02-001629 Florida Audubon Society, D/B/A Audubon Of Florida; National Park Conservation Association; The Everglades Trust, Inc.; And The Everglades Foundation, Inc. vs. Lennar Homes Inc. And South Florida Water Management District Status: Closed Recommended Order on Friday, January 10, 2003.

Summary: Implementation of comprehensive Everglades Restoration Plan among overall objectives of water district, which may impose conditions on environmental resource permit to achieve consistency with future CERP project.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

FLORIDA AUDUBON SOCIETY, )

INCORPORATED, d/b/a AUDUBON )

OF FLORIDA; NATIONAL PARKS )

CONSERVATION ASSOCIATION, )

INCORPORATED; THE EVERGLADES )

TRUST, INC.; and THE )

EVERGLADES FOUNDATION, INC.; )

)

Petitioners, )

)

vs. ) Case No. 02 - 1629

)

SOUTH FLORIDA WATER )

MANAGEMENT DISTRICT and )

LENNAR HOMES, INC., )

)

Respondents. )

______________________________)

RECOMMENDED ORDER

Robert E. Meale, Administrative Law Judge of the Division

of Administrative Hearings, conducted the final hearing in West

Palm Beach, Florida, on August 19 - 21, 2002.

APPEARANCES

For Petitioners: Richard Grosso

Louise Caro, Certified Legal Intern

Environmental & Land Use Law Center, Inc.

Shepard Broad Law Center

3305 College Avenue

Fort Lauderdale, Florida 33314

Marcy I. LaHart

Marcy I. LaHart, P.A.

711 Talladaga Street

West Palm Beach, Florida 33405

For Petitioner Florida Audubon Society, Incorporated,

d/b/a Audubon of Florida:

Erin L. Deady

Environmental Counsel

444 Brickell Avenue, Suite 850

Miami, Florida 33131

For Petitioner The Everglades Trust, Inc., and

The Everglades Foundation, Inc.:

E. Thom Rumberger

Rumberger, Kirk & Ca ldwell, P.A.

403 East Park Avenue

Tallahassee, Florida 32301

For Respondent South Florida Water Management District:

Luna Ergas Phillips

Douglas H. MacLaughlin

Office of Counsel

South Florida Water Management District

3301 Gun Clu b Road

West Palm Beach, Florida 33406

For Respondent Lennar Homes, Inc.:

Frank E. Matthews

Gary V. Perko

Hopping Green & Sams, P.A.

Post Office Box 6526

Tallahassee, Florida 32314

STATEMENT OF THE ISSUES

The issues are whether Resp ondent Lennar Homes, Inc., is

entitled to an environmental resource permit to construct a 516 -

acre residential development in Miami - Dade County known as Lakes

by the Bay South Commons Project and, if so, under what

conditions.

PRELIMINARY STATEMENT

On Ma y 18, 2001, Respondent Lennar Homes, Inc., filed an

application for an environmental resource permit authorizing the

concept and initial construction of a 516 - acre residential

development in Miami - Dade County known as Lakes by the Bay South

Commons Project . On March 13, 2002, Respondent South Florida

Water Management District issued a Notice of Proposed Agency

Action, in which the staff report recommends that the Governing

Board of District issue an environmental resource permit,

subject to various conditi ons.

On April 3, 2002, Petitioners filed a petition objecting to

the issuance of the environmental resource permit and requesting

an administrative hearing.

On August 16, 2002, the parties filed their Joint

Prehearing Stipulation. In the stipulation, th e parties

described this case as a "de novo" proceeding, under Sections

120.569 and 120.57(1), Florida Statutes, to resolve the

following issues:

1. Whether the project would be contrary to

the public interest in contravention of

Section 373.414(1), Flori da Statutes, or

Rule 40E - 4.302(2), F.A.C., because the

proposed development is located in an area

necessary for implementation of the Biscayne

Bay Coast Wetlands component of the

Comprehensive Everglades Restoration Plan.

2. Whether the project would be harmful to

the water resources of the SFWMD in

contravention of Sections 373.413 and

373.416, Florida Statutes, because the

proposed development is located in an area

necessary for implementation of the Biscayne

Bay Coastal Wetlands component of the

Compre hensive Everglades Restoration Plan.

3. Whether the project would be

inconsistent with the overall objectives of

the District in contravention of Section

373.416, Florida Statutes, because the

proposed development is located in an area

necessary for impl ementation of the Biscayne

Bay Coastal Wetlands component of the

Comprehensive Everglades Restoration Plan.

4. Whether the District erroneously shifted

the burden of providing reasonable

assurances that the proposed project will

comply with all applicabl e permitting

criteria by not requiring a factual basis

that the goals and objectives of the

Biscayne Bay Coastal Wetlands project can be

achieved, notwithstanding the project's

construction on the last undeveloped parcel

suitable for intercepting and treat ing flows

from the C - 1 canal.

5. Whether the project will cause adverse

secondary impacts to the water resources in

violation of Rule 40E - 4.301(f), F.A.C.

6. Whether the project will adversely

affect the public health, safety, or welfare

or the propert y of others.

7. Whether the project will adversely

affect the fishing or recreational values or

marine productivity in the vicinity of the

activity, as a result of the project's

interference with the Biscayne Bay Coastal

Wetlands project.

8. Whether th e project will adversely

affect the current condition and relative

value of functions being performed by areas

affected by the project, because of its

adverse impact upon restoration of Biscayne

Bay's coastal wetlands.

9. Whether the District should have

required the applicant to demonstrate that

the project was clearly in the public

interest because of its potential to degrade

an Outstanding Florida Water.

10. Whether the project will adversely

impact the value of functions provided to

fish and wildlif e and listed species by

wetlands and other surface waters in

violation of Rule 40E - 4.301(d), F.A.C. as a

result of interference with the restoration

goals of the Biscayne Bay Coastal Wetlands

project.

11. Whether the implementation of CERP to

the extent that it is approved, authorized,

and funded by Florida law, the Florida

Legislature, and the Governing Board of the

South Florida Water Management District is

in the public interest pursuant to Section

373.414, Florida Statutes.

