreme hardship. But he did not

satisfactorily explain how either could be considered an

element of extreme hardship. As for "contractual/financial

obligations," it was not clear what obligations were meant.

Those created in order to en hance Petitioners' application

were self - imposed and certainly would not qualify. Others

were not shown to be unique. As for alleged emergency

evacuation assistance, that factor may be a public interest

consideration but can only be considered to be proo f of

element of extreme hardship if it is a public necessity.

35. Petitioners also contend that the project proposed

in this case is a public project that is a "public necessity."

There was evidence to prove that Petitioners propose a public

project no twithstanding that it combines private and public

components. There was proof that the law enforcement

component of the proposed project would benefit the protection

of the health and safety of the public. But the law

enforcement justification does not e xtend to the rest of the

proposed marina. In addition, the evidence did not prove that

the law enforcement component of the proposed project is

"required" for the protection of the health and safety of the

public; to the contrary, the greater weight of th e evidence

was that there are reasonable alternatives.

36. Regardless where the Marine Patrol's headquarters

and docking facilities are located, the most effective law

enforcement is performed by an officer in a boat on the water.

As the City's witness es readily conceded, the proposed project

is not imperative; law enforcement will continue to be

effective without it.

37. The City's Marine Patrol presently maintains an

office on Watson Island where docking space is provided at no

charge. (The Watson Island facility has a total of 45 slips.)

Watson Island is about one mile from Brickell Key, and the

Marine Patrol could reach Brickell Key in 3 - 4 minutes in an

emergency. The Marine Patrol's current facilities include

office space, bathrooms, a kitchen , and a storage area for

dive gear and other equipment. There also is space for vessel

storage in the uplands and docking space for two or three

vessels. Storage space would still be needed even if Swire

builds a headquarters for the unit at the proposed Brickell

Key location.

38. The Marine Patrol also has access to City of Miami

marinas in the area, including Dinner Key, where the Marine

Patrol has use of two slips at no cost. In addition, United

States Customs has a facility on the Miami River near its

mouth, about a minute away from the proposed new headquarters;

docking facilities are available there and are used on

occasion by the City's Marine Patrol.

39. There also are a number of other city - owned or

operated marinas within five miles of Bricke ll Key besides the

Watson Island facility, including Bayside Marina (between

Brickell Key and Watson Island) and Marine Stadium Marina on

Virginia Key. In addition, the City Manager has an office in

the City Administration Building which overlooks the Mia mi

River much like the proposed new headquarters would, only a

half mile upriver; and there are boat slips adjacent to the

City Administration Building.

40. To the extent that Petitioners were alleging that

provision of emergency evacuation assistance w as a "public

necessity," there was no proof of that.

Public Interest

41. In addition to proving extreme hardship, Petitioners

must prove that their proposed lease will be in the "public

interest," meaning "demonstrable environmental, social, and

econom ic benefits which would accrue to the public at large as

a result of" the proposed lease "which would clearly exceed

all demonstrable environmental, social, and economic costs of

the proposed action," considering "the ultimate project and

purpose to be ser ved by" the lease. See Conclusions of Law

67 - 68, infra , for "public interest" requirement and

definition.

42. The environmental benefits of the proposed lease are

limited to dedication of a conservation easement in 5,551

linear feet of shoreline and Sw ire's proposed development of a

program to allow hotel guests to contribute part of their bill

to helping manatee education, awareness, and protection and to

match those contributions up to $50,000 annually.

43. The BBAP is the most urbanized aquatic pr eserve in

the state and one of the most heavily used for recreation

purposes; and Brickell Key is in one of the more urban parts

of the BBAP. But there still would be environmental costs as

a result of the proposed project.