12. Whether the goals and objectives of

CERP are the restoration, preservation and

protection of the Everglades and the South

Florida ecosystem while providing and

balancing for other water - related needs of

the region.

13. Whether the goals of CERP generally

include improvements in freshwater

deliveries to major water bodies including

Biscayne Bay.

14. Whether and to what extent the Biscayne

Bay Coastal Wetlands project is a project

component of CERP.

15. Whether the Biscayne Bay Coastal

Wetlands project as discussed in the B BCW

PMP is made up of 5 subcomponents known as

"Deering Estates"; "Cutler Wetlands"; "L - 1E

Flow Way"; "North Canal Flow Way"; and

"Barnes Sound Wetlands," and whether these

subcomponents were identified by a Restudy

Planning Group because of the conceptual

project's overall size and complexity.

16. Whether a conceptual primary purpose of

Biscayne Bay Coastal Wetlands project is to

redistribute freshwater runoff from the

watershed into Biscayne Bay and an overall

estimated project cost is approximately $30 0

million.

17. Whether the general geographic extent

of the Biscayne Bay Coastal Wetlands project

is along the mainland coast of southern

Biscayne Bay from the Deering Estate at

C - 100C south into the undeveloped lands of

Homestead and Florida City known as the

Model Land Basin.

18. Whether the District has the authority,

pursuant to Sections 373.413, 373.414, and

373.416, Florida Statutes, to consider the

potential impacts an ERP application may

have on the Comprehensive Everglades

Restoration Plan (CER P) projects.

19. Whether the District has the authority

and discretion to review and determine

whether a proposed ERP application will be

inconsistent with the overall objectives of

the District.

20. Whether the District has the authority

and discretio n to review and determine

whether a proposed ERP application will be

harmful to water resources.

21. Whether the District has the authority

and discretion to review and determine

whether a proposed ERP application will be

contrary to the public interest.

Following the filing of Petitioners' challenge to the

issuance of the permit, Respondent South Florida Water

Management District has twice amended its original staff report,

which was issued on March 13, 2002. On August 9, 2002,

Respondent South Florid a Water Management District issued an

Addendum to Staff Report adding Special Condition #24, which

creates a flowage easement. On September 5, 2002, Respondent

South Florida Water Management District issued a Revised

Addendum to Staff Report revising Spec ial Condition #24 and

adding Special Conditions ##25 and 26.

At the hearing, Petitioner National Parks Conservation

Association, Inc., called one witness. Petitioner Florida

Audubon Society, Incorporated, d/b/a Audubon of Florida, called

one witness. Pe titioners The Everglades Trust, Inc., and The

Everglades Foundation, Inc., called no witnesses. Respondent

South Florida Water Management District called three witnesses,

including one witness whose testimony was taken after the

conclusion of the remainde r of the hearing. Respondent Lennar

Homes, Inc., called four witnesses. The parties jointly offered

into evidence 27 exhibits: Joint Exhibits 1 - 5 and 7 - 28.

Petitioners offered into evidence 26 exhibits: Petitioners

Exhibits 47 - 49, 72.b - 72.v, and 75 - 76 . Respondent South Florida

Water Management District offered into evidence four exhibits:

District Exhibits 72.a, 72.w, 91, and 94. Respondent Lennar

Homes, Inc., offered into evidence 12 exhibits: Applicant

Exhibits 101.a - 101.d, 103 - 107, 109, 110.a, 1 11, and 112. All

exhibits were admitted.

The Administrative Law Judge admitted District Exhibit

72.a, which is the August 9, 2002, Addendum to the Staff Report.

During the deposition of the witness who testified after the

hearing, Respondent South Flor ida Water Management District

offered into evidence District Exhibit 72.w, which is the

September 5, 2002, Revised Addendum to Staff Report. The

Administrative Law Judge overrules all objections to District

Exhibit 72.w, as well as objections to the other exhibits

offered during the post - hearing eliciting of testimony.

The court reporter filed the transcript on October 4, 2002.

The Administrative Law Judge granted the parties an extension of

time within which to file proposed recommended orders, which

we re filed by October 24, 2002.

On November 6, 2002, Petitioners filed a Motion to Strike

Lennar's Closing Argument. The Administrative Law Judge denies

the motion.

On November 6, 2002, Respondent South Florida Water

Management District filed a Motion t o Strike Certain Findings of

Fact in Petitioners' Proposed Recommended Order. On

November 15, 2002, Petitioners filed a response and Motion to

Supplement the Record. The Administrative Law Judge grants the

motion to strike and denies the motion to supple ment the record.

FINDINGS OF FACT

1. On May 18, 2001, Respondent Lennar Homes, Inc. (Lennar

Homes), filed an application with Respondent South Florida Water

Management District (District) for an environmental resource

permit (ERP) for a 516 - acre residenti al development in Miami -

Dade County known as Lakes By The Bay (Project). On June 12,

2002, Lennar Homes filed a revised ERP application for the

Project. The application, as revised, is for an ERP

conceptually approving the construction of a surface water

management system to serve the Project and authorizing the

construction to clear the site, excavate the wet retention

areas, and expand an existing lake. Providing 3300 single -

family residences, the Project is the last phase of a master

planned residenti al development, which presently contains over

1500 residences north and west of the Project.

2. The Project is bordered by Southwest 97th Avenue to the

west, Southwest 87th Avenue to the east, Southwest 216th Street

to the north, and Southwest 232nd Str eet to the south.

Immediately south of the Project are a regional wastewater

treatment plant and county solid waste landfill. These

facilities occupy opposing banks of the C - 1 Canal, which runs a

short distance from the southwest corner of the Project.

3 . The Project site is drained, cleared, and infested with

Brazilian pepper and melaleuca. The Project will impact 135

acres of wetlands, but these wetlands are severely degraded due

to the construction of roads, berms, and canals. No evidence

suggests t hat the site is presently used by any listed species.

At present, drainage across the site is from west to east, where

stormwater is intercepted by the L - 31E levy and canal running

along the west side of Southwest 87th Avenue. At its nearest

point (the s outheast corner), the Project is about one mile from

the southern part of Biscayne Bay.

4. Biscayne Bay is an Outstanding Florida Water. Much of

its central and southern parts, including the area closest to

the Project site, are within Biscayne National Park. In

contrast to the northern part of Biscayne Bay, the central and

southern parts contain significant mangrove - lined coastal

wetlands. The bay bottom in southern Biscayne Bay hosts dense

seagrass beds, and coral reefs within Biscayne National Park

s upport a diverse community of marine life.

5. The L - 31E levy and canal redirect stormwater from the

Project site south to the C - 1 Canal, which runs, in this area,

in a northwest - to - southeast direction before emptying into

Biscayne Bay. The C - 1 Canal drai ns an extensive area to the

north and northwest of the Project. The landfill and water

treatment plant are a short distance downstream of the Proposed

Project.

6. The parties have stipulated that the Project meets the

following ERP criteria (with minor r ephrasing from the

stipulation):

1. The Project will not adversely affect

significant historical and archaeological

resources.

2. The Project is not located within an

Outstanding Florida Water and will not

result in the direct discharge of surface

water into an Outstanding Florida Water.

3. Lennar has proposed mitigation to offset

the adverse impacts of the Project, and the

mitigation is in the same drainage basin as

the adverse impacts. Therefore, the Project

will not generate unlawful cumulative

imp acts, in violation of Section

373.414(8)(a) - (b), Florida Statutes.

4. The Project will not cause adverse water

quality impacts to receiving waters and

adjacent lands, in violation of Rule

40E - 4.301(a), Florida Administrative Code.

5. The Project will n ot cause adverse

flooding to onsite or offsite property, in

violation of Rule 40E - 4.301(b), Florida

Administrative Code.

6. The Project will not cause adverse

impacts to existing surface water storage

and conveyance capabilities, in violation of

Rule 40E - 4.301(c), Florida Administrative

Code.

7. The Project will not adversely impact

the maintenance of surface or ground water

levels or surface water flows established

pursuant to Section 373.042, Florida

Statutes, in violation of Rule 40E - 4.301(g),

Florid a Administrative Code.

8. The Project will not cause adverse

impacts to a work of the District

established pursuant to Section 373.086,

Florida Statutes, in violation of Rule

40E - 4.301(h), Florida Administrative Code.

9. The Project will be conducted b y an

entity with sufficient financial, legal, and

administrative capability to ensure that the

activity will be undertaken in accordance

with the terms and conditions of the permit,

as required by Rule 40E - 4.301(j), Florida

Administrative Code.

10. No sp ecial basin or geographic area

criteria established in Chapter 40E - 41,

Florida Administrative Code, are applicable

to the Project.

11. The Project will not adversely affect

navigation or the flow of water or cause

harmful erosion or shoaling, as prohibit ed

by Section 373.414(1)(a)3, Florida Statutes.

12. The Project will be permanent, as

addressed by Section 373.414(1)(a)5, Florida

Statutes.

7. The District issued its Staff Report on March 13, 2002.

The Staff Report approves the proposed mitigation p lan, which

would enhance or create and preserve 135 acres of onsite

wetlands by creating an upland buffer, emergent marsh and

transitional herbaceous shrub areas, and tree island areas.

Much of the proposed mitigation area will occupy the southern

half of the perimeter of the Project site. As proposed in the

mitigation plan, Lennar Homes will grant the District a

conservation easement over the mitigation area and will be

required to meet certain mitigation performance conditions.

8. Shortly prior to the commencement of the final hearing

in this case, the District decided to change the proposed permit

regarding mitigation. The purpose of the change was to require

Lennar Homes to allow the mitigation area to be used as a

flowway between the C - 1 Canal, upst ream of the nutrient loads

deposited by the landfill and water treatment plant, and an area

to the east of the Project site. The receiving area consists of

vestigial tidal creeks leading to presently remaining tidal

creeks that empty into small embayments within Biscayne Bay.

The general purpose of the change was to remediate the loss of

freshwater flows into these tidal creeks, the embayments, and

Biscayne Bay that resulted from the construction of drainage

canals and levies, such as C - 1 and L31 - E.

9. A ccordingly, the District issued an Addendum to Staff

Report on August 9, 2002. The Addendum adds an easement to the

original mitigation plan by adding Special Condition #24, which

states:

No later than 30 days after permit issuance

and prior to commenceme nt of construction

resulting in wetland impacts, the permittee

shall submit two certified copies of the

recorded flowage easement for the mitigation

area and associated buffers and a GIS disk

of the recorded easement area . . .. The

recorded easement shal l be in substantial

compliance with Exhibit 41. Any proposed

modifications to the approved form must

receive prior written consent from the

District. The easement must be free of

encumbrances or interests in the easement

which the District determines are contrary

to the intent of the easement. . . .

10. Exhibit 41 (actually Exhibit 41A) is entitled,

"Perpetual Flowage, Inundation, Construction, and Access

Easement." Representing a grant from Lennar Homes to the

District, the easement (Flowage Easement ) is

for any and all purposes deemed by [the

District] to be necessary, convenient, or

incident to, or in connection with, the

unrestricted right to regularly, or at any

time, and for any length of time[,]

overflow, flood, inundate, flow water on,

across, and through, store water on, and

submerge the [encumbered property], together

with the unrestricted right at any time to

enter upon and access the [encumbered

property], with any and all vehicles and

equipment, including but not limited to the

right to mo ve, transport, store, operate,

and stage equipment, materials and supplies,

in order to construct, operate, and maintain

any and all structures, improvements,

equipment, pumps, ditches and berms upon the

[encumbered property] deemed by [the

District] to be necessary, convenient,

incident to or in connection with the

implementation of the BBCW Project on the

[encumbered property], or in connection with

any project in the interest of flood

control, water management, conservation,

environmental restoration, wa ter storage, or

reclamation, and allied purposes, that may

be conducted now or in the future by the

[District], or to carry out the purposes and

intent of the statutory authority of the

[District], presently existing or that may

be enacted in the future, t ogether with all

right, title, and interest in and to the

[BBCW] Project Structures.

* * *

This Easement shall at no time be construed

to alleviate or release [Lennar Home's]

responsibilities and require [sic] under E RP

Permit No. _____ to construct and maintain

an on - site mitigation area as described and

authorized in the ERP Permit.