44. As compared to other par ts of the BBAP, the area of

the proposed Brickell Key marina project has relatively low

biological and aesthetic resource value. The bottom in the

area is not in its natural state, and the water is relatively

deep near the island's shore. As a result, th ere are some but

relatively few hard - bottom benthic communities, seagrasses,

and other macro algal habitat; for that reason, impacts from

the marina and its use, including impacts from shading, prop -

dredging, and grounding would be relatively small. In

ad dition, larger and more costly vessels -- both powerboats and

sailboats -- are less likely than smaller, less expensive boats

to leave marked channels and enter shallow water. As

mentioned, most vessels using the marina would be expected to

leave the BBAP via Government Cut to the Atlantic Ocean.

45. Environmental costs of the proposed lease also

include impact on manatees. The area of the proposed marina

is considered essential manatee habitat. Manatees frequent

and make use of the area of the proposed m arina and the Miami

River daily for resting, feeding, cavorting, and drinking

freshwater. The proposed marina would increase the number of

boats in the area. Operation of these boats would be expected

to overlap manatee travel patterns. Six manatees are known to

have died due to watercraft - related injuries within a two - mile

radius of the proposed marina between 1974 and February 2002.

Within a five - mile radius, 18 are known to have died due to

watercraft - related injuries in the same time period.

46. On the other hand, the proposed project has been

modified to reduce environmental costs from impact on

manatees. Besides Petitioners' proposals to emphasize manatee

awareness, education, and protection, 35 of the 68 slips at

the proposed marina would be u sed for sailboats, which pose

relatively little danger to manatees, and 6 would be dedicated

to law enforcement, which also should be assumed to pose

little or no additional danger to manatees. Of the remaining

slips, 7 are for transient use, and the othe r 20 would be

expected to be used by larger power vessels, which generally

pose less danger to manatees than smaller speedboats,

depending on how they are operated. Generally, larger vessels

are operated more responsibly and safely than lower - cost,

smalle r powerboats; in addition, since larger vessels

generally are operated from a position higher above the water,

it is easier for their operators to see and avoid manatees.

Most of these larger vessels would be expected to operate at

low - wake or no - wake spe ed in the vicinity of the proposed

marina before leaving the area through Government Cut to the

Atlantic Ocean.

47. The Miami - Dade County Manatee Protection Plan allows

a riparian owner on Brickell Key one power boat slip per 100

feet of shoreline for m ulti - family residential use and one

boat slip per 500 feet of shoreline for limited special use,

such as temporary moorings for use by a waterfront hotel,

restaurant or similar business. Whether the Plan would

accommodate the proposed marina depends on ho w the Plan is

implemented. Dedicated sailboat slips are not counted under

the Plan; the law enforcement slips probably also would not be

counted. Remaining are 7 transient and 20 first - come, first -

serve powerboat slips.

48. Swire entities and the City own 4592 linear feet of

the shoreline surrounding Brickell Key. (After having

conveyed 1,694 linear feet to the City, Swire entities retain

ownership of 2,831 linear feet; the City also owns another 66

feet of right - of - way at the island terminus of the b ridge to

the mainland.) The Brickell Key Master Association owns

another 959 feet. Under the 1982 Declaration of Covenants,

Restrictions and Easements for Brickell, voting control of the

Brickell Key Master Association is vested in Swire entities,

as dev eloper, until such time as development is completed. As

a result, Swire entities now control the additional 959 feet

of shoreline. If the Miami - Dade County Department of

Environmental Resources Management gives Petitioners credit

for ownership of all 5,5 51 feet of shoreline claimed (and can

deliver the owners' relinquishment of any right to seek

additional powerboat slips anywhere on this shoreline), it

appears that Petitioners would qualify for the 7 transient

slips and 20 powerboat slips. However, it i s possible for

adverse impacts to manatees to result even with compliance

with the Miami - Dade County Manatee Protection Plan.

49. On balance, Petitioners did not prove that

environmental benefits which would accrue to the public at

large as a result of the proposed lease would clearly exceed

all environmental costs.

50. Most of the economic and social benefits of the

proposed marina project would accrue to the Swire entities and

the residents of Brickell Key. While these beneficiaries are

a part of t he public at large, most of the public at large

will not benefit in the same way. Although the proposed

marina will be operated on a first - come, first - serve basis,

not many others would be expected to use the marina. The

transient slips would be expected to serve others, but Swire's

Mandarin Orient Hotel also would benefit from this use.

51. Other economic and social benefits would benefit the

public at large. The land deeded to the City in anticipation

of the project has a value of $3 million. To th e extent that

the law enforcement component of the proposed project would

improve law enforcement, the public at large would benefit.

The public at large also would benefit economically from

provision of the 6 law enforcement slips and 2,000 square feet

o f office and storage space to the City's marine patrol unit

free of charge. Comparable office space would rent for as

high as $30 per square foot.

52. There probably would be some economic benefit from

infill redevelopment, increased tax base, and econ omic

activity from the proposed project. The City and the Miami

River Commission, which is responsible for the Urban Infill

Plan and the Miami River Greenway Action Plan, support the

project in part for these reasons. But the evidence did not

quantify th ese benefits incrementally. Petitioners only

quantified the current real estate tax revenue generated by

Brickell Key; they did not quantify any additional real estate

tax revenue as a result of the proposed project.

53. There also probably would be so me social benefits

from the proposed project as a result of its connection to

redevelopment efforts downtown and along the Miami River. The

City and the Miami River Commission both support the project

in part for these reasons. Specifically, both the Cit y and

the Commission would like to see public access to the river

improved through a riverwalk concept called the Miami River

Greenway. Brickell Key already has a linear baywalk and

riverwalk park around much of the island. The proposed

project is viewed as an extension and enhancement of those

amenities, which can be connected to Miami River Greenway

improvements by the Brickell Key bridge.

54. When praising and supporting the proposed project,

Petitioners and the Miami River Commission cite both the

proposed marina and the public park to be developed on the

uplands adjacent to the marina. Although social enhancements

contributed to a marina are subjective and debatable, the

proposed marina would provide some limited additional access

to the public pa rk to be developed. But the park itself

already is required under the 1975 DO for Brickell Key. The

proposed project would just accelerate dedication of the park,

now required under the DO by completion of development of the

island.

55. The economic a nd social costs of the proposed

project would arise from loss of use of the preempted part of

the BBAP and a limited additional increment of boating

congestion. These costs were not quantified.

56. On balance, it appears that the economic and social

be nefits of the proposed project might exceed the economic and

social costs. But it was not proven that the combination of

environmental , economic, and social benefits would clearly

exceed the environmental , economic, and social costs.

CONCLUSIONS OF LAW

57. Under Section 253.03(1), Florida Statutes, BOT "is

vested and charged with the acquisition, administration,

management, control, supervision, conservation, protection,

and disposition of all lands owned by [the State]."

58. Section 253.77, Florida Statutes, provides: "A

person may not commence any excavation, construction, or other

activity involving the use of sovereign or other lands of the

state, the title to which is vested in the board of trustees

of the Internal Improvement Trust Fund under t his chapter,

until the person has received the required lease, license,

easement, or other form of consent authorizing the proposed

use."

59. Florida Administrative Code Chapter 18 - 21 was

promulgated under the specific authority of Section 253.03(7),

Fl orida Statutes. Rule 18 - 21.004(3)(b) states: "Satisfactory

evidence of sufficient upland interest is required for

activities on sovereignty submerged lands riparian to uplands,

unless otherwise specified in this chapter." Rule 18 -

21.003(49) states:

"S atisfactory evidence of sufficient upland

interest" shall be demonstrated by

documentation, such as a warranty deed; a

certificate of title issued by a clerk of

the court; a lease; an easement; or

condominium, homeowners or similar

association documents th at clearly

demonstrate that the holder has control and

interest in the riparian uplands adjacent

to the project area and the riparian rights

necessary to conduct the proposed activity.

Other forms of documentation shall be

accepted if they clearly demonst rate that

the holder has control and interest in the

riparian uplands adjacent to the project

area and the riparian rights necessary to

conduct the proposed activity.