11. Other provisions of the Flowage Easement impose all

risk of loss in connection with the flowway upon Lennar Homes,

which indemnifi es the District from all losses, costs, damages,

and liability in connection with the flowway.

12. On September 5, 2002, after the hearing, but a few

days before the taking of the post - hearing testimony, the

District issued a Revised Addendum to Staff Rep ort. The Revised

Addendum restates Special Condition #24 with a few relatively

minor changes and adds Special Conditions ##25 and 26. Special

Condition #25 attempts to harmonize the Flowage Easement with

the original mitigation plan contemplated by the S taff Report.

Special Condition #25 provides that when the District exercises

its rights under the Flowage Easement, other special conditions

shall be deleted, so as, for example, to relieve Lennar Homes of

its obligations to maintain the mitigation area ( except for a

25 - foot buffer) and post a mitigation - performance bond. Special

Condition #26 changes the language in the conservation easement,

which was contemplated by the original Staff Report and

mitigation plan, to harmonize this easement with the Flow age

Easement.

13. Lennar Homes has submitted a version of the Revised

Addendum to Staff Report that would satisfy its concerns. The

Lennar Homes version would require the District, within 30 days

after issuing the ERP to Lennar Homes, to obtain permits f rom

the U.S. Army Corps of Engineers and the local environmental

regulatory agency, although not the Florida Department of

Environmental Protection, which, under state law, would have to

issue an ERP to the District before it could construct the

flowway. The Lennar Homes version would also give the District

only 90 days after issuing the ERP to Lennar Homes within which

to exercise its right to construct the flowway and would

sequence events so that Lennar Homes would not spend the

estimated $2 million on wetland enhancement and creation and

then lose the investment due to the inundation of the mitigation

site with water, as authorized by the Flowage Easement.

14. The Comprehensive Everglades Restoration Plan plays a

crucial role in this case. But for thi s plan, the District

would not have attached the additional conditions contained in

the Addendum to Staff Report and Revised Addendum to Staff

Report -- without which conditions, the District now contends that

Lennar Homes is not entitled to the ERP.

15. Co ngress initially authorized the Central and Southern

Florida (C&SF) Project in 1948. Objectives of the C&SF Project

included flood control, water supply for municipal, industrial,

and agricultural uses, prevention of saltwater intrusion, and

protection of fish and wildlife. The C&SF Project attained

these objectives, in part, through a primary system of 1000

miles each of levees and canals, 150 water - control structures,

and 16 major pump stations. Unintended consequences of the C&SF

Project have included the irreversible loss of vast areas of

wetlands, including half of the original Everglades; the

alteration in the water storage, timing, and flow capacities of

natural drainage systems; and the degradation of water quality

and habitat due to over - drainage or extreme fluctuations in the

timing and delivery of freshwater into the coastal wetlands and

estuaries.

16. In 1992, Congress authorized the C&SF Project

Comprehensive Review Study (Restudy). The objective of the

Restudy was to reexamine the C&SF Proj ect to determine the

feasibility of modifying the project to restore the South

Florida ecosystem and provide for the other water - related needs

of the region.

17. Completed in April 1999, the Central and Southern

Florida Project Comprehensive Review Study Final Integrated

Feasibility Report and Programmatic Environmental Impact

Statement (Restudy Report) notes that, among the unintended

consequences of the C&SF Project, was "unsuitable freshwater

flows to Florida and Biscayne bays and Lake Worth Lagoon [tha t]

adversely impact salinity and physically alter fish and wildlife

habitat." The Restudy Report states that, absent comprehensive,

new restoration projects, the "overall health of the [South

Florida] ecosystem will have substantially deteriorated" by

205 0.

18. The Restudy Report recommends a comprehensive plan for

the restoration, protection, and preservation of the water

resources of Central and South Florida. This plan is known as

the Comprehensive Everglades Restoration Plan (CERP).

Acknowledging the complex dynamics of the restoration goals

identified in CERP, the Restudy Report establishes Project

Implementation Reports to tie together CERP and the detailed

design necessary for the construction of individual restoration

projects and adaptive asse ssments to monitor the performance of

individual components, incorporate new data, and refine future

components.

19. The Restudy Report is, among other things, a

programmatic environmental impact statement. The Restudy Report

states: "Due to the conce ptual nature of [CERP] and the

associated uncertainties, many subsequent site - specific

environmental documents will be required for the individual

separable project elements."

20. In May 2002, the District and U.S. Army Corps of

Engineers completed a draf t of the Project Management Plan for

the Biscayne Bay Coastal Wetlands (BBCW PMP). Noting that a

"major goal of [CERP] is to improve freshwater deliveries to

Biscayne Bay," the BBCW PMP identifies the BBCW project as the

means by which to restore some of the coastal wetlands and

tributaries in south Dade County. The BBCW PMP states that the

primary purpose of the BBCW project, which is one of sixty

projects contained in CERP, is to "redistribute freshwater

runoff from the watershed into Biscayne Bay, away from the canal

discharges that exist today and provide a more natural and

historic overland flow through existing and or improved coastal

wetlands."

21. The Cutler Wetlands subcomponent of the BBCW project

encompasses the Project site. One of the object ives of the

Cutler Wetlands subcomponent is to divert water from the C - 1

Canal upstream of the landfill and water treatment plant to the

east of the L - 31E levy and canal.

22. In connection with the Cutler Wetlands subcomponent

and the possible role of the flowway identified in this case,

the District retained Dr. John Meeder, a Biscayne Bay ecologist

associated with the Southeast Environmental Resource Center at

Florida International University, to perform an abbreviated

study and issue a report concerning the conditions required for

the restoration of the coastal wetlands in the vicinity of the

coastal wetlands to the north of the C - 1 canal and east of the

Project site (Meeder Report).