60. Respondents and Intervenors take the position that

Petitioners have not demonstrate d satisfactory evidence of

sufficient upland interest. But, as found, the deeds

introduced in evidence are sufficient to clearly demonstrate

that Petitioners have "control and interest in the riparian

uplands adjacent to the project area and the riparian rights

necessary to conduct the proposed activity." Swire

Properties, as a subsidiary of the Swire Group, filed the

original application in 1997 and filed the Petition for

Administrative Hearing in this case. But Swire Properties

merged into Swire Pacifi c in 1986. See Section 607.1106(1),

Florida Statutes (2001). Since the merger, Swire Properties

has been the registered fictitious name for Swire Pacific for

transacting business in Florida (except for a period of time

when the registration lapsed). Eit her Swire Pacific or a

wholly - owned subsidiary owned all of the necessary upland

interest; those entities have conveyed interests to co -

applicant, the City of Miami. To the extent that more is

required, an officer of the Swire owners of the upland

interes t testified to the willingness of Swire Pacific to be

substituted as co - applicant with the City of Miami, and the

willingness of those Swire owners to quitclaim the interest in

the property to Swire Pacific. That evidence is sufficient to

satisfy the requ irements of Rule 18 - 21.003(49); implementation

of the substitution and quitclaim deeds would assure BOT of

leasing to the correct entities.

61. Consolidation of legal ownership in Swire Pacific,

as co - applicant, would also help ensure compliance with th e

Miami - Dade Manatee Protection Plan, an issue on the regulatory

side (along with impacts on manatees in general).

62. Section 258.36, Florida Statutes, states:

It is the intent of the Legislature that

the state - owned submerged lands in areas

which ha ve exceptional biological,

aesthetic, and scientific value, as

hereinafter described, be set aside forever

as aquatic preserves or sanctuaries for the

benefit of future generations.

63. Section 258.37, Florida Statutes, includes the

definition:

As us ed in ss. 258.35 - 258.46:

(1) "Aquatic preserve" means an

exceptional area of submerged lands and its

associated waters set aside for being

maintained essentially in its natural or

existing condition.

64. Under Section 258.42(1)(e)1., Florida Statutes,

commercial docking facilities in an aquatic preserve may be

approved only if "shown to be consistent with the use or

management criteria of the preserve."

65. The BBAP in Dade and Monroe Counties was established

by Section 258.397, Florida Statutes. Su bsection (3)(a)

provides:

No further sale, transfer, or lease of

sovereignty submerged lands in the preserve

shall be approved or consummated by the

board of trustees, except upon a showing of

extreme hardship on the part of the

applicant and a determinat ion by the board

of trustees that such sale, transfer, or

lease is in the public interest.

Subsection (4) authorizes the adoption and enforcement of BOT

rules to carry out the provisions of Section 258.397.

Subsection (5) provides:

Neither the establis hment nor the

management of the Biscayne Bay Aquatic

Preserve shall operate to infringe upon the

riparian rights of upland property owners

adjacent to or within the preserve.

Reasonable improvement for ingress and

egress, mosquito control, shore protectio n,

public utility expansion, and similar

purposes may be permitted by the board of

trustees or Department of Environmental

Protection, subject to the provisions of

any other applicable laws under the

jurisdiction of other agencies.

66. Florida Administra tive Code Rule 18 - 18.001(1)

provides:

The Biscayne Bay Aquatic Preserve, the

boundaries of which are fully described in

18 - 18.002, F.A.C., was established for the

purpose of preserving and enhancing

Biscayne Bay and all natural waterways

tidally connecte d to the bay in an

essentially natural condition so that its

biological and aesthetic values may endure

for the enjoyment of future generations.

67. Florida Administrative Code Rule 18 - 18.004 includes

the following definitions:

(3) "Aesthetic values" m eans scenic

characteristics or amenities of the

preserve in its essentially natural state

or condition, and the maintenance thereof.