23. The Meeder Report studies two feasible freshwater

delivery optio ns and prefers a bypass flowway along Southwest

224th Street, across roughly the middle of the Project site and

north of most of the proposed mitigation area, to the L - 31E levy

and canal. The distribution system resulting from the preferred

route would us e the natural grade of the land to divert the

water to the coastal wetlands and tidal creeks to the east and

south that are targeted for rehydration. The alternative

flowway route would run along Southwest 232nd Street, in the

approximate area of the Flow age Easement, but would require

pumping to distribute the water north along the L - 31E levy and

canal for release to the targeted coastal wetlands and tidal

creeks. Obviously, the District has chosen the less - preferred

route to minimize the impact on the P roject.

24. The Meeder Report considers the amount of freshwater

required for two rehydration options. In the first option,

water diverted from the C - 1 Canal and passing through the

flowway would rehydrate only the tidal creeks, which then empty

into t he embayments that lead to Biscayne Bay. In the second

option, water diverted from the C - 1 Canal and passing through

the flowway would rehydrate the tidal creeks and the surrounding

coastal wetlands. To maintain an appropriate salinity range and

rehydrat e only the tidal creeks, the flowway would need to

deliver 70 acre/feet per day in the dry season and 95 acre/feet

per day in the wet season. To maintain an appropriate salinity

range and rehydrate the tidal creeks and surrounding coastal

wetlands, the fl owway would need to deliver 209 acre/feet per

day in the dry season and 1139 acre/feet per day in the wet

season.

25. Several factors militate against an attempt to

rehydrate the coastal wetlands surrounding the targeted tidal

creeks. Potential errors in data and analysis increase in

magnitude with the larger freshwater diversions needed to

rehydrate the tidal creeks and surrounding coastal wetlands, and

Dr. Meeder admitted that the largest value was very approximate.

Potentially serious impacts upon sal inity and associated

vegetative communities increase in likelihood with the larger

freshwater diversions needed to rehydrate the tidal creeks and

surrounding coastal wetlands.

26. Also, the diversion of larger volumes of water from

the C - 1 Canal may hav e adverse impacts on downstream conditions.

At the point of the C - 1 Canal where it first enters the landfill

and wastewater treatment plant (just downstream from the

flowway), the average flow of the C - 1 Canal is 350 acre/feet per

day, but the median flow is only 160 acre/feet per day. (The

average flow rate is skewed by occasional, very high daily flows

of 4000 acre/feet during large storm events.) The larger

volumes diverted to rehydrate the tidal creeks and surrounding

coastal wetlands would, at times , withdraw a relatively large

portion of the water from the C - 1 Canal.

27. For these reasons, the District justifiably elected to

seek a flowway that would rehydrate only the tidal creeks,

including the vestigial tidal creeks, but not the surrounding

co astal wetlands.

28. Petitioners and Lennar Homes have raised numerous

other issues about the flowway that the District seeks to

obtain. The District requires a 200 - acre flowway to rehydrate

adequately the vestigial tidal creeks, the presently remaining

t idal creeks, the small embayment, and then the subject area of

Biscayne Bay, but the mitigation area potentially available on

the Project site is limited to about 135 acres, and some

uncertainty exists as to whether the District can obtain control

of the r emaining land necessary to assemble a 200 - acre flowway.

Even the 200 - acre flowway is probably insufficient to

accommodate significant water treatment, so water quality issues

remain outstanding, notwithstanding the better water quality

upstream of the lan dfill and water treatment plant.

29. Other issues arise from the requirement that the

District obtain an ERP from the Florida Department of

Environmental Protection, as well as one or more federal

agencies, before it could construct the flowway. To the e xtent

that this requirement delays and possibly precludes the

construction of the flowway, this requirement militates against

the inclusion of the Flowage Easement and new special conditions

in the ERP. To the extent that this requirement insures that

the flowway will not cause flooding or adverse water quality in

the tidal creeks, embayment, and ultimately Biscayne Bay, this

requirement militates in favor of the inclusion of the Flowage

Easement and new special conditions in the ERP; the absence of

detail ed specifications for the design and construction of the

flowway precludes any assurance that the flowway would not flood

or otherwise damage the upland portion of the Project site, so

subsequent permit - review is essential to the present inclusion

of the F lowage Easement and new special conditions in the ERP.

30. It is impossible to credit the District's evidence

that various transition - zone wetland species would survive

inundation under unknown flow rates, of variable depths, and of

unknown and possibly i ndefinite duration. Lennar Homes

legitimately is concerned that its substantial investment in

mitigation, pursuant to the original mitigation plan, would be

wasted if the District constructs the flowway. As presently

drafted, the Flowage Easement and new special conditions

contemplate that Lennar Homes would construct the original

mitigation, at a substantial cost, and the District would later

construct and inundate the flowway through largely the same

area.

31. Marketing of parcels in close proximity to the flowway

might be complicated by the uncertainty concerning what will

occupy the area beyond a resident's backyard -- a benign passive

mitigation area or a flowway that may range from a

intermittently wet slough or glade to a placid lake to a raging

sw ollen river -- and by the probability that the District would

not construct the flowway until 2009.

32. The District justifies the Flowage Easement and new

special conditions on two grounds. First, the District contends

that the ERP without the Flowage Eas ement and new special

conditions is harmful to the District's water resources.

Second, the District contends that the ERP without the Flowage

Easement and new special conditions is inconsistent with the

overall objectives of the District.

33. The first argument misses the mark. A project that is

otherwise permittable, except for the fact that it interferes

with the establishment of a restoration project, does not harm

the water resources of the District; such a Project interferes

with the improvement o f the water resources of the District. In

this case, the parties have stipulated that the Project will not

cause adverse impacts due to the original mitigation plan. If

adverse impacts means anything, it means harm to the water

resources of the District.

34. The second argument requires the identification of the

District's objectives. The Florida Legislature has declared at

Section 373.1502(2)(a), Florida Statutes, that CERP

implementation is "in the public interest and is necessary for

restoring, p reserving and protecting the South Florida ecosystem

. . .." In May 2000, the Florida Legislature enacted the

Everglades Restoration Investment Act, which commits Florida to

contribute over $2 billion for the implementation of CERP --

Florida's share for th e first ten years of implementation. The

Florida Legislature has made the implementation of CERP an

overall objective of the District.