* * *

(5) "Biological values" means the

preservation and promotion of indigenous

life forms and habitats, including but not

limited to, sponges, soft corals, hard

corals, seagrasses, mangroves, mud flats,

marine reptiles, game and non - game fish

species, marine mammals, tropical marine

invertebrates, birds and shellfish.

* * *

(7) "Commercial/industrial dock" me ans a

dock which is located on or over submerged

lands and which is used to produce income,

or which serves as an inducement to

renting, purchasing, or using accompanying

facilities including without limitation

multi - family residential facilities. This

te rm shall be construed to include any dock

not a private dock.

* * *

(10) "Essentially natural condition" means

those conditions which support the

continued existence or encourage the

restoration of the diverse population of

indigenous life forms an d habitats to the

extent they existed prior to the

significant development adjacent to and

within the preserve.

(11) "Extreme hardship" means a significant

burden, unique to the applicant and not

shared by property owners in the area.

Self - imposed circums tances caused to any

degree by actions of any person subsequent

to the enactment of the Act shall not be

construed as an extreme hardship. Extreme

hardship under this act shall not be

construed to include any hardship which

arises in whole or in part from the effect

of other federal, state or local laws,

ordinances, rules, or regulations. The

term may be inherent in public projects

which are shown to be a public necessity.

* * *

(17) "Preserve" means the Biscayne Bay

Aquatic Preserve which is an e xceptional

area of submerged bay lands and natural

waterways tidally connected to the bay,

including all privately and publicly owned

submerged lands, the water column over such

other lands, all publicly owned islands,

and such other lands as the Board may

purchase or approve for inclusion.

* * *

(20) "Public interest" means demonstrable

environmental, social, and economic

benefits which would accrue to the public

at large as a result of a proposed action,

and which would clearly exceed all

demonstr able environmental, social, and

economic costs of the proposed action. In

determining the public interest in a

request for use, sale, lease, or transfer

of interest in sovereignty lands or

severance of materials from sovereignty

lands, the Board shall con sider the

ultimate project and purpose to be served

by said use, sale, lease, or transfer or

severance of materials.

* * *

(22) "Public necessity" means works or

improvements required for the protection of

the health and safety of the public,

consi stent with the Act and these rules,

for which no other reasonable alternative

exists.

* * *

(25) "Riparian rights" means those rights

incident to lands bordering upon navigable

waters, as recognized by the courts of this

state and common law.

68. Florida Administrative Code Rule 18 - 18.006 provides

in pertinent part:

(3) Uses, Sales, Leases, or Transfers of

Interests in Lands.

* * *

(b) There shall be no further use, sale,

lease, or transfer of interests in

sovereignty submerged lands u nless an

applicant affirmatively demonstrates

sufficient facts to support a finding by

the Board that:

(i) An extreme hardship exists

for the applicant at the time the

application is filed; and

(ii) The use, sale, lease, or

transfer of interest and the

pro ject planned in conjunction

with the use, sale, lease or

transfer of interest are in the

public interest; and

(iii) The project planned in

conjunction with the use, sale,

lease, or transfer of interest is

consistent with these rules and

management plans wh en developed

for the preserve;

* * *

(c) A commercial/industrial dock on

sovereignty lands shall require a lease.

Private docks to be constructed and

operated on sovereignty lands shall not

require a lease of those lands.

(d) The failure of the B oard to

affirmatively find that a project complies

with the provisions of 18 - 18.006(3)(b),

F.A.C., shall preclude a finding of

consistency with these rules and management

plans when developed for the preserve.

69. The burden of proof was on Petitioners, as co -

applicants, to prove entitlement to a lease of state - owned

submerged lands under the statutes and rules, including the

elements of extreme hardship and public interest. See Florida

Department of Transportation v. J.W.C., Inc. , 396 So. 2d 778,

786 - 78 9 (Fla. 1st DCA 1981).

70. As found, although Petitioners were able to

introduce some evidence in support of a claim of hardship, the

evidence was not sufficient to find that an "extreme

hardship," as defined by rule, existed for Petitioners at the

time of filing their application.