35. Several factors are important in determining whether

the ERP without the Flowage Easement and new special condition s

would be inconsistent with the overall objective of the District

to implement CERP. These factors require consideration of the

purpose of the proposed restoration project; the extent of

completion of the project's design, permitting, and

construction; i f the project has not yet been designed or

permitted, the likelihood of construction; when the project

would be constructed; the impact of the ERP without the Flowage

Easement and new special conditions upon the proposed

restoration project; and the existe nce of feasible alternatives

to accomplish the same objectives as those achieved by the

proposed restoration project.

36. These factors generally favor the issuance of the ERP,

but only with the Flowage Easement and new special conditions.

The flowway pr oject would rehydrate a portion of the estuarine

waters of southern Biscayne Bay that are sufficiently healthy to

respond vigorously to the new freshwater infusions, so the

project is important. The C - 1 Canal appears to be the only

readily available sourc e of sufficient volumes of freshwater to

achieve the rehydration of the tidal creeks, and the proposed

path through the Lennar Homes mitigation area appears to be the

only readily available means by which to divert the freshwater

to the targeted tidal cree ks. If the flowway project is limited

to the tidal creeks and does not extend to the surrounding

coastal wetlands, the likely environmental impacts appear to be

positive on the receiving areas and the downstream portion of

the C - 1 Canal. For these reason s, even though the project is at

an early conceptual stage and construction would not start for

six years, it seems likely to be constructed. The apparent

difficulty in securing the necessary additional 65 acres may yet

be overcome through property acquis ition, and, if not, the

District may be able to increase the capacity of the flowway

without jeopardizing the adjacent uplands.

37. For the reasons stated in the Conclusions of Law

below, other factors in determining whether the ERP without the

Flowage Easement and new special conditions would be

inconsistent with the overall objective of the District to

implement CERP require consideration of the impact upon Lennar

Homes in accommodating the Flowage Easement and new special

conditions. With two excepti ons, the Flowage Easement and new

special conditions do not impose an inordinate burden upon

Lennar Homes.

38. The flowway would occupy the portion of the Project

site that would have been subject to the conservation easement

that was part of the origin al mitigation plan. Lennar Homes'

responsibility for maintenance is considerably lessened if the

District constructs the flowway, whose special maintenance needs

can only be met by the District or its contractors. Although

Lennar Homes may experience som e sales resistance due to the

uncertainty of the use of the mitigation area, the assurances

gained from the subsequent permitting process, during which the

District will seek an ERP from the Florida Department of

Environmental Protection for the constructi on of the flowway,

should allay reasonable concerns about flooding and other damage

to the adjacent uplands.

39. In three respects, though, the District has abused its

discretion in preparing the Flowage Easement and new special

conditions. First, the District abused its discretion in

requiring Lennar Homes to perform mitigation work in the

mitigation area, pursuant to the original mitigation plan, to

the extent that the products of such work will likely be

destroyed or substantially harmed by the const ruction and

operation of the flowway. The value of mitigation rests largely

in the functions that it can support through longterm viability.

The construction and operation of the surface water management

system, the posting of a sufficient bond to guaran tee future

performance under either mitigation scenario, the execution and

delivery into escrow of deeds and other legal instruments

sufficient to meet the requirements of the Flowage Easement and

new special conditions (subject to the two matters discusse d in

this and the two following paragraphs), and the construction of

the portion of the original mitigation that would not be

impacted by the flowway sufficiently respond to the need for

mitigation, until the District finally determines the need for

it to exercise its rights under the Flowage Easement.

40. Second, the District abused its discretion by omitting

any timeframe for the District to exercise its rights under the

Flowage Easement and new special conditions. The timeframe

proposed by Lennar Hom es for the District to make this final

determination of whether to proceed with the flowway is

unreasonable and ignores the substantial period of time required

to design, fund, and permit the flowway. But a timeframe may be

especially important if Lennar Homes encounters more marketing

resistance than might be reasonably anticipated. Therefore, the

new conditions should provide that if construction of the

flowway is not substantially completed by 2011, then the Flowage

Easement shall be released and retur ned to Lennar Homes, upon

its commencement, without delay, of the construction of any of

the original mitigation that it did not already complete.

41. Third, the District also abused its discretion in the

Flowage Easement and new special conditions in the allocation of

liability for the flowway, including apparently its

construction, maintenance, and operation. The District would

impose this liability upon Lennar Homes, which would have to

indemnify the District for construction damage or any

malfunctions in the operation of the flowway, such as damage to

adjacent uplands by flooding, erosion, or contamination. The

District has imposed this restoration project on Lennar Homes

and has done so, not to avoid harm to the District's water

resources, but to ach ieve the overall objective of the District

to implement CERP. The District and its contractors, not Lennar

Homes, will construct, maintain, and operate the flowway. The

District, not Lennar Homes, has the expertise in the design,

construction, and operat ion of water - control facilities of this

type. This record does not disclose a single legitimate reason

to impose upon Lennar Homes the liability for any aspect of the

flowway that does not result from the acts or omissions of

Lennar Homes or its assignees as owners of the adjacent uplands.

42. Although, as stated in its proposed recommended order,

the District does not object to the standing of Petitioners,

Respondents did not stipulate to the standing of any

Petitioners. Petitioners The Everglades Trust , Inc., and The

Everglades Foundation, Inc., offered no witnesses concerning

their standing, and no exhibits address the standing of these

parties. The record thus fails to demonstrate that Petitioners

The Everglades Trust, Inc., and The Everglades Founda tion, Inc.,

are substantially affected by the proposed agency action.

43. Petitioner National Parks Conservation Association,

Inc., (National Parks) is a not - for - profit corporation

registered in Florida as a foreign corporation. The corporate

purpose of National Parks is to protect and enhance America's

national parks, including Biscayne National Park, for present

and future generations. National Parks seeks the protection and

enhancement of the Biscayne National Park through the successful

implementatio n of CERP.

44. National Parks has 350,000 members, including 19,900

in Florida. Members of National Parks use Biscayne National

Park for recreational boating, fishing, snorkeling, fish

watching, scuba diving, and camping (on the barrier islands).

Member s of National Parks are actively monitoring the

implementation of CERP.

45. Petitioner Florida Audubon Society, Inc. (Florida

Audubon), is a Florida not - for - profit corporation that was

originally incorporated in Florida in 1900. The corporate

purpose o f Florida Audubon is to protect, conserve, and restore

Florida's heritage through the preservation of the state's

natural resources. Florida Audubon has adopted as its highest

priority the design and implementation of CERP.

46. Florida Audubon has 32,000 members in Florida,

including over 2100 members in Dade County. Numerous of these

members engage in bird watching, recreation, and scientific

research in Biscayne National Park. Florida Audubon organizes

membership trips to Biscayne Bay, conducts its an nual Bird - athon

and Christmas Bird Count in the vicinity of Biscayne Bay, and

conducts various environment educational programs in and

concerning Biscayne Bay.

47. The issuance of the ERP without the Flowage Easement

and new special conditions would subst antially impact the

ability of the District to restore this part of Biscayne Bay.

Without such restoration, the functions of Biscayne Bay will

slowly decline until eventually the overall health of the entire

South Florida ecosystem will be substantially d eteriorated.

Thus, National Parks and Florida Audubon would be substantially

affected by the issuance of the ERP without the Flowage Easement

and new special conditions.

CONCLUSIONS OF LAW

48. The Division of Administrative Hearings has

jurisdiction over the subject matter. Sections 120.569 and

120.57(1), Florida Statutes. (All references to Sections are to

Florida Statutes.)

49. Section 120.52(12)(b) defines a "party" as any "person

. . . whose substantial interests will be affected by proposed

agenc y action . . .." National Parks and Florida Audubon have

standing in this case. Petitioners The Everglades Trust, Inc.,

and The Everglades Foundation, Inc., have not proved their

standing.

50. Lennar Homes has the burden of proving its entitlement

to th e ERP. Department of Transportation v. J. W. C. Company,

Inc. , 396 So. 2d 778 (Fla. 1st DCA 1981).

51. Sections 373.414(1)(a) and (b) provide in part:

(1) As part of an applicant's demonstration

that an activity regulated under this part

will not be har mful to the water resources

or will not be inconsistent with the overall

objectives of the district, the governing

board or the department shall require the

applicant to provide reasonable assurance

that state water quality standards

applicable to waters a s defined in s.

403.031(13) will not be violated and

reasonable assurance that such activity in,

on, or over surface waters or wetlands, as

delineated in s. 373 .421(1), is not

contrary to the public interest. However,

if such an activity significantly de grades

or is within an Outstanding Florida Water,

as provided by department rule, the

applicant must provide reasonable assurance

that the proposed activity will be clearly

in the public interest.

(a) In determining whether an activity,

which is in, on , or over surface waters or

wetlands, as delineated in s. 373.421(1),

and is regulated under this part, is not

contrary to the public interest or is

clearly in the public interest, the

governing board or the department shall

consider and balance the follow ing criteria:

1. Whether the activity will

adversely affect the public health, safety,

or welfare or the property of others;

2. Whether the activity will

adversely affect the conservation of fish

and wildlife, including endangered or

threaten ed species, or their habitats;

3. Whether the activity will

adversely affect navigation or the flow of

water or cause harmful erosion or shoaling;

4. Whether the activity will

adversely affect the fishing or recreational

values or marine prod uctivity in the

vicinity of the activity;

5. Whether the activity will be of a

temporary or permanent nature;

6. Whether the activity will

adversely affect or will enhance significant

historical and archaeological resources

under the provisio ns of s. 267.061; and

7. The current condition and relative

value of functions being performed by areas

affected by the proposed activity.

(b) If the applicant is unable to

otherwise meet the criteria set forth in

this subsection, the governing board or the

department, in deciding to grant or deny a

permit, shall consider measures proposed by

or acceptable to the applicant to mitigate

adverse effects that may be caused by the

regulated activity. Such measures may

include, but are not limited to, onsite

mitigation, offsite mitigation, offsite

regional mitigation, and the purchase of

mitigation credits from mitigation banks

permitted under s. 373.4136. It shall be

the responsibility of the applicant to

choose the form of mitigation. The

mitigatio n must offset the adverse effects

caused by the regulated activity.

52. Courts have extended considerable deference to the

environmental agency in applying the two most important

provisions of Section 373.414. First, the determination of

whether an appl icant has provided "reasonable assurance" is a

conclusion of law. Compare 1800 Atlantic Developers v.

Department of Environmental Regulation , 552 So. 2d 946 (Fla. 1st

DCA 1989) (per curiam), rev. denied , 562 So. 2d 345 (Fla. 1990),

and Deep Lagoon Boat Cl ub, Ltd. v. Sheridan , 784 So. 2d 1140

(Fla. 2d DCA 2001), with Berry v. Department of Environmental

Regulation , 530 So. 2d 1019 (Fla. 4th DCA 1988). Second, the

adequacy of mitigation is a conclusion of law. See Save Anna

Maria, Inc. v. Department of Tra nsportation , 700 So. 2d 113

(Fla. 2d DCA 1997) and 1800 Atlantic Developers , supra .

53. Likewise, courts have extended deference to agencies

interpreting the statutes that they are required to enforce.

See , e.g. , Reedy Creek Improvement District v. Depar tment of

Environmental Regulation , 486 So. 2d 642 (Fla. 1st DCA 1986).

54. Supplementing these usual arguments favoring deference

to the agency in cases of this type is the unique demand imposed

upon the District in implementing CERP. The Restudy Report

amply describes the complexity of the task assigned to the

District and the U.S. Army Corps of Engineers. These agencies

must collect and analyze vast amounts of data, design and

construct elaborate restoration projects, monitor the

performance of these p rojects while continuing to collect and

analyze other data, and refine their planned and already - built

projects with the knowledge gained along the way. This dynamic

process constantly repeats itself, as the agencies, at the same

time, attempt to deal wit h the extra - scientific challenges, such

as funding limitations and the acquisition of interests in land

sufficient to allow the construction of the restoration

projects. Even without regard to the expertise of these

agencies, deference is indicated becaus e the complexity of these

daunting tasks demands the allocation of decisionmaking

authority, to the greatest extent reasonably possible, to the

smallest a number of entities.