71. Petitioners attempted to prove extreme hardship by

resort to the part of the rule definition that extreme

hardship " may be inherent in public projects which are shown

to be a public necessity." The law enforcement comp onent of

the proposed project may be desirable, but the evidence did

not prove that it is a "public necessity."

72. Citing court cases requiring only "reasonable

necessity" for the exercise of the power of eminent domain,

Petitioners suggest that a simi lar test should apply in this

case. See , e.g. , Canal Authority v. Miller , 243 So. 2d 131

(Fla. 1970); City of St. Petersburg v. Vinoy Park Hotel Co. ,

352 So. 2d 149 (Fla. 2d DCA 1977). But the term "public

necessity," as defined by rule for use in this c ase, creates a

stricter test -- the proposed project must be required for the

protection of the health and safety of the public , and there

can be no other reasonable alternative. See Conclusion of Law

67, supra . The facts of this case do not pass this stri cter

test.

73. Petitioners also cite the City's general need to

redevelop economically and build its tax base as a "public

necessity." Not only is the connection to public health and

safety too attenuated, it was not proven that there are no

other reas onable alternatives to accomplish those general

goals.

74. The evidence also did not prove that the proposed

marina project is "in the public interest." As defined by

rule, "public interest" means "demonstrable environmental,

social, and economic benef its which would accrue to the public

at large as a result of a proposed action, and which would

clearly exceed all demonstrable environmental, social, and

economic costs of the proposed action." (Emphasis added.) As

found, it is not clear from the eviden ce that Petitioners

passed this test.

75. Under Florida Administrative Code Rules 18 - 21.00401

and 62 - 343.075 linkage, if lease of sovereign submerged lands

is denied, environmental resource permit for same project also

must be denied. See Miami Beach R od and Reel Club, Inc. v.

Department of Environmental Protection , 19 FALR 3380 (DEP

1997).

RECOMMENDATION

Based upon the foregoing Findings of Fact and Conclusions

of Law, it is

RECOMMENDED that the Governor and Cabinet and the

Department of Environme ntal Protection deny the Joint

Application for Environmental Resource Permit/Authorization to

Use State - owned Submerged Lands/Federal Dredge and Fill Permit

(SLERP/ERP), File No. 13 - 0132744 - 001, as amended.

DONE AND ENTERED this 24th day of October, 20 02, in

Tallahassee, Leon County, Florida.

___________________________________

J. LAWRENCE JOHNSTON

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675 SUNCOM 278 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 24th day of October, 2002.

COPIES FURNISHED:

L. Kathryn Funchess, Esquire

William P. Bowe n, Esquire

Doreen Jane Irwin, Esquire

Lucinda R. Roberts, Esquire

Department of Environmental Protection

3900 Commonwealth Boulevard

Mail Station 35

Tallahassee, Florida 32399 - 3000

Frank E. Matthews, Esquire

Hopping, Green, Sams & Smith, P.A.

Post Office Box 6526

Tallahassee, Florida 32314 - 6526

Martha M. Collins, Esquire

Bavol, Bush & Sisco, P.A.

100 South Ashley Drive, Suite 2100

Tampa, Florida 33602 - 3424

Nancy Carroll Brown

6408 Stone Street Trail

Tallahassee, Florida 32309 - 2326

David B. Struhs, S ecretary

Department of Environmental Protection

3900 Commonwealth Boulevard

Tallahassee, Florida 32399 - 3000

Teri L. Donaldson, General Counsel

Department of Environmental Protection

3900 Commonwealth Boulevard, Mail Station 35

Tallahassee, Florida 32399 - 3000

Kathy C. Carter, Agency Clerk

Office of the General Counsel

Department of Environmental Protection

3900 Commonwealth Boulevard, Mail Station 35

Tallahassee, Florida 32399 - 3000

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to su bmit written exceptions within 15

days from the date of this Recommended Order. Any exceptions to

this Recommended Order should be filed with the agency that will

issue the final order in this case.