55. The District correctly contends that Section

373.414(1) justifies the imposi tion of the Flowage Easement and

new special conditions on the basis that the ERP must be

consistent with the overall objectives of the District.

Although nearly all ERP cases involve compliance with water

quality standards and consistency with the public interest,

which itself requires the balancing of the seven statutory

criteria, the statute itself warns that these requirements are

only "part of an applicant's demonstration that an activity

. . will not be harmful to the water resources or will not be

i nconsistent with the overall objectives of the district." If

the tests involving water quality and public interest are only

"part" of the applicant's demonstration, there must be another

part.

56. This case does not require a determination of the

extent to which an applicant may be required to make an

additional demonstration that the activity will not harm the

water resources. Obviously, the water - quality standards and

seven public - interest criteria directly pertain to harm to water

resources, so such a determination might prove problematic.

57. As noted in the Restudy Report, merely continuing to

prevent harm to the District's water resources is insufficient

to prevent the substantial deterioration of the South Florida

ecosystem. In recognition of t his fact, the Florida Legislature

added to the objectives of the District the responsibility of

designing and implementing CERP restoration projects, as

reflected in Section 373.1501, which assigns the District the

crucial role of the local sponsor of CERP projects.

Unmistakably underscoring the importance of this new objective

of the District, the Florida Legislature dedicated $2 billion,

as Florida's contribution toward these restoration projects over

the next ten years.

58. By not specifying District objectives, Section

373.414(1) anticipates evolving District objectives, which may,

as here, extend past merely preventing harm to water resources

to restoring water resources. Recognizing the flexibility

inherent in the above - described language of Secti on 373.414(1)

and the dedication of the Florida Legislature to the attainment

of this important objective does not frustrate legislative

intent in demarking carefully the limits of agency discretion,

as Lennar Homes contends, but serves the legislative int ent in

protecting Florida's considerable investment in the

implementation of CERP and achievement of the resulting

improvements in water quality.

59. Equally misplaced, in this case at least, is the

concern of Lennar Homes about the lack of definition o f the

concept of the "overall objectives of the district." As long as

the District considers the factors described above with respect

to the specific project whose viability may be implicated by a

specific ERP, the addition of specific conditions to an ER P will

not render the permitting process vague or unpredictable.

60. The better reading of Section 373.414(1) requires the

District to balance the applicant's interests with the

District's objectives, even when adding specific conditions

under the resid ual requirement of consistency with the overall

objectives of the District. Although the balancing required

under Section 373.414(1)(a) applies only when applying the

public - interest test and the balancing inherent in the

mitigation under Section 373.414( 1)(b) applies only when an

applicant fails the public - interest test, the concept of

"reasonable assurance" implicitly attaches to the demonstration

that an applicant must make under the residual requirement of

consistency with the overall objectives of the District.

Supporting this construction of Section 373.414(1), Section

373.416(1) provides that the District may impose such

"reasonable conditions" as are necessary to assure that the

operation of stormwater management system will not be

inconsistent wit h the overall objectives of the District.

Reasonableness requires consideration of the burdens imposed

upon Lennar Homes by the Flowage Easement and new special

conditions.

61. For the reasons stated in the preceding paragraph, the

Flowage Easement and n ew special conditions are an appropriate

exercise of the District's condition except for the requirements

that Lennar Homes construct the mitigation under the original

plan prior to the District's decision to exercise its rights

under the Flowage Easement and new special conditions and that

Lennar Homes bear the liability for the construction,

maintenance, and operation of the flowway. The Findings of Fact

above cover in more detail the necessary revisions to the

Flowage Easement and new specific condition s.

62. Petitioners' alternative represents an even less

appealing encroachment upon the District's discretion in this

case than do the alternatives proposed by Lennar Homes of no

Flowage Easement and new special conditions or a highly

restricted Flowage E asement and special conditions. First,

notwithstanding potential water quality considerations, which,

like the flooding conditions of particular interest to Lennar

Homes, will be considered in the permitting process that

precedes any construction of a flo wway, the record suggests that

the diversion of a volume of water from the C - 1 Canal to the

coastal wetlands surrounding the targeted tidal creeks may not

be environmentally feasible or, even if environmentally

feasible, financially feasible.

63. Second , the District must enjoy wide discretion in

determining what lands to acquire in fee simple and with what

landowners, and on what facts, to risk takings litigation. CERP

funding is not unlimited, and the District, on these facts, has

reasonably decided n ot to expend funds appropriated by the

Florida Legislature in obtaining the fee simple to part or all

of the Project site or litigating a takings claim with Lennar

Homes on the facts that would result from the position advocated

by Petitioners.

RECOMMENDAT ION

It is

RECOMMENDED that the District issue the environmental

resource permit with the Flowage Easement and new special

conditions, as modified in accordance with the matters presented

in paragraphs 39 - 41.

DONE AND ENTERED this 10th day of January, 2003, 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

(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 10th day of January, 2003.

COPIE S FURNISHED:

Henry Dean, Executive Director

South Florida Water Management District

Post Office Box 24680

West Palm Beach, Florida 33416 - 4680

Richard Grosso

Louise Caro, Certified Legal Intern

Environmental & Land Use Law Center, Inc.

Shepard Broad Law Center

3305 College Avenue

Fort Lauderdale, Florida 33314

Marcy I. LaHart

Marcy I. LaHart, P.A.

711 Talladaga Street

West Palm Beach, Florida 33405

Erin L. Deady

Environmental Counsel

444 Brickell Avenue, Suite 850

Miami, Florida 33131

E. Thom Rumberger

Rumberger, Kirk & Caldwell, P.A.

403 East Park Avenue

Tallahassee, Florida 32301

Luna Ergas Phillips

Douglas H. MacLaughlin

Office of Counsel

South Florida Water Management District

3301 Gun Club Road

West Palm Beach, Florida 33406

Frank E. M atthews

Gary V. Perko

Hopping Green & Sams, P.A.

Post Office Box 6526

Tallahassee, Florida 32314

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 e xceptions

to this recommended order must be filed with the agency that

will issue the final order in this case.